Investment Product Comparison can be broadly classified into three factors:
  • Degree of Risk Involved – Most investments do not give you a capital guarantee.
    • Principal protected or at risk?
    • Returns assured or risk of poor returns?
    • Is there inflation risk?
    • Is there credit risk?
  • Duration – The tenure or holding period or recommended tenure to stick with a particular investment product depends on individual to individual, based on his individual requirement of that fund.
  • The Likelihood of Return   Risk- Return Trade off theory states that ‘Risk and Return go hand in hand, so as a general rule the lower the risk the lower the rate of return you should expect’. With longer-term and higher-risk products, you can expect higher returns, but this is not guaranteed and you could lose some or all of your money. You need to consider carefully the effect of this on your financial situation.
Compare Investments basis:
  • The minimum & maximum investment amount allowed
  • Top up allowed
  • Open ended or close ended
  • The minimum recommended investment term.
  • Liquidity & penalty
  • Fees & charges etc.

While the bouquet of investment products are more complicated than savings and deposit accounts, so consider getting professional financial advice. Make sure any advisor you use is authorised to give investment advice and get the most from any financial advice by asking the right questions.

Have questions before investing in particular product- What? How ?Where? Why?
  • Potential risk & return that the product category falls in?
  • What is the minimum recommended term of the investment? If it’s a long-term investment, can you afford to tie up my money for that long?
  • What is the penalty for early withdrawal? Schedule of penalty & when the investments are free from exit load?
  • What are the charges?
  • Whether the product offered has guarantee or protection or is market linked ?
  • What is the Tax Implication?
  • What are similar options for parking the same lump sum forsame term?
  • What happens to your investment if you die? Whether nomination possible ?
  • How to track performance of investment?