I have about Rs 8 lakh with me which I don't need for an immediate requirement. What would you suggest given the present situation - should I invest in the stock market, mutual fund, land or just leave this amount in an FD? What do you think is the best employment for my money?
With your money, you'll be able to average your investment in an equity fund which will help you reduce your risk and have a diversified portfolio. Land requires a different kind of commitment as the ticket size is different. It is worth considering if you are presented with a special situation or a special opportunity that looks like a bargain. Still, it has its complexity of dealing with it.
My suggestion would be to consider a conservative equity fund or maybe an aggressive hybrid fund for five years and more. So that in case of a crumbling market, you will not be greatly disappointed. And over this period, I think it will turn out to give a reasonable return. Today, the fixed income rate has come down so drastically that it is nothing meaningful even if you get lucky with the highest possible return. We are in a very unusual situation where inflation has started moving up, while interest rates have come down to a very low level. So there is a possibility that your money will grow or earn interest but will not beat inflation, which effectively translates into the value of your money going down.
So I would say, take a more modest chance and take it with all the precautions, which means, average your investment. Don't invest all your money in one go and invest in a conservative equity-oriented mutual fund or an aggressive hybrid fund.