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PRATHAM
Experimenting On lea... • 21d
Top three investments with zero to low risk in which you can earn 7 to 9% are: first, FDs; second, Liquid Mutual Funds; and third, Arbitrage Funds. Liquid Fund is a day fund which invests in super ultra short-term instruments like T-Bills in the money market, which mature in 91 days. Therefore, in these, the risk is very low and the return is stable. Arbitrage Fund is an equity fund. One stock can have different prices on two exchanges. So, the Arbitrage Fund buys that stock on one exchange and immediately sells it on the other exchange. It takes advantage of the arbitrage opportunity in between. In FDs, returns of 7 to 9% are possible. In Liquid Funds, 7 to 7.5%. In Arbitrage Funds, 7 to 8% returns are possible. Exit load: If an FD is broken, then premature withdrawal of money can be applied, and due to change in tenure, the entire interest rate can also change. In Liquid Funds, mostly up to the first seven days, an exit load of only 0.0045% is applicable. In Arbitrage Funds also, an exit load of 0.1 to 0.3% is applicable. As soon as an FD is broken, within one day your money will come to you. In Liquid Funds also, it comes in one day. But in Arbitrage Funds, it can take three to four days. The returns from FDs are taxed according to the slab rate. The same applies to Liquid Funds. But because Arbitrage Funds are equity funds, short-term capital gains tax is 20%, and long-term capital gains tax is 12.5%. Now you can see what suits your needs.
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