Mutual Fund
“The Common Investor does not have the skills or skills, nor does it have time for capital and direct investment and also track its investment in capital and bond markets. Mutual funds is one of best investment instruments available to common man for long term wealth creation. Investing in a Mutual fund offers an excellent opportunity for diversifying risk as well as Investment portfolio”. One could have Proper Asset Allocation through Investments in to various categories of Mutual Funds schemes.“
What is Mutual Fund?
Mutual fund is where money of different investors with common objective is pooled in with an aim of investing in various securities. With mutual funds you may invest in multiple instruments like stocks, bonds, money market securities, gold (in ETF through gold Fund) or by combining these instruments to invest your funds in diverse areas. To help investors attain their financial goals, these schemes are handled and maintained professionally.
Benefits
- Professional Management of money
- Diversification to your portfolio
- No Entry Loads
- Highly Liquid in nature
- Well regulated
- Low cost of investment due to economies of scale
- SIP Investing Plan
Investing in Mutual Funds can also be done by Systematic Investment Plan (SIP). It helps you in preparing for future by integrating a systematic and disciplined investment to allow you benefit from the powerful tool of rupee-cost averaging & power of compounding. Systematic Investment Plans is one of the most powerful tools of financial planning. SIP aims at creating wealth by investing small amount of money at regular intervals over a specific period of time. SIP also cultivates the idea of investing money at early stage of life so that the investors find their financial goal by resting on pillars of discipline & consistency.
Advantages of Investing in an SIP:
- Disciplined approach for investing.
- SIP can be started with small amount of INR 500 or INR 1000.
- Through SIP, you cannot go wrong with the timing of investments due to continuity of investments over a period of time.
- Road map to save for big events in life like child’s education, child’s marriage, buying a house step by step..
- The thumb rule of compounding serves as effective tool for wealth creation by reaping cumulative returns over the years
- The principle of rupee-cost enables you to lower the average cost of investment.