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how to invest in mutual funds

Why Invest in Mutual Funds with Gulaq

  • Everything Digitally from KYC to Execution.
  • Profoundly researched mutual funds.
  • No commissions, we sell only direct, zero commission mutual funds.
  • Complete privacy and security of data.

Top 5 Mutual Funds to Invest 2019

Mirae Asset Emerging Bluechip (G)

Mutual Fund 5 Star

Return 3Y:  22.39%

L&T India Value Fund - Direct Plan

Return 3Y: 15.89%

SBI Magnum Multicap Direct Fund

Mutual Fund 5 Star

Return 3Y:  15.8%

Kotak Standard Multicap Direct Fund

Mutual Fund 5 Star

Return 3Y: 18.5%

Mirae Asset India Equity Fund

Mutual Fund 5 Star

Return 3Y: 19.3%

  • Past Performance Is No Guarantee of Future Results

Invest in Mutual Funds online within 30 seconds

4 easy steps to invest in Mutual funds online.

  • Enter your name, email and phone number.
  • Afterwards an OTP will be sent to your verified mobile number.
  • Again, after verification write down the Pan Number details.
  • Now, further enter the bank details of your personal bank account.

How to Invest in Mutual Funds in Deep 

Before you decide to invest in a mutual fund, there are certain things to be kept in mind. Doing so will help you choose the right kind of funds to invest in, and help you accumulate wealth over time.

  • Purpose for investing: This is the basic and crucial step towards investing in a mutual fund. An investor needs to redefine their investment objective, whether it’s short term like child education, buying a vehicle or long term like retirement.In case, if you don’t have clarity over your goals, then depending upon the wealth you wish to accumulate in how much time. Identifying an investment objective helps the investor zero in on the investment options based on level of risk, payment method, lock-in-period etc.
  • Fulfil the Know your customer requirements: – First, in order to invest in a mutual fund, investors need to comply with the KYC guidelines. For this, in order to invest, the investor needs to submit the proof copies of their residence, age and PAN card.

  • Know about the schemes available: – There are numerous numbers of mutual fund schemes available in the market. Each investor has different preferences, so they need to select from the list of the options. But before investing, an investor needs to make sure that they are fully aware about investment objective, risk appetite, affordability and other factors.  In case, if they are not confident enough to decide, then it’s better to take the help from a financial advisor.

  • Risk factors: Investing in mutual funds comes with their own risks. So before investing in mutual funds, investors should be fully aware of their risk appetite as well strategy to achieve their favourable returns. In case, if the investor prefers to take less risk then it’s better to invest in debt schemes, which offers moderate returns.

After investors have identified their investment objective, fulfilled their KYC requirement, then they can start investing in mutual fund. Most mutual fund houses will ask for a physical or an online copy of a cancelled cheque leaf bearing the IFSC and MICR of the bank.

Investment based on Your Purpose

  • Easy and Quick Investment through SIP

Invest in lumpsum or SIP schemes of your choice.

  • Direct Investment

Through Gulaq make direct investment and save commission as well as earn high returns.

  • New Fund Offer

 Invest in New Scheme NFO’s from popular AMC’s through Gulaq.

  • Invest in Short term Funds/liquid funds.

An Investor can invest in short term funds as well as liquid funds through Gulaq.

  • Save Tax

Invest in ELSS tax saving funds and save tax under section 80C.

How Mutual Funds Work

When you invest in mutual funds, then it generates wealth for you in two ways.

  • Dividend Payments: When an investor gets return in the form of dividend declared by the fund.
  • Capital Gains:  Investor gets his return in form of capital gain, when she sells or redeem her mutual fund units. This usually happens when the Net Asset Value of the mutual fund at the time of redemption is higher than the NAV at the time of purchase.

Frequently Asked Questions

What is a Mutual Fund and types of mutual fund in India?

