6 Best Short Term Investments Options for 2013

Several investors would have surplus money which needs to be invested for short term of 1 to 3 years. There are various good options available for such short term investments.

Need for short term investment

Short term investment option arises when we have surplus money and there is a pressing need of money in the short term. The pressing need could be either for children education, down payment for housing loan, down payment for buying a car, money required for setting up a business etc. The need can be anything, but parking the money in good short term investment options would increase the value of the money.

6 Best Short Term Investments Options for 2013

Some of the good short term investments options are

1) Bank fixed deposits: Invest in top bank fixed deposits for short term to get higher returns. Indian banks are providing interest rates of 8% to 9.25% per annum. Currently below are the top 5 bank fixed deposits which are offering highest returns for the 3 year period.

2) Investments in corporate/company deposits/NCDs: There are various corporate companies which are offering fixed deposits / Non-convertible debentures (NCD) with attractive interest rates. The interest rates are ranging between 9% to 12%. However when you are investing in NCD, see for the SECURED NCD to ensure your capital is safe. Top 5 corporate fixed deposits are enclosed below.

3) Mutual funds Large cap: Large cap mutual funds invests in blue chip companies for long term. However these can be invested for short term investments of 3 years period as only little downside is expected in case of share market downtrend. In the last 3 years period, they have offered 10% to 13% annualised returns. Below are the top 5 large cap mutual funds which you can look even for short term investments.

3) Mutual funds Ultra short term: These mutual funds invests majority of the portfolio in fixed deposits and short term investment options. Investor can invest in such ultra short term mutual funds for the period of 1 to 3 years period. The returns in the last 3 years are 8% to 8.5% per annum.

5) Mutual funds Debt funds: Debt mutual funds invest majority of the portion in debt related instruments like corporate deposits, NCDs etc. These are generally offer attractive returns when interest rates are declining. Invest in debt mutual funds to get benefitted if you are looking for a investment period of 1 to 3 years. The returns in the last 3 years are 8% to 10% per annum. This is one of the good short term investment options.

6) Investment in gold: This is my favorite investment option for short term as well as for long term. Investment in gold has given 24% annualized return in the last 5 years period. There are various ways to invest in gold. You can pick-up your choice and invest in gold.

Conclusion. Short term investment arises when you have pressing need of the surplus money in the next 1 to 3 years. Invest in best short term investment options to get benefitted to the maximum extent.

Readers, do you invest in any of these best short term investment options. Please give your comments

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Best short term investments