New Delhi. After a continuous decline till May and half of June, the stock markets are once again on a bullish trend since June 16. On Monday, the Sensex climbed 760 points to close at 54,521. However, experts say that the volatility in the market will continue for now. In such a situation, investors are likely to get fewer returns than Fixed Deposit (FD) in the stock market this year. Investors have got more than 5% return on FD in 2022, but the stock market has given an average 10% loss to the investors.
RBI has indicated a hike in interest rates on bank deposits this year, which will further increase the returns on FDs. On the other hand, even in the remaining 5 months of this year, there is a possibility of getting less than a 5% return from the stock market. Whereas the interest of 6% to 7% will be available on the investment of FD. The Sensex and Nifty have lost 8% this year, while the smallcap index fell 12%.
According to the RBI report, banks will be forced to increase deposit rates in the coming months, as the credit growth (loans) of banks is growing much faster than the coming deposits. To increase deposits, banks will have to increase the interest rates on FDs.
Year investors will increase interest in August! Banks are currently giving 5-6% interest on FDs. In such a situation, if the same return of the stock market is assumed, then Sensex can go up to 56,000. However, with RBI planning to raise interest rates in August, the market may continue to decline further. This year the repo rate can go above 6%. Due to the increase in repo rate, FD rates will increase again in August.
According to investment expert Balwant Jain, investors can go for corporate FDs along with FDs for higher returns. Corporate FDs are getting 2-3% more interest than bank FDs. Liquid funds are also a better option than FDs.
Debt funds give higher returns than FDs. 4 to 45% interest is available on FDs of 45 to 180 days. Whereas debt funds have more than 5% returns. On the other hand, FDs of 3-5 years have 5.50% interest, while the target fund is giving 7.30% returns.