Every investor has various life goals. These goals could be immediate in the short term or 1-2 years down the line or long-term like retirement or children’s education. Investing and building a corpus in thetime available to reach these goals is called goal-based investing.
Regulatory guidelines mandate investors to appoint a nominee for all their mutual fund folios or inform the respective fund house they do not wish to nominate. The folios will be frozen for debits for investors who fail to comply.
Equity mutual funds invest mostly in equity or stocks. According to Sebi, the mutual fund regulator, these schemes should invest at least 65% in stocks. They are further divided into ten categories, based on their investment universe and investment strategy, and investment style, and so on.
Small amounts received as gifts by children on festive occasions, birthdays or for good academic performance could be channelised into mutual funds to create wealth.
Investors are back to arbitrage funds, pouring in as much as Rs 10,074 crore in July, with cumulative flows rising to Rs 23,800 crore this financial year. The inflows reflect high returns and better taxation treatment these funds offer compared to debt plans.
A fund manager is an investment expert responsible for managing the scheme’s investing strategy. Every scheme is managed by one or two fund managers, while in some cases where the scheme is huge or has more than one asset class, it would have more than 2 people.
Most new investors believe that they need a large amount of money to start investing in mutual funds. This is not true. You can invest as little as 100 in a mutual fund scheme
Hybrid funds are a category of mutual funds that invest in more than one asset class. While some schemes combine equity and debt, there are others that could also include gold, silver and REITs.
It may sound like a relationship situation, but mutual funds may also sound very complicated to new investors. However, you encounter such situations every day when you do something new. Every new activity appears daunting initially but you find your way in some time. And you become good at it in some period of time.
Financial planners ask investors to step up their systematic investment plan (SIP) whenever there is an increase in income due to a salary hike or a job change. A primer.
The best opportunity to put money in small cap funds would be when they are ignored by the majority in the market, financial planners recommend a systematic investment plan (SIP) in these products to reduce risks.
Typically, before starting to make investments, a financial planner suggests an asset allocation after understanding an investor’s profile and risk taking capability.
Financial planners say that expense ratio is just one of the factors investors need to look at and it must be used in combination with other factors like performance, fund management, track record of the fund house etc. while choosing a mutual fund scheme.
Investors who believe the markets are running slightly ahead of fundamental valuations and could have a time correction ahead, but believe in the long-term potential of equities, can use STPs.
