August 2021 – Welcome to

Best Performing Mutual Funds in the Present Market

Best Performing Mutual Funds

Mutual funds being the buzzing words in the investment market, everyone seeks to find the best performing mutual funds. But the concept of the best performing mutual funds does not depend on a single factor; an investor needs to verify a few essential things to determine which mutual fund is performing well in the market. Apart from verifying the percentage of return in the last few years, a company’s profile, number of schemes, and its Net Asset Value (NAV) are equally important. The following things become determining factors for assessing best performing mutual funds in the market.

CRISIL Rank: CRISIL rank is globally recognized for evaluating a mutual fund’s performance in all segments. CRISIL rank depends on the factors like scope of return, nature of the portfolio, volatility, quality of assets, risk factors, liquidity analysis, etc. After analyzing all such factors over a period of three to ten years. Rating is given between 1-5, the more a company is rated, the more a company is supposed to be worthy of investment. The top 10% of companies that perform well in all segments are rated 5; whereas the 10% from the bottom line are rated 1. Some of the 5 & 4 rated top-performing funds* in the present mutual fund market are Mirae Asset Emerging Bluechip Fund – Growth (5 star), Aditya Birla Sun Life Tax Relief 96 – Regular Plan – Growth ELSS (4 star), ICICI Prudential Focused Equity Fund – Retail – Growth (4 star), Edelweiss Large and Mid Cap Fund – Regular Plan – Growth (4 star), Kotak Equity Opportunities Fund – Growth (4 star), IDFC Large Cap – Regular Plan – Growth (4 star), DSP Midcap Fund – Regular Plan – Growth (4 star), Sundaram Rural and Consumption Fund – Growth Sectoral/Thematic (5 star), SBI Infrastructure Fund – Growth (4 star), etc.

Net Asset Value (NAV): Net Asset value is a parameter that an investor must check before investing in a mutual fund. Total assets controlled by an Asset Management Company is known to be Asset Under Management (AuM). NAV is determined by subtracting the price of total assets minus the total liabilities and then divided by the number of units. The NAV, as well as AuM of an AMC, gives an idea about the present market value of the fund. For instance, the total Asset Under Management of Mirae Asset Emerging Bluechip Fund – Growth (as of 27 August 2021) is 19,567.86 and it says that it is a large fund to invest in.

Return: Return is the most important thing for investment and it is the only factor that we seek. Mutual fund returns are subject to market risk, but a sincere investigation about a scheme and its past performance help to overcome the risk. Only seeing the immediate return is not a good idea. An investor should see the return of a mutual fund over the weeks, months, and years to see how consistent the fund is. Mutual funds providing consistent moderate returns are more trustworthy than mutual funds having big ups and downs. The diversity of a fund scatters the risk factor and provides a comparatively consistent return over the period. A mutual fund investing in equity or debt is prone to more risk than a mutual fund that combines equity and debts in its fund.

This guidance will help the new and existing investors who want to ensure the best return out of mutual fund investments. Return in the Mutual Fund during this COVID 19 situation might be volatile. But the investors are advised not to lose hope because India is bravely fighting back with the situation. Otherwise, you can gain when you invest online in any fund during this situation if you follow a few strategies. For real-time guidelines and for getting a platform to invest in best performing mutual funds in the present market, you may consult with an AMFI registered mutual fund distributor.

*source: moneycontrol.com

Investments during the COVID 19

Investments during the COVID 19: Is it the right time?

COVID 19 pandemic has hit the world economy to an extent. Since March 2020, lockdown in most of the parts of the world has made a great impact on the economy for various reasons. The large, medium and small scale industries which are based on productions have continued to face hurdles due to lack of manpower, proper logistic facilities, improper supply of raw materials and so on. Amidst this crisis, the market value of so many companies have fallen to an extent and a few are struggling continuously. The market has become more volatile than before. So, people have become perplexed regarding investments during the COVID 19. It has become a common question among investors if this is the proper time for investing or not.

A report in the Hindustan Times shows that the 2nd wave of COVID 19 in India has caused more than 1 crore unemployment. The report says that the income of almost 97% of families has declined. The continuous recession has also made a strong impact on the overall scenario of investments in India. A major portion of Indian investors belongs to the middle class and lower-middle-class families. They invest in mutual funds and stocks for various reasons like family security, dream fulfilment, children’s future and education, etc. When they have continued to receive a cut of their income, it has really become hard for them to think of investment. So, the investment market is also facing a crisis resulting in the fall of the market for so many companies.

