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Ramalingam

Ramalingam Kalirajan  |11151 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 08, 2024

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
Asked by Anonymous - Apr 29, 2024Hindi
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How to assess good mutual funds and what's the difference between MF and NFO?

Ans: Assessing good mutual funds is crucial for building a robust investment portfolio. Here's how you can distinguish them and understand the difference between mutual funds (MF) and new fund offers (NFO):
• Understand your investment objectives, risk tolerance, and time horizon before selecting mutual funds. This will help you align your investments with your financial goals.
• Look for funds with a consistent track record of performance across different market cycles. Analyze factors such as returns, volatility, expense ratio, and fund manager expertise.
• Consider the fund's investment strategy and portfolio composition. Ensure that the fund's objectives match your investment goals and risk profile.
• Check the fund's asset allocation and diversification to minimize risk and enhance potential returns. A well-diversified portfolio spreads risk across various asset classes and market segments.
• Assess the fund house's reputation, management team, and investment process. Choose funds managed by experienced professionals with a proven track record of delivering value to investors.
• Understand the difference between mutual funds and new fund offers (NFOs). MFs are existing funds with a track record, while NFOs are new schemes launched by fund houses.
• NFOs may offer opportunities to invest in unique themes or asset classes but lack a performance track record. Investors should carefully evaluate NFOs based on their investment objectives and risk appetite.
• Unlike established mutual funds, NFOs carry higher uncertainty and may take time to establish a performance track record. Investors should exercise caution and conduct thorough research before investing in NFOs.
Remember, due diligence and research are essential when selecting mutual funds or evaluating new fund offers. Consult with a Certified Financial Planner (CFP) to understand your investment needs better and make informed decisions aligned with your financial goals.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner
www.holisticinvestment.in
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Ramalingam

Ramalingam Kalirajan  |11151 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 18, 2024

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Sir I have been investing in MF's for last 5 years. However I have not taken any expert advice or from a certified planner while selecting funds. However I want to understand if I have invested in good funds with the objective of long term wealth creation. PPFAS FLEXI CAP Direct Growth-5200 ICICI Pru Value Discovery-1500 Tata ELSS tax saver-1000 Canara Robeco ELSS tax saver-1000 Axis ELSS tax saver-1000 Quant small cap direct growth-2600 PGIM India mid cap growth-2500 HDFC children gift fund-5000 SBI Magnum children benefits fund-5000. Kindly let me know if I am right track.
Ans: It's great that you've been investing for the last 5 years with a focus on long-term wealth creation. Your portfolio appears to be diversified across flexi cap, value-oriented, tax-saving, small cap, mid cap, and children's funds, which is a positive approach.

To assess if you're on the right track:

Diversification: Your portfolio seems to be diversified across different fund categories, which can help in spreading risk.
Tax Planning: Investing in ELSS tax saver funds can provide tax benefits under Section 80C of the Income Tax Act, enhancing your overall tax planning strategy.
Long-Term Focus: With your investment horizon aligned with long-term wealth creation, the funds chosen generally cater to this objective.
However, it's essential to periodically review your portfolio's performance, ensure alignment with your risk tolerance, and make adjustments as needed. Consider consulting a certified financial planner for a comprehensive review tailored to your financial goals and risk profile.

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DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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