Asset management companies (AMCs) are firms pooling investments from various individual investors. AMC maintains the diversity of portfolios by investing in both high-risk and low-risk securities such as stock, debt, real- estate, shares, bonds, pension funds, etc. The asset management companies have professionals called fund managers who decide where the pooled money is invested.
Switching simply means taking the investment out of one scheme and re-investing the same money into another scheme, usually, you can switch between funds only of the same AMC (Asset Management Company) that is you can switch from a Kotak MF to another Kotak MF scheme but not from Kotak MF to Axis MF
There can be several reasons for switching funds – change in investor objectives, low-performance of current fund scheme, or a desire to handle mutual funds by themselves.
You have invested in different classes of assets over a period of time to spread your risks. Owing to market conditions, however, some of your investments will do well at times, while others will not. It is therefore essential to review your investments from time to time and rebalance the portfolio as required. Essentially, rebalancing is the act of adjusting the mix of assets in your portfolio so that they perform in line with your long-term financial goals.
There may be several ways of reviewing your mutual fund portfolio, and one among those can be seeking the advice of the financial advisor with whom you have planned your investments, as will be the right person with whom you should spend some time, understand the progress of the funds and review the same periodically.
Goals differ from people to people – depending on their circumstances at different points of time. But what is your long-term goal? Is it to buy an expensive house or go touring around the world? Is it investing in a child’s education etc? The setting of goals marks the beginning of financial planning to help you achieve the objectives at various life stages. Goal-setting gives meaning and direction to the various financial decisions which one has to take during his or her lifetime for self or others.
There are thousands of mutual fund schemes you can choose from and it can become a difficult task to select the right scheme. An investment adviser who is unbiased and independent can guide and handhold you to design a worthy mutual fund portfolio by recognizing your risk profile, investment objective, financial health, goals and the investment time horizon.
Benchmarks are a handy tool for useful comparison as the benchmark returns are indicative of how much your fund has earned against how much it should have earned. Your mutual fund schemes target should be the benchmark’s return, and if your fund manages to beat the benchmark, it will be considered to have done well.
Asset allocation plays a pivotal role. The factors that need to be considered before choosing an asset class are age, risk profile, goal, and time horizon.
What are the asset classes?
While officially, there are many asset classes, the ones you definitely need to know about are the following:
|Asset Class||Examples||General Rate of Return (Per Annum)||Volatility (Up and Down based on markets)|
|Cash||Bank savings A/c, Certain Debt funds||5% or less||Low|
|Fixed Income||FD, PPF, Post office schemes, Certain insurance fixed payout plans||6.5% – 8 %||Low to Medium|
|Equity||Stock & Shares, Equity mutual funds, ELSS||12% over long term||High|
|Real Estate||Commercial property Residential property, REITS, Land||Not Specified||Medium to High|
You should align the asset class with the time horizon of your goals. Long-term goals should ideally go with Equity, while short-term goals align best with fixed income.
Mutual funds have various advantages like more returns, portfolio diversification, time horizon, liquidity etc. over FD/PPF. So if you do not mind carrying investment risk for higher returns and have long-term objectives, you can browse through the different types of Mutual Funds.
It is not easy to find out the suitable mutual fund and scheme. One should clearly identify goal and measure risk taking capacity before investing in various mutual fund schemes available.
Selecting a suitable fund and scheme is a rigorous job; one should always seek a professional and expert advice before investing into mutual funds.
This product is specially designed as per the requirement of the investors who are invested in Mutual Funds and somehow their investment is not growing as per their expectations. Under this product, investor/s will be rendered advisory services as per their financial objectives, risk-taking capacity, current portfolio’s performance, and other relevant parameters basis.
Every individual invests their hard-earned savings keeping certain financial objectives (or obligations in some cases) in mind, and when such investments do not yield sufficient amount in terms of returns to achieve those pre-determined financial objectives because of certain uncontrolled external factors, the entire exercise of investing early in the life becomes futile and takes away the key working years of life, especially those years where your risk-taking capacity was relatively better than today. TriFid Research (IA) has envisaged this situation of not generating enough on investment because of NO TIMELY ADVICE GIVEN TO INVESTORS ON INVESTMENTS MADE THROUGH MUTUAL FUND, and therefore, we came about with this product. Where you just have to provide the details of your current portfolio (Mutual Fund/s) and our highly experienced team of advisors will provide you the best available solution/s.