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ULIP INSURANCE

Are You Investing In The Best Performing Mutual Fund?

Joan Mathews Joan Mathews 07 June 2019
5.0 (2 votes)

Mutual funds are a popular and preferred investment option among most investors in India. This article lists down the best performing mutual funds in the market that can help grow your wealth.

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Have you been investing in mutual funds for a while now? Were the returns as per your expectation? If yes, you’re on the right track. But if that hasn’t been the case or you feel like there’s potential to earn more, then this article is just for you. Below, we have covered some of the best-performing mutual funds that you must consider including in your portfolio. Before we dive into that, however, let’s quickly go through the basics of mutual funds, just so we’re clear with our base.

What is a Mutual Fund?

A mutual fund is a professionally managed investment fund where money from various investors is pooled to purchase securities, such as stocks, bonds, short-term money market instruments, commodities, etc. The fund is managed by professional fund managers, who will buy and sell securities from the portfolio on behalf of the investors.

5 Things Mutual Fund Investors Should Keep in Mind

Investing in mutual funds is a suitable option for those looking to take advantage of market movements for wealth creation. To make the most out of your investment, here’s a look at some of the golden rules that mutual fund advisors swear by:

  1. The number of mutual fund schemes in the market are plenty, and finding the right investment plan that matches a person’s risk appetite can be difficult. Therefore, it is necessary to have a solid understanding of each risk (returns, market volatility, inflation, etc.) prior to investing.
  2. For every investment plan, there will be an investment objective. As you go through the best performing mutual funds, make sure to read their investment objective. This will help you determine if the scheme fits your financial goals, risk appetite and liquidity position.
  3. Often times, investors change their investments during times of volatility. Advisors generally suggest against this as too much tweaking can hurt your returns. During uncertain times, advisors consider it best to stick to the asset allocation.
  4. Take some time to compare a fund’s past performance with its benchmark indices as well as peer funds. Doing so will help you understand the consistency of its performance across different market conditions. Also, this way, you’ll be able to identify which is the best mutual funds to invest in.
  5. Always make sure to go through the organizational processes and management teams of fund houses before purchasing any investment plan. The fund house determines the investment approach and its decisions play a crucial role in a mutual fund’s growth and capacity. Thus, check to see if the fund house you choose has a long, proven and consistent track record.

Conclusion

Knowing exactly where you’re going to invest your hard-earned money is extremely crucial as this will either build your wealth or cause you to lose money. And that is why, for mutual fund investments, you need to have a clear understanding about the best performing mutual funds in the market. Knowledge of the top funds as well as the elements to look into while comparing schemes will help you land the right fund that fits your objectives and other financial needs.

Recommended Read: How Side Pocketing Affects Mutual Fund Houses and Investors

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Joan Mathews
Written by Joan Mathews
Joan has over 4 years of experience writing for the BFSI industry. She enjoys watching mystery TV series, listening to 80s classics and spending time with her furbabies.