Now coming to the major point, YES this might be a good time for the prospective investors. When the market falls, the share value of most of the funds decreases. Hence if you invest right now, you have a high chance to gain in future. We hope that we would overcome the situation very soon and India would be able to fight the pandemic bravely. Most of the states have started unlocking the services of everything. The production has resumed, all the industries are gradually opening for the workers. The Indian government has been running the vaccination drive among the mass population rapidly and the active case is declining throughout the country. Hopefully the normalcy is going to be restored very soon.

The COVID 19 pandemic has provided us with the opportunity to work from home. Many of us are having plenty of time to go through sincere research of the market condition. This might help us to know the market better than before. We might search for alternative ways of investing now. Even amidst this COVID 19 situation, the market of few focussed mutual funds has proven to be stable and less volatile. If we have a glance at the focused equity mutual funds based on healthcare, logistics and technology, we can explore that they have recorded a proven rise since the advent of COVID 19 in 2020. So, a sincere investigation of the market is necessary before investing this time.

The investors who have already invested in several lockin funds like tax saving ELSS funds should keep their patience. They might be in the depression of the volatile nature of the market. They have to wait and watch to get the desired outcome or profit. As you might need liquid cash anytime for the treatment of family members, you should keep a handsome amount of liquid cash before investing in long term funds. If you have a regular flow of cash, you may invest without being much concerned. You may invest in an equity fund without a locking period that deducts very less percentage of expense ratio and exit load. This will help you to encash your investment when you feel emergency. For better advice for your investment strategies, you might consult an AMFI registered mutual fund distributor.

Best Mutual Funds to Invest

When mutual funds have opened up a new horizon for the next-gen investors, we often become perplexed about which are the best mutual funds to invest in in the market. The answer is simple, it depends on your financial goal. The definition of “best mutual fund” is a relative matter and it varies from person to person. Mutual funds offer you the most customized way of investments according to your portfolio and financial goal. The following matters define the best mutual funds for an investor.

Reliability

An Asset Management Company (AMC) pulls money from so many investors and their fund managers decide where to invest that capital for a better return. In this way, mutual fund investments go on through several AMCs across the country. The profile of an AMC is a big factor for making it reliable to investors. AMCs are in most cases connected to reputed banks, financial organizations, insurances, and big corporates. The position of their stocks in the market, history of returns over the past few years, and the flexibility of their schemes are the things that make a mutual fund reliable for investors. You may check if your target fund is SEBI authorised mutual fund or not.

Nature of investments

Duration of investments: Why and how long do you want to invest? Ask yourself, and then find out the scheme suitable for you. If you want to invest for a limited time, choose debt funds that will provide you with a secured income in duration from one day to more than seven years. If you want to invest for a moderate return over a few years, you may invest in large-cap funds of a mutual fund. If you are interested in investing in stocks for a higher return, invest in equity funds. If you want to invest a small amount monthly for a longer period (3-5 years), you may choose an SIP of a mutual fund. If you want to save tax, go for ELSS schemes of mutual funds.

Past records

A sincere study on the past record of all existing schemes of mutual funds in the present market is essential before you invest in a scheme of mutual funds. Suppose, you want to invest in a SIP under the ELSS scheme for multiple purposes, systematic investment, tax benefits, and return. The first thing you need to do is to study the percentage of annual return/loss of all the schemes of all Asset Management Companies (AMCs) in the present scenario. You will get a clear cut idea about the way of management of different AMCs. The company, which has been able to provide better returns at an average over the last 3-5 years, are suitable for your investments. You can choose the specific scheme offered by that AMC for your investment for a better outcome.

Risk factors

Investments should be made in mutual funds as per your risk appetite. If you want to invest in a comparatively safe zone, you can think of debt funds in mutual funds for a shorter term and also a secured return. Otherwise, you can invest in large-cap funds in mutual funds for 2-4 years because, in such funds, your money is invested for the top 100 stocks in the present market. If your risk appetite is moderate, you can go for mid-cap funds in mutual funds. If you possess a high-risk appetite, you should think of small-cap funds. Such funds are the most volatile, you may face comparatively bigger losses. But, in terms of return, small-cap funds can give you the best return in the market.

This year has seen the most volatile market not only in India but also across the globe since March 2020. After COVID 19 pandemic hit the global financial market, investors in stocks, debts, equities and other funds have become suspicious about the outcome of their investments. But, we hope that the market will soon be suitable for the investors as soon as we come out of this situation. Investors are suggested not to lose hope, they can think of plans for longer terms for their desired outcome. You may consult an AMFI registered mutual fund distributor for knowing the best mutual fund for you according to your portfolio.

