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June 19, 2021

Tata Mutual Fund: Invest in High-Performing FundsTata Mutual Fund:

TATA Mutual Funds

About Tata mutual fund

Tata Mutual Fund was incorporated in 1994 and commenced operations in 1995. It is a mid-sized mutual fund but also among the most stable investments of the last two decades or so.

Some of the least volatile and yet fastest growing schemes of the Indian mutual funds market belong to the Tata Mutual Fund.

The total value of the assets under management of the Tata Mutual Fund is 57,299 crore as of 1 March 2021.

The Tata Mutual Fund’s offerings are not restricted to being debt or equity alone. It offers a wide range of instruments for investment that aid investors in diversifying their portfolios.

Hybrid, liquid, tax savings/ELSS, and overnight funds are all parts of their offerings.

The Tata Mutual Fund is sponsored by Tata Sons Limited and Tata Investment Corporation Limited. Tata Sons is a multinational conglomerate that is more than 150 years old.

It was founded by Jamsetji Tata in 1868, and its affiliates include multi-billion-dollar enterprises such as Tata Motors, Tata Steel, Tata Capital, Tata Elxsi, Tata Power, and Tata Communications.

It has more than 7 lakh employees and a revenue of over USD 100 billion. The current chairman of the Tata group is N. Chandrasekaran.

About two-thirds of Tata Sons is held by philanthropic trusts that have, over the past century, opened multiple institutions for the encouragement of arts, sciences, and engineering.

The Tata Mutual Fund offers 76 equity schemes, 66 debt schemes, 24 hybrid schemes, 4 liquid schemes, 4 tax savings schemes, and 4 overnight schemes.

The CEO of the company is Prathit Bhobe, and there are nine members on its board of directors. 

Important information

Name of the AMCTata Mutual Fund
Incorporation Date15 March 1994
SponsorsTata Sons Limited & Tata Investment Corp. Ltd.
TrusteeTata Trustee Company Pvt Limited
Board of DirectorsRajiv Sabharwal F.N. Subedar Suprakash Mukhopadhyay Prathit D Bhobe Anuradha E. Thakur Keki Manchersha Elavia Prabhat Chandra Tripathi V. Chandrasekaran Vittaldas Leeladhar
MD/CEOPrathit Bhobe
CIORahul Singh
AAUMRs. 57,299 Cr as of 1 March 2021
AuditorsAMC Auditors: BSR & Associates Scheme Auditors: M/s Deloitte Haskins & Sells
CustodiansDeutsche Bank, HDFC Bank, CitiBank N.A., Standard Chartered Bank
AddressMafatlal Centre, 9th Floor, Nariman Point Mumbai 400021
Contact Number022-66578282
Emailservice@tataamc.com

Best Tata Mutual Fund schemes

The Tata Mutual Fund is a moderate-sized fund that has a number of successful products in the market. Let us look at the top ten among them.

1. Tata banking and financial services fund direct

The Tata Banking and Financial Services Fund has been among the successful funds in the Indian market over the past few years.

It has a Value Research rating of 4, and investors have realized returns of over 34% in the past year and almost 23% in the last five years, as of 1 March 2021.

Minimum InvestmentINR 5000
Minimum Additional Investment INR 1000
Minimum SIP InvestmentINR 150
Minimum WithdrawalINR 500
Exit Load0.25% for redemption within 30 days; Nil for redemption after 30 days
Return Since Inception:18.76%
AssetsINR 660 Crore
Expense Ratio1.03%
*All values as of 1 March 2021

2. Tata digital India funds direct

The Tata Digital India Fund is among the best-performing equity funds in the Tata Mutual Fund. It has an AUM of 1161 Crore as of 1 March 2021 and has returned 79.91% over the last year and nearly 22.50% over the last five years.

Minimum InvestmentINR 5000
Minimum Additional Investment INR 1000
Minimum SIP InvestmentINR 150
Minimum WithdrawalINR 500
Exit Load0.25% for redemption within 30 days; Nil for redemption after 30 days
Return Since Inception:22.02%
AssetsINR 1161 Crore
Expense Ratio0.89%
*All values as of 1 March 2021

3. Tata India consumer fund direct

The Tata India Consumer Fund is an equity fund that has an AUM of 1188 Crore as of 1 March 2021. It has returned more than 20% in the last five years, including nearly 31% in the last year.

Minimum InvestmentINR 5000
Minimum Additional Investment INR 1000
Minimum SIP InvestmentINR 150
Minimum WithdrawalINR 500
Exit Load0.25% for redemption within 30 days; Nil for redemption after 30 days
Return Since Inception:17.19%
AssetsINR 1188 Crore
Expense Ratio0.89%
*All values as of 1 March 2021

4. Tata resources & Energy funds direct

The Tata Resources & Energy Fund has been an extremely successful fund, and though it is a comparatively small fund with an AUM of 73 crores, it has returned nearly 20% in the last five years as of 1 March 2021.

Minimum InvestmentINR 5000
Minimum Additional Investment INR 1000
Minimum SIP InvestmentINR 150
Minimum WithdrawalINR 500
Exit Load0.25% for redemption within 30 days; Nil for redemption after 30 days
Return Since Inception:20.18%
AssetsINR 73 Crore
Expense Ratio1.12%
*All values as of 1 March 2021

5. Tata retirement savings fund progressive plan direct

The Tata Retirement Savings Fund Progressive Plan is a high-performance equity fund that has among the highest returns for any fund in the Tata Mutual Fund.

Since its inception, it has returned over 15% and has accumulated an AUM of over 995 crores as of 1 March 2021.

