Showing posts with label mutual fund companies. Show all posts
Showing posts with label mutual fund companies. Show all posts

Mutual Funds | Disappointment Yes or No

Few would dispute that the year 2008 has been tough on investors. This holds especially true for first-time investors i.e. the ones whose tryst with equity markets only began in the last few years. After having seen the markets surge to record highs, the downturn has certainly caught several investors off-guard.

And the despondency is not restricted only to those who have participated in equity markets via the direct equity investment route. Even investors in equity mutual funds have borne the brunt of falling markets. As a result, several investors are in panic mode. Some are even contemplating redeeming all their mutual fund investments and instead making investments in risk-free avenues like fixed deposits and bonds.

But is that the right course of action? We don’t think so. To begin with, investors must conduct an honest appraisal of their risk profile and investment horizon. Also, they must candidly answer the question – why did I get invested in a given mutual fund?
If an investor truly believes that he can take on higher risk and is willing to stay invested for the long-haul (at least 3-5 years), then we believe there is no reason to panic. In fact, given the attractive valuations, investors should consider adding to their investment portfolios. As regards, the reasons for getting invested – if it was to achieve a predetermined investment objective, then it’s all the more reason to stay the course.

Conversely, if the answers are on the lines of ‘have a low risk appetite’, ‘wanted to make a quick buck’ or ‘to ride the rising markets for the short-term’, there is a cause for concern. Such investors got invested in avenues that were wrong for them or made investments for the wrong reasons. In either case, they would do well to work out an exit strategy in consultation with their investment advisors.
As for investors who have the requisite risk-taking ability, investment horizon and clearly defined objectives backed by investment plans, it’s a good time to evaluate if they are invested in the right avenues i.e. in this case, the right mutual funds. Even the best of plans will not deliver if poorly-managed funds are deployed to achieve them. However the evaluation process needs to be a proper one.

To begin with, investors would do well to understand the fund’s nature and investment style, before evaluating its performance. For example, an aggressively-managed equity fund that professes to take stock and sector bets should be expected to deliver above-average results in rising markets. On the other hand, when markets move southwards, such a fund is likely to be worse hit as well. This is keeping in line with the fund’s high risk – high return investment proposition. Comparing the fund’s performance on the downturn with that of a conservatively-managed equity fund would be unfair, akin to comparing apples with oranges.
Similarly, understanding the fund’s investment universe is vital as well. For instance, a professed mid cap fund would be predominantly invested in stocks from the mid cap segment. Expecting it to feature among the top performers at a time when large caps are rallying would be unfair.

Another common mistake is considering funds in isolation. Any advisor worth his salt will emphasise on the importance of diversification. Hence the norm is existence of investment portfolios, instead of investments in single funds in a standalone manner. The key to a well-constructed portfolio is that the downturn in an investment avenue can be offset by an upturn in another. Similarly in a mutual fund portfolio, the presence of diverse investment propositions and styles should help the investor’s cause. Broadly speaking, so long as the investment portfolio is on course to accomplish the predetermined investment objectives, investors should be fine.

Clearly conducting an appropriate evaluation is easier said than done. Hence investors would do well to engage the services of their investment advisors for the evaluation exercise. The next step is to take corrective measures.
Now depending on the specifics of each case, it could vary right from altering the allocations to various funds, exiting some funds and investing in new ones to doing nothing. Surprised? Don’t be. It’s possible that investors are already invested in funds that are right for them and in the right allocation as well. And it is not uncommon even for the best of funds to hit a rough patch. If no material changes have occurred in a fund’s investment proposition and its ability to deliver over the long-term is undiminished, keeping the faith and staying put wouldn’t be a bad idea.

The importance of the evaluation exercise, especially in testing times cannot be overstated. From an investor’s perspective, the key lies in striking a balance between pressing the panic buttons and being complacent. Also, engaging the services of a competent investment advisor is vital.

Mutual Funds | Right time to invest

Mutual Funds in India, Right Mutual Fund, Best Performing Mutual Fund
Mutual Investment

investing in Mutual Funds will all remain the first priority which every fund manager or financial consultant will advice you. Investing wisely in Mutual funds will always provide better returns. I myself invested in various mutual funds and almost received returns of more than 15%.

Mutual funds are managed by highly qualified and experienced professional fund managers and is these managers work for Asset Management Companies. Your money is handled by these Asset Management Companies (AMC) and the money is invested in various bonds and funds along with government bonds and money market.

Its always a right time to invest in Mutual Funds. There is no specific age limit but yes it requires patience and if one waits for certain time period, he / she really will reap the benefit. So you can prepare a target regarding a certain amount of funds required after a certain period. For example, if you require 1 Cr or say US$ 1 million after 10years then how much you need to invest from today every month to achieve the target.

There are various mutual funds available in market and one can choose as per their requirements that in which mutual fund they want to invest.

The main are listed below

1) Equity

2) Debt

3) Money market

4) Hybrid Funds

Beside this, all mutual funds are categorized into Open Ended ( any time you can withdraw) and Closed Ended (fix maturity value).
Those who have interested and want more information can read our blogs or may directly ask questions in the comment box.
We also provide consultancy services for choosing and investing in perfect Mutual Funds matching your needs, for example, whether you are planing for retirement, child eduction, repayments, etc. The returns are totally depend on market.

Some of the books are available on Amazon and you can read those also to get proper view and understanding about mutual funds. You can these books online also.



Top Performing Mutual Funds | India


Mutual Funds in Year 2013

Reliance Mutual Fund
Reliance Mutual Fund (Photo credit: Wikipedia)
Today, debt mutual funds are the best performing mutual funds. The debt mutual funds primarily invest in debentures, bonds, fixed incomes, securities etc for either long term, short term or medium term. The debt funds are low risk funds with higher returns in comparisons to fixed deposits in banks.
Debt funds are easy to liquidate and come with flexible investment terms and withdrawal facility. Investing in debt mutual funds proves to be good investment when interest rates are falling.

Investors who are plans to get returns above bank interest rates and face low market risk can invest in these debt mutual funds. For better returns, invest in debt mutual funds for a period between 3 to 5 years.

Always note that all mutual funds are unstable and are directly exposed to market risk. Also save yourselves from the miss-selling from agents or brokers. Before investing, check the past performance of the mutual fund. If you don’t feel comfortable, study more, and invest only when you are clear and comfortable. The mutual funds schemes don’t provide any guarantee for objective provided in the mutual fund schemes.

Once you become mutual fund savvy investor, you will feel comfortable and easy to invest and will reap the effective and safe returns from mutual funds.
In year 2013 it is expected that in debt mutual fund category Birla Sun Life Medium Term, Franklin Templeton India Income Builder Plan A and Religare Active Income Plan A will be the best performer.

Among the balanced mutual funds, HDFC Balanced, HDFC Prudence, Reliance Regular Saving Balance and Birla Sun Life will be the best performer.

In this blog above all details are provided in good faith but without guarantee. Readers should take advice of their own or experts before investing.

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