Working over more than 5 years i found most of my friends, Investors puzzled on selecting a mutual fund. whenever they checked out best performing funds on the web, and saw their friends investing in some funds and getting handsome return, the most common question was "Is it the best fund?" Many of us confued regarding this matter lets a have some talk, as Mutual fund also requires as much planned contribution as any other buying:
• Identify funds whose investment objectives match your needs Just as you would buy a shoes that fits your budget and foot, you should choose a mutual fund that meets your need and your budget .usually investment objectives of mutual funds include fixed income or equity, general equity or sector-focused, high risk or low risk, blue-chips or turnarounds, long-term or short-term liquidity focus.
• Compare apple to apple like if you compare sectorial fund to equity fund, it's not fare. Read carefully and pick your best one
• Balanced Schemes Asset Allocation of these schemes is in both Equity and debt(combination of fixed and Government sector papers), normally 50:50. Balanced Schemes aim to provide both growth through Equity and Protection through debt.
• Income Schemes Income Schemes are also famous as debt schemes. This scheme offers regular and steady income to investors, by investing in fixed income securities such as bonds and corporate debentures. Capital protection in such schemes is high.
• Close-ended mutual fund schemes have a fixed maturity time in which the depositor can invest at the time of the initial issue and later units of the scheme can be bought or sold on the stock exchanges where the scheme is listed.
• Equity Schemes that invests at least 65% of its corpus in equity and their peer termed as.
FACES OF EQUITY FUND
- INDEX FUND, ETFs FUNDS
- DIVERSIFIED FUNDS
- ELSS FUNDS
- THEMATIC FUNDS
Option Dividend & Growth, read it in next article
Till then
!! Happy Investment !!
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