About Mutual Funds
To read म्यूच्यूअल फंड्स in Hindi/हिंदी
Mutual funds are a good way to invest and get good returns, that’s why even you might have seen through many advertisements that “mutual fund Sahi hai” and as the market is at its low, use this opportunity for mutual funds to invest now and good returns in future.
When investing in a mutual fund, remember your investment goal and invest accordingly for your:
- Retirement
- Own House in the future
- Your children’s education
- Marriage
- Own car
Remember that Mutual funds are subject to market risks so invest after checking all the options.
There are two ways to invest in mutual funds:
Still in doubt then utilize the mutual fund return calculator to calculate returns based on the amount invested and duration with expected % return.
Mutual Fund Calculator by ETMoney, SBI Mutual Funds, Groww App.
Know The types of mutual funds and decide which Mutual Funds in India are best for you:
1) Equity Mutual Funds or Long Term Funds:
- Investing in equity mutual funds is very risky, as the full amount will be invested in the Equity Market butt these funds have the capability to generate higher returns compared to other funds.
- These types of funds are suitable for long-term goals.
2) Balanced Funds:
- Balanced Funds are also known as hybrid funds with money invested in both stocks and bonds.
- These funds are ideal for those people who are looking for a mixture of safety, income, and modest capital appreciation.
Top Balanced Fund To Invest In 2023 (Source: Policybazaar):
Funds | Five Year Returns | Three Year Returns | Required Investment |
Equity Direct fund Kotak | 14.86% | 20.65% | ₹5000 |
Prudential Equity & Debt fund ICICI | 16.41% | 19.67% | ₹5000 |
Equity & Bond fund DSP | 13.6% | 19.55% | ₹500 |
SBI Equity Hybrid Fund-Direct Plan-Growth | 15.09% | 18.66% | ₹1000 |
Mirae Asset Hybrid- Equity Fund-Direct Plan-Growth | 16.62% | 18.92% | ₹5000 |
3) Fixed Income Funds:
- These types of mutual funds are good for Medium Term and are less risky.
- The money in these funds is not invested in equity funds.
- Good fund for earning extra income to complete your daily needs.
4) ELSS Mutual Funds:
- ELSS funds are also known as the Tax Saving Mutual Funds.
- All Investors can claim deductions up to Rs 1.5 lakh a year with the ELSS funds as per Section 80C of the Income Tax Act, 1961.
- In these types of funds, there’s no maximum limit to invest and can generate higher returns when compared to the PPF and NPS.
Top Best ELSS Funds to Invest in 2023 as per Cleartax data: Based on the past 5-year returns:
| Mutual fund | 5 Yr. Returns | 3 Yr. Returns | Min. Investment |
| Quant Tax Plan – Direct-Growth Plan-Growth | 0.2296 | 0.4039 | ₹500 |
| SBI Tax Advantage Fund Series III Direct Growth | 0.2764 | 0.375 | — |
| SBI Tax Advantage Fund Series III Regular Growth | 0.2696 | 0.3678 | — |
| Quant Tax Plan Payout of Income Distribution cum capital withdrawal option Option Direct Plan | 0.2121 | 0.3543 | — |
| SBI Long Term Advantage Fund Series IV Direct Plan-Growth | — | 0.3523 | — |
| SBI Tax Advantage Fund Series II Growth | 0.2525 | 0.3455 | — |
| SBI Long Term Advantage Fund Series IV Regular Plan-Growth | — | 0.3451 | — |
| Quant Tax Plan Reinvestment of Income Distribution cum capital withdrawal option | 0.1948 | 0.3311 | — |
| Quant Tax Plan Payout of Income Distribution cum capital withdrawal option | 0.1948 | 0.3311 | — |
| Quant Tax Plan-Growth | 0.1942 | 0.3299 | — |
5) Liquid Funds:
- Liquid funds are also known as short-term and ongoing funds.
- Liquid funds generate very fewer returns but have almost no risk and provide 100% returns.
- There’s zero exit load in these kinds of funds.
5 Top Liquid Mutual Funds in India to Invest in 2020: (Source: ClearTax)
| Fund Name | AUM (cr.) | 1 Year Returns | 3 Year Returns | 5 Year Returns |
| Aditya Birla Sun Life Liquid Fund | ₹40,835 | 6.70% | 6.99% | 7.43% |
| Axis Liquid Fund | ₹29,119 | 6.61% | 6.98% | 7.39% |
| Nippon India Liquid Fund | ₹24,235 | 6.69% | 7.00% | 7.42% |
| Franklin India Liquid Fund | ₹12,529 | 6.85% | 7.07% | 7.49% |
| Baroda Liquid Fund | ₹6,071 | 6.62% | 7.00% | 7.46% |
You can invest in mutual funds through 3rd party applications or by visiting directly to the Mutual fund’s companies’ websites.
You can also make use of ET-money, Fisdom, Angel Bee applications or websites to invest in mutual funds.
To invest in Direct mutual funds use Mycams, Zerodha application or website.
Also, you can give requests to cancel, redeem and switch funds online or through the Application anytime.
Monthly Investment Amount: 10000
| Expected Returns | 5 years | 10 years | 20 years | 25 years | 30 years |
|---|---|---|---|---|---|
| 8.0% | 7.4 Lac | 18.3 Lac | 58.9 Lac | 95.1 Lac | 1.5 Cr |
| 10.0% | 7.7 Lac | 20.5 Lac | 75.9 Lac | 1.3 Cr | 2.3 Cr |
| 12.0% | 8.2 Lac | 23.0 Lac | 98.9 Lac | 1.8 Cr | 3.5 Cr |
| 15.0% | 8.9 Lac | 27.5 Lac | 1.5 Cr | 3.2 Cr | 6.9 Cr |
| 20.0 % | 10.1 Lac | 37.6 Lac | 3.1 Cr | 8.5 Cr | 22.9 Cr |
Difference between Regular and Direct mutual funds:
- As the name suggests Direct Funds are those mutual funds that you have bought directly from the mutual fund company through their website or application.
- But Regular Funds, are what you have bought through a broker or distributor, and In regular mutual funds company pays a commission to the intermediary that will not be deducted from your installments and then recovered as an expense from your Mutual Fund plan.
- When we compare the Direct and Regular Funds the expense ratio is higher for a Regular plan compared to a Direct.
Note: When are investing in Mutual Funds return you make on a direct plan is higher by approximately 0.5% for equity funds and approximately 0.2% for debt funds
Also, Read at knowandask:
ELSS Mutual Funds in India Save Tax While Creating Wealth.
Liquid Mutual Funds in India for Safe and short investment.
