Mutual funds are one of the safest investment instruments for wealth creation, tax savings, and achieving financial goals. Mutual funds are succeeded by asset management companies (AMC) who bring together a group of people and invests their money in stocks, bonds and other securities.
Create a portfolio
To start a mutual fund investment, you require to open an account with fund houses and complete your KYC. The next step is to create a mutual fund portfolio which many investors find tough.
First, shortlist a few schemes with credible long-term performance record. Next, pick the ones that are in line with your risk profile and investment objectives.
Now determine how much you want to invest in it. The best way to invest in mutual funds is through Systematic Investment Plans (SIPs). SIP lets you purchase units of your chosen mutual fund as per your budget at fixed intervals (typically, once a month).
Once you purchase the funds, don’t forget to check and review the performance of your portfolio at regular intervals. You can make changes in your portfolio whenever you think it’s necessary. It is advised that you should review your investments and re-balance it at least once in a year.