What Tips Can Help You In Choosing The Right Equity Mutual Funds For You?

What Tips Can Help You In Choosing The Right Equity Mutual Funds For You?

If there is any habit that every individual must inculcate in their life, it surely has to be the habit of investing. Though investing was a completely new term 100 years back, but today it is quite famous and prominent. For all those who don’t have any clue regarding the best investment opportunity which they should invest in, then maybe equity mutual funds are something that you should consider investing in. Equity mutual funds are the funds in which the 65% of the Portfolio constitutes of Equity securities, which are generally the linked with companies regulated by SEBI. Due to their heavy reliance on equities, they are highly risky in comparison to debt and hybrid funds. Incase you are someone who is looking forward to getting high returns in the long term, then these security option is the best for you. Only the investors who wish to invest in them for 5 years or more, should consider opting for these equity mutual funds, as they are not suitable for short term investment. For all those individuals who don’t know how to choose the best equity mutual funds, the following tips will help you in selecting the right ones:

  • Consider the cost: Whenever you buy an equity mutual fund, the major thing you need to consider is the cost that you need to incur on buying those equity mutual funds. According to the securities and exchange board of India, the upper limit for these expenses in case of Equity linked mutual funds is 1.05%, and no fund can charge any expense exceeding this limit. If we compare index funds with the actively managed equity funds, they are generally more expensive and costly, which is why you should consider the cost beforehand only and make the right decision.
  • The history of the fund: Another major point that you need to consider while investing in equity mutual funds is how old the fund house is and how trusted and reliable they are. The more old it is, the high chances of getting the best services from them. The main point that you need to consider is the fact that the fund house you choose should have been existing in the market since the past 5 years at least, as it signifies that they have witnessed all the slump and rally cycle many times in their tenure.
  • The returns from the fund: This is a very crucial factor that can help you in getting access to the best equity mutual funds. Choose the funds which have given its investors great results in the past five years. The more returns you get, the more profit you can generate and grow your wealth. But always make sure to opt for the right funds and invest for a long period of time.

So what are you waiting for? Invest in mutual fund shares and get accustomed to the world of investing in the best way.

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