Mutual fund is basically a pool of funds, which is managed by professional fund manager whose goal is to minimize the risk and maximize profits.  There is a wide range of mutual funds in India, which is categorized based on investment objective, asset class and structure.

Types of Mutual Funds based on Asset class:

  • Equity funds.
  • Debt Funds.
  • Money Market Funds.
  • Hybrid or balanced funds.
  • Sector Funds
  • Index Funds
  • Tax- saving funds

Types of Mutual Funds based on Structure:

  • Open- ended Funds.
  • Close ended Funds.

Types of Mutual Funds based on Investment objective:

  • Growth Funds
  • Income Funds
  • Liquid Funds

What is tax saving mutual funds?

Tax saving mutual funds are those mutual funds with an added tax saving benefit. ELSS is one such tax saving mutual fund scheme.

What type of mutual funds are best for the long term?

Most mutual funds are best for long term except liquid Fund.

Which mutual funds are taxable?

Non-tax saving mutual funds are taxable

What type of mutual fund is safe?

Debt funds are one of the safest mutual funds as they invest in government securities, corporate bonds and treasury bills.

How will Mutual Fund will do in 2019?

According to data released by Associations of Mutual funds in India (Amfi), the mutual fund industry rose by 13% to Rs. 24 trillion in 2018 by November end. For a new investor, investing in 2019 will be a tough task due to various factors like the general election, future government economic policy and performance of the stock market and the economy. It’s better to take the help from the mutual fund advisors and financial planners.

When will mutual funds pay dividends?

Each of the mutual fund houses has a particular time period for paying out the dividends.

Will Long Term Capital gain affect dividends?

Yes, LTCG affect the capital gain dividends.

Which mutual funds will come under 80c?

ELSS comes under the income tax act of 80c

Can Mutual funds be transferred?

No, you cannot transfer mutual fund.

Can Mutual funds decrease in value?

Mutual funds are represented in the NAV (Net Asset Value). The value of the NAV is increased or decreased depending upon the performance of the fund.

Can Mutual funds invest in ETFs?

Yes, Mutual funds invest in ETFs.

Can Mutual funds invest in private equity?

No, A mutual funds cannot invest in private equity.

How do Mutual Fund work?

As any investor invests in mutual funds, she get returns in two ways i.e. through dividend payments and capital gains.

How does Mutual funds grow?

When any investor invests in the mutual fund, then their capital gets appreciated over the course of time. This helps in the growth of the fund.

How does mutual funds trade?

When an investor decides to purchase that mutual fund, the fund will issue new shares to the investor based upon the current net asset value and redeem the shares when the investor decides to sell.

How does Mutual fund returns are calculated?

Mutual funds returns are calculated through Future value.

 Future Value (FV) = Present Value (PV) ( 1+r/100)n

 

Where FV= Future value of your investment

PV= Present value of current cost of your goal

r= annual rate of inflation

n= time period to reach your goals (in years).

How is Mutual funds safe?

In case of any investment, safety can be ascertained in two ways:

  • Safety in terms of offering capital protection and guaranteed returns.
  • Safety in terms of credibility of the institutions.

Mutual Funds in India are very strictly regulated by the Securities and Exchange Board of India, making them safest investment options from a regulatory standpoint.

How do Mutual funds beat inflation?

Historically, Mutual funds have given a return of anywhere 12-15% per annum. Inflation on an average has been around 5% for the past one decade or so. Thus, it has clearly beaten the inflation over a good margin.

How Mutual funds are beneficial?

As an investment tool, Mutual funds provide various benefits: –

  • Diversification: – It provides diversification of your portfolio at minimum cost.      
  • Low minimum amount: – You can start investing in a mutual fund with a minimum as low as Rs. 500.

Tax benefit: Mutual fund provides tax benefits through various tax saving mutual funds.

List of mutual funds come under Karvy?

There are 19 mutual funds under Karvy. Here are some of the top Mutual funds.

  • Axis Mutual Fund.
  • Reliance Mutual Fund.
  • UTI Mutual Fund.
  • LIC Mutual Fund.

