How to invest in mutual funds bpi online,thinking of you dear friend quotes,how to make a job offer wait,successful in life essay - 2016 Feature

Author: admin, 22.03.2014. Category: The Power Of Thinking

A: A mutual fund is a common pool of money into which investors with common investment objectives place their contributions that are to be invested, in accordance with the stated objective of the scheme. A: The Indian Mutual fund industry has started opening up many exciting investment opportunities for Indian investors.
Mutual Funds now represent perhaps one of the most appropriate investment opportunities for most investors.
The second phase was between 1987 and 1993, during which period, 8 funds were established (6 by banks and one each by LIC and GIC). The third phase was marked by the entry of private and foreign sectors in the Mutual fund industry in 1993.
Today the AUM of the Mutual Fund Industry stands at over Rs.2 lakh crores, a growth of over 1 lakh crores since the last 5 years. One of the primary benefits of investing in Mutual Funds is that an investor gets the advantage of professional management of his finances. A mutual fund enables you to participate in a diversified portfolio for as little as Rs.5000, and sometimes even lesser.
In open-ended schemes, you can get your money back at any point in time at the prevailing NAV (Net Asset Value) from the Mutual Fund itself.
The investment objectives of general-purpose Equity schemes does not restrict these funds from investing only in specific industries or sectors. The primary purpose of an Index is to serve as a measure of the performance of the market as a whole, or a specific sector of the market.
Investors (Individuals and Hindu Undivided Families ("HUFs") are now encouraged to invest in Equity markets through Equity Linked Savings Scheme (ELSS) by offering them a tax rebate. The Scheme is subject to Securities & Exchange Board of India (Mutual Funds) Regulations, 1996 and the notifications issued by the Ministry of Finance (Department of Economic Affairs), Government of India regarding ELSS. Investments in ELSS schemes are eligible for deduction under Sec 80C.An example of ELSS scheme is the Kotak ELSS scheme. Specialized real estate funds would invest in real estates directly, or may fund real estate developers or lend to them directly or buy shares of housing finance companies or may even buy their securitized assets. These schemes, (also commonly referred to as Income Schemes), invest in debt securities such as corporate bonds, debentures and government securities. These schemes invest in money markets, bonds and debentures of corporates with medium and long-term maturities.
Liquid Income Schemes are similar to the Income schemes but have a shorter maturity period. These schemes invest in short term instruments such as commercial paper ("CP"), certificates of deposit ("CD"), treasury bills ("T-Bill") and overnight money ("Call").
These schemes are commonly known as balanced schemes and invest in both equities as well as debt. OAn any time exit option, the issuing company directly takes the responsibility of providing an entry and an exit.
OAn any time entry option, an open-ended fund allows one to enter the fund at any time and even to invest at regular intervals. However some category of investors are not allowed to invest in particular schemes of certain funds.
While past performance is not an indicator of the future it does throw some light on the investment philosophies of the fund, how it has performed in the past and the kind of returns it is offering to the investor over a period of time.
While choosing a mutual fund, one should always consider factors like the extent of diversification that a Mutual Fund offers. A fund with high costs must perform better than a low-cost fund to generate the same returns for you. Finally, an investor must be careful not to pick a fund simply because it has shown a spurt in value in the current rally. Equity Schemes are schemes, which have more than 50 per cent investments in Equity shares of domestic companies. The difference between the sale consideration (selling price) and the cost of acquisition (purchase price) of the asset is called capital gain. If the holding period of the Mutual Fund units is less than or equal to 12 months from the date of allotment of units, then short term capital gains is applicable. The Gain will be added to the total income of the Investor and taxed at the marginal rate of tax. The holding period of Mutual Fund units is more than 12 months, from the date of allotment of units. A: Having understood the basics of Mutual Funds, the next step is to build a successful investment portfolio. At the cornerstone of investing is the basic principal that the greater the risk you take, the greater the potential reward. Risk then, refers to the volatility - the up and down activity in the markets and individual issues that occur constantly over a period of time.
Different types of mutual funds have different levels of volatility or potential price, and those with the greater chance of losing value are also the funds that can produce the greater returns for you over time. At times, the prices or yields of all the securities in a particular market rise or fall due to broad outside influences. Sometimes referred to as "loss of purchasing power." Whenever inflation rises forward faster than the earnings on your investment, one runs the risk of actually being able to buy less, not more. A number of companies generate revenues in foreign currencies and may have investments or expenses also denominated in foreign currencies. In sectoral fund schemes, investments will be predominantly in Equities of select companies in the particular sectors. Mutual Fund is a new baby for most of Indians – I keep getting lots of mutual fund question through Comments on post, Ask Us or Business Bhaskar newspaper where I regularly write query section. Question: I want to invest in Reliance Mutual Fund, but as I am seeing the NAV, there is huge gap in Growth and Dividend NAV.
