Mutual fund investments are subject to market risk but the best part of this is the availability of fund managers. Fund managers are those hired by mutual fund houses to optimize the returns of investors. However, as an investor, it is not advisable to rely solely on fund managers. According to experts, an investor should be cautious about one’s investment, if he wants to maximize one’s returns. Experts have listed the following 5 ways to optimize mutual fund investment.
1]Choose Direct Plan: Investing in a direct plan rather than regular plans gives an investor 1 to 1.5 percent more return on their mutual fund investment. “Direct plans are better than regular plans because it helps an investor save the money being given to the fund houses in the form of a brokerage that ranges from one percent to one and a half percent, which is the cost of any one scheme. Depends on type. ”Karthik Jhaveri, Director – Wealth Management at Transgender Consultants.
2]Choose SIP instead of Lump sum: Mutual fund investments offer the Systematic Investment Plan (SIP) option, in which anyone can start investing with even a small amount. Batting in favor of SIP in lieu of a lump sum investment, Manikarna.com founder Manikaran Singhal said, “SIP can be started at any time, while lump sum investment is advised when the market has made its bottom . As hard to find. Under the market, it is better to invest via SIP. “
3]Diversify your investment: Suggesting mutual fund investors to diversify Pankaj Mathpal, MD’s portfolio at Optima Money Managers, said diversification of investments helps a person reduce risk. He said that one should invest in small-cap, mid-cap and small-cap mutual funds based on their risk appetite. If the risk appetite of the investor is high, then one should invest 60 per cent in small-cap mutual funds, 20 per cent in mid-cap, 10 per cent in index funds and 10 per cent in large-cap. .
4]Debt vs. Equity Investment: Mutual funds provide both debt and equity risk. One should choose one’s contact based on their risk appetite. Generally, an investor’s risk-taking ability decreases as his or her age moves north. Manikaran Singhal of Goodmoneying.com said that one should reduce one’s age by 100 and the result should be the equity exposure of one’s mutual fund investment. However, he said that if an investor has a high risk appetite, he can increase one’s equity exposure by 10-15 percent more.
5]Regular Review: A mutual fund investor should periodically review one’s portfolio. According to SEBI registered tax and investment expert Jitendra Solanki, “Regular review does not mean analyzing one’s portfolio on a daily basis. It means, one should review one’s portfolio at least on a quarterly basis and if any The plan has given a lower amount than its expected return., Then the investor should check about the performance of the industry before exiting the scheme. “