Minimum InvestmentINR 5000
Minimum Additional Investment INR 1000
Minimum SIP InvestmentINR 150
Minimum WithdrawalINR 500
Exit Load1% for redemption within 1829 days; Nil for redemption after 1829 days
Return Since Inception:15.89%
AssetsINR 995 Crore
Expense Ratio0.80%
*All values as of 1 March 2021

6. Tata midcap growth direct plan

The Tata Midcap Growth Direct Plan is an equity product with a Value Research Rating of 3. It has been able to return nearly 18% in the last five years as of 1 March 2021, including over 45% in the last year.

Minimum InvestmentINR 5000
Minimum Additional Investment INR 1000
Minimum SIP InvestmentINR 150
Minimum WithdrawalINR 500
Exit Load1% for redemption within 365 days for units more than 12% of investment; Nil for redemption after 365 days
Return Since Inception:19.33%
AssetsINR 1129 Crore
Expense Ratio1.14%
*All values as of 1 March 2021

7. Tata Equity PE Fund Direct

The Tata Equity PE Fund is another equity fund that has performed rather well since its inception and has had a constant rate of return of over 17% a year over the last 5 years, as of 1 March 2021.

Minimum InvestmentINR 5000
Minimum Additional Investment INR 1000
Minimum SIP InvestmentINR 150
Minimum WithdrawalINR 500
Exit Load1% for redemption within 365 days for units more than 12% of investment; Nil for redemption after 365 days
Return Since Inception:15.97%
AssetsINR 4550 Crore
Expense Ratio0.79%
*All values as of 1 March 2021

8. Tata Large & Mid Cap Fund Direct Plan

The Tata Large & Mid Cap Fund Direct has an AUM of nearly 2153 Crore as of 1 March 2021. It has had a constant annual rate of return that has been over 16% since its inception.

Minimum InvestmentINR 5000
Minimum Additional Investment INR 1000
Minimum SIP InvestmentINR 150
Minimum WithdrawalINR 500
Exit Load1% for redemption within 365 days for units more than 12% of investment; Nil for redemption after 365 days
Return Since Inception:15.79%
AssetsINR 2153 Crore
Expense Ratio1.09%
*All values as of 1 March 2021

9. Tata Index Sensex Direct

The Tata Index Sensex Fund is a market-indexed fund with an AUM of nearly 62 crores as of 1 March 2021. Its rate of return has been over 12% annually for nearly all of its existence and has a low expense ratio.

Minimum InvestmentINR 5000
Minimum Additional Investment INR 1000
Minimum SIP InvestmentINR 150
Minimum WithdrawalINR 500
Exit Load0.25% for redemption within 7 days; Nil for redemption after 7 days
Return Since Inception:12.14%
AssetsINR 62 Crore
Expense Ratio0.05%
*All values as of 1 March 2021

10. Tata India Pharma & Healthcare Fund

The Tata India Pharma & Healthcare Fund invests exclusively in pharma and healthcare stocks in the Indian market and has provided a handsome rate of return of over 10% since its inception as of 1 March 2021.

It has an AUM of over 430 crores.

Minimum InvestmentINR 5000
Minimum Additional Investment INR 1000
Minimum SIP InvestmentINR 150
Minimum WithdrawalINR 500
Exit Load0.25% for redemption within 30 days; Nil for redemption after 30 days
Return Since Inception:11.36%
AssetsINR 435 Crore
Expense Ratio1.19%
*All values as of 1 March 2021

How can you invest in the TATA mutual fund via Edufund?

Your child’s education abroad can be secured by using EduFund to invest in any of the various schemes provided by the Tata Mutual Fund. Here are the steps that will enable you to invest in the Tata Mutual Fund through EduFund.

  • Download the EduFund app from the App Store or the Google Play Store.
  • Create an account on EduFund.
  • Enter the information provided, which is primarily your ambitions for the education of your child. This includes the country that you want to send your child to, what level of education you want to send your child abroad for, and the major that you want your child to undertake while abroad.
  • It is also possible to enter a rank bracket for the colleges you want your child to gain admission into and the type of city the college must be in.
  • As per the entered information, you will receive a list of colleges that match your criteria. There will also be a list of the mean tuition fees of these colleges for your selected major.
  • Now, you may choose the Tata Mutual Fund scheme that you wish to invest in. As you browse through schemes, you will also gain an insight into how long it is likely to take you to accumulate the amount of money required for your child’s education through the selected scheme.
  • Using the EduFund app, you can continue to track the performance of several different schemes, including the ones you have invested in. If you wish to invest in more schemes, it is possible to pay using all acceptable transaction portals and forms.
  • EduFund also put you in contact with affiliated education counselors who have years and years of experience in the field of foreign education. They can help allay your doubts regarding majors, your experience abroad, as well as financial matters.
TATA Mutual Funds India

Leading fund managers at Tata Mutual Fund

The fund manager of the mutual fund schemes that you choose to invest in determines how much your investment is going to appreciate over time.

An adept and experienced fund manager is capable of recouping your money many times over and improving the performance of the allotted scheme at an accelerated pace.

All the decisions associated with the running of the mutual fund, from the financial instruments to be invested in the allocation of funds in these financial instruments, are made by the fund manager.

The Tata Mutual Fund has some very experienced fund managers for the schemes that it offers. Here are some of the leading fund managers you are likely to come across as you browse through the Tata Mutual Fund.

1. Sonam Udasi

Mr. Sonam Udasi has over 23 years of experience in equities research. His vast experience in the field of finance has meant that he has managed some of the highest return-providing schemes at the Tata Mutual Fund over the years. 

Mr. Sonam Udasi holds a postgraduate diploma in management, in which he specialized in the subject of finance. After his education, he joined the Quantum Group as an analyst, where he worked in sectors ranging from retail and pharma to media and utilities.

He was then a senior analyst at JMC Financial asset management company, where he reported directly to the chief investment officer.