Which mutual funds are best for short term?

For short term investment, an investor should invest in debt funds. Only if there investment horizon is more than 3- 5 years, then they must invest in equity mutual funds.

Do mutual funds pay monthly dividends?

It’s depended upon the fund house and fund policy. So, before investing make sure to check whether the fund is providing the services of monthly dividends.

Where to buy mutual funds online?

There are various investment websites or trading platforms. But there are mainly two basic ways to purchase mutual funds online.

  • Investment companies:

The most obvious option is to buy mutual funds directly through the investment companies that offer and manage them.

  • Brokerages:

There is also an option to open an account with the help of a brokerage. It will be the most expensive course. Typically, these types of accounts charge a transaction fee/commission for each trade.

  • Mutual Fund Distributors:

You can sign up with Distributors like Gulaq who offer Direct Funds with no extra charge

How to compare mutual funds?

Mutual fund comparison depends upon various factors such as investment objectives, goals and risk of an investor. But there is certain basic parameter to look for in a fund.

  • Benchmark: It provides a yardstick against which you can measure your fund performance. It indicates how much returns the fund has generated as against how much it should have delivered.
  • Investment Horizon: Your investment horizon becomes a key factor for fund selection and comparison. Investment horizon relates to the time for which you stay invested in the given fund. Afterwards, compare the performance of your mutual fund with another mutual fund during the same investment horizon.
  • Risk Factor:  Whenever you make an investment in any mutual fund, you take some risk. The risk related to the vulnerabilities of the NAV as per the overall market performance. According to the investment thumb rule, high risk is rewarded with higher returns. Financial ratios tell us about the rewarding potential of a mutual fund. Beta tells you how much risk is being involved in investing in a fund. Alpha tells you how much return the fund will generate over and above the underlying benchmark. Suppose there is a Fund A and Fund B has an alpha of 3 and 3.5 respectively. Fund B is better because it gives higher risk adjusted returns.

How to sell mutual funds?

You can sell your mutual funds in following ways:

  1. Visit the website of the registered AMC’s which fund you have purchased.
  2. Login with your credentials and then redeem your funds.
  3. Visit to the distributor website and then select the online funds which you want to transact and redeem your funds.

How to purchase mutual funds?

Investor can purchase the mutual funds either directly with the AMC’s, Online portals, through banks or demat and online trading account.

Why mutual funds are attractive to small investors?

Mutual funds are attractive to small investors because they offer the systematic investment plan. A SIP allows investors to invest at regular intervals and thus helping in diversification of portfolio at minimum amount.

Why mutual funds are better than stocks?

Mutual funds are better than stocks for several reasons.

  • Good and consistent return
  • Less risk.
  • Less volatility in the prices of NAV.

Are mutual funds liquid?

No, all mutual funds are not liquid. But most mutual funds are liquid.

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Attention Investor
Investments in Mutual fund & Securities Market are subject to market risks. Please read the scheme information and other related documents carefully before investing. Past performance is not indicative of future returns. Please consider your specific investment requirements before choosing a fund or designing a portfolio that suits your needs. Terms and conditions of the website are applicable.

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Estee Financial Services Pvt. Ltd. (hereinafter referred to as “EFSPL”) Formerly Estee Commodities Pvt. Ltd ( hereinafter referred to as “ECPL”), 7th Floor, Block 1, Vatika Business Park, Sohna Road, Sector 49, Gurugram, Haryana 122001.
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Estee Advisors Pvt Limited (hereinafter referred to as “EAPL”) is registered with the Securities and Exchange Board of India as Stock Broker with registration number INZ000170130 and registered with BSE Star with code 24408 for mutual fund transaction facility. EFSPL and EAPL are group companies and EAPL is authorized to provide its services to the Users on the Gulaq website/app under a Sub-distribution agreement with EFSPL.

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Mutual fund investments are subject to market risks, read all scheme documents carefully.

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