WHAT IS FINANCIAL SECTOR?

• The financial sector is a section of the economy made up of firm and institutions
that provides financial services to commercial and retail customers.
• The financial sector generates a revenue from mortgages and loans, which gain
value as interest rates drop.
• The health of economy depends, in large6.53part on the strength of its financial
sector. The stronger it is the healthier the economy. A weak financial sector means
the economy is weakening.
• Many people equate the financial sector with Wall Street and the exchange that
operate on it.

Made By Suraj Prakash

TYPES OF FINANCIAL SECTORS:
1. Share Capital 5. PPF

2. Mutual Funds 6. Real Estate

3. Gold Funds 7. Post Office

4. Bank 8. Life Insurance

WHAT IS SHARE CAPITAL?
• A company’s share capital is the money it
raises from selling common or preferred stock.
• Authorized share capital is the maximum
amount a company has been approved to raise
in public offering.
• A company may opt for a new offer of stock in
order to increase the share capital on its
balance sheet.
PROS AND CONS OF INVESTING IN SHARE CAPITAL

Pros of Share Capital: Cons of Share Capital:

1. You can make money in shares 1. You can lose money in shares

2. Its easy to buy shares 2. Make sure you have enough funds

3. Plenty of shares to choose from 3. You can get overexposed to risk

4. The benefits of growth vs dividend 4. The share market might crash

WHAT IS MUTUAL FUNDS?
• A mutual fund is a type of investment
vehicle consisting of a portfolio of stocks,
bonds, or other securities.
• Mutual funds are divided into several kinds
of categories, representing the kinds of
securities they invest in, their investment
objectives, and the type of returns they seek.
• Mutual funds charge annual fees, expense
ratios, or commissions, which may affect
their overall returns.
PROS AND CONS OF INVESTING IN MUTUAL FUNDS
Pros
• Advance Portfolio Management
• Dividend Reinvestment
• Risk Reduction (Safety)
• Convenience and fair pricing
Cons
• High Expense Ratios and Sales
Charges
• Management Abuses
• Tax Inefficiency
• Poor Trade Execution
WHAT IS GOLD FUND?
• Gold funds are investment vehicles that offer exposure to
gold.
• They come in a variety of forms, but three popular varieties
are those investing in physical gold, gold futures contracts,
and gold mining companies.
• Investors interested in hedging against inflation generally
opt for gold funds that hold gold bullion or futures
PROS AND CONS OF INVESTING IN GOLD FUNDS
Pros Cons

• Gold is a hedge Against inflation • Gold is not a passive investment

• Liquidity • Gold is difficult to store

• Diversification • Price correction can lead to losses

• Holds its value over long period of time

• Most desired commodity

WHAT IS A BANK?

• A bank is a financial institution licensed

to receive deposits and make loans.
• There are several types of banks
including retail, commercial, and
investment banks.
• In most countries, banks are regulated
by the national government or central
bank.
PROS AND CONS OF INVESTING IN BANK
Pros Cons
• Safety of Public Wealth • Chances of Bank Going Bankrupt

• Availability of Cheap loan • Risk of Fraud and Robberies

• Economies of Large Scale • Risk of Public Debt

• Propellant of Economy
WHAT IS A PPF?

• The PPF account or Public Provident Fund scheme is one of the most popular long-term
saving-cum-investment products, mainly due to its combination of safety, returns and tax
savings.
• The PPF was first offered to the public in the year 1968 by the Finance Ministry's
National Savings Institute. Since then it has emerged as a powerful tool to create long-
term wealth for investors.
• Investors use the PPF as a tool to build a corpus for their retirement by putting aside
sums of money regularly, over long periods of time With its attractive interest rates
and tax benefits.
PROS AND CONS OF INVESTING IN PPF
Pros Cons

• Safest Investment Avenue

• Lock-in period of 7 Years
• Fixed and Assured returns
• Upper limit
• Tax Benefits
• Moderate Returns
• Options to invest in PPF
WHAT IS REAL ESTATE?
•Real estate is considered real property that includes land and anything

permanently attached to it or built on it, whether natural or man-made.

•There are five main categories of real estate which include residential,

commercial, industrial, raw land, and special use.

•Investing in real estate includes purchasing a home, rental property,

or land.

•Indirect investment in real estate can be made via

REITs or through pooled real estate investment.

PROS AND CONS OF INVESTING IN REAL ESTATE
Pros Cons
• Sense of Security • Professional help required

• Gen Generates Cash Flow • Time Commitment

• Home Loan Tax Benefit • Maintenance Cost

• Simple and Controlled • Less liquidity

• Property Appreciation • Property Tax

WHAT IS A POST OFFICE ?
• The Post Office term deposit (POTD) is similar to a
bank fixed deposit, where you save money for a
definite time period, earning a guaranteed return
through the tenure of the deposit. At the end of the
deposits tenure, the maturity amount comprises the
capital deposited and the interest it earns.
PROS AND CONS OF INVESTING IN POST OFFICE
Pros
• Low Minimum Amount – The minimum is only
₹1,000.
• High Interest Rates – Currently, the Post Office FD
interest rate is high, far more than banks and some
NBFCs give you.
• Premature Withdrawal – You can withdraw your FD
before maturity.
Cons
• The maximum tenure of a post office FD is five years, and you
cannot opt for a longer tenure.
• If you opt for a premature withdrawal, you may be charged a
fee.
• Most services rendered are not online, and this may be a
disadvantage to many.
• Banks offer more flexible tenures of FDs than post office FDs,
offering only tenures of 1, 2, 3 and 5 years.
 WHAT IS LIFE INSURANCE ?
• Life insurance is a legally binding contract that pays a death benefit to the
policy owner when the insured person dies.
• When the insured person dies, the policy’s named beneficiaries will receive
the policy’s face value, or death benefit.
• Term life insurance policies expire after a certain number of years.
Permanent life insurance policies remain active until the insured dies, or
surrenders the policy.
• A life insurance policy is only as good as the financial strength of the
company that issues it.
PROS AND CONS OF INVESTING IN LIFE INSURANCE
Pros Cons

• Death benefit • Can be expensive for old-aged people

• Additional coverage • The return on life insurance are not significant

• Guaranteed Income • Insurers may not pay the benefit

• Tax Benefits • Complex policies

• Availability of loan • Exclusions

• Valuable return on investment

THANK YOU !