He has also worked with Raymond James and was the head of the consumer vertical at BRICS Securities. He was also the head of the research team at IDBI Capital Marketing Services Ltd. for four years.

With him as the leader, his team was ranked third as the “Top Most Award Winning Team” by Thomson Reuters Starmine Awards for Excellence for Fiscal Year 2013.

Mr. Udasi joined Tata Asset Management as the Head of Research in 2014. He later became the Principal Officer for Portfolio Management Services and is currently a Senior Fund Manager. 

Mr. Udasi manages a total of 18 schemes with an AUM of 11484 Cr as of 1 March 2021. Under his management, the Tata Banking and Financial Services Fund has returned a CAGR of over 22% between 2016 and 2021. The Tata India Consumer Fund Direct has also returned over 20% over the same time period.

2. Rahul Singh

Mr. Rahul Singh is the Chief Investment Officer for Equities at Tata Mutual Fund. He has over 25 years of experience in asset management and finance. As a fund manager, he has had some of the highest returns in the last few years.

Mr. Rahul Singh earned a Bachelor of Technology degree in Mechanical Engineering from the Indian Institute of Technology Bombay.

Post this, he enrolled in the Indian Institute of Management Lucknow and earned an MBA in Finance and Financial Management Services. He subsequently joined CRISIL as the head of Ratings and served there for five years.

He was then an Equity Research Analyst at SSKI for five years and at Citibank India for five years after that. In 2010, he joined Standard Chartered Bank as the Head of Equity Research. Prior to joining Tata Mutual Fund, Mr Singh was a Managing Partner at Ampersand Capital Investment Advisors LLP. He joined Tata Mutual Fund as CIO in 2018.

Mr. Rahul Singh manages 11 schemes with a total AUM of about 3700 cr as of 1 March 2021. Under his management, the Tata Digital India Fund Direct has returned over 30% per annum between 2018 and 2021.

The Tata India Pharma and Healthcare Fund Direct have also been top performers, with a CAGR of over 22% in this time.

3. Meeta Shetty

Ms. Meeta Shetty is a fund manager at Tata Mutual Fund and manages some of the largest schemes the fund offers its customers. She has over 14 years of experience and her fund have yielded great returns, especially in the last three years.

Ms. Meeta Shetty holds a Bachelor of Economics degree and is also a CFA charter holder from the CFA Institute in the USA. She was initially employed as an Equity Research Analyst at Dala and Broacha Stock Broking Pvt. Ltd., post which she took up a research role at HDFC Securities.

Till 2017, Ms. Shetty was involved in equity research in the pharma sector for Kotak Securities. She was also an Equity Advisor for Karvy Stock Broking.

In 2017, she joined Tata Asset Management Ltd. as a Research Analyst and tracked the IT, Pharma, and Telecom sectors. Since 2018, she has been an Assistant Fund Manager.

Ms. Meeta Shetty manages 9 schemes, including Tata Digital India Fund and Tata India Pharma & Healthcare Fund, as well as the Tata Large & Mid Cap Fund.

Her total AUM is 1329 Cr as of 1 March 2021. The Tata Large & Mid Cap Fund has yielded a CAGR of more than 15% between 2018 and 2021.

4. Rupesh Patel

Mr. Rupesh Patel is a Senior Fund Manager at Tata Asset Management Ltd. He has over 20 years of experience and has managed some immensely successful funds in his long tenure at Tata Asset Management.

Mr. Rupesh Patel earned his Bachelor of Technology degree in Civil Engineering from Sardar Patel University, Gujarat. He subsequently earned an MBA in Finance from the same institute.

He was then a Manager of Projects at the Gujarat State Road Development Corporation Ltd. for two years before joining CARE Ratings as a manager and rising up to Deputy General Manager. He then joined Indiareit Fund Advisors Ltd. as the Assistant Vice President for Investments.

He joined Tata Asset Management in 2008 and has been here ever since. He was initially the Deputy General Manager for Investment and later served as the Head of the Portfolio Management Services Division. He became a Fund Manager in 2013.

The total AUM of the 15 schemes managed by Mr. Rupesh Patel is more than 6500 cr as of 1 March 2021. He manages the Tata Midcap Growth Direct Plan, which has returned a CAGR of above 18% between 2016 and 2021.

He also manages the Tata Large Cap Direct Plan, which has returned about 15% in the same time period.

5. Murthy Nagarajan

Mr. Murthy Nagarajan brings more than 20 years of experience, the vast majority of which have been spent at Tata Asset Management.

He is currently the Head of Fixed Income at Tata Asset Management Ltd. and manages a plethora of high-performing debt schemes.

Mr. Murthy Nagarajan holds a Master of Commerce degree and earned a Post Graduate Diploma in Business Administration from Somaiya Institute of Management & Research.

He worked at Mirae Asset Global Investment India Ltd. where he was the Head of Fixed Income for two years. Later, he worked at Quantum Asset Management Company, where he was the Head of Fixed Income for another three years. 

Mr. Murthy Nagarajan manages 25 schemes with a total AUM of almost 10,000 cr as of 1 March 2021. This is among the highest AUM values for any fund manager at Tata Mutual Fund.

The Tata Gilt Securities Fund Direct has returned a CAGR of more than 8% under its management between 2016 and 2020. The Tata Short-Term Bond Direct Plan has yielded more than 7% in the same time period.

Why should you invest in Tata Mutual Fund?

When you are looking out for your child’s education, you need to invest in financial instruments that provide you with assured returns within the limited period of time that lies between your date of investment and the date of your child’s departure for college.

You need a financial plan that is based on research and statistics, as well as advisors who will help you tailor your financial plan to your needs and requirements.

You also require the promise of stability and assurance from the financial instrument that you invest in.

