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HomePersonal FinanceInvesting in Mutual Funds? You can get more returns in these ways

Investing in Mutual Funds? You can get more returns in these ways

Mutual Fund: For what purpose you want to invest in Mutual Fund, choose a mutual fund keeping in mind that.

In changing times, mutual funds have emerged as a better option for investment. In the midst of declining returns of bank FDs and other fixed income instruments, people’s inclination towards mutual funds has increased. If you want high returns then mutual funds are a good option for you. Although mutual fund investments are subject to market risk, you can get a higher return on your investment by keeping a few things in mind. We are mentioning some such methods here.




How to choose mutual fund

Choose a mutual fund keeping in mind the purpose for which you want to invest in mutual funds. Equity mutual funds are beneficial if you want to make long term investments. On the other hand, debt funds or liquid funds are better for short-term investments. Apart from this, the direct plan is also a good option. Opting for this can give you 1%-1.5% higher return on investment. 1-1.5% brokerage has to be paid in the regular plan. The expense ratio of the direct plan is less as compared to the regular plan.

SIP better

There are many types of mutual funds. But investing through SIP is considered the safest. Certified Financial Planner Vishal Shah says that investing in mutual funds can be started with a small amount through Systematic Investment Plan (SIP). Apart from this, if you are going to invest in more than one SIP, then do not invest in schemes of the same fund house, but invest in different fund houses.

Diversification

According to experts, investors should invest in small-cap, mid-cap and large-cap funds according to their risk appetite. A high-risk investor should invest 60 per cent of his fund in small-cap, 20 per cent mid-cap, 10 per cent in index funds and 10 per cent in large-cap.

Debt or Equity?

Mutual fund houses offer investors the option to invest in both debt and equity. Experts say that risk appetite declines with age. Equity always gives higher returns as compared to equity but the risk is also higher.

Select Step-up SIP

If you invest every month through SIP, then there is a huge benefit in returns by increasing it a little, which is called Step-up SIP. Suppose, if you invest every month for 10 years with a SIP of Rs 30,000, then at the rate of 12.5% ​​return per annum, you will be able to raise a total fund of Rs 71.82 lakh. If you increase it by 10% every year, that is, Rs 30,000 every month in the first year, then Rs 33,000 every month in the second year, then Rs 36,000 and so on for 10 years, you will be able to collect a total amount of Rs 96.95 lakh. That is, by adding only 10% every year, you can save 35% more.

Record previous check

While choosing any mutual fund, it is important to know about its past record. This will let you know the history of the company and the performance record of the fund. By this you will be able to know up to what percentage the fund has given before.

Parvesh Maurya
Parvesh Maurya
Parvesh Maurya, has 5 years of experience in writing Finance Content, Entertainment news, Cricket and more. He has done BA in English. He loves to Play Sports and read books in free time. In case of any complain or feedback, please contact me @ informalnewz@gmail.com
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