The Octa Guide To Affordable Investing In India

As an accessible source of supplementary income, investing in financial markets is especially relevant to India, where high inflation rates become a major obstacle to reaching higher living standards and saving money for retirement. But how much capital do you need to start your investing journey? The experts at Octa, a globally recognized financial broker since 2011, shed light on the affordability of investing.

With the inflation in India currently outpacing monthly earnings growth and deposit interest rates offered by banks, having an additional source of income on top of a regular salary becomes a pressing issue for many.

As an entirely legitimate and highly dynamic wealth management option, investing has been growing in popularity over the recent years. According to research conducted in 2023, tens of millions of people in India already regularly engage in trading. This underscores the profit-making opportunities in this field — and more and more Indians want to be a part of it.

But how much capital do you really need to engage in investing actively? According to a popular opinion, you must have significant savings to kick off your investing career. However, this is far from the truth, Octa experts argue. Below, several popular investment options are analyzed based on the starting capital requirements.

Forex

Among a wide range of available investment options, few offer low time to profitability and modest starting capital requirements. In particular, Forex and contracts for difference (CFDs) have gained significant popularity due to their unique advantages.

The largest and most liquid market in the world, Forex is perfectly positioned to accommodate investors who seek fast-paced action and high profitability potential.

Some Forex experts suggest $100 as a recommended starting amount for new traders. However, experienced and trusted brokers tend to offer even lower entry thresholds. Octa, a globally recognized financial broker with 13+ years of experience and a wide variety of tradable assets on offer, allows emerging traders to start off with just $20. Providing all-time-free access to a full-featured demo account for all users, Octa offers commission-free trading, tight spreads and fast order execution.

Gold

Historically, gold has been among the most trusted ways to preserve wealth. Investors often use it to shield their capital against inflation and market fluctuations in times of economic and political instability. On the other hand, gold has some distinct drawbacks, including high volatility and increased return on investment time.

While trading in commodities technically has no fixed minimum capital requirement, gold presents some specific challenges when collecting your profits. According to the Indian Income Tax Act, selling physical gold incurs a 20% tax, along with a 4% cess on long-term capital gains. If you take traditionally low liquidity into account, gold comes off as a precarious commodity that doesn't consistently deliver on the implied promises.  

Stocks

There is no predefined minimum limit to start trading or investing in India. Unlike some other financial markets, you don’t need a large sum to get started. However, low entry costs of entering the stock market have a significant caveat – all brokers charge either fixed or percentage-based transaction fees, so by the end of the day, you will incur accumulating expenses regardless of success or failure.

Additionally, the spreads in the stock market are usually much higher than in Forex, which, along with more flexible hours, lower fees and higher trading volume, makes the latter a clear favorite for many retail traders.

Mutual Funds

Mutual funds gather money from multiple investors to invest in various securities, including stocks, bonds and other assets.

Although some retail mutual funds have no minimums, most require a minimum initial investment of between $500 and $5,000.

On top of being a relatively expensive investing choice, mutual funds are also quite slow to pay off, as the returns are generated through capital gains and dividends over an extended period.

Investing in mutual funds usually involves additional fees and expenses, which is an additional drawback compared to other choices like the Forex market, which is free of commissions via Octa, a global and time-proven investment platform. 

Conclusion

Contrary to popular opinion, not all investment options involve significant entry costs. Even with a modest amount on your account, you can dive into investing and turn your ambitions into consistent daily income. Millions of people are making profits by Forex and contracts for difference trading. With Octa, a versatile digital investment platform, you can try investing without risks on a demo account with virtual funds and hone your skills before engaging in real trades.

Featured photo courtesy of Octa.

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