Financial Mantra- Investment Solutions

There’s always a good time to make a better investment

Investment is time, energy, or matter spent in the hope of future benefits actualized within a specified date or time frame. Investment has a different meaning in finance from that in economics. In finance, investment is buying or creating an asset with the expectation of capital appreciation, dividends (profit), interest earnings, rents, or some combination of these returns.

TYPE OF INVESTOR

Conservative

You are an investor who is prepared to accept lower returns with lower levels of risk in order to preserve your capital. The negative effects of taxation and inflation will not be of concern to you, provided your initial investment is protected. As a conservative investor, you might expect your portfolio to be allocated approximately 30% in growth assets, with the remainder in defensive assets.

Moderate

Your are an investor who would like to invest in both income and growth assets. You will be comfortable with calculated risks to achieve good returns, however you require an investment strategy that adequately deals with the effects your portfolio to be allocated approximately 55% in growth assets, with the remainder in defensive assets.

Aggressive

Your are an investor who is comfortable with a high volatility and high level of risk in order to achieve higher returns over long term. Your objective is to accumulate assets over long term by primarily investing in growth assets. As an aggressive investor, you might expect your portfolio to be allocated up to 70% in growth assets.

MUTUAL FUND-

A mutual fund is a type of professionally managed collective investment vehicle that pools money from many investors to purchase equity debt and other securities.It reduce unsistamatic risk. Some important definition of MF-Tenor refers to the 'time'. Mutual funds can be classified on the basis of time as under:

Open Ended funds- These funds are available for subscription throughout the year. These funds do not have a fixed maturity.
Close Ended funds- These funds begin with a fixed corpus and operate for a fixed duration.

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Online MF Transactions

Asset Classes

Equity funds- These funds invest in shares in deferent stocks depending on the investment objective of the fund.
Debt funds or Income funds- These funds invest money in bonds and money market instruments. These funds may invest into long-term and/or short-term maturity bonds.
Hybrid funds- These funds invest in a mix of both equity and debt or gold. Percentage of equity and debt will be depending on the investment objective of the fund as per offer document. investment Philosophy.
1. Diversified Equity Funds- These funds diversify the equity component of their Asset Under Management (AUM), across various sectors. Such as oil & gas, construction, metals etc. Thus, they use the diversification strategy to reduce their overall portfolio risk.
2. Sector Funds- These funds are expected to invest predominantly in a specific sector. Such as banking fund will invest only in banking stocks.
3. Index Funds- These funds seek to have a position which replicates the index, say BSE Sensex or NSE Nifty. They maintain an investment portfolio that replicates the composition of the chosen index, thus following a passive style of investing.
4. Exchange Traded Funds (ETFs)- These funds are open-ended funds which are traded on the exchange (BSE / NSE). Such as gold ETF.
5. Fund of Funds (FOF)- These funds invest their money in other funds of the same mutual fund house or other mutual fund houses or ETF.
6. Fixed Maturity Plan (FMP)- These funds are basically income/debt schemes like Bonds, Debentures and Money market instruments. They give a fixed return over a period of time. FMPs are similar to close ended schemes which are open only for a fixed period of time during the initial offer. However, unlike closed ended schemes where your money is locked for a particular period.
7. Capital protection fund Or Dual advantage fund- This tips of fund is a closed ended hybrid fund.