Mutual Funds

Mutual Funds are the most popular investment vehicle offering various kinds of schemes. They cater to different investment objectives. We believe that investments through mutual funds are one of the safest, easiest and convenient ways of successful investment making. A plethora of mutual fund schemes with different features makes the right choice for an investor difficult. We have a dedicated task force to analyze the different schemes of mutual funds across various parameters on an ongoing basis.

  • Magic of Mutual Fund Systematic Investment Plan (SIP)

    Systematic Investment Plan in Mutual Fund is commonly named SIP – is really getting popular in India. Systematic Investment Plan is such a beautiful tool, which if used properly can help you to achieve all your financial goals.

    What is Systematic Investment Plan?

    We all have various financial obligations. Some of them like daily needs, school fees, etc involve the major outgo of your cash. Others like trip for your family or buying a fancy gizmo entails a one time payments for which money can be relatively easily collected. But for long term goals like retirement or purchasing a home require you to save and invest for many years. Yet irrespective of the amount involved and the time horizon, planning and investing money systematically and regularly enables you to sail through these obligations. A SIP could prove to be a simple and effective solution toward achieving these goals.

    A SIP is a method of investing in mutual funds, by investing a fixed sum at a regular frequency, to buy units of a mutual fund schemes. It is quite similar to a recurring deposit of a bank or post office. For the convenience, an investor could start a SIP with as low as Rs 500; however this amount may differ from one fund house to other.

    Benefits of Systematic Investment Plan

    1) What is your equation to investments:

    The first is a wrong way of investing. You should be saving in a disciplined manner and SIP enables you to follow the second, which is the correct equation of investments.

    2) Power of compounding:

    SIP make sure that you are not only benefited on your investment but you also get returns over the interest which in overall will result generating greater returns.

    3) Easy, Flexibility and Liquidity:

    SIP is easy to start, manage and stop. It gives you flexibility to choose a desired scheme or to with draw in parts. And with conditions you have the money for contingency and emergency use.

    4) You can also do SIP in ELSS (Equity Linked Saving Scheme) to save tax under section 80 C.

    Best Systematic Investment Plans in India

    Mutual Fund 3 Years Investment 36000 5 Years Investment 60000 10 Years Investment 120000 12 Years Investment 144000
    Scheme Name % Amount % Amount % Amount % Amount
    Birla Sunlife Equity Fund 26 51990 17 92033 29 570925 27 847695
    DSP BR Equity Fund 30 55142 22 103852 32 656368 28 890730
    Franklin India Blue Chip Fund 28 54785 20 98935 29 549491 27 860441
    HDFC Equity Fund 39 61979 26 112626 34 721916 32 1142897
    HDFC Top 200 Fund 34 57909 24 109045 33 706670
    ICICI Prudential Growth Fund 25 51186 16 90158 25 437115 22 616589
    Reliance Growth Fund 29 54014 21 100716 38 901404 35 1407815
    Reliance Vision Fund 25 51789 17 91941 33 677154 31 1078457
    SBI Magnum Global Fund 29 54249 16 88337 31 607379 26 793162
    Sundaram Growth Fund 24 50576 15 88069 25 458342 22 617858
    Tata Pure Equity Fund 27 52625 19 95385 29 554004 25 727228

    *Calculations are done on 1st day of 2011 – Monthly Investment of Rs 1000
    I will again say Best comes after postmortem report – you should see them as Top Systematic Investment Plans in Last 10 Years or just Systematic Investment Plan Comparison.
    Calculations are done on Rs 1000 per month investment to keep things simple. If you would like to calculate for Rs 5000 or Rs 10000 – you can multiply the amount by 5 or 10.

    Life Insurance provides the dual benefits of savings and security. The following benefits explain why this investment tool should be an integral part of your financial plans.

    Advantages of Life Insurance

    Risk Cover :Life today is full of uncertainties; in this scenario Life Insurance ensures that your loved ones continue to enjoy a good quality of life against any unforeseen event.

    Planning for life stage needs :Life Insurance not only provides for financial support in the event of untimely death but also acts as a long term investment. You can meet your goals, be it your children's education, their marriage, building your dream home or planning a relaxed retired life, according to your life stage and risk appetite. Traditional life insurance policies i.e. traditional endowment plans, offer in-built guarantees and defined maturity benefits through variety of product options such as Money Back, Guaranteed Cash Values, Guaranteed Maturity Values.

    Protection against rising health expenses :Life Insurers through riders or stand alone health insurance plans offer the benefits of protection against critical diseases and hospitalization expenses. This benefit has assumed critical importance given the increasing incidence of lifestyle diseases and escalating medical costs.

    Builds the habit of thrift : Life Insurance is a long-term contract where as policyholder, you have to pay a fixed amount at a defined periodicity. This builds the habit of long-term savings. Regular savings over a long period ensures that a decent corpus is built to meet financial needs at various life stages.

    Safe and profitable long-term investment : Life Insurance is a highly regulated sector. IRDA, the regulatory body, through various rules and regulations ensures that the safety of the policyholder's money is the primary responsibility of all stakeholders. Life Insurance being a long-term savings instrument, also ensures that the life insurers focus on returns over a long-term and do not take risky investment decisions for short term gains.

    Assured income through annuities : Life Insurance is one of the best instruments for retirement planning. The money saved during the earning life span is utilized to provide a steady source of income during the retired phase of life.

    Protection plus savings over a long term :Since traditional policies are viewed both by the distributors as well as the customers as a long term commitment; these policies help the policyholders meet the dual need of protection and long term wealth creation efficiently.

    Growth through dividends :Traditional policies offer an opportunity to participate in the economic growth without taking the investment risk. The investment income is distributed among the policyholders through annual announcement of dividends/bonus.

    Facility of loans without affecting the policy benefits :Policyholders have the option of taking loan against the policy. This helps you meet your unplanned life stage needs without adversely affecting the benefits of the policy they have bought.

    Tax Benefits :Insurance plans provide attractive tax-benefits for both at the time of entry and exit under most of the plans.

    Mortgage Redemption :Insurance acts as an effective tool to cover mortgages and loans taken by the policyholders so that, in case of any unforeseen event, the burden of repayment does not fall on the bereaved family.