A perfect Financial Planning for your better future

Financial planning is the most important key to ensure a hassle-free future. Financial planning involves a systematic approach to link the present financial situation to future goals. This is hardly possible to achieve all our future goals without proper financial planning.

Step by step direction of Financial Planning

Determine your asset: To set up perfect financial planning, you need to determine your present asset. Your financial status should match with the investment schemes. For instance, if you have the ability to invest more than 50 lakh per year, you can manage your investments through Equity Portfolio Management System or equity PMS. If you have the ability to invest 2-5 lakhs per year or less than that, mutual funds might be the best option for you. At first, you need to find out the present values of your home, income from different sources, your car, jewellery, money in the savings accounts, investments, insurance policies, retirement benefits, provident fund, etc. The next step is to determine your total outstanding that may include the existing loan amount and your debts in credit cards. You can determine your present asset in this formula:

Present Asset = Present value of your assets – Present outstandings

Calculate your present expenses: This is the most important thing to set your financial planning. You have to keep a track record of the flow of all your expenses. You may maintain a diary to keep records of each and every expense. Otherwise, you can sum it up through your bank and credit card statements. There are festive seasons and months having birthdays of your dear ones. Hence, you can not maintain the same flow of your financial expense every month in the same way. The best way is to calculate the expenses of the last twelve months, add at least 10% in the next year thinking of inflation, and then divide it by twelve.

Restructure your future expenses: Based on the previous year’s balance sheet, you may make a plan for the next year. You have to determine your priorities and it is the most vital thing to set a financial goal. Suppose, you had spent a lot on entertainment in the last year and you need to pay extra money for your child’s education in the upcoming year. Then you can reduce your expenses from things which are not essential for life. We can not cut our expenses for food, house rent, policy premium, education, and health. Hence, we need to set up our priority so that we can manage our expenses with our income keeping a portion intact for investment. Investment is necessary for multiple reasons in our life. They are:

To manage the expenses in your life for a longer run
To ensure a better education for children
To meet our dream of apartment, car, and foreign tour
To manage the moments of crisis in our life
To live an easeful life after retirement
To gain financial freedom
To manage our investment goal
To save tax

To meet all these requirements in our life, perfect financial planning is highly necessary. It would help you to utilize your surplus money judiciously even after ensuring an uncompromised lifestyle.

Thinking of perfect planning

Now on the basis of your present financial position, you may invest your money in the following schemes:

Mutual Fund Investment: Mutual fund investment is one of the popular schemes nowadays due to its flexible investment plans and higher return. There are multiple schemes of multiple durations in mutual funds like debt funds, ELSS or tax savings funds, equity funds, hybrid funds, etc. Investors need to know their investment goals and risk appetite before choosing the schemes of mutual funds. Investors can invest a lump sum amount at a time or they can opt for an easy monthly plan through a Systematic Investment Plan (SIP) in a mutual fund scheme. Currently, there are more than 51 SEBI authorized mutual funds working in the Indian market, but you need to read all the schemes before investing because the return of a mutual fund is subject to market risk. If you want to overcome the risk of the market, we have to think of longer-term investments in mutual funds. You can contact an AMFI registered mutual fund distributor for investments and experts’ advice.

Public Provident Fund: Public Provident Fund (commonly known as PPF) is very popular among middle-class professionals who want a secured return to meet their goals. But it has no risk and similarly less prospect of return in comparison to the mutual funds. One more reason for choosing PPF for investment is its tax benefit under section 80C of income tax.

Risk management plans: Risk management plans include general insurance, life insurance, term insurance, health insurance that would cover our expenses during times of crisis. Without a proper risk management plan, we may lose all our investments during a crisis in our life. Be sure that you are not taking risk management plans as your primary financial goal, just take those for an emergency. Many of those (like life insurance) have low returns, most of those (like term insurance, medical insurance, and general insurance) have no cash return at all except their benefits during the emergency. So, it is better to have proper risk management plans to cover up our crises.

Tax management plans: Tax management plans include life insurance, health insurance, PPF, and ELSS schemes of mutual funds that would help us in multifaceted ways. These plans would cover our risk, would give some monetary benefits, and would save our annual tax.

So, it is very urgent to follow proper financial planning to make the best use of our hard-earned money. Nowadays, managing investments has become so easy because an investor can invest online in almost all the schemes mentioned here. A financial planning agency may properly instruct you to manage your financial matters for meeting your long-cherished dream.

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