Thursday, August 12, 2021

How to Choose Right Company Fixed Deposit?

It is always very difficult to choose between two or three alternatives and when alternatives are similar and related to financial well-being of the individuals, things become even more difficult and complicated. But the interesting part of the game is that one has to choose among the alternatives.

A Few Facts about Company Fixed Deposits

It is imperative and very important the individual to choose the right Company Fixed Deposit Offer in the market as hard earned money is at the stake. One must know the following facts about the company fixed deposits:
  • It is an unsecured investment option. So huge risk is associated with these investments.
  • There is no insurance of the company fixed deposits unlike the bank fixed deposit which is insured for ₹5,00,000.

Check these before selecting any offer:

  • Check the rating of the offer and reputation of the groups as well as the size of the company. 
  • Prefer to invest into big and reputed companies. 
  • Check the financial position of the company. 
  • Check the dividend history. 
  • Check the previous offers and issues relating to the fixed deposits available in the market. 
  • Check the market conditions to decide whether to invest in company fixed deposits or not. 
  • Compare the interest rates offered by the company with prevailing market rates. 
  • Avoid offers with lower ratings. 
  • Avoid offers with very high interest rates. High return is associated with high risks. 
  • Prefer public limited companies. 
  • Avoid new companies as well as unregistered bodies. 
  • Avoid companies with accumulated losses or liquidity problems.

Periodic Review of Investment

Periodic review of investments into company fixed deposit is imperative. You must ensure that you continue your investment only when there have been no additional risks that cropped in after the investment. Also don’t put your all the money into one company fixed deposits. Diversification is key so go for many company fixed deposits.

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