The document discusses suitable investment instruments for a retail investor given the current economic environment in India. It recommends equity linked savings schemes (ELSS), health insurance policies, and gilt funds. For a hypothetical retail investor with a monthly income of Rs. 2 lakhs, it suggests investing Rs. 10,000 in ELSS, Rs. 8,000 in gilt funds, and Rs. 28,000 in health insurance. These instruments provide good returns and low risk suited for retail investors in the current economic scenario of moderate GDP growth, inflation, and business cycles in India.

1. Identify Three Investment
Instrument ( Not Limited to Equity)
Suitable For a Retail Investor in The
Current Environment.
AM 2 Group 3
Participant’s Name
Shreya Verma
Gautam Kumar
Sonu Gupta
Pallavi Mishra

2. Flow
• Current Scenario (Economic Environment)
• Impact of Current Scenario Factors- GDP,
Inflation & Business Cycles
• How they perform
• Investment
• Type of Investment
• Need of Investment
• Types of Investor
• Retail Investor
• Three best Investment Instrument for Retail
Investor- ELSS, Health Insurance & Gilt Fund
• Conclusion

3. Current Economic
Environment
• India has emerged as the fastest growing major economy in
the world as per the Central Statistics Organisation (CSO)
and International Monetary Fund (IMF).
• It is expected to be one of the top three economic powers of
the world over the next 10-15 years, backed by its strong
democracy and partnerships.
• Indian economy is expected to grow at a rate of 6.7 per cent
in the year 2017-18 and in the next financial year 2018-19
the economy is expected to grow at a rate of 7.2 percent.
• Improvement in India’s economic fundamentals has accelerated in
the year 2015 with the combined impact of strong government
reforms, Reserve Bank of India's (RBI) inflation focus supported by
benign global commodity prices.

4. • India's consumer confidence index stood at
128 in the second quarter of 2017, topping
the global list of countries on the same
parameter, as a result of strong consumer
sentiment.
• Moody's has affirmed the Government of
India's Baa3 rating with a positive outlook
stating that the reforms by the government
will enable the country perform better
compared to its peers over the medium term

5. GDP
• Gross domestic product is the best way to measure a country's
economy.
• GDP is the total value of everything produced by all the people and
companies in the country. It doesn't matter if they are citizens or
foreign-owned companies. If they are located within the country's
boundaries, the government counts their production as GDP.
• Current Economic Situation Of GDP:-
• India's gross domestic product (GDP) grew only by 5.7 per cent year-
on-year in April-June 2017 quarter. as per Organisation for
Economic Co-operation and Development (OECD) Economic Survey
of India, 2017.
• According to IMF World Economic Outlook Update (January 2017),
Indian economy is expected to grow at 7.2 per cent during FY 2016-
17 and further accelerate to 7.7 per cent during FY 2017-18.

6. • Corporate earnings in India are expected to
grow by over 20 per cent in FY 2017-18
supported by normalisation of profits,
especially in sectors like automobiles and
banks, while GDP is expected to grow by 7.5
per cent during the same period, according
to Bloomberg consensus..
• India's foreign exchange reserves stood at
US$ 399.921 billion as of October 20, 2017
as compared to US$ 367.932 billion on
March 24, 2017, according to data from the
RBI

7. Business Cycle
• Business cycle is also known as economic cycle. It refers
to economy –wide fluctuations in production, trade and
economic activity in general ,over several months or
years in an economy.
• It is usually measured by considering the growth rate of
real GDP.

8. INFLATION
• Inflation is a rise in the general level of price of goods and
services in an economy over a period of time.
• Inflation rate is the annualized percentage change in a
general price index , normally the CPI or WPI over time.
• Current economic scenario of Inflation:-
• Consumer prices in India increased 4.88 percent year-on-year
in November of 2017, higher than 3.58 percent in October
and well above market expectations of 4.2 percent. It is the
highest inflation rate since August of 2016, mainly due to
rises in cost of vegetables and fuel. Inflation Rate in India
averaged 6.73 percent from 2012 until 2017, reaching an all
time high of 12.17 percent in November of 2013 and a record
low of 1.54 percent in June of 2017.

9. INVESTMENT
• An investment is an asset or item that is purchased
with the hope that it will generate income or will
appreciate in the future.
• In the financial sense, this includes the purchase of
bonds, stocks or real estate property.
• There are many type of investment & Two of them
are:-
• Short-term investment(maturity is less than one
year)
• Long –term investment(maturity is more than one
year)

10. • Investment plays macro economic
roles:-
• Domestic Expenditure
• Investment enlarge the production
capacity
• It reduces the labour needs for unit of
out put.

11. Need of Investment

12. TYPES OF INVESTOR
• INDIVIDUAL INVESTOR:-
• -Invest for personal financial goals(retirement ,
house)
• INSTITUTIONAL INVESTOR:-
• Paid to manager other people’s money
• Typically manage large amounts of money
• Include : banks, life insurance companies,
mutual funds and pension fund.

13. RETAIL INVESTOR
• A retail investor is an
individual who purchases
securities for his or her own
personal account rather
than for an organization.
• Retail investors typically
trade in much smaller
amounts than
institutional investors such
as mutual funds, pensions,
or university endowments.

14. EXAMPLE
Suppose Mr. Suraj, a 60-year retail investor, and he is a
salaried person his salary is around 1 lakh per month. He is
ready to invest now. According to current economic situation
we would like to suggest three investment instruments in
which he invest, get good return and face low risk.
They are:-
1. He invest Rs.10,000 per month in ELSS
2. Rs.8,000 per month invest in Gilt Fund
3. Rs.28,000 per month invest in Health Insurance

15. HEALTH
INSURANCE:- Health
insurance provides
protection to
individual against
medical expenses and
financial loss that an
individual might incur
from illness, injury and
accidents

16. Continue…

17. HEALTH INSURANCE POLICY

18. ELSS:-Equity link
saving scheme
• ELSS are tax-saving
mutual funds that you
can use to reduce
taxable income by upto
Rs 1.5 lakh under
Section 80C.

19. Some Suggestion for Mr. Suraj
in ELSS

20.  Gilt Fund:- Gilt fund
represents Government securities(G-
Sec) or government debts which are
very secure.
• There is no possibility of the
government not returning the money.
But the return will depend on
variation in the prevailing interest
rates in the market.
• With the rise of interest rate, the
market value of those funds decrease
and similarly with the decrease in
interest rate, the market value of
these funds increase.

21. Some Best Suggestion
For Mr. Suraj in Gilt Fund

22. Conclusion
From the above discussion we all describe all
the things which help in Economic growth like
GDP, Inflation, Business Cycle also.
And about Retail Investor whose monthly
income is around 2 lakh, Where should they
invest according to current scenario? We all
suggest them to invest in ELSS, Health insurance
& Gilt Fund, whose return is good.
Finally, don't wait for the right time. The most
important thing in investing is to start it, no
matter how small your investment is.
 Begin with a small amount and grow the
investment, thereby gaining in experience about
the markets.