In 2017-18, India’s unorganized sector’s share in GDP was 52%, which has fallen significantly due to the last pandemic and creates 82% jobs. Why are we giving this information? Because all these companies are proprietorship, family business or partnership companies, many of them will become public listed companies.
The investment of the general investor in India was 33% till 2016 which has increased to 45% in 2021, in which the evidence of individual investment has also increased by 16%, from this we can guess how much is expected from the Indian stock market in the future. Most of the people invest in the stock market through mutual funds.
We will try to give you the right information together by analyzing here about Mutual Funds, which you are looking for differently. Even if you are not an expert to invest in the stock market, but with basic information, we will learn how to make the right investment.
What is mutual fund ? –
When you invest your money and do expert planning of that money, then the risk of that investment is reduced and the chances of getting more profits increase. To invest in the stock market, a huge amount is needed, which gives good income and it is necessary to have knowledge of the stock market.
Mutual funds provide us this facility so that our investment specialist can invest in different companies in different companies and he does this with a lot of modifications. In mutual funds, the money of many investors is collected and invested in specific or different companies.
Investing in mutual funds does not require you to give time intelligence, experts give it and instead by charging some fees, you increase your chances of getting profit from the investment. If we try to invest in the stock market without knowledge, then there is a high possibility of loss. Hence Mutual Funds this option is the best way to take advantage of stock market investments.
What are the types of Mutual Funds –
Twenty, thirty years ago, the way to invest was to make a fixed deposit in a bank or invest in gold. Investing in property used to be very difficult for common people, but in today’s time, without knowledge in the stock market, good income can be earned. We make such investments for marriage, for higher education and for many such important reasons we want to invest.
Therefore, for investing in the stock market, we get several thousand mutual funds, in which we can fulfill many of our objectives and there is no need to spend much time for that. That’s why we see how many such important types of mutual funds we get to see.
1) Equity and Growth Scheme Mutual Fund
- Sector Specific Fund
- index fund
- tax saving fund
2) Money Market/Liquid Fund
3) Fixed Income / Debt Market Fund
4) Balanced Fund
5) Hybrid / Monthly Income Fund
6) Gilt fund (Investment only in government companies)
7) Other Funds
In such a market, we get to see many fund schemes every day, which is a good investment option to give us good income.
How to Invest in Mutual Funds –
When a mutual fund representative comes to you for the first time with an investment plan, we find it difficult to understand. To invest in mutual funds, we are first advised by our friends or people working with us. This is our knowledge about mutual funds and this is our knowledge of social media and television advertisements.
We are so busy in our work that we do not use platforms like YouTube and Google on the Internet to get such information, after our busy work we like to watch programs on entertainment. So all we have to do is invest it by an expert who will put your money to work for you.
Earlier the process of investing in mutual funds was paperwork, but after the advent of digital technology, now the whole process is done online, in which you can make your investments by keeping experts in the middle or you can change mutual funds like online purchase of shares. Nowadays every company that runs mutual funds gives such facilities.
Earnings from Mutual Funds –
Mutual fund investment in India gives us an average of 10 -20 percent income and the average increases as the time of the investment increases. Directly this investment in the stock market is done by mutual fund companies, whose benefit we cannot buy big shares and expensive shares, but mutual funds benefit us by buying these shares with the money of all such investors.
For this, the cost to our specialist is only 1-2 percent, which if we go to an expert for direct investment advice, then he can charge thousands of rupees. Therefore, we get income on 99% of our amount and for this we do not need to give time and we can change the scheme of mutual funds anytime.
If we keep our capital in Savings Account for the same for one year, then it gets depreciated by seven percent i.e. our hundred rupees become 93 rupees after one year. If we make a fixed deposit of the same money, then we get seven percent interest which is exactly equal to the rate of inflation.
That’s why the money kept in fixed deposit, neither increases nor decreases. The income received in mutual funds is the best among other options.
Highest Returning Mutual Fund –
- SIP Mutual Fund
- Equity Mutual Fund
- small cap mutual fund
- large cap mutual fund
- multi cap mutual fund
- tax saving mutual fund
- mid cap mutual fund
- debt mutual fund
- short term mutual fund
- income fund
- Balanced Mutual Fund
Best Mutual Funds Companies on Returns basis –
- Axis Blue Chip Fund
- Mirae Asset Large Cap Fund
- Parag Parekh Long Term Equity Fund
- Kotak Standard Multicap Fund
- Axis Midcap Fund
- DSP Midcap Fund
- Axis Small Cap Fund
- SBI Small Cap Fund
- SBI Equity Hybrid Fund
- Mirae Asset Hybrid Equity Fund
Mutual Funds & Shares Investment –
Investing directly in the stock market is very less in India, but the evidence of investing indirectly has increased a lot, in which investing in mutual funds is considered a very popular option. Investing in direct shares is synonymous with very good income, but the proof of successful investors is very low and the risk in this investment is also very high.
Therefore, people who do not have much knowledge about the stock market, they prefer the option of investing in mutual funds. By investing in the direct stock market, this investment gives very low income, but in terms of risk, this option is much safer than direct investment.
