Financial Literacy: Investing Fundamentals
Description
This subject develops competency in investment principles, asset classes, and portfolio construction for wealth creation aligned with financial goals. It covers the distinction between saving and investing, risk-return relationships, diversification principles, and various asset classes (stocks, bonds, mutual funds). The subject teaches practical investment selection methods, systematic investment plans (SIP) leveraging rupee cost averaging, and asset allocation strategies adapted to life stages. Understanding investing is essential for building long-term wealth and achieving major financial goals beyond inflation.
Learning Objectives
Upon successful completion of this subject, learners will be able to: (1) distinguish between saving and investing, (2) understand risk types including systematic and unsystematic risk, (3) explain expected return and risk premium concepts, (4) apply diversification principles to reduce portfolio risk, (5) evaluate stocks as ownership stakes with dividend and capital appreciation potential, (6) understand bonds and fixed income instruments with coupon mechanics, (7) distinguish between corporate bonds and government securities, (8) evaluate mutual fund structures and advantages vs. direct investment, (9) categorize mutual funds by type (equity, debt, balanced, hybrid), (10) understand SIP mechanics and rupee cost averaging benefits, (11) evaluate stock market indices (Sensex, Nifty) as performance benchmarks, (12) assess asset allocation strategies by life stage and risk tolerance, (13) understand rebalancing and portfolio review importance, (14) project investment growth using compounding calculations, (15) match investments to specific financial goals.