Does it makes sense to invest in RD when MFs are giving a fair good amount of returns on investments ?

Question

I know there is always a risk factor in Mutual Funds but I received 7 times the amount of interest on MFs compared to RDs for a lesser amount for a period of one year.

RD - Recurring Deposits - a fixed amount is transferred into RD a/c for a fixed period.

Janani B : I invested in 3 different MFs last year for a period of 1 year & in 5 different MFs this year, for a period of 1 year under Syatematic Investment Plan(SIP).
What you have mentioned is for close-ended schemes :)

Answer 1

You can definitely get about 30% return in a year in MF investment.

Buy the units when the NAV is normally low during Aug - Sep and sell it off during April May next year.

Even if you get 70 p divident and NAV goes up by 2 Rs.you stand up to gain.Invest on NFO started during april - may during Aug their NAV will be less than Rs.10
.
Look for equity diversified MF having assests over 500 Cr.While buying spread out as service indusry fund,Technology fund infrastructure fund and banking sector fund,
Debt and other funds may not fetch you 30% return
A portion can be put in ELSS to avail IT concession even if you have to lock for 3 years or more returns from this category is definitely better than RD

Answer 2

Yes. Certainly MFs are giving high returns when compared to bank RDs.But there is a lockin period of 3 years I think so before that u can't either close or withdraw the amount. U have to select the scheme which suits best. Systematic Investment like RD regularly every month will spread u r risk. A word of caution In RD u will certianly get the matured amount but MFs are depends on share market yield and NAVs.

Answer 3

Investment into Recurring Deposits comes under Fixed Maturity Plans, which will give you assured return along with the principle invested in tact. There is almost no risk if you invest in R.D.s of any commercial banks. But the growth is limited to less than 12% p.a. depending the term of investment.

You are sure get better returns if you invest in good diversified equity oriented schemes in good mutual funds through SIP (Systamatic Investment Plan) for a period of more than 36 months. However choosing a good scheme of a good mutual fund requires some study or advice from certified financial advisors. Investments through SIP averages your cost over a long period and will benefit you.

Answer 4

A SIP (Systematic Investment Plan) in a Mutual Fund is definitely a better alternative compared to a RD.

Answer 5

Any investment decision, whether RDs or MFs, depends a lot on any individual's own perspective of the things, risk appetite, objectives, time horizon for investment and such other factors. Whatever you said for RDs vis-a-vis MFs is true in present days, but the picture may or may not remain the same on any future date. Today's investments give results in future time, which is unpredictable. Therefore, wise people spread their investments wisely to tackle any eventuality and for good overall returns for their lifetime. People with surplus funds and high risk appetite may invest in equity directly, margin & day trading etc. to make more money in much shorter time. Their such decisions are guided by specific factors akin to them.

Overall, safety and liquidity of funds blended with good returns are the factors for an investor.

Answer 6

Investments in MF gets you better returns than RD. instead of monthly instalments you can invest in Systematic Investments Plans in one of the reputed MF Co's. The rate of ROI (return on Ivestments will be better. But for best returns keep them invested atleast for 3 yrs to get optimum benefits. Reliance Growth Fund is also a good invt option.

Answer 7

and what about the risk in MFs? The performance of MF is linked to stock markets.... you may get good returns or you may not get that... RD is safe... even if the returns are less...

Answer 8

8% isn't rubbish, extremely whilst that's compounded over the years. of direction the better the extra helpful, yet 8% activity with out extra money invested will double in 8.5 years, it fairly is is you in basic terms put in money as quickly as and permit it journey. the optimal returns, usual stands out as the optimal danger shares are frontier markets, however the prospect is out of the uncomplicated you're incredibly entering into shady business enterprise.

Answer 9

No, MFs are the best investment.

Answer 10

The market won't rise forever. On the downhill side, you'll be happy if you have some more conservative investments.