Creating a plan and moving forward with it is hard in an area. In the financial world, generating a financial plan to serve your investment goals may prove more challenging than ever. However, thanks to our new (now a bit old) friend called “technology”, any investor has a number of online tools and devices to search for great investment instruments and decide which is best for them. Among popular investments like a mutual fund investment to other kinds, an investor can match investment goals, income, horizon for investment and most crucially, returns on investment, and allocate funds to match objectives in an organised way.
Today, a financial advisor may tell you that a great investment opportunity may be had if you invest in a mutual fund. However, can you be certain that any mutual fund investment suggested by someone else will be beneficial to you? Every investor is unique with distinct financial goals and requirements, not to mention the resources at their disposal. So, if you just invest on the basis of someone’s word, you may be making a gross error in judgement.
Advancements in technology have brought every kind of function to our doorsteps from online shopping to online investment and banking. Hence, online tools that help you invest your money better than someone’s “word of mouth” are a great choice when you are allocating your funds for investment. Any financial expert may tell you that SIPs are good investments, or stocks promise great returns. However, you may want to think twice, and know what your returns on investment would be.
Although you may open a demat account on the suggestion of your advisor, when you actually wish to invest, there is a lot of homework you should do yourself. With some investment instruments, different online calculators give you the edge and tell you how much to invest and for how long.
Whether you want to invest in the share market today or in a less risky investment like a fixed deposit, you can discover ways to gauge your returns. Each investor is different with a range of requirements. Investments are tailor-made these days. With a kind of instrument to match every investor type, risk appetite, goal of investment and time horizon, investors in 2022, get an investment match made in heaven. Investors are sometimes apprehensive about certain instruments and would like to know how their future investments will work for them. Instead of living with apprehension, and thus, curbing any action to invest, whether in an upcoming IPO or a mutual fund, investors can make use of useful online calculators for different instruments. This way, they can choose any investment channel matching requirements, and not have to worry later. Online calculators help to estimate returns based on an investor’s initial investment, the tenure, etc. They are available to use free of charge at most portals of banks, brokers and AMCs (asset management companies). You should know what the key calculators are and how they can help you invest wisely.
In India, for those who want to keep away from investment in direct equity, but still want some equity in their portfolio with minimal risk, they can go in for a mutual fund. Mutual funds pool a group of investors’ capital and allocate the pooled sum of money to market-linked securities, like equity (if you don’t mind risk, but want the potential of high reward), debt (if you want barely any risk, but low returns), or a combination of debt and equity (balancing of your investment). A mutual fund investment calculator can help you to find out the returns you will get from a particular fund (with certain securities, debt or a combination invested), based on the fund’s historical performance in terms of rate of interest. Depending on your needs, you can get some idea of the estimates of returns.
An instrument which is an extension of a mutual fund, is a SIP, or systematic investment plan. A SIP works like a mutual fund, but rather than investing a lump sum initially (as required by a mutual fund), investors can invest gradually (in regular instalments) with small sums of money. These sums are then invested in market-related securities. The share market today is a volatile place, and a SIP investment may be appealing to many small investors or newbies who wish to lessen risks in pure equity investments. A SIP return calculator can tell you how much you should invest in each instalment (monthly, quarterly, bi-yearly), in order to gain returns from a SIP.
Furthermore, if you choose a step-up option in a SIP, in case you want to add more capital to your initial investments, you can use a step-up SIP calculator to see your new returns.
Some investment instruments, like mutual funds, build your wealth through the compounding of interest. Hence, if your mutual fund earns interest in a particular tenure, the interest is added to your initial investment and you get further interest on this amount in the next year. A compound interest calculator can show you how much your interest over interest can earn you across a particular term that your money is invested. Besides a mutual fund investment, a compound interest calculator can be used to estimate returns from any other form of investment which uses compound interest to give you returns. For instance, PPF (public provident fund) can give you compound interest and this can be calculated through a compound interest calculator. Here, the capital you initially invest is fixed and so is the rate of interest, your compound interest returns are guaranteed.
If you open a demat account today, you probably want to make it big in the stock markets. You are not alone, if this is your intention. Stocks are popular ways to invest, along with mutual fund investment these days. Any upcoming IPO is a good bet too, according to many investors. However, if you are a prudent investor, you will evaluate your own financial requirements and objectives, keeping short-term and long-term aims in mind. After you have considered this in depth, you can choose your investments and use online digital calculators to plan investment amounts accordingly.
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