Comparing Risk and Reward Unlisted Shares vs Liquid Equities.pdf

Compare unlisted shares vs listed equities—risks, rewards, liquidity, and portfolio strategies to make smarter investment decisions.

1. Comparing Risk
and Reward:
Comparing Risk
and Reward:
UNLISTED SHARES VS LIQUID EQUITIESUNLISTED SHARES VS LIQUID EQUITIES

2. In investing, every decision is make down to balancing two forces: risk and
reward. Investors generally find themselves drawn towards the growth
potential of unlisted shares (pre-IPO companies, startups, or private firms
backed by strong investors) or the liquidity and transparency of listed
equities. Both asset classes can play critical roles in an investor’s portfolio
—but their risk-reward profiles are very different.
Let’s unpack these differences through the lens of a typical investor.
Introduction

3. Unlisted shares are equity in companies before they are listed on a
stock exchange. This means you are buying into early-value stories—
brands such as Orbis Financials, Lava Mobiles etc. In short The
companies or firms that are preparing to go public or high-growth firms
operating in private markets.
Understanding
Unlisted Shares

4. The chance to enter before an IPO
at attractive valuations. Exposure to high growth
companies shaping the future
(tech, fintech, EVs, consumer
brands). Multi-bagger potential: A
company you buy at ₹100 may list
at ₹400, giving you a 4x return if
timing and market sentiment
align. Potential Rewards: Risks Involved: Lack of liquidity—selling your
holdings before a listing can be
difficult. Limited financial disclosure
compared to listed peers, so risk
of information asymmetry. Regulatory and business risks: If
the IPO gets delayed or sentiment
shifts, expected valuations may
not hold.

5. Liquid equities are the listed stocks you buy and sell almost instantly on
stock exchanges. These are companies under SEBI’s Watch, offering
quarterly disclosures, analyst reports, and extensive public scrutiny.
Understanding
Listed Shares

6. Easy liquidity—you can exit any
day if your investment thesis
changes or you need cash. Transparent data to evaluate
corporate health (balance sheets,
management commentary, price
charts). Stability in large-cap, blue-chip
names that offer long-term
compounding as well as
dividends Potential Rewards: Risks Involved: Price volatility due to global and
domestic sentiment. Herd mentality: retail investors
often overreact to market swings. Returns can be slower compared
to early-stage unlisted bets,
especially in large caps.

7. Parameter Unlisted Shares  Liquid Equities 
Liquidity Low, can take months/years to exit  Very high, instant exit possible
Transparency
Limited disclosures, private company
info 
High, quarterly reports & regulator
audit 
Return Potential
High (multi-bagger potential pre-
IPO) 
Moderate to high depending on
sector 
Risk Level High (valuation uncertainty, delays)  Moderate (market-driven volatility) 
Time Horizon Long-term (3–7 years)  Flexible (short-, mid-, or long-term) Comparing Risk-Reward

8. Which One Should You
Choose?
The answer isn’t an either-or—it’s about portfolio balance.
If you’re an investor with strong liquidity needs (you want flexibility
to exit anytime), then liquid equities should be your core.

If you have surplus capital, higher risk appetite, and the patience to
wait for compounding stories to unfold, allocating 5–15% of your
portfolio to unlisted shares can add powerful growth kickers.
For conservative investors, large-cap liquid equities and mutual
funds remain the safer foundation, while unlisted shares become the
“satellite bet” for higher returns.

9. Investor’s Takeaway
Unlisted shares offer the excitement of being early in the story,
but they require research, networks, and patience. Liquid
equities, on the other hand, provide confidence, exit options,
and transparency. A wise portfolio often blends the two—
combining the growth optimism of unlisted shares with
the stability of listed equities.
Because at the end of the day, investing isn’t purely numbers—
it’s about aligning opportunities with your personal goals, risk
appetite, and comfort.

10. Thank YouThank You
If you looking for high growth potential unlisted shares to invest. You can
contact – [phone] or visit Rits capital now!