Selecting top mutual funds to invest is a little tough, but with support it isn’t
Saving money is one best solution for all our future financial needs, but leaving your money idle in your bank account is like shutting down the gold mine to prevent the gold being taken. Off course we work hard to earn money, once we acquire it we should allow our money to work hard for us.
How to do it? The best option is to invest in share market. It gives higher returns that can beat the inflation. But higher returns come at higher risk. That’s why many shy away from share market. If not share market, what’s better? Mutual funds! Though the return acquired through mutual funds may not be equal to return from shares, this is one best solution for those who don’t know anything about share market or those whose risk appetite is average.
If you choose to invest in mutual funds, it’s always better to compare funds before investing. Here comes the trouble, there are around 40 to 50 registered fund houses in India. Each fund house houses a bunch of fund options. It sums up to hundreds of funds to choose from. So, how to do it? That’s why this article
Here we have listed few best funds from different fund houses to start with.
Jump to topic:
1. Axis Long Term Equity Fund
2. SBI Focused Equity Fund
3. Axis Blue Chip fund
4. Axis Mid cap Fund
5. UTI Equity Fund
6. SBI Small Cap Fund
7. DSP Strategic Bond Fund
8. DSP Banking and PSU Fund
Points to remember before investing
Disclaimer: The below list is just our analysis based on the funds’ past performance and the shares or bonds it holds in its folio. We advise you to consult with your financial advisor before investing.
Let’s start with an equity fund, Axis long term equity fund is one best equity fund that has given better income comparing its peers in this category.
The money you invest in this fund is being invested in equities (Shares off course) and bonds, to be precise 97.22% in shares and the remaining in bonds (As on 23.08.2020). You can find the entire list of shares and bonds in the folio here.
The fund was launched in the year 2009; it has given 15.29% returns since its inception. This fund holds 37 top performing stocks and few debt bonds in its folio. Though the fund is placed in moderately high risk category the returns are worth the risk.
The best aspect about the fund is that, one can get tax benefit of up to 1.5 lakhs per financial year by investing in this fund. The money invested in this fund will be locked for three years. One can withdraw from this fund only after three years.
If you are ready to take some risk that gives you high returns and if you are ready to lock your investment for minimum three years Axis Long Term Equity fund is your best choice.
The next in our list is SBI Focused Equity Fund, one of the best funds from the popular fund house. This fund holds 84% of it AUM in equities.
The money you invest in this fund will be invested in selected equity funds. This fund has fared better in the recent times and has upgraded in Crisil ranking.
This fund was incepted in the year 2004 and it has given 18.52% return since its inception against the category return of 14.84%. It’s one of the best funds in this category.
The fund is for those who have higher risk appetite, since it is placed in moderately high risk category. It is one best option for those interested in high return.
Final words, the investment made in this fund is not tax exempted. In other words you have to pay tax for the investment made and the returns acquired in this fund (Only if your income exceeds the governments stipulated range). Only ELSS funds are eligible for tax exception.
Next in our list is Axis Blue Chip Fund. Blue chips are funds that invest your investment in blue chip companies, blue chip stocks far better than other stocks, since these stocks are managed by better managements and brands.
Axis blue chip fund holds most of the blue chip stocks listed in the exchange; hence it has performed well in this category. Launched in the year 2010, it has given 17.59% return since inception.
The fund holds 97.22% as stocks out of which 67.33% in large cap stocks, 16.35% in mid cap and 5.81% in small cap, the remaining in debt fund and as cash.
Again this fund is placed in high risk category, so one who is ready to take risk against their investment can invest in this stock. It will not disappoint you in terms of return.
Another equity fund in our list is UTI equity fund. This is from one of the oldest and the well known mutual fund houses UTI. The fund was launched in the year 2013, and has given 13.09% return against the category return of 6.75%
This is one of the best funds in equity category. It holds 98.04% as Indian stocks. Of course it’s placed in high risk category and it is for those who are ready to take some risk for higher return.
The third and final Axis fund in our list is Axis Mid Cap fund. This fund is again an equity fund, but the investment you make in this fund is mostly invested in mid cap stocks.
The fund holds 86.27% as Indian stocks out of which 63.4% in mid cap segment. This fund fared better than other funds in the category and has yielded 17.27% return since its inception. This high risk fund is for high risk appetite investors for better return.
The last equity stock in our list is SBI small cap fund. This fund is from small cap segment. The investments made in this fund will be invested mostly in small cap stocks.
71.12% of the fund’s folio is Small cap stocks. This fund has performed better in the last one year, yielding a whopping 24.16% return. Since its inception the fund has given 23.48% return. On the long term this fund can easily beat inflation.
The money invested in this fund is not tax exempted and again this fund is placed under high risk category. Investors with high risk appetite can invest in this fund for better return.
The first moderate risk fund in our list is DSP strategic bond fund. This is a dynamic bond fund where 99.27% of the folio is invested in Government securities (A safe bet)
This has given 9.15% return since its inception. It is one of the best funds in the category. This fund is for those who can wait longer duration for better return with less risk. The fund is managed by DSP fund house.
The last in our list is DSP banking and PSU fund. This is one safe bet for mutual fund investors. The fund is placed in moderate risk category. This has given 9.3% return since its inception.
The major chunk of the folio is low risk securities and a little in government securities. This fund is again for those who can wait for long time for better return with less risk.
Though mutual funds give higher return, one should keep the following points in mind.
1. Never invest without making an assessment of the fund or consulting your financial advisor.
2. Best strategy to earn from a fund is investing for a long term. Mutual funds may or may not give good return in short term, but on the long term it gives better return which can beat the inflation (Especially equity funds)
3. Another best strategy is to start a SIP rather than investing one time. History of mutual fund return shows that SIP gives better return than one time investment.
4. Never borrow money from others to invest, invest the surplus money from your monthly income.
5. Always choose growth option when you are given dividend or growth as options. Dividend option may give dividend when available, growth option reinvest the dividend and earn as even better return
Hope our list contains all the funds you look for. If you find that we have missed a fund, do comment in the comment section. Happy investing!