Tata Mutual Fund is sponsored by one of the largest conglomerates in the world. Worth hundreds of billions of dollars, Tata Sons, has been a beacon of stability for over 150 years now.

The company has been able to weather severe economic storms, multiple recessions, and stock market crashes and still remains profitable. Some of the largest companies in India and the world across industries and domains belong to Tata Sons.

From automobiles to coffee and from retail to communications, Tata Sons has made its mark in several fields across the world.

Perhaps the greatest differentiating factor of the Tata Mutual Fund is its flexibility. As a parent investing for the future of your child, you are probably looking to diversify the financial instruments that you invest in, so that you can assure returns on your investment.

A mutual fund that offers only a limited number of schemes and contains no diversity in the type of offering can often be severely limiting for the investor.

Tata Mutual Fund offers the greatest variety of scheme types for almost any mutual fund in the market. You can invest in equity or debt-based schemes.

Apart from these, you can also opt for tax saver funds or overnight funds. If you wish to invest in bullion, Tata Mutual Fund also offers gold and liquid schemes to its investors. If neither equity nor debt schemes suit you, you can also opt for hybrid schemes.

This underscores the importance of choosing the right mode of investment for your child. The Tata Mutual Fund isn’t merely about stability.

The reason that thousands of customers from across the country have reposed their faith in Tata Mutual Fund is that it has been a consistent performer. Customer satisfaction from the Tata Mutual Fund is the reason that people continue to invest in the schemes offered by the fund.

For the sake of your children’s education, Tata Mutual Fund is capable of providing you with the right services and leading to great returns in your required time period.

Invest in Tata Mutual Fund using EduFund

Educating your child abroad can be a costly affair. Especially if you are looking to send your child to countries such as the United States, the United Kingdom, Canada, or Australia, tuition fees can run into hundreds of thousands of dollars.

Add to it living expenses such as food and accommodation, and it is likely that you will receive a bill beyond affordability.

As large as this bill is, the level of education provided in these countries is also well worth the inconvenience, being by far the best in the world.

Through EduFund, you increase your chances of meeting the financial requirements for the education of your child through consultation with experienced advisors in education finance.

Alongside this, the process of investing is also very simple and secure and takes no more than a few minutes. Your financial plan is completely customized for you and highly research-based as well.

Consult an expert advisor to get the right plan
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As parents, we have a profound responsibility to ensure a bright and secure future for our children. While providing love, care, and education are crucial aspects, financial planning plays a pivotal role in setting the stage for their success. Investing wisely is key to securing their future aspirations and safeguarding against unforeseen circumstances. Let's explore five essential investment plans that every parent should consider, ranging from mutual funds and US ETFs to US stocks and insurance. So, we will dive in and discover the strategies that can pave the way for your child's financial well-being. Education Fund: The Power of Mutual Funds One of the most crucial investments you can make as a parent is in your children's education. Start by setting up an education fund that specifically caters to their academic pursuits. Consider tax-efficient options like a 529 plan, which allows you to invest in a variety of mutual funds, ensuring growth potential while enjoying tax benefits. Platforms like EduFund (www.edufund.in) offer valuable guidance and tools to help you plan and manage your child's education fund effectively. investment plans US ETFs: Diversification Made Easy 1. Exchange Traded Funds Exchange-Traded Funds (ETFs) have gained significant popularity in recent years due to their flexibility and global exposure. Just like mutual funds, ETFs represent a basket of securities, including stocks, bonds, commodities, or a combination thereof. However, unlike mutual funds, ETFs are traded on stock exchanges throughout the trading day at market prices. ETFs offer several benefits, including transparency, liquidity, and cost-effectiveness. Parents can buy and sell ETFs at any time during market hours, allowing for more flexibility in managing their investments. Additionally, ETFs disclose their holdings daily, ensuring transparency in the investment portfolio. With generally lower expense ratios compared to mutual funds, ETFs offer a cost-effective investment option for parents. 2. USA Stocks For parents who are comfortable with taking on more active roles in their investment journey, investing in individual stocks can be an exciting avenue. Owning shares of well-established companies can offer substantial returns over time. While investing in individual stocks requires careful research and monitoring, it can provide the potential for higher growth compared to mutual funds or ETFs. EduFund's resources can assist you in understanding stock investing basics and identifying companies with strong fundamentals. To mitigate risk, parents can consider diversifying their stock portfolios across different sectors and industries. This diversification helps reduce the impact of a single stock's performance on the overall portfolio. In addition, parents should adopt a long-term investment mindset and focus on the fundamentals of the companies they invest in rather than short-term market fluctuations. Investment Tips for Dad's in India Read More Insurance - Protecting Your Family's Future Insurance is a pivotal component of any comprehensive financial plan, especially for parents. Life insurance provides financial protection to your family in the event of your untimely demise. It ensures that your children's education, living expenses, and future aspirations are secure, even in your absence. Term life insurance offers coverage for a specified period, providing a higher coverage amount at an affordable premium. Additionally, health insurance safeguards against unexpected medical expenses, offering peace of mind during uncertain times. By securing adequate insurance coverage, parents can safeguard their family's financial well-being and ensure a secure future. Investment Tips for Mom's in India Read More Mutual Funds - Diversify and Grow Your Wealth Mutual funds are an excellent choice for parents seeking diversification in their investment portfolios. These funds pool money from several investors to invest in a variety of asset classes, including stocks, bonds, and money market instruments. Managed by professional fund managers, mutual funds allow parents to benefit from their expertise and experience in making investment decisions. By spreading investments across different sectors and markets, mutual funds help reduce the risk associated with investing in individual stocks. Parents can choose from many types of mutual funds on the basis of their risk appetite and financial goals. For those seeking stability, bond funds can offer a regular income with lower volatility. On the other hand, equity funds offer an opportunity for capital appreciation through investments in stocks. Balanced funds offer a blend of both equity and bond investments, providing a balanced risk-return profile. By investing in mutual funds, parents can access professional investment management and enjoy the benefits of diversification. You can lay a strong foundation for your family's future by incorporating these investment plans into your financial strategy. Remember that investment decisions should align with your risk tolerance, financial goals, and time horizon. It's always suggested as advice to seek guidance from financial advisors who can provide personalized advice based on your specific circumstances. Conclusion  Investing wisely is an integral part of parental responsibility. By incorporating these five investment plans into your financial strategy, you can take proactive steps toward securing your child's future while also protecting your own financial well-being. Remember to conduct thorough research, seek professional advice, and regularly review your investment portfolio to adapt to changing circumstances. By combining long-term vision with disciplined investment practices, you can build a strong financial foundation for your children, allowing them to chase their dreams with confidence. Start planning today and pave the way for a prosperous future for your family. Consult an Expert Advisor
5 reasons why SIP is the best investment choice?

