Best Funds to Buy
What are Mutual Funds?
Mutual funds are professionally managed financial instruments in which investors pour their money so as to capitalize over the market opportunities. Mutual Funds are most commonly suited for the people who are not well versed with the market and its dynamics or don’t have the time to closely monitor their investments.
Mutual Fund Performance
A mutual fund performance in the simplest way can be judged by the amount of returns it has been giving to its investors. Best mutual fund can be described as the one with less management fees as well as less deviation in its Returns in the past few years. Mutual Fund Performance is subjective to the investor strategy. Best mutual Funds may be defined by various parameters like sharpe ratio, returns across various time horizons, etc.
Mutual Funds are of 4 types essentially: Equity, Debt, Hybrid & ELSS. Best Portfolio might be termed as the one with the combination of top performing mutual funds of each category. This can be a well-diversified portfolio with a balanced risk component.
Equity Mutual Funds are those in which the investor’s money is invested in the equity stocks in order to maximize the returns. This category of Mutual Fund can be termed under High Risk & High Return instruments.
Debt Mutual Funds are those in which the investor’s money is invested in the debt market in order to maximize the returns. This type of Mutual Fund can be termed under low risk and low return ones.
Hybrid Mutual Funds are those in which the investor’s money is invested in both equity as well as debt market in order to maximize the returns. This type of Mutual Fund has moderate returns.
ELSS- Equity Linked Saving Schemes are the mutual funds which provide tax benefits to the clients along with the moderate returns.
Best Mutual Funds thus vary from investor to investor based on the intent of Investment.