What are some handy tips to help maximize mutual fund returns?

Mutual Fund is an amazing investment vehicle to invest in different asset classes like Stocks, Bonds, Real Estate, Bullion(Gold & Silver).

Mutual Fund is managed by professionals (Fund Manager and their team) which invest the fund money into assets to generate returns which can beat the benchmark against which it is compared to.

Now, when it comes to investing in Mutual Funds, following tips can help you to maximize returns:

1. Buy Mutual Fund that is having 1–3 Fund managers with a history of managing money and track record of generating double digit returns on a 5-year horizon
2. Buy Mutual Fund that is not recommended by websites or experts but by professionals or something that you arrive at through your self-research
3. Invest in Funds which take lower risk to generate higher returns
4. Invest in Funds which have a lower churn ratio (churn ratio is how many times the fund manager buys-sells stocks). High churn ratio leads to charges to the fund and lower returns
5. Invest in Funds with balanced exposure in the category. Different Categories are Large Cap, Midcap, Small Cap, etc.
6. Invest through the Systematic Investment Plan(SIP) Route with Step-up of minimum 10% on a half-yearly or annual basis
7. Buy more into the invested Mutual Fund if the Stock market corrects more than 5% (Buy on Dip Strategy)
8. Do not withdraw or stop SIP based on your whims and fancies. Stay Invested for 5–7 years minimum to see your investments bloom

Hope you find this helpful

You can read more content linked to finance here

Finance – Lateral Thinking

Happy Investing and God Bless!

About the Post Author:

The Author is an AMFI registered Mutual Fund Distributor (ARN-262589). Reach out to him via email: edteficonsult@gmail.com