5 reasons why SIP is the best investment choice?

A systematic investment plan or SIP is the best plan that helps you invest in mutual funds on a regular basis.  You can choose to invest weekly, monthly or even quarterly – the most popular choice being monthly. There are multiple reasons why SIPs are the best way to grow your money especially when you have a goal to plan – e.g. your child’s education. SIPs can be bought easily and you can start with a very low amount - Rs. 500 per month. In this blog, we will talk about the ‘Big 5 advantages’ that SIPs offer to you as a parent. But before that, let's understand what a SIP is What is SIP? A SIP or systematic investment plan is an investment mode through which an investor can create a regular mechanism of investment for themselves. Let's take the example of investor X. Investor X wishes to invest Rs. 10,000 every month in a mutual fund. In this case, investor X can create a SIP for a fund they want to invest in and the money will be deducted every month automatically (the deduction can be weekly, monthly, or even quarterly, depending on the investor's choice). Think of it as a recurring deposit, with better returns. Now that we know what a SIP is, let's get to know why investing via SIP is the best choice you can make to enlarge your corpus. CALCULATE MONTHLY SIP 5 Reasons SIP is the best These are the 5 main reasons why you should invest via a systematic investment plan to reach your financial goals 1. Suitable for Long-Term Investment Any financial advisor will tell you that if you want to invest long-term, SIP is the way to go. The reason is simple, regular investing and automatic deductions keep investors motivated to stay invested and reach their investment goals quicker. During the 2008 financial recession, many people withdrew money from mutual funds. However, the ones that remained invested via SIP, attained a huge profit once the markets rose. Long-term investing makes sure that even if the market is down at the moment, once the markets rise, the investor will make profits. 2. Goal-planning ‍SIPs are good tools to plan for a future goal – to buy a 4-wheeler or to pay for college tuition fees maybe 10-15 years from now. When you determine the amount required to achieve your goal, you will know how much you should invest and how long it will take to reach your goal. This will help in planning effectively. Having financial goals is very important to creating a financially secure future. One must have a defined idea about what financial goal one wants to reach by the age of 30, 40, 50, and so on. 3. Effect of Compounding Compounding is one of the biggest advantages of a SIP. Over time your investments grow because you start earning returns not on your principal amount, but on the interest that keeps getting added to it. Let's take an example. Suppose you invest Rs.1,000 in a mutual fund that gives you a yearly return of 10% p.a. Your amount becomes 1,100. at the end of the first year. At the end of the second year, the rate of return is 11%, this time the returns will be calculated on Rs. 1,100 and not the principal amount, which is, Rs. 1,000. ‍This ensures the growth of your corpus and is one of the reasons why experts advise you to not withdraw your investments when the market is down. 4. Curated by Experts With the increasing number of fund types like equity, debt, mixed, gold-based, etc. there is a wide variety to choose from based on your risk appetite and preferred investment duration. This has led to customized offerings based on individual needs, supervised by experts in the SIP domain. All you need is to specify your goal and timeline and you are provided with the best possible funds that can meet your future goals. ‍SIPs have become popular over the past few years, because of the ease of investing and the flexibility provided in terms of the amount of money that can be invested. You can stay invested as long as you want, although average returns have been higher when invested in the long term. Research also shows that the returns offered by SIPs are more than recurring deposits in banks, in the long term. 5. Automates Your Investment Experience SIPs automate your investment experience, which makes you a regular investor. It is easy and convenient and because of the online surge, today, it is super easy to invest via SIP. If you choose the lump sum method, you will have to manually invest an amount and there may be times when you can miss an installment. ‍With automated installments and a streamlined process, investing via SIP has now become an extremely popular method, to reach long-term goals like saving up for your child's education. FAQs Why is SIP investment good? By investing through SIPs, you will do away with the burden of timing the market as you could then avail the benefit of Rupee Cost Averaging. By investing through SIP, you will tend to invest in the up and down markets. This helps you shy away from the volatility of the market. Additionally, you will benefit from the power of compounding, which fundamentally generates returns not only on capital but also on returns. Is SIP good for students? Investing in SIP can be a huge benefit for students. It cultivates a healthy investment habit, and they can invest a small amount to start their journey. SIP is best for beginners and a comparatively safe investment vehicle. What are the features of SIP? A SIP offers the following features: It is best for long-term investment, brings financial discipline, allows small investment amounts, benefits from the power of compounding, and is a comparatively safer investment tool. Why do people prefer SIP? A systematic investment plan helps bring discipline to an individual’s investment habits. A SIP will automatically deduct a pre-decided amount periodically. Investors also do not need to worry about timing the market while investing via SIP. It is one of the best investment vehicles for beginners. Consult an expert advisor to get the right plan TALK TO AN EXPERT
SIP
5 tips to know before investing in US stocks