Answer: You are lucky that you are asking me this question in No Entry Load era so there are only annual charges that you have to pay.
Answer: Far more money has been lost by investors in preparing for corrections, or anticipating corrections, than has been lost in the corrections themselves.
Answer: Equity gives you two type of return, one is speculative and another is fundamental growth. Answer: Infrastructure as a theme was started in 2003-04 at that time exposure of infrastructure based sector was not more than 25% in diversified equity funds. Question: I want to invest 2 lakh in share market for 10 year please suggest me best shares in infra, power, bank, FMCG? Regarding your question – Reliance Equity Opportunities is a diversified equity fund with multi-cap focus. It’s good to see that lot of people are taking interest in SIPs & asking questions regarding the same.
Simple reason is there is no entry load on mutual funds – means less earnings for mutual fund advisors. I want to understand in todays scenario if the investors horizon is for 2 years which would benefit him more an investment in MIP or investment in GOLD Savings Fund. This is a dream question that people ask me daily – which is the asset class that will perform best in near future? As I have already mentioned to few readers that people should have proper diversified portfolio same applies to you. I am a regular investor in Birla Sun Life tax relief 96 growth fund and invest monthly Rs 10000 since last one and half years. My suggestion is you should divide this amount in 3-4 funds – you can add HDFC tax saver or fidelity tax saver.
I am planning a SIP of 1000 and 3000 INR respectively initially, this is apart from my other financial savings. I have read the fund performance reports of the 2 funds, given the knowledge you possess could you please tell me if its worthy the effort ?
Both funds are good but I will suggest you to divide your funds in 2 mutual fund companies – you can also invest in fidelity equity fund. I agree that both the HDFC funds – Prudence and Top 200 (and even Equity) are managed by the same manager.
I agree Anil that advisers do not favor having funds from the same fund house in the portfolio.
There is so much of difference of opinion among the advisers as for as investment in mutual funds is concerned that it leaves the investors confused.To give you an example recently I read the opinion of two advisers in two different magazines regarding investment in Reliance Growth Fund.
As for as HDFC Mutual Fund is concerned it has perhaps the highest number of highly performing schemes.


Hello sir, inspired by your site, started gaining knowledge abt mutual funds and willing to invest in equity funds. Regarding your question – Why mid and small cap funds offer high returns as compared to large cap? Your selection of funds is good.For additional investment select the large cap funds from the list of funds for SIP given by Hemant. It does not appear to me that sensex is going to touch 21000 in near future.This is blessing in disguise for you and will allow your husband to remain invested in these good funds for a longer period of time. I wanted to have a very straight and profeesional opinion about investing in Sundram Equity Plus NFO.
The investment manager invests the money collected into assets that are defined by the stated objective of the scheme. We have started witnessing the phenomenon of savings now being entrusted to the funds rather than in banks alone.
As financial markets become more sophisticated and complex, investors need a financial intermediary who can provide the required knowledge and professional expertise on taking informed decisions.
The total number of schemes went up to 167 and Assets Under Management saw the figures improving to over 61,000 crores. The first entrant was Kothari Pioneer Mutual fund, launched in association with a foreign fund. Also the percentage of Equity assets in the overall AUM has increased from a shade under 5% to over 30% in the same period. Being full-time, high-level investment professionals, a good investment manager is more resourceful and more capable of monitoring the companies the Mutual Fund have chosen to invest in, rather than individual investors. The schemes are the least volatile of all the types of schemes because of their investments in money market instruments with short-term maturities. Hence the investor usually does not have to worry about credit risk since Government Debt is generally credit risk free. By investing in a mix of this nature, balanced schemes seek to attain the objective of income and moderate capital appreciation and are ideal for investors with a conservative, long-term orientation. Investors can buy or sell units at NAV-related prices from and to the mutual fund, on any business day. This provides ready liquidity to the investors and avoids reliance on transfer deeds, signature verifications and bad deliveries. Investors can buy into these funds during the period when these funds are open in the initial issue. They may be traded on the stock exchange or may be open for sale or redemption during pre-determined intervals at NAV based prices. Besides the investors who are eligible to invest may still need to follow different procedures.
Further more, our offerings are customized to suit your investment profile, hence you can meet your investment objectives.Added to this our , extensive research and wide range of products would cater to your needs and objectives. Reading the fund's prospectus is a must to learn about its investment strategy and the risk that it is prone to. Maintaining a diversified and balanced portfolio is a key to maintaining an acceptable level of risk. Even small differences in fees can translate into large differences in returns over a period of time.
NAV is required to be disclosed by the Mutual Funds on a regular basis - daily or weekly - depending on the type of scheme.
