By Sumit Chanda

Many Indians traditionally regard Diwali as a favourable time for gold investments because purchasing gold around the time of Dhanteras is considered highly auspicious in many households. On Dhanteras, Indians invest in gold by purchasing yellow metal, coins, or jewellery due to the sentimental value it holds. People have purchased gold for future generations for decades because it is known to be a safe investment.

However, today, investors have multiple assets to invest in, and several options can be explored for investment during Diwali with the purpose of wealth creation and diversification. People are also showing more willingness to move beyond gold during Diwali investments. When it comes to high returns and creating wealth, an asset that tops every list is equity. Investors looking to stay invested for a long time can either invest a lump sum amount this Diwali (if they find stocks at reasonable valuations) or start SIP in some quality stocks (SIP is always a better route).

New investors can use a technology-driven platform that makes investments easier by providing customized suggestions. Today there are several AI investment advisory platforms that are making it easily accessible to retail investors and are simple to use with the objective of catering to a larger audience base. These platforms also help greatly to generate a good portfolio, based on one’s risk appetite and generate returns as per one’s financial goals. 

Also Read: How not to be fooled while buying Gold for Dhanteras and Diwali: 5-point guide

Another route to invest in equities is via mutual funds, index funds and ETFs. This way of portfolio diversification is crucial as it helps in a better risk-return ratio. Equity investment is risky, but investors should not avoid the investment option rather, focus on ways to minimize risk. One of the easiest ways to reduce the risk is by diversifying the equity portfolio.

Disciplined decision-making is imperative when it comes to allotting money and hence technology comes in as a saviour in carefully evaluating your risk appetite and helping in planning according to different financial capacities. Starting off with smaller amounts, understanding the market trends and then gradually increasing the corpus can be beneficial to investors who are looking to stay in the market for the long run. This can also be achieved by investing small amounts in companies from different sectors and across market-cap. Research conducted by BHB suggests that a majority of volatility in a portfolio can be addressed by careful asset allocation and diversification. 

Long-term investors can also explore the option of investing in international funds. In the current global macroeconomic scenario, a lot of these international funds are available at a discount.

Most investors in India are unaware of angel investing. Earlier, angel investing was beyond the reach of most, but today, becoming an angel investor has become easy. One can consider this option during Diwali after understanding the risks involved. It is a high-risk and high-return investment option. Investing a small percentage of the total portfolio (3 to 5%) in different start-ups as angel investors and not everything in one or two start-ups can be a wise path, to begin with. If one of the start-ups scales up, then the investment could multiply 100 times or more.

Also Read: Should mutual fund investors track stock market bulk deals by AMCs?

The popularity of multi-asset investing, as a method of building a diversified portfolio, has risen significantly in recent years. It provides long-term stability, smoother returns, and sustainable income, and is cost-effective in every way.

Due to the changing economic and political environment, as well as increased market volatility, investors have turned to multi-asset funds to help them navigate their investments through these treacherous waters.

(The author is CEO and founder of JARVIS Invest)

(Views expressed above are those of the author and not necessarily of financialexpress.com. Please consult your financial advisor before making any investment decision)