There is no need to pay any fees to the expert in direct investing in the stock market and you can buy and sell shares directly on the online platform. By the way, in mutual funds online, you can choose the option of any mutual fund online, the company of which you have purchased the mutual fund platform.
Advantages of Mutual Funds –
- You can exit the mutual fund at any time, that is, you can sell the mutual fund.
- At the same time, the capital of many investors is invested in different shares in mutual funds, due to which your investment risk is much less than direct share investment.
- Your money management is done by the company by expert representatives so you do not need the knowledge of the stock market.
- To make direct investment in the stock market, a large amount is required and many stocks are very expensive, so this option of mutual funds gives you income by withdrawing income from such expensive shares in less investment.
- The process of investing in mutual funds is very simple, so that you can invest from any corner of the world.
- Mutual funds appoint experts to make investments, so that you do not need to devote time to the stock market information.
- This investment is much safer than direct investment and is regulated by SEBI.
- Investing in Mutual Funds saves you from the vicious cycle of taxes and inflation.
Disadvantages of Mutual Funds –
- High quality experts are appointed for investing in mutual funds, whose value is deducted from your investment.
- On direct investment for a long time, you have to pay transaction tax only twice, but to win this expense in mutual funds, once the mutual fund experts behave, this money is deducted, which increases the cost of your investment.
- You get much less income from mutual funds than direct investment.
- Buying and selling mutual funds in the ups and downs of the stock market is completely dependent on the investor, due are which the investor panics and sold his mutual funds at the wrong time.
- As mutual fund investments are invested in many stocks, which also has a loss when some shares give a lot of profit, but some shares also give a lot of loss, which affects your income.
- Before buying a mutual fund, its lock-in time is fixed, so when you want to sell the mutual fund, you have to pay the amount.
Features of Mutual Funds –
- Mutual fund investment is able to protect your investment from inflation and tax.
- There is a lot of safety in mutual funds with direct investment.
- You can invest in different mutual funds for various purposes in life.
- You can invest in the stock market through mutual funds with a small amount without any knowledge.
- You can take advantage of the growth of big and expensive stocks by investing in mutual funds.
- You can get better income from mutual funds than fixed deposits and savings accounts.
- Each number of mutual funds are called NAV, which is what the company decides for your entire investment and the value of each NAV.
- Many investors invest in mutual funds, due to which the expenses of experts are greatly reduced.
- Mutual Funds are regulated by SEBI by making laws, so it is a safe investment.
How Mutual Companies Earn –
Mutual fund companies charge fees in return for the modification of the amount invested by their profit investors and do many investments in the stock market without money themselves. This is a very efficient job, but giving good income to the investor is what increases the success of the company.
In case of loss to the investor, it is the responsibility of the investor, which is taken by writing in advance in terms and conditions, from which the company is not required to withdraw income, but it is necessary for the success of the company.
Although there is transparency in where the investors’ money is being invested, but the company earns much more income than this money ,which direct investors earn, that too without any risk. The investment amount is much larger than that of individual investors, so the company can earn a lot of income from it.
Mutual Funds Investment good or bad –
By the way, many people ask this question that how much is right and how wrong to invest in mutual funds, it applies differently to every person. For those who have more knowledge about the stock market, direct investment is the right decision for them.
Those people who do not have any knowledge about the stock market or have little knowledge, then those people invest in the stock market, then this is the right decision. Investing in the property market requires a lot of investment, although investing in mutual funds does not require a large amount, so this option is good for those who have less investment horizon.
Those whose money is lying in a savings account, at home or in fixed deposit, they will have to put their money to work because inflation and tax exhaust your money every year. Hence, investing in Mutual Funds can be the right decision. It would be right to invest in mutual funds for some important purpose of life.
Mutual Fund vs Public Provident Fund –
Before the introduction of Mutual Funds in India, PPF fund was very popular among the general investor, which is now losing its income potential, and gives very low returns as compared to the returns of Mutual Funds. The investment tenure of PPF investment is very long, due to which we get many options in better mutual funds.
Annual investment up to 1.5 lakh in PPF investment is tax free, which gives you tax benefits under 80C. You can get this benefit under GK, done for specific different segment tax benefits in mutual funds.
Therefore, in comparison between PPF and Mutual Fund, mutual fund is the easiest and best option giving best returns in today’s era from PPF investment, which is regulated by SEBI, the benefit of the development of the stock market, mutual fund investors without stock market knowledge. can take.
In this way, we tried to know about mutual funds, so that we have collected and amended many things about mutual funds and put them in front of you. Due to which it will be the right decision for you to start investing in the stock market with mutual funds, which have very little risk.
We saw how the returns of mutual funds from fixed deposits and PPF accounts of banks are good, we understood this. By making laws by SEBI, the government keeps an eye on the companies running mutual funds, so that the confidence of the people in the market remains.
We tried to know about what can be the disadvantages of mutual funds and what can be the advantages, so that we have many types of mutual funds and in which mutual funds we should invest, we have ready made data in front of you. Have you tried?