2014 is definitely a year to watch out for especially for those who have a kept a keen eye on Indian markets and have wondered the fate of the Indian Rupee. Well, amidst all the economic mayhem, 2014 is also important politically. Reason: it’s the election year. Economics has always been a hostage to many political gimmicks and unfulfilled promises by the party that comes into power. 2014 is, however, a bit different than any other election year held before. One big difference is that whichever party wins, will either bring very little change or will bring a lot of change. This is because India is going through an economic reform process. The central bank of India (Reserve Bank of India) has been making changes in repo rates in installments making interest rates fluctuate, something similar to what Federal Reserve did in 2008. Investors need to understand that the ‘ruling party’ or even a prediction to which party will form the government in 2014 will have an effect on the markets. This holds true not only for Indian investors but all those NRIs who are looking to invest in the Indian markets in 2014.

1. Investments for 2014
( a forecast for Indian/NRIs
investors)
2014 will be a year that will witness many changes
and whichever party comes into power will have to
save the falling economy. The answer as to how one
should invest in 2014 is through diversification.
Spreading your risks will keep you safe from any
future surprises.
© 2014 Deena Zaidi. All rights reserved

2. Equity &
Real Estate
• Equity investment has loads
of risk and investing a lot in it
now will not be advisable.
20%
is
advisable
for
diversification. Look out for
funds invested in IT industry
since they’ll be doing well in
2014.
• Real Estate remains a big
NO since there remains a gap
between the given current
prices
and
the
huge
affordability gap.
© 2014 Deena Zaidi. All rights reserved

3. Gold Investment
Gold has always been termed
risky but financial pundits have
always been very positive about
investing a part of income in it.
Gold is ruled by the global prices
and curbing imports( like what
India did) has little effect. With
surprises in gold, take 10% off
your income, at least, in this.
Gold prices (as much as UPA
thinks it to be useless) holds
value especially during Indian
occasions you always see a rise
in the gold price from the
previous year e.g. Dhanteras
and Diwali.
© 2014 Deena Zaidi. All rights reserve

4. Rental
Income &
Bonds
• If you have rental
income, get a recurring
deposit and put some amount
there so you know that part of
your income is not lying idle
or being used aimlessly.
• 30% is for bonds. Low
returns for fixed duration but a
safe bet in your portfolio.
© 2014 Deena Zaidi. All rights reserve

5. Bank Fixed Deposit
Bank Fixed deposit remain my
favorite because you are safe
from the market moves and its
better to have a term deposit
than just keeping your cash in
savings account. 40% should go
here. You will not lose anything
and if you feel it is a lot, you can
always break them in the middle
since there is no penalty charge
on premature withdrawal. The
interest rate will always be higher
than regular 4%.
© 2014 Deena Zaidi. All rights reserve

6. This is what your 2014
portfolio should look like!
10%
Gold
40%
Bonds
30%
Equity Instruments
Bank Fixed
Deposits
20%
© 2014 Deena Zaidi. All rights reserve

7. Conclusion
2014 is not only the year for Indian political shift but also a global
change. 2014 will see the entry of new Fed Chairman, Janet
Yellen. The year will see the reaction of Abenomics, an effort by
Japan’s Shinzo Abe to put an end to inflation by creation of special
economic zones. Eurozone’s reforms could see more exits from
Eurozone. Amidst all this will be China, doing something that will
cause further uncertainty in the global markets. Therefore, these
could give rise to fresh monetary bubble and impact Indian
markets and common investors.
So staying sheltered by diversification will help in getting
adequate returns while being both risky (gaining from markets
when they rise) and safe (with debt instruments and fixed
deposits).
© 2014 Deena Zaidi. All rights reserved