If the investor sells his units and earns capital gains, he is liable to pay capital gains tax.
Before one begins to build a portfolio, one should understand some other elements of Mutual Fund investing and how they can affect the potential value of investments over the years. This volatility can be caused by a number of factors - interest rate changes, inflation or general economic conditions. So risk has two sides: it causes the value of your investments to fluctuate, but it is precisely the reason you can expect to earn higher returns. There are very few perfectly safe havens and those simply don't pay enough to beat inflation over the long run. When this happens, the stock prices of both an outstanding, highly profitable company and a fledgling corporation may be affected.
How certain are you that it will be able to pay the interest you are promised, or repay your principal when the investment matures? Changes in exchange rates may, therefore, have a positive or negative impact on companies which in turn would have an effect on the investment of the fund. Accordingly, the NAV of the schemes are linked to the equity performance of such companies and may be more volatile than a more diversified portfolio of Equities. It is a myth that it’s good to invest in Mutual Fund with a low NAV because you will get more units and that means more returns. Low NAV is a gimmick used by agents to introduce you to new funds where their commission is higher.
Under growth option, you get the units at the time of buying and you have same number of units till the end. Suppose an investor decides to invest INR 1000 in both, Dividend Re-invest and Growth option of the fund. 95% of the investors in shares or mutual fund are here for speculative gain that is gain from the short term price movement. But now compare portfolio of diversified equity fund with any infrastructure funds and you will find that exposure in infrastructure related stocks has gone up to 60-70% of overall portfolio. Good thing is you want to invest for long term in equity but bad thing is you want to invest directly in equity rather than going through Mutual Fund Route. In case if you have any mutual fund question – feel free to add it in comment section. Multicap means fund is not biased toward large cap or mid cap – but it is free to invest in any type of stocks.
Regarding your 1st query – you can review your portfolio on quarterly or half yearly basis but if you are following asset allocation you should try to rebalance it not before 6 months.
So I contacted some other agent through reference of my friend but he tried to sell me ulips. Is this exit loads also applicable if we withdraw the dividends reinvested from the same scheme before this period? But if the funds are the best performing funds in their respective categories, does it not make sense to continue with them rather than get a relatively low-performer from the same category? One adviser was of the opinion that one should immediately come out of this fund in view of its deteriorating performance whereas other said that in view of its past history one should remain invested in this fund. Sir, It would be great if you suggest some funds and diversifying strategy regarding my two goals, i mentioned!
I understand that it is advisable to invest in NFOs but sundaram is a good fund house and have a standing in the market. For example, an Equity fund would invest in Equity and Equity related instruments and a Debt fund would invest in Bonds, Debentures, Gilts etc.
The managers have real-time access to crucial market information and are able to execute trades on the largest and most cost-effective scale. Gone are the days when people used to fill up long and tedious forms for applying in Mutual Funds. There are funds that focus on blue-chip stocks, technology stocks, bonds or a mix of stocks and bonds. Since they depend upon the performance of select sectors only, these schemes are inherently more risky than general-purpose schemes. Some investors are interested in investing in the market in general rather than investing in any specific fund. Most of the returns to the investors are generated through dividends or steady capital appreciation in these schemes. Hence they distribute a substantial part of their distributable surplus to the investor by way of dividend distribution.
These schemes have become popular with institutional investors and high net worth individuals having short-term surplus funds. These schemes have unlimited capitalization, do not have a fixed maturity date, there is no cap on the amount you can buy from the fund and the unit capital can keep growing. Statistics such as how 'these funds had performed in the bull and bear markets of the immediate past?' would shed light on the strength of a fund.
It would be sensible to always ask about the fund manager before investing, knowing about changes in the Fund Manager's strategy or any other significant developments that an AMC may have undergone.


If the investor is totally risk averse, he can opt for pure debt schemes with little or no risk. The one thing to remember while investing in Equity funds is that it makes no sense to get in and out of a fund with each turn of the market. Since market value of securities changes every day, NAV of a scheme also varies on day-to-day basis.
The first thing that has to be kept in mind while investing, is that there is no guarantee that one will end up with more money while withdrawing.
It is this variability, uncertainty and potential for loss, that causes investors to worry. An investor would do well to evaluate them against potential rewards while selecting an investment. You can also invest in Equity Linked Tax Saving Schemes of mutual fund to take benefit under section 80 C. In long term equity has consistently outperformed all other asset classes and works well against rising inflation. In long term equities give better return than real estate but investors have earned better returns in real estate. The biggest problem with direct equity is that a very small number of people can do it right.
These are bit aggressive funds as fund manager talks calls depending on the future market outlook.
