Mutual Fund Basics

[kimat]

Re: What to do in this falling market?

I concur with Vicky, just keep up with your SIP.

 

[games_icon]

Things to consider while choosing a mutual fund???

This is my first post...
Apologies if this topic already posted here!
As a newbie to mutual funds I need to know what are the things that we need to consider if we are taking a mutual fund.
I have a basic idea of stocks. I hope that will help.

Any help is very much appreciated.

Thanks.

 

[Vicky78]

Re: Things to consider while choosing a mutual fund...

1. Invest in equity funds for the long term (5 -10 years) and invest regularly via SIP (systematic Investment Plan)
2. Choose the core funds with a long term track record. Avoid New funds. the core funds should have atleast a good 10 year track record. Core funds should be diversified equity funds which does not restrict itself to any themes or market cap.
3. See to that the overall portfolio once created has 50% plus in large caps stocks
4. Stick to 4-5 funds in your portfolio
5. Do not "trade" in mutual funds. Evaluate your portfolio once in 6 months or a year.

 

[viv97in]

thematic funds??

hi. Could anyone tell me about thematic funds. What all funds are available in the market. How are they different from sector funds and is it a good idea to invest in them though SIP?

 

[MFadvisor]

Re: What to do in this falling market?

SIP are best for falling or volatile market.
MFAdvisor

 

[MFadvisor]

Re: Things to consider while choosing a mutual fund???

Hi,
There is a good blog site which keeps you aware of Mutual Funds.
www.mutualfundexpert.blogspot.com.

Be aware of all the so called Financial advisor they mostly advise where they have high commission you better do your own research of top performing funds.

MFAdvisor

 

[Vicky78]

SIP is good for any market because nobody knows the direction of the market.

For example if you take the period 1/1/96 to 1/1/99 here are 3 year returns of equity MF.

Birla Advantage 20.4
Franklin India Bluechip 12.58
Franklin India Prima Plus 10.04
Morgan Stanley Growth 8.84
HDFC Equity 8.41
Reliance Growth 8.39
HDFC Capital Builder 5.61
UTI Master Plus '91 0.68
Magnum Equity 0.29
UTI Master Growth -0.02
Reliance Vision -0.06
Magnum Multiplier Plus -0.07
Magnum Global -0.98
JM Equity -3.02
UTI Mastershare -3.09
ICICI Prudential Power -3.81
Franklin India Prima -3.94
UTI Equity -4.3
LICMF Equity -9.42
Taurus Bonanza Exclusive -11.5
Taurus Starshare -11.89
Tata Growth -16.67
LICMF Growth -18.86
Taurus Discovery Stock -23.32

Most of them are worse than bank FDs. After a brief bull spike in 1999 Investors had to deal with 3 more rough years between jan 2000 & jan 2003. Here are the 3 year returns between jan 2000 to jan 2003.

Tata Growth 7.81
Reliance Vision 2.96
Taurus Bonanza Exclusive 1.47
UTI Services Sector -0.28
Templeton India Growth -1.16
HDFC Equity -2.77
Franklin India Bluechip -5.21
UTI Index Select Equity -5.34
UTI Master Value -6.71
HDFC Top 200 -7.18
Magnum Contra -7.98
Franklin India Prima -8.46
UTI Master Growth -9.68
Franklin India Prima Plus -10.15
Tata Pure Equity -10.2
Sundaram BNP Paribas Growth Reg -10.31
UTI Mastershare -10.46
HDFC Capital Builder -10.55
Reliance Growth -10.73
UTI Master Plus '91 -10.86
Birla MNC -11.98
UTI Equity -12.23
Morgan Stanley Growth -12.26
ICICI Prudential Power -12.45
UTI MNC -12.7
ICICI Prudential Growth -15.42
Birla Sun Life Equity -15.47
Kotak 30 -15.75
Taurus Discovery Stock -16.14
LICMF Equity -18.15
DSPML Equity -19.25
Taurus Starshare -20.45
JM Equity -23.67
LICMF Growth -24.32
Birla Advantage -26.48
Magnum Equity -27.35
Magnum Global -28.55
ING Core Equity -29.57
Magnum Multiplier Plus -35.9

After all this loses well the story is known about the amazing bull run.So if investing in equities, it is very important to stay commited for long and go via SIP as the market may turn bullish or bearish anytime.

 

[funderji]

Vicky, your figures helped me in something else. I was wondering why Taurus Star Share was rated quite low by many "raters" even though it did have an excellent record in its last 5 years.
Seems as a teenager, it had a notorious record. Though it's a gentleman now, the past blot still hangs on it

 

[Vicky78]

There are also other reasons why taurus funds have been rated badly. The primary reason being its portfolio. I have seen it invest 20% of its asset of single stock. A portfolio that concentrated can be very risky.

 

[shehul]

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