Stocks vs other investments

Stocks compete with many other asset classes, starting from a rudimentary bank account to other advanced asset classes like currency futures. While diversification across asset classes is a good idea, no other asset class is more rewarding than equity. Bank deposits and debt instruments (bonds and bond funds, Public Provident Fund, post-office deposits, etc.) give fixed returns and hence look safer than stocks, which can be highly volatile. Debt instruments were the previous generation's pet. Many of us still vouch by the sanctity of fixed income. The only problem is that you can't create wealth with debt. If you account for inflation and taxes, you ma

This article was originally published on November 03, 2020.