Mutual funds are pooled investments that are managed professionally by a fund manager. They offer an effective way for individual investors to invest their money in a diversified portfolio of stocks, bonds, or other assets. A mutual fund is created when a group of investors pool their money together and invest it in a portfolio of assets.
Mutual funds offer several distinct advantages over other forms of investment, including:
- Diversification: Perhaps the most significant advantage of investing in a mutual fund is diversification. The fund manager invests in multiple stocks or bonds, which spreads the risk over multiple companies and sectors, reducing the overall risk of the portfolio.
- Professional Management: Mutual funds are managed by skilled fund managers who utilize their deep industry expertise to assess investment performance using metrics such as gross IRR vs net IRR. They strategically make investment decisions aligned with the fund’s goals to maximize returns.
- Liquidity: Mutual funds offer liquidity, meaning that investors can withdraw their money and sell their units at any time. This makes it an attractive option for investors who may need access to their funds in the near future.
- Access to a Wide Range of Assets: Mutual funds invest in a diversified range of assets that individual investors may not have access to, such as stocks or bonds in international markets or sectors that require a high amount of capital to invest in.
- Low entry Barrier: Compared to investing in individual stocks or bonds, mutual funds require lower minimum investment amounts, making them more accessible to a broader range of investors.
Some features of mutual funds include:
- Net Asset Value: The value of a mutual fund is expressed in terms of its net asset value (NAV). The NAV represents the fund’s total assets, minus its liabilities, and is divided by the total number of units outstanding.
- Portfolio Holdings: Mutual funds have an investment portfolio consisting of a range of asset classes, including stocks, bonds, and other securities. Fund managers often diversify the portfolio to reduce overall risk and enhance long-term returns.
- Expense Ratio: Mutual funds charge an expense ratio to cover management and administrative costs. This expense is typically a percentage of the fund’s net asset value and varies from one scheme to another.
- Load and No-Load Funds: Mutual funds can have a front-end load or back-end load, which is a percentage charge applied either when purchasing or selling units. Some mutual funds do not charge either of these loads and are called no-load funds.
- Dividend Reinvestment: Mutual funds can also offer dividend reinvestment options where investors can reinvest their earnings to purchase additional units in the fund, which can compound returns over time.
Mutual funds are pooled investments that are managed by a professional fund manager. They allow investors to purchase shares in a portfolio of stocks, bonds, or other assets, providing diversification and reducing the risk of individual securities’ fluctuations. Investing in mutual funds has become increasingly popular in India, and many apps have been developed to make mutual fund investment more accessible and seamless for people. Let’s take a look at the top 10 Mutual Fund Schemes in India for online investment, reviews, ratings, and comparisons.
- Axis Bluechip Fund: The Axis Bluechip Fund invests primarily in large-cap stocks, making it a low-risk investment option. It has a good long-term performance record and is suitable for investors looking for stable returns.
- HDFC Index Fund – Sensex Plan: This fund invests in the BSE Sensex, India’s oldest stock index, which includes the top 30 companies listed on the Bombay Stock Exchange (BSE). This investment option is ideal for investors seeking a long-term investment opportunity with low fees.
- Aditya Birla Sun Life Equity Fund: The Aditya Birla Sun Life Equity Fund invests primarily in the equity markets, focusing on high-quality companies with a strong track record of earnings growth. It offers an excellent chance to earn substantial returns over the long term.
- ICICI Prudential Bluechip Fund: This fund invests in blue-chip companies, which have a strong reputation and a proven track record of stability and growth. The ICICI Prudential Bluechip Fund is suitable for investors looking for stable returns from large-cap companies.
- Mirae Asset Large Cap Fund: Another low-risk investment option is the Mirae Asset Large Cap Fund. This fund invests in large-cap stocks and has a strong performance record over the long term.
- SBI Bluechip Fund: The SBI Bluechip Fund is a leading large-cap equity fund that invests in blue-chip stocks. This fund has a good track record of stable returns and is suitable for risk-averse investors with a long-term horizon.
- Kotak Standard Multi-Cap Fund: A multi-cap fund, the Kotak Standard Multi-Cap Fund invests in stocks across market caps, offering an excellent opportunity for growth in the long term while being a less risky option than small-cap funds.
- Nippon India Small Cap Fund: The Nippon India Small Cap Fund is a small-cap equity fund, focused on investments in small-cap stocks. This fund has the potential to provide high returns in the long term but carries higher risk.
- DSP Small Cap Fund: Another fund focused on small-cap stocks is the DSP Small Cap Fund. It has a proven track record of a few years, and its performance is impressive. However, this investment option is more suitable for investors with a high-risk appetite.
- Bajaj Finserv Investment App: Bajaj Finserv’s mutual fund investment app is a reliable and user-friendly option for investing in a broad range of mutual funds. The app offers a range of asset classes and provides regular portfolio updates as well as expert advice, making it suitable for first-time investors.
These are the top 10 mutual fund schemes in India for online investment. However, before investing in any mutual funds, it is essential to undertake thorough research, keeping in mind your investment goals, risk appetite, and financial circumstances. Different mutual fund apps have different features and investment options catering to users’ needs. Here are some of the other mutual fund apps that one can explore:
- Paytm Money: Paytm Money is a user-friendly investment app that enables users to invest in mutual funds. It comes with a unique feature of ticker tapes that provides users with live updates on the mutual fund portfolio.
- Groww: Groww is an excellent option for first-time investors, with an easy-to-use interface and instant activation of investment plans. It offers real-time tracking of mutual funds, automated investment management, and free investing advice.
- Kuvera: Kuvera is an AI-based app that offers personalized investment advice based on the user’s investment profile. The app is easy to navigate and offers several unique features such as tax planning, goal-based investing, and an auto-investment feature.
- Zerodha Coin: Zerodha coin offers mutual fund investment options with zero commission and no hidden charges. The app is easy to use and provides real-time insights into the user’s mutual fund portfolio.
To conclude, mutual funds provide a great opportunity to invest and diversify one’s portfolio. While it is essential to keep track of one’s investments and choose the best mutual funds schemes based on one’s risk profile and return expectations, investing through a reliable and trustworthy mutual funds app can make the process seamless and hassle-free.