5 tips to know before investing in US stocks

If you want to invest in the US stock market to benefit from US stocks, you may start by opening an international trading account in India. But before investing in US equities, here are the 5 important things to know before investing in US stocks. 1. Regulatory framework One of the oldest, most effective, transparent, and well-regulated stock markets in the world is the one in the United States. On US stock markets are listed some of the largest businesses in terms of market capitalization, sales, and profitability. The worldwide exposure and flavor that US markets offer are crucial since many of these listed firms have a significant global presence, scale, and operational structure. The regulatory body that monitors the operation of the US stock markets is the Securities and Exchange Commission (SEC), which was founded in 1934. It guarantees the strict application of laws and rules that establish the highest standards of openness and integrity—essential for stock markets as well as for the safety and trust of investors. 2. Impact of Foreign Exchange  The volatility in the value of the US and other currencies should be taken into account while investing in US equities. This is because before any gain (or loss) for an Indian investment is realized, it would be converted using the appropriate exchange rate in the Indian rupee. The gains (or losses) will fluctuate in lockstep with changes in the exchange rate. An Indian investor must be aware that the exchange rate can be unpredictable and is influenced by a wide range of political, economic, and supply and demand variables. 3. Liberalized Remittance Scheme According to the Reserve Bank of India's Liberalized Remittance Scheme, an individual may invest up to $ 250000 per year in US equities from India (LRS). The cap covers any money sent abroad for purchases, travel, education, or other international transactions during the year. The investor's brokerage account has to be filled before making any investments in US equities. Investors must complete Form A-2, which is available from RBI-authorized dealers. Any sum over the $250000 cap requires RBI approval. Additional read: US stocks for investing in child education 4. Taxation To make your efforts worthwhile, it is crucial to take into account the tax consequences of your international assets. Due to the Double Tax Avoidance Agreement (DTAA) between the US and India, the same income cannot be taxed twice on investments made in the US stock market. 5. Dividend tax The dividends from US stocks are taxed at a fixed rate of 30% for overseas investors. However, as a result of the tax agreement between the US and India, citizens of India pay a 25% tax rate (deducted before distribution). However, because of the double tax avoidance agreement between the US and India, the tax paid in the US may be claimed as a foreign tax credit in your domestic filing. 6. Capital gains tax Your assets in the US are not subject to capital gains tax. However, India requires you to pay tax on your overseas capital gains. This may be divided into two groups.: Long-term capital gain (LTCG)If you keep the equities for more than 24 months before realizing capital gains, you will be subject to indexation advantages and a 20% tax rate in addition to any relevant fees and other surcharges. Short-term capital gain (STCG)Standard income-tax regulations apply to any gains from assets held for less than 24 months, and they are added to your ordinary taxable income. You must also take into account the recently implemented Tax Credited at Source or TCS. Under the new regulations, a 5% TCS will be applied to all international transfers over INR 7 Lakhs in a fiscal year. It is not an additional expenditure to deduct this advance tax when submitting your taxes each year. Charges on US stock-broking account  Using an Indian stock brokerage account to invest in the US stock market is prohibited. You would need to create one with a US stock brokerage company instead. To provide this service, the majority of Indian stock brokers who allow you to invest in US equities typically collaborate with a US stockbroker. You would also be required to pay certain fees for a US stock broking account, just like you would for an Indian trading account. This is something you should also take into consideration when you buy US stocks because these fees can reduce your earnings. These fees include Annual Maintenance Costs, brokerage charges, bank charges, transaction charges, and more. Invest in the US stocks with EduFund  Download the EduFund app and create an account to start investing in US stocks. With zero charges and no hassle account opening process from the comfort of your home, you can start investing in FAANG stocks in your portfolio to geographically diversify your portfolio!! Thus, investing in US firms and equities may give investors access to the worldwide market, credibility, and an opportunity to increase their wealth. Consult an expert advisor to get the right plan TALK TO AN EXPERT
5 top investments for risk-averse investors

