In this article, we will explain the categorization of debt funds in brief and its features & impact.
Dynamic asset-allocation funds factor in market valuations before investing in various assets.
With sector funds, the timing of the investment and the health of the concerned sector is very crucial.
As direct plans do not incur distribution expenses, the savings made in total operating expenses remain invested with the fund, which then start generating returns.
You can start an SIP in multiple mutual funds with varying amounts.
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.
It’s advisable to adopt the twin strategy of Systematic Investment Plan (SIP) and Systematic Withdrawal Plan (SWP) to meet financial goals.
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.
GOI has decided to introduce a 10% tax on long term capital gains on equities and equity oriented mutual funds exceeding INR 1 lakh.
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.
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.
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.
A mutual fund can offer a simple and efficient way to invest for your life goals
The returns you actually earn from the debt scheme may or may not be similar to the Portfolio YTM
For regular returns, investors opt for fixed deposit, company deposit or small saving schemes. These suffer from disadvantages when it comes to taxation, falling interest rates & liquidity in case of some emergency.
Your SIP investment must go up as your income rises.