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Which mutual funds investment would give you the best returns on your hard-earned money? Are you receiving the Mutual Fund Benefits, that you expected on your existing investments? How much you need to invest in Mutual Funds, to achieve your financial goal? How long would you need to keep investing to meet the target, considering anyone can set aside only a particular part of the income? The Mutual Funds Calculator gives you the answer to all the above questions and some more.
What are Mutual Funds?
Mutual Funds are pools of money collected from many investors to invest in a variety of schemes. These may be securities, stocks, bonds, money market instruments, and other assets. Each investor or the unitholder is assigned a particular number of units proportional to his invested amount in the pool. The investor gets to share in the gains, losses, income, and expenses of the fund in proportion to his investment.
These funds are operated by Asset Management Company (AMC), with professional money managers. They allocate the fund’s assets and attempt to produce capital gains or income for the investors. All AMC are regulated by the Securities Exchange Board of India (or SEBI) (Mutual Fund) Regulations 1996. Except for the Unit Trust of India (operating UTI Mutual Funds), which was created by the UTI Act.
The Prospectus of your Mutual Funds Investments tells you about the portfolio it will maintain. The portfolio states the variety of securities it will invest in and the percentage.
Mutual Fund investments give small and individual investors the opportunity to invest in professionally managed portfolios of Equity Funds, bonds, and other securities.
In short, Mutual Funds are:
- A Tool for investing in Stocks and Bonds,
- Each mutual fund has a Specific Objective, as stated in its Portfolio,
- The funds are managed by an AMC. Funds governed by Board of Directors
Basics
The investments in Mutual Funds are managed by a portfolio manager. He frames the strategies to be adopted, depending on the investment objectives of the fund. He manages the fund on a daily basis, deciding about buying and selling the securities according to the investment objectives of the fund.
The number of units conveys your part of holdings in a specific scheme. These units are valued at the Net Asset Value (NAV) which is determined at the end of every day. This NAV keeps fluctuating according to the changes in the market value of the mutual fund’s particular investments. When you purchase or redeem securities of a mutual fund, you pay or receive the NAV of the security at that point of time.
Investing in Mutual Funds
If you are planning to start investing in mutual funds, there are many channels available, from where you can buy:
1. Direct Plans: A Direct Plan involves investing through an AMC. You can approach AMC and invest in the direct plan of your choice. These plans have a lower expense ratio considering you do not have to pay the distributor commission. Therefore, you earn a better rate of return.
2.Mutual Fund Distributor: You, yourself, can contact a registered mutual fund agent. You can clear your doubts with him about which portfolio to take. He will advise you based on your risk appetite and objectives. He will help you out in completing the required documentation and charge distributor’s commission. In other words, you hire a personal investment manager.
3.Online: There are many online portals available, nowadays. These are third-party portals. With their help, you get to know the vast variety of investment options available in the market. Most websites also have a Mutual Funds Calculator, in-built, to give you an estimated return. You can visit the site and invest in any of the Mutual Funds by paying a nominal fee.
Investment in SIP or LumpSum
There are two ways you can invest your money in your chosen Mutual Fund. You can either make a Lump Sum investment, at one time or invest regularly, at fixed intervals.
1. Lump-sum investment: The lump-sum investment means the entire amount is invested at one go into a chosen mutual fund scheme. Under this, you invest one large amount of your funds and undertake a one-time investment. These strategies are mostly adopted by investors who have a better understanding of the markets, valuations, and fluctuations. Together with the investors who have a personal financial advisor who understands the equity market behavior.
Usually, this kind of investment is done when you receive some huge amount, such as the sale of an asset, through a will or retirement benefits.
2. Systematic Investment Plan (SIP): To invest in SIP is a more disciplined form of saving and investing. Under a SIP Plan, you can instruct your bank to deduct the amount from your bank account every month and invest it in the selected mutual fund scheme. So the deductions are made automatically from your bank account into the chosen Equity Mutual Fund, on a specific date for a specific period.
Under this option, you keep buying units continuously and get the benefit of rupee cost averaging and enjoy the power of compounding. As a result, you will invest in the markets whether bullish or going through a bear phase. Subsequently, you get a weighted average return over a period of time.
How does the Mutual Fund Calculator help?
The Mutual Funds Calculator helps you calculate the estimated returns on the capital invested in various mutual fund schemes. This Mutual Funds Calculator will bring out your investment value at the maturity by calculating fund returns according to your investment horizon. It will show how much your net worth would be at the conclusion of investment time.
When we consider investing, the most important question that comes to mind is what kind of returns can be expected? With the market fluctuating due to many reasons influencing it, the returns after a long period of time are difficult to compute. However, it is significant to figure out what the eventual corpus would be at the various rate of returns, available.
A Mutual Funds Calculator considers the different variables, such as the type of investment – SIP or Lumpsum, the investment duration and expected rate of return, among other things.
With its help, you can check whether the mutual fund scheme is generating returns in line with your expectations? You can calculate the SIP amount you need to put aside to accomplish your personal goal.
The Mutual Funds Calculator provides the answer to whether your Mutual Funds are generating returns to meet your expectations.
You need to only fill in the variables of the calculator like SIP or Lumpsum, Amount of investment, frequency of SIP, expected rate of return and the duration of SIP.
It also displays returns and performance rank of the fund, as compared to other MF players belonging to the same group for different time frames.
To get the best returns on your hard-earned money, get registered at WealthBucket. Take help of the expert advice from professionals with the market experience of over 10 years. Let us guide you to reap the best benefits Debt Mutual fund, Large Cap Mutual fund or Multi-Cap Mutual fund, to achieve your objectives.
To reach quickly, call us on +91 9999379929. Or Email at contact@wealthbucket.in.
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