A debt fund carries low risk in comparison to the equity oriented mutual fund, but they are not totally risk free as many people think.
Earlier, in the absence of any standard definition of MF categories, mutual fund companies and research & advisory firms came up with their own methodologies of categorizing funds.
For the past two to three quarters, the debt market has been more volatile than equity, but for the recent equity market correction in February.
Mutual fund offerings most often exceeded the returns generated by ULIPs in the same category offered by the same investment house, though it might not be a given at all times.
If you are long term investors and worried about highly volatile markets you can invest in these mutual fund schemes.
Making investment decisions just based on the tax advantage has never been a good idea.
Long-term investors benefit hugely in midcaps. Overall, midcaps tend to go through high volatility but, at the end of the day who has remained a long-term investor has amassed considerable wealth.
Investors who don’t want to be part of this excessive fluctuation in the short term can use debt funds and fixed deposits as investment options.
It’s advisable to adopt the twin strategy of Systematic Investment Plan (SIP) and Systematic Withdrawal Plan (SWP) to meet financial goals.
Keeping money lying idle is not the best thing to do. If you are a risk-averse investor, fixed deposits and liquid MFs are the best options. Here are some tips that can help you decide your investment plans.
If you need liquidity along with steady returns, short-term liquid funds could be a good option, though returns are not guaranteed as in FDs.
Product awareness campaigns by market participants and sustained backing from the regulator would motivate more retail investors to embrace direct plans.
Bottomline, the policy statement has put a lid on to the markets ultra bearish imaginations and going forward global and domestic data points would be watched for by policymakers as also market participants.
The RBI did flag off the risks to inflation, but did not sound alarmist.
GOI has decided to introduce a 10% tax on long term capital gains on equities and equity oriented mutual funds exceeding INR 1 lakh.
RBI bond comes with a rate of interest of 7.75% which is comparable to the interest offered on the small saving schemes such as National Saving Certificate.
On CNBC-TV18's special show Mutual Fund Day, watch the interview of Sailesh Raj Bhan, Deputy CIO Reliance Mutual Fund and Harsh Roongta, Independent Financial Advisor where they shared financial planning tips for young professionals.
Though there is some breathing space in the hands of the investors here in India, it is time to carefully study the broad picture.
One significant global phenomenon at this point of time is that the US is exiting from the ultra-easy monetary policy initiated in the wake of the global financial crisis of 2008.
Much to the surprise of the analysts, the RBI chose to raise the H2 FY2018 Consumer Price Index (CPI) path slightly by 10 bps to 4.3%-4.7%, to accommodate upside risks from crude prices, delayed impact of state Housing Rent Allowance (HRA) implementation and a sustained uptick in core inflation.
Looking at the average credit rating exposure of the industry, we observe that the exposure to ‘A and below’ rated securities saw a steady increase up till the end of 2015, when the Amtek Auto incident occurred.
Bank FDs are one of the safest investment-cum-savings avenue which can help you get 7-9% return annually.
The SWP enables investors to withdraw a specified amount regularly, thus addressing two shortcomings of the dividend option viz., quantum and timing.
All mutual fund schemes within a fund house will need to be appropriately distinct from each other in terms of strategy, asset allocation, etc.
Watch fund managers discuss about investing in mutual funds at the 4th Mint Mutual Fund Conclave.