In India following the laws of investing, the government has permitted the establishment of such institutes that help in investments in India. Being focused on the changing aspects of the financial investment in corporate or non-corporate businesses, these particular institutes helps in managing the finance while helping in making decisions regarding investment-related actions, based on this factual knowledge this current study has aimed to represent an overview of the purpose of the establishment of such investment institutions in India. Different examples of the investment institutions will be added in the discussion sections as well.
Definition of Investment Institutions
As per the definition of finance, investment institutions are largely considered legal entities that have the responsibility of gathering funds from various investors with an intention of investing in various financial instruments. Based on this fact, it can be stated that investment institutions refer to such specific companies that are established in order to help the business of India to get the achievement regarding the financial requirement. In order to ensure the fulfilment of these kinds of investment procedures, the organisations or institutions offer trade securities in large enough quantities.
Purpose of Investment Institutions
The main purpose of the investment institution in India is to ensure the achievement that is related to the finance of the business. By investing in the financial matters of the Indian organisations, the investment institution helps in achieving the core requirement of a business that is having financial stability. Based on this particular statement stated previously, it can be proposed that the purpose of the investment institutes includes the roles of a financial advisor as well. The main reason is that if the investment institutions are unable to represent the importance of the investment, the institutions will fail to collect the financial investments. On the other hand, if the investments will not be invested in the required sections of the business, the business will be a total failover from the financial perspective.
Examples of Investment institutions in India
Investment institutions in India are known for offering customers both advisory and financial services. The demand for investment institutions in India is higher and they tend to offer the customers financial products of currency, equities, commodities and credit. Different investment institutions that are operating in the Indian market are Barclays Capital, Citi Bank, B.N.P Paribas, Deutsche Bank, Kotak Mahindra Bank, Yes Bank, and J.P Morgan.
Importance of Investment Institutions in India
The Indian economy observes a greater necessity for Investment banks, as they are responsible for removing deficiency of capital. Investment banks are liable for offering investments along with stimulating the savings level of their customers. Investment banks tend to mobilise scattered and small savings of the community people while converting them into productive businesses. Investment institutions are also capable of fostering both indirect and direct investment for offering economic development. Investment institutions also look after the economic well-being of the nation. The funds of investment banks are obtained by offering securities to the investors.
Risk of investment in India
In the investment of India, several risks have been involved that are mentioned in the below section:
- The main risk of investing in India is the ever-changing financial market that brings severe issues in the invested money
- The company can impose greater risks in order to manage the financial activities in the target market
- In the open market of India, any newcomers have to encounter a high opportunity cost in order to gain first profit from the target market, if the organisation will fail to achieve the intended profit, the investment will be meaningless for the investors
Advantages of Investment Institutions
Among the main advantages of the investment include that the person who invests in the Indian market will be able to stay ahead of the inflation of the market. On the other hand, it has been seen that the investment in the market in India helps to build wealth that will contribute to achieving the early requirement of finance for various purposes. In addition to the other factors stated so far, investment can be beneficial in order to have some savings on providing taxes. Besides that, a proper investment strategy developed by different investment institutions helps the investors to meet other financial goals as well.
Conclusion
The present study has shed light on the factors related to investment institutions. These Institutions have offered several scopes and other available investment sections in the market in India. The main purposes of the investment institutions have been found to help the businesses of India to achieve the financial requirements in order to improve the businesses and other sections of the business. On the other hand, it has been seen in the discussion that as in India, matters like the financial market often change on large scales; the investment in the Indian market becomes a bit riskier for the investors.
