An investment is defined as committing funds with the expectation of earning a positive return in the future. It involves sacrificing present consumption for future benefits and always carries some degree of risk that the actual return may be lower than expected. The key elements of any investment are expected return, risk, safety, liquidity, and potential tax benefits. Common avenues of investment include bonds, gold, mutual funds, real assets, equities, insurance policies, and financial derivatives. Factors like current events, currency valuations, production costs, and economic/political uncertainty can influence fluctuations in gold prices over time.

1. Investment

2. What is
investment ?....
Meaning
• An investment is an asset or item that is
purchased with the hope that it will
generate income or will appreciate in the
future.

3. Definition
• It may be defined as........
• “Sacrificing some money value in the
present with the expectation of
making gain in the future” or
“a commitment of funds made in the
expectation of some positive rate of
return”
or
“a sacrifice of current money or other
resources for future benefits”.

4. •Expectation of return is the
essential element of investment .
• Since return is expected to be realised in
future, There is a possibility that the return
actually realised is lower than the rate
expected to be realised.
• This possibility of variation in the actual
return is known as investment risk
• Thus every investment involves return
and risk
• (Expected rte of return – Actual return =
Risk)

5. Numerous avenues of investment are....
• Bonds
• Gold
• Mutual fund schemes
• Real assets
• Equity shares
• Life insurance policies
• Financial derivatives

6. FINANCIAL AND ECONOMIC
MEANING OF INVESTMENT
• In an economic sense, an investment is
the purchase of goods that are not
consumed today but are used in the future
to create wealth.
• In finance, an investment is a monetary
asset purchased with the idea that the
asset will provide income in the future or
will be sold at a higher price for a profit.

7. IMPORTANCE OF
INVESTMENT
• Financial Independence
• Increases Wealth
• Desires Of Family members
• Increases Knowledge
• Increases Vision
• Fulfilling Personal Goals

8. Financial Independence
• financial freedom.
• Avoid future financial needs -
future is uncertain
• habits of saving and investing.
• children's education, marriage
or medication.

9. Increases Wealth
• increases the wealth of the
investor
• investment increase your
returns
• more wealthy-more financial
freedom and vice versa.

10. Desires Of Family members
• It is social responsibility towards
your family members to look after
them.
• fulfill all the desires of yourself as
well as your family members also.
• your family member's wishes.

11. Increases Knowledge
• it needs a thorough research in the
various aspects of stock market
• it will improve knowledge.
• successful investor.
• Decision making

12. Increases Vision
• future happenings.
• So good vision fetches you more returns
and will contribute to your success at all
the fields.
Thus all the above are only few of the
many, you should start investing from now
onwards to make yourself more successful
in this present world.

13. Fulfilling Personal Goals
• As you become richer, you may find
no difficulty in achieving your
personal goal.
• Achieving personal goals is the
essence of your success in every
aspect of your life.

14. Characteristics of Investment
All investments are characterised by certain
features.
 Returns
 Risk
 Safety
 Liquidity
 Tax Shelter

15. Return
Returns depends upon
 nature of the investment
 the maturity period
 host of other factors

16. Risk
• Risk is inherent in any investment.
• Risk and return of an investment are
related.
• the higher the risk, the higher is the return..
• Risks may be
Loss of capital
Delay in repayment
Non-payment of interest
Variability in returns

17. Received return in the form of
Yield [dividend or interest] + capital
Appreciation [difference between sales price and
purchase price]

18. Safety
• Every investor expects to get back his
capital on
maturity without loss and without delay
• Safety is another feature which an investor
desires for his investments
• safety implies the certainty of return of
capital

19. Liquidity
An investment which is easily saleable or
marketable
• without loss of money
• without loss of time
is said to be possess liquidity.

20. Tax Shelter
Tax benefits are in the following three
kinds
Initial tax benefit
Continuing tax benefit
Terminal tax benefit

21. Initial Tax Benefit
The tax relief enjoyed at the time of making the
Investment.
Continuing Tax benefit
A continuing tax benefit represents the tax shield
associated with the periodic returns from the
Investment.

22. Terminal Tax benefit
Relief from taxation when an investment is
realized or liquidate
Ex:
withdrawal from a public provident fund
account is not subject to tax

23. What factors drive the gold
price?
• Current Events; Breaking News.
• Devaluate USD
• Others
i.e. Higher Cost of Gold Mining

24. Gold price movement –last 10
years
0
5000
10000
15000
20000
25000
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Series 1
Series 1

25. • Year price
• 2007 12000
• 2008 10000
• 2009 8000
• 2010 10000
• 2011 12000
• 2012 14000
• 2013 16000
• 2014 18000
• 2015 20000
• 2016 19000
•

26. Reasons for the change of gold
prices
1. Curb on gold import
2. Higher domestic gold inventories
3. Concerns over monsoon
4. Massive selling in China
5. Stronger US dollar
6. Worry over US Fed rate hikes
7. Uncertainty in international
commodity markets Top Comment