blog

Home / DeveloperSection / Blogs / The best route to enter the stock market

The best route to enter the stock market

nishant dhar615 25-Mar-2019

There are many ways to invest money. Some wish to invest in banks, some in land, some in gold and some wish to invest in share market. The returns from the share market are higher enough to beat inflation. In the stock market, there are various products such as mutual funds, equity, bonds, commodity, currencies, etc. One can choose the financial asset based on his goals, time horizon and risk appetite. Let us read about mutual funds in detail in this article.

Anybody can enter the share market via mutual funds route. Even if you are a novice, it doesn’t matter as these are managed by fund managers who are experts. You as an investor just have to invest money in the right mutual fund. Fund managers invest your money into bonds, stocks, etc. and pass on the returns generated to you. Due to diversification of assets, risk is minimized. Markets are regularly monitored by the fund managers and they take the necessary investment decisions accordingly. You have the option of investing in equity or debt or in both the instruments. Before you select a fund, you have to compare the charges, services with other funds. The main factor is consistency in performance by the fund.

An investor who does not want to invest more in equity can choose debt funds which assure regular income and a person who has a higher risk appetite can invest more proportion of money into equity and lesser proportion in debt instruments. Periodic monitoring of the fund’s performance is very much necessary to remove the under performing or loss making stocks and to add outperforming stocks. Funds are sold as units on the basis of NAV (Net Asset Value). In order to fulfill your long term goal, you can start investing in mutual funds. SIP (Systematic Investment Plan) is a mutual fund tool that provides better returns due to the power of compounding effect. With a very minimum amount, anybody can start investing in SIP. An investor has to stay invested in SIP for a longer period of time to realize better returns. When the market is low, one can buy more units of SIP and when the market is high, one can get less units of SIP. Even during market volatility, one should not exit SIP as it is the time to accumulate more SIP units. Hope you got an overview of mutual funds by reading this article. Start investing today to achieve your dreams!



Updated 25-Mar-2019

Leave Comment

Comments

Liked By