Is the stock market riskier than other investments (like real estate)?




Yes, till date stock market has proven itself riskier than traditional investment products like fixed deposit, bonds, real estate, gold etc. Traditional investment products are widely held among all class of people and you hardly go wrong with them. At least, it holds true in Indian context. We have not seen as many of real estate market crash or banks going bankrupted and not returning investors money on fixed deposits. However, you would have heard many stock market crisis stories. You may have heard many companies stocks crashing individually even when stock market is doing fine as a whole. So, you have to be more cautious while investing in stock market. Do a proper research before investing your money in stock market. 

 I would like to highlight few related things on this topic. In last few years, real estate prices has gone up like anything in almost all part of the country. Traditionally, Indian used to buy/built houses to reside. But, in last few years, trend has changed and it is getting used as Investment vehicle. And, this has made real estate equally riskier. In fact, investment size is very big and transaction cost is also high in real estate. So, you have to be equally cautious in real estate investments as well.

Fixed deposits or liquid funds are still safe if you are not looking take any risk on your savings. I would advice you to read on different type of risk to understand these concepts better. Maybe, refer to this link. 

 main thing is how you define risk.Yes there is risk of capital loss.basically you will find risk in every investment.the safest bet is fd in bank but at 9% return before tax it is hardly any return considering inflation.
Regarding fd yes it is risky if you go into the market  without doing your homework.but if invest in good companies after doing analysis yourself(no the analysis of TV analysts dont count) you can be sure of return
Also the return in equities is not fixed,sometimes very good business can remain low for a very long time.
Also few of the risk i can think of in real estate investment are
1)highly iliquid investment
2)token size is huge
3)excess supply in the market

In the end ,it all depend on you,you should invest in asset in which you yourself are knowldege able and is comfortable with.
thanks

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