Mutual funds are the best way to get a higher return on investment:
Firstly the Question arises what is the Mutual Fund and Investments in Mutual Funds offer profitable results to investors? Here you find that Mutual Funds means the investors have to spend money in various asset classes such as debt funds, liquid assets and more according to their requirement.
Mutual funds mean the investor has to buy or sell stocks, funds online whenever they want or need. Mutual funds are registered by SEBI (Securities and Exchange Board of India) and it fully controls the market of mutual funds. Gain and reward that investor earns over the period of investment depend on the types of a mutual fund the investor has to invest money.
By investing in equity funds, the investor has return expectation of around 9 to 12 % over the period of investment of mutual funds. If the investor has invested money in debt funds then in long terms he can expect around 7 % return expectation.
If the person invests the money in mutual funds with a proper survey, then the investor surely get the huge amount of return back after retirement and make their life secure on long terms.
Selection of Right Mutual Funds by investors offers huge profits:
Before jumping to invest money in mutual funds, there is the need that the investor must read the guidelines of different mutual funds. The investor should not invest the whole amount of money in one mutual fund, equal distribution of money in diversified mutual funds by investors has reduces the risks of loss involved in funds.
In a Contemporary era, every individual like to invest in mutual funds. In recent time numerous varieties of insurance policies are appreciated by everybody. People should invest in that particular mutual fund policy that secures family monetarily.
There are diverse kinds of mutual schemes plans are available in the market, the investor holder has to invest money in mutual funds plans according to his requirement. Before purchasing any mutual fund plan the investor must need to know what is correct length of the plan and to what extent the investment holder has to pay the premium of the plan.
Financial goals of your investment must match with the maturity date of products:
Before investing money in any funds you must identify your financial goals. It will create the problem for you, if your financial goals is of 10 years but the maturity date of a funded scheme is of 13 years, then it that situation, the investor feel short of meeting his financial goals.
If the financial goal period is below 5 years then do not invest money in equity products. In those situation debt products is the better option for you.
Selection of Right Types of Mutual Funds Creates Wealth to investor:
Systematic Investment Plan:
In Systematic Investment plan, the investor has to fixed amount regularly in a mutual fund scheme according to their plan monthly, quarterly or yearly. An investor has to pay the fixed amount as long as a plan goes on.
Equity funds are called higher risk funds and offer a higher return to the investor. So it is good for those investors only who you must to invest money in equity stocks and shares of companies to earn the huge profit in long terms.
Debt funds offer the investors a fixed amount of profit. So is invested money in these funds is safe. Debt funds invest money in government bonds, company debentures, and fixed income asset. These funds offer fixed returns to investors.
Hybrid or Balanced Funds:
Balanced funds have invested money of investors in different asset classes. Investment in these funds means investment in less of equity and more in debt. So investment in these funds offers a good return. Risk factors strike a perfect balance in balanced funds.
Investment in growth funds may be risky but it generates higher returns to an investor. Growth funds have to invest money in equity stocks with the purpose of offering capital appreciation.
Money Market Funds:
Money market funds offer moderate returns to investors. Money market funds mean to invest money in liquid instruments such as T-bills, CPs. And so on. An investor has to invest money in liquid funds with the purpose of providing liquidity.
Entry and Exit Mutual Funds offers high profit on short terms:
The investor has to invest money in these funds throughout the year after reviewing the level of share market globally. Purchases and redemption of the funds have totally depended on the market value of NAV.
Close Ended Funds
In these funds during the initial offer period, units can be purchased only. At the specific maturity, date units can be redeemed only.
Interval funds have the peculiarities of open-ended and close-ended funds. During the fund tenure, these funds are opened for repurchase of shares at different intervals.
If the investor financial goal period is of 5 to 10 years then allocate money in debt: equity funds in the ratio of 40:60 is are the good option. If the goal is more than 10 years then allocate money debt: equity in the ratio of 30:70 is the best option to get huge profits.