Key investment options if you have Rs 10 lakh to park

"Diversifying between equities, fixed income instruments, and avenues like bonds, commercial real estate (CRE), an astute investor can target an average annualised return of around 8-10% over the long term and can harness market potential while minimising exposure to volatility. The backdrop of economic dynamism underscores the significance of staying attuned to emerging sectors. Investing a small part of the money in growing sectors like technology or sustainable energies can potentially yield exponential gains," Aggarwal told CNBC-TV18.com.

Experts consider equity as one of the most rewarding asset classes to bet on. Investing for the long term allows one to ride out market fluctuations and recover from losses. However, it's crucial to understand that equities come with higher risks compared to other asset classes like debt.

Investors with moderate/high-risk appetite can allocate a higher portion to equities, while those with lower risk tolerance should maintain a balance with debt, allocating 30-40 percent towards equities, experts say.

Investors can also consider investing in quality equity mutual funds to diversify unsystematic risks. It's vital to determine the investment time horizon before selecting funds.

For those needing funds in a few months or less than a year, ultra short-term debt products are recommended. For those investing for more than 5 years, equity mutual fund schemes are a suitable choice. Many experts endorse index funds as a low-cost option for long-term investments. These funds provide a well-diversified portfolio that passively tracks an index. Young investors can have a portfolio biased towards equity due to their ability to take on more risk.

Satyen Kothari, Founder & CEO, Cube Wealth thinks age also plays a crucial factor here. He thinks that a 35-year old who already has emergency fund and insurance in place can invest ₹ 6-₹ 8 lakh in 3-4 quality equity mutual funds recommended by a reliable mutual fund advisory specialist who has a 10-year-plus track record of beating the markets.

Gold has a historical track record of consistent appreciation and serves as a valuable diversification tool within an investment portfolio. However, it's advisable to invest in gold as an asset class rather than in the form of jewelry. Gold ETFs, mutual funds, and Sovereign Gold Bonds (SGBs) are available investment options. SGBs, in particular, are a decent option as they provide liquidity, don't involve storage costs, and are easy to redeem.

For those with short-term financial goals (up to 3 years) and wishing to earn returns greater than those offered by savings accounts or fixed deposits, Kothari suggests allocating ₹ 2 to ₹ 4 lakh to alternative assets such as Peer-to-Peer (P2P) lending and lease finance.

"These options can potentially yield returns of 10% or more," he told CNBC-TV18.com.