4 Best Mutual Fund Investment Strategies

With each passing day, the mutual fund is gaining an incessant popularity among investors. Whether a newbie or a veteran investor, the mutual fund fails to entice none with its diversifying nature and stable portfolio. I wasn’t left untouched either by its charisma which as a result, drawn into the mutual fund investment. As was told by my friends, my mutual fund portfolio started giving me a promising return within a period of time. I was not a pro in the investment nor had I had much knowledge about it. All that came to my rescue was a full-service brokerage firm and their intense research, analysis and strategies. Here I am going to share 4 best mutual fund strategies out of them, which are sure to benefit you in the long run.

Analyze the kind of mutual fund required: Before you start investing in mutual fund, understand the types that are available –

Equity mutual fund: Equity mutual fund is a fund that exclusively invests in the domestic companies’ stocks, listed on stock exchanges. This category of a mutual fund is primarily considered to be a high-risk fund.

Money market: Money market is a kind of fund that invests in money market instruments such as Treasury Bills (T-Bills), Commercial Papers (CPs), Repurchase Agreements (Repo) and Government Securities. This fund is specially meant for those investors who look for easy liquidity and quick return in a short period of time.

Debt fund: This is the best alternative for fixed deposits in banks. In this fund, a fixed amount of money is invested in fixed-income securities. Debt fund is ideal for people who have low risk-appetite and want a steady return.

Hybrid or balanced: This fund invests in both fixed-income securities and equities, thereby offering a balanced return to the investors.

Evaluate your investment objective: Now when you know the types of funds available to you, it’s time to decide which one you should go for. For that, you need to evaluate your investment objective and analyze the risk appetite. Then accordingly opt for a debt fund, money market fund, best large-cap mutual funds or mid-cap funds.

Look for a brokerage firm:: Look for a brokerage house that has at least 10 years of relevant experience in the industry and also has the capability to deal with the most critical situations. Besides this, make sure that the company you choose is loyal and credible. Check the users’ reviews on its website and ask your friends and acquaintances if they happen to know anything about the firm. Brokerage cost is also an important factor to consider. So, compare the costs of 10 different firms and then pick the one that offers you the most suitable rate.

Do your own research: Your brokerage firm will offer you the research and advice for sure but it is recommended that you also do your own share of research work and gather as much information as possible about the mutual fund. Read journals and articles on the mutual fund investment and get familiar with the most common terminologies used in this trade, such as large-cap mutual fund, small-cap fund, AMC (Asset Management Company), NAV (Net Asset Value), Load, Portfolio, Corpus, AUM (Assets under Management) and many others. Knowing these terms will make your communication easy with the fund managers and also help you to understand the investment in a much better way.

Model mutual fund is one such brainchild of Narnolia Securities, which has been reaping great returns on clients’ investments by strategically creating ideal mutual fund portfolios for them.