Telling average return in future depends on many thing so quoting exact figures is like gazing crystal ball which is not possible but still you can expect 12-15% cagr returns from equity mutual funds if you horizon is 10 years. Should I hold it for long ie say 2 more years or should I look for some other mutual funds with better returns.
All these funds from HDFC have been very consistent in their performance and i see no reason that they won’t continue to do so.
As an example, if HDFC Prudence is the best performing fund in the balanced category, should one avoid it simply because one already has HDFC Top 200 or HDFC Equity?So do i diversify at the cost of reducing returns?I think it is not easy to answer that.
Apart from this, you can also call us on 30305757 to place your orders in a particular Mutual Fund and we will execute orders on your behalf. Infact, the greatest challenge can be sorting through the variety and picking the best for you. They are best suited for informed investors who wish to take a view and risk on the concerned sector. These schemes are ideal for conservative investors or those not in a position to take higher Equity risks, such as retired individuals. Such schemes usually declare quarterly dividends and are suitable for conservative investors who have medium to long-term investment horizon and are looking for regular income through dividend or steady capital appreciation. However, after the initial issue, you can buy or sell units of the scheme on the stock exchanges where they are listed.
Tracking the fund's performance in the bear market is particularly important because the true test of a portfolio is often revealed in how little it falls during a bearish phase. For instance, if the portfolio manager who generated the fund's successful performance is No longer managing that particular fund, one would do well to look into the implications and analyze what the pros and cons of investing in that fund. Most investors prefer the balanced schemes, which invest in a combination of equities and debts. Hence, it is of utmost importance that an investor always chooses a particular scheme after considering his financial goals and weighs them against the risk that a Mutual Fund may take while investing in a particular sector. The fact that under the dividend option the fund keeps on declaring regular dividends so NAV reduces with such dividends.
ELSS schemes have lockin period of 3 years & as the name suggest it invest in equity shares.
Charges are higher in case of equity funds if compared to debt funds – if size of the fund is big charges are comparatively low. Equities are volatile in short run but have the potential to create immense and stable wealth in long run.
Infrastructure covers lot of things like banking, power, energy, engineering, construction, cement, metal etc. And people who can do it right don’t ask for suggestions or tips – they just research & make their investments.
Another big advantage is that you can move your funds easily from one fund to another, within a mutual fund family.
As it is not practical to invest in each and every stock in the market in proportion to its size, these investors are comfortable investing in a fund that they believe is a good representative of the entire market. However, when compared to the money market schemes they do have a higher price fluctuation risk. The market price of the units could vary from the NAV of the scheme due to demand and supply factors, investors' expectations and other market factors. Growth and pure equity plans give greater returns than pure debt plans, but their risks are higher.
But it is this very volatility that earns higher long-term returns from these investments, than from a savings account. Investment for long run is not only rewarding but also beats inflation by a good margin and creates wealth. One more thing people need to realize that any diversified equity fund can buy into any sector or theme if fund manager sees potential.
But in equity we do it other way & that’s the reason investor feel properties give better return. But most of the people just feel they’re right, till they get really screwed big time when market makes a turn. You can continue your investment in this fund but if you are thinking about further investment you should choose 1 large cap & other mid cap fund. If one of the funds is not performing for 2-3 years you should check the reason why this is happening – is there a change in fund management team, there thought process, any changes in overall objective, what about other funds in the same category. This limits investment risk by reducing the effect of a possible decline in the value of any one security. This allows you to easily rebalance your portfolio to respond to significant fund management or economic changes. Just because a fund invests in Government or Corporate bonds does not mean that it does not have significant risk. However, the truth is that it does not make a dime of difference which option you choose, from the pure investment yield point of view. These charges are used for asset management, distribution cost, custodian charge, registrar charge etc. But if you don’t feel that you have such patience better invest through 1 year Systematic Transfer Plan.
If you keep such a close track on your investment it is going to be very tough for you to achieve your goals through equity investment. Buying theme funds should be decided only when the theme has something unique to offer, which other funds are either not offering or offering in a limited way. Also remember their are many short comings with real estate as well like size of investment, leveraging, black money, title problem, encroachment, liquidity issue, maintenance charges etc. Also see what was the reason that you bought that particular fund – once you have done all this take a well thought decision. Mutual fund unit-holders can benefit from diversification techniques, which are usually available only to investors wealthy enough to buy significant positions in a wide variety of securities. There is a caveat, though – Investors should opt for that option that minimizes their tax liability. But now as the markets are going down, I think I have taken a wrong move by not taking the money out. I learned abt diversification and it suggests me(citing example) not to include HDFC top 200 and HDFC equity in one portfolio bcoz their stocks are very similar. It can’t be calculated through statement but you can check these expenses in monthly factsheet.



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