5 top investments for risk-averse investors

All investments are associated with risks. Yet, the risk is not uniform, and it's essential to be aware of the different levels of risks linked with all types of investment instruments. This is why the first thing to consider before investing is how much of a risk appetite has – how much risk one is willing to take. Want to know the best investment options for risk-averse investors but still generate good returns? Continue reading this article to know more! What is risk averse? Risk-averse refers to an investor who chooses to preserve the capital over and above its potential to generate returns that are higher than the average. Risk can refer to many factors – volatility, currency, market, credit rating, etc. Risk-averse can also refer to a conservative investor. Low risk symbolizes stability in investments. A low-risk investment generates guaranteed reasonable returns, if not outstanding, above benchmark returns. But chances are near zero that the principal investment amount will be lost. Whereas a high-risk investment option may gain or lose money over time. Risk-averse investors are unwilling to accept market volatility. They prefer their investments to be highly liquid - readily available to be withdrawn. Such investors usually include old investors or retired individuals who depend on their savings for their daily expenses. Start Investing in Mutual Funds Is FD a good option for risk-averse investors? One should constantly adjust their returns against the current inflation rate. The current Fixed Deposit interest rates are 5-7% p.a. on average. But the current inflation rates are around 6-8% p.a. Give these figures a thought. The price you pay for your everyday goods and services is rising at 6-8%, whereas your FD investments are growing at only 5-7%. FDs do not increase the value of your money over time. In fact, you actually lose money or its purchasing power over time. Do you think FDs are the safest investment option? Banks defaulting on payments is rare but definitely possible. The Deposit Insurance and Credit Guarantee Corporation (DICGC) guarantees Rs. 5 lakhs per person per bank if the bank defaults. Let's not forget the liquidity part of this instrument. Fixed deposits can have a lock-in ranging from 3-5 years. Banks penalize the investors for withdrawing money before the lock-in is over. This penalty is in the form of a reduction of interest rate by a certain percentage. Download App and Start Saving for Child Education What are the best investment options for risk-averse investors? The market is filled with many investment options for investors with varying risk appetites. Let's look at some of the best investment options for risk-averse investors: 1. Short-term bond fund The best alternative for investors who do not want exposure to FDs or volatile instruments. Short-term bond funds – bond funds with low maturity and a high potential to offer better returns. Debt Funds with longer maturity are subjected to interest rate risk. But short-term bonds have a lower interest rate risk as their maturity period is much lower. 2. Municipal and Corporate Bonds State and local governments and companies usually raise money by issuing bonds to the public. Bonds offer lower risk than stocks. When a company is winding up, the bondholders are given first preference in the payment and settlement order. 3. Other debt funds Other debt funds include banking and PSU Funds, ultra-short duration funds, Dynamic Bonds, etc. You could always invest a lump sum in these debt-based mutual funds and opt for a Systematic Withdrawal Plan (SWP). This would ensure that along with the returns being generated on your investments, you would also get a monthly income from these investments. This investment option is one of the best options for older people who want a monthly income. 4. Liquid funds Invest in top-rated liquid funds to avoid loss of capital with a higher degree of safety for your primary investment. Also, when the market moves up, your investment performs better and generates higher returns in line with the market. 5. Dividend growth stocks Stocks are not as safe as cash, savings, or other debt-based instruments. But they are safer than options and futures. Dividend-paying stocks are considered safer than high-growth ones as they minimize volatility, if not eliminate it. You don't depend on the value of the stock as you get a dividend as a regular income on your investment. Apart from debt-based investments, you could also apply a staggered investment approach in equity-based mutual funds for a long-time horizon. A periodically rebalanced portfolio helps you minimize your portfolio volatility and ensures efficient capture of up-market and down-market movements even with equity exposure.  Take the help of an Investment Advisor who will guide you through goal-based planning and help you choose the investments that are most suitable to your goals and objectives and your risk appetite. FAQsWhat type of investments do risk-averse investors prefer?  Risk-averse investors typically prefer conservative investments with lower volatility and more predictable returns. These may include government bonds, high-quality corporate bonds, certificates of deposit (CDs), and stable dividend-paying stocks. These options aim to preserve capital while providing modest growth, aligning with the risk tolerance of such investors.   What are 3 high-risk investments?  Three high-risk investments include investing in individual stocks of volatile and speculative companies, trading in cryptocurrencies known for their price volatility, and investing in startups or early-stage ventures that have higher failure rates. These investments offer the potential for significant returns but also carry a substantial risk of loss.   Which investment is the riskiest for investors?  Investing in highly speculative and unproven assets like cryptocurrencies, especially in lesser-known or new coins, can be among the riskiest options for investors. The volatile nature of these assets can lead to substantial financial losses due to sudden price fluctuations and lack of regulation.   Which investment has the highest return without risk?  No investment offers guaranteed high returns without any risk. Investments with potentially higher returns often come with varying degrees of risk. While some low-risk options like government bonds or savings accounts provide stability, they usually offer lower returns. Diversification and a clear understanding of risk are important for any investment strategy.  TALK TO AN EXPERT
5 types of mutual funds

5 types of mutual funds

Investing in mutual funds for your child’s education is always advisable. First of all, it is a less stressful option than investing in direct equity stocks because that requires you to have in-depth knowledge of market trends and fluctuations. Secondly, with mutual funds, there are a variety of schemes you can opt for depending on a range of factors. These factors could include the time period for which you can invest before liquidating, the amount of money you can invest, the amount you require to secure the education fund, the level of risk you can take, and so on.  When it comes to building an education fund, here are the top 5 types of mutual funds you can choose from. 1. Large-cap mutual funds The defining characteristic of large-cap equity funds is the fact that these funds invest in the top 100 Indian companies that have the highest market value. Large-cap mutual funds can bring in impressive returns if you remain invested for a long period. If you are a person who wants to avoid taking very high risks with your investments and has decided to invest early for your child’s education, this is the way to go. The average returns rate has historically beaten that of Fixed Deposits and similar investment alternatives. SIP Mutual Fund Investment Read More 2. Mid-cap mutual funds Mid-cap funds invest in Indian companies that come in the next best 250 in terms of market value. These funds are for you if you are ready to take on a higher level of risk. Justifiably, the return rates also tend to get higher. One way to satiate the risk appetite of mid-cap equity funds is to let them season for at least 7-10 years. If your child is in primary or middle school, investing in such a scheme will generate a wholesome amount of wealth by the time they are ready to pursue a college education.   How to track Mutual Funds? Read More 3. Equity-linked saving schemes  Among the various perks of investing in mutual funds is the tax deduction benefit. Equity Linked Saving Schemes are devoted to enabling investors to save taxes, as the name also indicates.  The only catch here is that it has a compulsory lock-in period of at least 3 years. The aim here is to keep you invested longer to counter the risk level. If you can spare that amount of time, then ELSS is definitely a go-to. An added benefit is the historically high level of returns.   Mutual Funds to invest in Child Education Read More 4. Low-risk options  There is this whole myth surrounding mutual funds that they only come with a high-risk factor. On the contrary, a debt fund is also a kind of mutual fund that comes with low risk, so much so that it remains undisturbed by market fluctuations.  Debt funds are still a better option than Fixed Deposits because they can generate a higher percentage of returns. So, if you are not in favor of taking high risks, debt funds are a go-to.  5. Hybrid mutual funds  If you are confused about your investment options or even hesitant about risking too much, the answer to your problems is a hybrid mutual fund. This kind of fund is a mixture of equity as well as debt.  Hybrid mutual funds bring in the best of both worlds. They tend to generate good returns at low risk. FAQs What are the different types of mutual funds? Large-cap mutual funds Mid-cap mutual funds Equity-linked saving schemes Low-risk options Hybrid mutual funds Which type of MF is best? The best type of mutual fund is the Hybrid mutual fund. Which MF gives the highest return? Equity-linked mutual funds are considered the mutual funds with the highest returns. Conclusion There will be miscellaneous financial goals you will be required to set if you are a family person. One among these might be to straighten up the roadmap to your child’s academic and career aspirations. The first step is calculating your expected expenses with the help of an education cost calculator. The calculator will help you draw your investment map to fulfill your child's aspirations. The earlier you invest, the more prepared you will be to make critical decisions as the moment arrives. DisclaimerMutual funds are subject to market risks. The previous performance of a fund is no guarantee of future success. Please reach out to an expert to know more about the schemes before investing.
5 ways you can save up for your child’s education

