How are you all?
Through our previous blogs, I hope you must have understood about Mutual Fund Investments and its significances. Many people, when they would have got to know about mutual funds, they must have considered mutual fund investments, the best choice for their capital appreciation, for there financial goals.
Some people are there who think they know everything about mutual funds and can deal with their mutual fund investment, in the best way. They are also confident that they can do it all by themselves. They can do the research on the mutual funds, they can shortlist the schemes and proceed with their investments directly with the mutual funds.
As per the survey, it is observed that after demonetization, many new DIY investors entered the world of mutual fund investments. They all started their investments as per their own research and selection of funds.
Everything was good with these new DIY investors and their investment, but the trouble started when their fund started to perform low due to market fluctuation. Investors look troubled when the market starts moving in a range or sometimes directionless. Many of these investors, shared their doubts with mutual fund advisors or forums.
There were some investors, who even started to doubt their selection of funds, in fact, some, instead of discussing or sharing their doubt with the experts and clarify them, decide, selling their holdings, and ultimately end up at earning a loss.
If you are also one among the new DIY investors, and you too have some doubts regarding the performance or anything else, of your funds, then, don’t panic, stay calm, and read the blog.
Through this blog, we are going to highlight some points that would offer more clarity over your investment.
GET YOUR BASICS RIGHT
It is said by many, to start your investment in mutual funds, you need to be an expert in market knowledge, but I say, you need not graduate yourself in mutual funds, before starting your investment. If you are a mutual fund investor and you are having some kind of doubt with your funds, take some extra interest and brush up your knowledge about mutual funds.
Although, friends and mutual fund forums advice works much better, to clarify your doubts, but remember, it is in your interest to be reasonably knowledgeable about mutual funds. This would help you to create wealth with your mutual funds, on a good scale.
TOO MANY COOKS SPOIL THE BROTH
There are some investors, who don’t get satisfied by two or three advises, rather they discuss the same doubt in mutual funds, with many different mutual fund forums, experts, and also with their friends. Many of the experts suggest the same advice, but some suggest different advice too.
The solution to this problem is getting confined advice. Stick to a friend, colleague, forum, online expert, instead of wandering from expert to expert.
DON’T TAKE DECISIONS IN HASTE
Well, this is the very common mistake done by DIY investors, whenever their funds start giving negative returns, they get afraid, and in haste, take the decision to redeem their funds, without even thinking or analyzing their funds capital gains, tax exemption, returns, and many more. They do realize these things, but till then it becomes too late to return.
The only solution to this problem is, think twice, analyze thrice, then if the return is suitable for your financial goal, freely redeem your funds. Always keep in mind that you will pay short-term capital gains tax if you exit the scheme before a particular period. If you sell debt funds before three years, short-term capital gains would be added to your income and taxed as per the applicable income tax slab.
DON’T MAKE IT PRESTIGE ISSUE
Well, there are many investors, who can deal with their mutual funds’ investments very easily and positively, but it is also true that everyone is not an expert, some are there who face difficulties in carrying their investments on their own. If for some reason you find it taxing, don’t hesitate, you should try to seek help. If you really don’t have time to manage your funds, there no problem in taking professional help, don’t hesitate and go for it.
Seeking references or help from your fellow investors doesn’t harm your pride if it's beneficial for your investment. No matter what the designation, discuss with the person in detail about your investments and how he is going to charge you.
DON’T STOP YOUR EDUCATION
It's not necessary that now you have hired a professional advisor to regulate your investment in mutual funds, you don’t need to know anything about mutual funds. It is in your interest to keep track of your investments and try to be updated on mutual funds, this very thing will help you maximize your returns, and for this, you need to educate yourself about mutual funds.
As of now, you have understood, what clarifications you need to get done, in your mutual fund investments, if you are a new DIY mutual fund investor.
You can also contact us at Shri Ashutosh Securities Pvt Ltd., we are here to help you in any way possible.
(Mutual Fund investments are subject to market risk Illustrations are for example only, there is no guarantee of returns. Past performance is not an indicator/guarantee to future returns).