For the longest time people have debated over the question on which is a better investment. Would it be in equities of in real estate?
In order to answer the question, it would be much better if we can take a look at the pros and cons regarding each of the factors that contribute as to why equities or real estate would be a lucrative investment now and in the years to come.
Anil Rego, CEO and Founder of Right Horizons gave his insights about the differentiation between equity and property on one of his contribution to Moneycontrol.com.
Equity
He said that in Equity, you can either make a selection whether to invest in direct security like stocks or in mutual fund. However there are those who are skeptical about it for the reason that most security assets are now in electronic form and that raises concerns when it comes to 'how secure is it?'
Anil also stated that it is less cumbersome if one invest in stocks, than the mutual fund. It is because with stocks, you can easily diversify your portfolio in various sectors and if you have the ability to hold it there for over a year, it will become tax free.
You will need to do a research though as to which companies you would like to stay invested in, as not all companies are fundamentally sound.
Real Estate
As for the Real Estate, it more in the scope of capital appreciation, although markets for the property sector also rise and fall. You will also have to identify yourself as to whether you are a speculator or an investor.
A speculator may hold his purchased property for a short period of time, especially if he believes that the property may go down in value, so he will sell it when the market rises, but those who buys and holds a property for a longer period of time is called an investor.
Growing money in equities and real estate is not an overnight sensation. It takes a while to grow money in both of these investment instruments so not the decision is on you whether you'd like to be invested more in equities or you'd rather have properties as part of the asset class in your portfolio.
