what do you think ? Many will say FD is better than CSE,
But my choice is CSE, you know why ??
Lets take an example,
A person called "A" is having LKR 1.0mn & he is planing to put it on 1 year FD @ 15% per annum. There are many finance companies which are paying more than 15% but he choose a bank considering risk factor. After one year he will earn,
as interest------------150,000/- (1,000,000*15%)
Let say he choose 1 month FD on monthly reneval basis @ 15% (normally 1 month FD rates less than that), he will earn,
as interest------------160,754/-
But if he invest in CSE,
He choosed
share "---H" & bought 175000@2.80= 495,488/- (including 1.120%)
share "--L" & bought 5000@98= 495,488/- (including 1.120%)
He is keeping share "---H" as short term & sold @ 3.10 after three months, his capital gain 40,936/-
Share "--L" he kept as meduim term & sold @ 150/- after one year, his capital gain 287,048/-
Totla will be 287,048/-. It may be more than that because he sold share "---H" after three months, therefore he has chance to buy another.
From FD--------150,000/- (15%)
From CSE-------287,048/- (29%)
what is your choice............
This is just a example........