I am beginning mutual funds investment: Your advice ?

Question

I am beginner when it comes to investment. I have taken interest in mutual funds and wish to go ahead with some investment in them. I do understand that mutual funds are risky investments.

Could you please explain to me how mutual funds work, how one should invest in mutual funds keeping in mind Indian finince scenario and what is the best way of doing it ?

Answer 1

Hi. gr8 to hear to your decision!! investing in stock market is always a double minded thing for beginners. well, i appreciate that u took mutual funds option rather than stock market directly. There is low risk in investing in Mutual funds than stock market. the thing is,you must choose a good fund,second is you must have to be a long term investor. i ll give you advise to start S.I.P(Systematic Investment Plan) on monthly basis. so,you can watch your money's growth as well as you ll earn lots of experience to how to watch & where to invest. Meanwhile,u can contact me on this topic anytime. Happy Investing!!!

Answer 2

Hi, my first investment was a mutual fund at Citibank when I was in college. I purchase a balanced fund because it's lower in risk since I was a newbie. It made me some money. When I needed the money, I realized that I had to pay over 5% in fees to withdrawl the money on top of the management fee that the fund charges. That's where Citibank makes the money. Then I started research on fees and performance. I found out that you can buy direct and pay no fee. The fund company makes money from just managing the fund.
My advise is do your research online (free) at morningstar.com or Yahoo's investment site. Look for No-Load funds with good 3 and 5 year returns compare to it's peers. Invesco, Vanguard, T-Rowe Price, and TIAA-CREF are among my favorites. I recommend something that's conservative to start. I put my ex-wife's money into a mutal fund and made money years ago. She was happy and didn't say much. When she lose about 5 to 10%, she wants out. That's bad investment. There is always up and down especially in investing. No risk = No reward.
People always do the opposite of what they should do.
To save more money, you can buy Index funds because they don't require an active fund manager. All the money are link to a specific index. It's a learning curve, go slowly and ask more specific questions.

Do you research and use them. Charts are my favorite, use moving averages. Buy low and sell high. Don't be too greedy.

Answer 3

I congratulate on your decision to begin investing. I think the sooner you start the better it is.

However, I am not a big fan of mutual funds. For once, most of the mutual funds will lag behind an index fund after factoring in for management expenses. Second, I think you could do a much better job investing for your self directly in the stock market provided you have done enough research.

So I would say, index funds are the best way to go since they offer better returns than mutual funds. In the mean time, read read read to find out more about the stock market.

Remember, the stock market is the ONLY market where buyers run for the exits when there is a sale (refering to the corrections, drops, etc). So being a contrarian would benefit you.

Answer 4

There are many different mutual funds to invest in. You need to do your own research and find a company that you like and a fund that you like and meets your risk levels. There are many different type of funds, such as sector funds, growth funds, value funds, bond funds, index funds and more. There are also things called loaded and no load funds. Be careful here. No load funds are typically best because they do not charge a fee just to invest. Loaded funds charge a fee, either up front (front loaded) or when you sell (back loaded). The purpose of the load is to increase profits of the company and to encourage investors to stay invested for the long term. Results are not uniform among loaded and no load funds. There are many places to start. First since you have not invested yet, your first investment needs to be an IRA. Good news is that you have until 15 April to fund a 2007 IRA. One thing you can do to get started sooner rather than later is to find an index fund from one of the major mutual fund companies. That will get you started and you can spend more time doing research. You can find good reference material online and in various personal investing periodicals. Good luck and keep saving!

Answer 5

Mutual funds are not that risky if you know what you are looking for. First LONG TERM performance 5-10 year time ond LOW expense fees (anything1% or under) third NO LOAD funds (meaning they charge you for buying or selling them) fourth some have high initial investments but a lot of good ones are under $,000. Finally think GLOBALLY do not pick a single country/sector unless you are investing in more than one different mutual fund.

Answer 6

Did the mutual fund thing earlier in life. I was very unhappy with those fees and the return on my money. I also find nothing good about these funds and the people who run them. Some funds invest in good companies only too return so little to its mutual fund holder. My advise to you is stick with some good growth stocks that pay a nice dividend . In the long run you will be allot happier.

Answer 7

A mutual fund is basically people allowing somebody, in this case a mutual fund advisor, to do the investing for them. "Here's some money, invest it for me."

Find out the benchmark for India. In the U.S., the benchmark is the SP 500, which only 20% of the mutual funds out there have been able to beat the SP 500 over the long haul. See how well the mutual funds you are looking at stack up to the common benchmark. You want a mutual fund that has met or beat that benchmark. If non of those mutual funds have beat the benchmark over the long hail, see if you can invest in the benchmark itself.

Answer 8

A mutual fund is a collection of securities, stocks or bonds usually managed by a third party (not your broker). Usually these mutual funds are run by large sophisticated organizations like Franklin or Janus. The prices of all the individual securities adds up every day and the mutual fund is priced. You can get more information on mutual funds by looking at Morningstar.com.

Answer 9

Mutual furnds are not risky. Share market is risky. MF willl invest your money in share market also.
Contact any MF, broker, sub broker, bank etc. Make payment by cheque only. You will get statements of units alloted you. You can sell any time within 3-4 days.
Best wishes for high profit in advance.
Invest regulary.

Answer 10

You can't succed in binary trading without a strategy, a good method to follow and some kind of software support. They program I use is called "Autobinary signals". It helps finding loopholes for guaranteed returns. It's very easy to use and I'm earning good money. You find all the details on this site: http://tradingsignal.toptips.org