5 ways you can save up for your child’s education

In this blog, we will explore the best ways to save for your child's education! Education in India is viewed as a stepping stone to a good future. ‍The race to get children into the best colleges is so keenly fought that every Indian parent can qualify for a role of an expert counselor. The “padhai karo, nahi tho achchi Naukri kaise lagegi” line is so often heard that it could very well replace the “so jao, varna gabbar aa jayega” line. ‍The belief that a good education will provide for a good life, is entrenched in the way we think. Indian parents are willing to go to lengths to provide their children with the best education and are ready to spend as much as it takes. Many parents start saving when their child is very young, to prepare for future college-related expenses. ‍In this blog, we will look at 5 avenues where Indian parents can consider investing their hard-earned money. 5 Best ways to save for your child's education Your child's education does not deserve to be compromised and here are some ways in which you can plan ahead and start taking small steps toward your child's college fund. ‍Let's get started. ‍1. Investing in Mutual Funds We're sure you have heard of the phrase 'mutual funds' Sahi hai! And when it comes to saving up for long-term investments, mutual funds definitely Sahi hai! ‍Investing in mutual funds as a way to build a corpus fund for a particular goal has gained a lot of interest in the past decade or so. Building a retirement fund or a home purchase fund is very common and a small percentage of investors are also parents keen on saving up for their child’s education. Investing in mutual funds is viewed as a potentially high-return investment with the risk involved since the returns on mutual funds are market-related. Markets have been extremely volatile in the recent past, but mutual funds should still form a large part of an education fund, considering the longer time horizon involved. It is possible to invest as per your risk preference and redemption is far easier when you need the money. With Systematic Investment Plans (SIPs) that give you the option of investing monthly, there is a possibility of better returns compared to one-time/lumpsum investment mutual funds, especially over longer investment periods.   INVEST IN MUTUAL FUNDS 2. Exchange Traded Funds (ETFs) ‍For those of you who are unfamiliar with the concept of ETF, it is basically a basket of securities that is traded on an exchange. They are similar to mutual funds. ‍Investing in ETFs can prove to be a successful investment option when saving up for your child's education. The reason is, that you will be investing your money in dollars, therefore, if your child aspires to pursue his/ her education abroad, the dollar holds more value than many other currencies. INVEST IN ETFs 3. Buying Insurance Plans Buying an insurance plan to provide income security to your child is also an option. Many of these so-called child plans provide insurance cover and also market-linked returns after a fixed tenure. ‍However, returns on these plans have been volatile and impacted by frequent regulatory changes. Also, child insurance policies may not be the best investment option, because they are bound by various terms and conditions. 4. Buying Real-Estate Yes, this holds true for parents trying to save up for their children even today. Real Estate is considered by many, to be a good long-term investment. Since the time horizon that parents should consider is 15-20 years, real estate investments are good to maintain a diversified portfolio. But, real estate has lost its sheen as an attractive investment option over the past decade or so, due to excess inventory and regulatory impacts. ‍There are a number of hassles when investing in real estate. Other than the declining returns – unreliable deals, possible legal tangles, and a high wait time when one wants to sell are some of the factors to consider if this is an investment option for you. 5. Investing in PPF In India, the Public Provident Fund, or PPF is the go-to option for many parents when investing in their child’s future. It is a low-risk option that is exempt from tax on the withdrawal. The returns are lower but predictable. However, there is a limit to the amount of money one can invest through this route – the upper limit is Rs. 1,50,000, annually. PPFs are also less suited when an investor is ready to take more risk and willing to invest in market-linked funds. FAQs How can we save for children's education? Ans. Investing in mutual funds, exchange-traded funds, buying insurance plans, buying real estate, investing in PPF.  What is a good educational plan? A solid educational plan will give your family and you a road map for your future educational and professional objectives. Although parents and kids are free to start as early as they'd like, planning for college and technical training at the middle school level is not too early.  What is the best savings plan for a child? Ans. Sukanya Samriddhi Scheme, Make Investments in Gold, Invest in Equity Mutual Funds, Investments via Recurring Deposits.   Why save for your child's education? Ans. You can avoid taking on significant debt to pay for your child's higher education by starting a savings plan early, even before they enter kindergarten.  What is the right time to start saving for your child's education? The right to start saving for your child's education is as early as possible. The earlier you begin, the better it will be for your investments, as you'll be able to take advantage of the power of compounding. Conclusion We hope now you have a decent idea of what investment options you could consider, as well as the pros and cons of each. In our next post, we will look at why we think mutual funds - through SIP mode - are a good way to build a corpus fund with the goal of educating your child. With this kind of education fund, you can stop worrying about the finances that are required to send your child to the college of her dreams. ‍Your investment today will gift your child a good life, tomorrow. Consult an expert advisor to get the right plan TALK TO AN EXPERT
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