Mutual funds have become an increasingly popular investment option in India over the past few years, with investors looking for higher returns than traditional fixed deposit schemes can provide. However, with a plethora of mutual funds available, selecting the right one can be daunting. In this blog, we will look at some of the best mutual funds in India for the year 2021.
Mirae Asset Large Cap Fund
The Mirae Asset Large Cap Fund is a top-performing mutual fund that invests primarily in large-cap stocks. The fund has delivered consistent returns over the years, with an average return of around 18% in the past five years. The fund’s expense ratio is also low, making it an attractive option for investors.
Axis Bluechip Fund
The Axis Bluechip Fund is another top-performing mutual fund that invests primarily in blue-chip companies. The fund has delivered an average return of around 17% in the past five years and is managed by experienced professionals. The expense ratio of the fund is also low, making it an attractive option for investors.
SBI Small Cap Fund
The SBI Small Cap Fund is a high-risk, high-reward mutual fund that invests primarily in small-cap stocks. The fund has delivered an average return of around 25% in the past five years and is managed by experienced professionals. However, investors should be aware of the high risk associated with small-cap stocks before investing in this fund.
HDFC Mid-Cap Opportunities Fund
The HDFC Mid-Cap Opportunities Fund is a mutual fund that invests primarily in mid-cap stocks. The fund has delivered an average return of around 20% in the past five years and is managed by experienced professionals. The fund’s expense ratio is also low, making it an attractive option for investors.
ICICI Prudential Equity and Debt Fund
The ICICI Prudential Equity and Debt Fund is a balanced mutual fund that invests in both equities and debt instruments. The fund has delivered consistent returns over the years, with an average return of around 14% in the past five years. The fund is managed by experienced professionals and has a low expense ratio.
Conclusion
It is important to note that mutual funds are subject to market risks, and investors should carefully evaluate their investment goals and risk tolerance before investing in any mutual fund. It is also recommended to seek the advice of a financial advisor before making any investment decisions.
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Frequently Asked Questions (FAQs)
Q.What is a mutual fund?
A mutual fund is a type of investment vehicle where investors pool their money together and invest in a diversified portfolio of stocks, bonds, or other assets. The mutual fund is managed by a professional fund manager, who makes investment decisions on behalf of the investors.
Q.How do I invest in a mutual fund?
You can invest in a mutual fund through a financial intermediary like a bank, a mutual fund distributor, or an online platform. You will need to provide some basic information and complete the necessary paperwork to open an account and invest in the fund.
Q.What is an expense ratio?
An expense ratio is the annual fee charged by a mutual fund to cover its operating expenses, such as management fees, administrative costs, and other expenses. The expense ratio is expressed as a percentage of the total assets under management (AUM) of the fund.
Q.What is a load and no-load mutual fund?
A load mutual fund is a mutual fund that charges a sales commission or fee when you buy or sell shares. A no-load mutual fund, on the other hand, does not charge any sales commission or fee.
Q.What is a net asset value (NAV)?
The net asset value (NAV) is the price at which the shares of a mutual fund are bought and sold. The NAV is calculated by dividing the total value of the assets held by the fund by the number of shares outstanding.
Q.Are mutual funds safe investments?
Mutual funds are subject to market risks and there is no guarantee of returns. However, by investing in a diversified portfolio of stocks and bonds, mutual funds can help mitigate the risk of investing in individual stocks or bonds. It is important to understand the risks associated with investing in mutual funds and to carefully evaluate your investment goals and risk tolerance before investing.
Q.Can I redeem my mutual fund investment at any time?
Yes, you can redeem your mutual fund investment at any time. However, there may be redemption fees or charges associated with early redemption, so it is important to check with your mutual fund company before redeeming your investment.
Q.How are mutual fund returns taxed?
Mutual fund returns are taxed based on the type of mutual fund and the holding period. Equity mutual funds held for more than one year are taxed at a flat rate of 10% on long-term capital gains, while debt mutual funds held for more than three years are taxed at a flat rate of 20% with indexation benefits. Short-term capital gains are taxed at the investor’s applicable income tax rate.
