Mutual Funds - Invest in Top Mutual Funds India | Fincover® (2024)

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Mutual funds are one of the most preferred investment options these days. A mutual fund collects and invests funds from thousands of individuals who have a common investment objective. They are managed by Asset Management Companies that provide various mutual fund schemes to the public. Each mutual fund can invest money in stocks, bonds, Government securities and various other listed and unlisted assets.

Mutual funds are a fantastic investment option for individuals as they can invest in different kinds of asset options without the effort to do the research. The returns generated from mutual funds are distributed proportionately to all the investors. Most AMCs have schemes designed to provide optimum returns to their investors.

If you want to invest in mutual funds, you have two modes of investments – lump sum and Systematic Investment Plans (SIP)

• Lump Sum Investment: As the name indicates, it involves a one-time investment. If you have a sizable disposable income in hand, you can go in for lump sum investment.
• Systematic Investment Plans (SIP):Systematic Investment Plan or SIP allows you to invest money at periodic intervals. Investors can facilitate transfer to their SIP through the auto-debit feature from their savings account.

Cost-Effective & Affordability

Economies of scale lead to lower transaction costs, making mutual funds a cost-effective option for Investors

Professional Management & Expertise

Experienced Fund Managers make informed decisions optimizing returns & managing Market associated risks

Liquidity & Accessibility

Easy to buy and sell at Net Asset Value (NAV). It can be liquidated easily compared to other investments in the market

Diversification

Mutual funds spread your investments across various assets, minimizing risk and enhancing portfolio stability

Transparency

Regular reporting and disclosure offer transparency, providing investors with clear insights into their mutual fund holdings

Power of Compounding

Dividends & capital gains can be automatically reinvested, fostering the compounding effect for long term big returns

You should always invest in any sector with an eye towards the future. Whether you are looking for a short-term profit or long-term benefit like a retirement corpus, you must be clear about your financial goals. Investing without a plan can lead to massive financial mismanagement. If you are a risk-averse individual, it's better to go for less risky funds but provide decent liquidity.

Once you select the best mutual fund category, you should opt for the top-performing mutual fund in that category. Analyzing the returns over some time is the best way to know if that mutual fund would be beneficial to you or not. If the fund has shown better returns over five years, it could be the right choice.

Choosing the best mutual fund also depends on your risk appetite. If you have a high-risk appetite, you can choose equity funds that may provide you with higher returns. On the other hand, if you are a conservative investor who is wary of taking risks, it's better to opt for a debt fund or a large-cap equity fund.

The higher the value of total assets in a fund, the chances for the returns are better. A large AUM (Assets under Management) also indicates investors' trust in that fund and its performance.

NAV represents the per-unit market value of a mutual fund's assets minus its liabilities and it is calculated everyday. It is the price at which investors buy or sell units

Yes, Most Mutual funds allow investors to redeem their units anytime. The redemption involves selling units back to fund and the proceeds are based on current NAV

Large-cap funds invest in large-sized companies (Top 100 in fortune 500), mid-cap funds focus on medium-sized companies (101 – 250), and small-cap funds target small-sized companies (250 and above), providing different risk-return profiles.

Mutual Fund returns are taxed based on factors like holding period, and the type of the fund. Equity gains have different tax implications than debt

Investment in mutual funds are subject to market risks as it is directly linked to the performance of the underlying securities in the portfolio

Fincover charges a 0% commission on MF investment. You can freely choose from over 3000+ direct mutual funds and begin your investment journey anytime