How To Choose Mutual Fund Schemes?

Summary

The video discusses how to choose from over 2,000 asset management schemes by focusing on three main categories: equity, debt, and hybrid funds. It emphasizes the importance of financial planning, understanding subtypes within these categories, and the need for fundamental analysis to compare schemes effectively. Viewers are encouraged to assess their own expertise in managing investments; if lacking, they should seek assistance from mutual fund distributors. Overall, the content highlights the complexity of wealth management and the significance of informed decision-making.

Takeaways

• 😀 There are over 40 asset management companies and more than 2,000 mutual fund schemes available for investment.
• 📊 The first step in investing is to conduct thorough financial planning to identify your financial goals and time horizons.
• 💰 The three main categories of mutual fund schemes are equity, debt, and hybrid funds.
• 📈 Equity funds invest in stock markets, while debt funds focus on fixed-income instruments with no stock market exposure.
• ⚖️ Hybrid funds combine investments in both equity and debt, providing a balanced approach.
• 🧐 Understanding the subtypes within each category is crucial for making informed investment choices.
• 🔍 Conduct fundamental analysis to compare schemes, focusing on performance ratios and parameters rather than just past performance.
• ⏳ Regularly track and reassess your investments to ensure they continue to meet your financial goals.
• 👨‍💼 If you lack the expertise or time to manage investments, consider seeking help from a mutual fund distributor.
• 💡 Wealth management is complex and sensitive, emphasizing the importance of making informed and objective investment decisions.

Q & A

What are the three broad categories of investment schemes mentioned in the transcript?

The three broad categories of investment schemes are equity, debt, and hybrid funds.

What is the first step in choosing an investment scheme according to the speaker?

The first step is to do financial planning, which involves understanding your financial goals and time horizon.

What types of instruments are included in debt investment schemes?

Debt investment schemes include overnight, liquid, ultra-short duration, low duration, money market, short duration, medium duration, corporate bonds, and more.

What is the significance of tax considerations in hybrid funds?

Tax considerations are important because hybrid funds may have different tax implications based on whether they are classified under equity or debt.

How many schemes might you find within each subtype of investment?

Within each subtype, there may be 10 to 12 schemes to choose from.

What should investors consider when comparing investment schemes?

Investors should conduct fundamental analysis based on ratios and parameters to determine which schemes are good or bad.

Why is it important to track investments after making them?

Tracking investments is important to assess whether they remain good options and to decide if any changes or rebalancing are necessary.

What should someone do if they lack the expertise to manage their investments?

If someone lacks the expertise, they should consider seeking help from a mutual fund distributor.

Why is managing wealth compared to managing health in the transcript?

Both health and wealth are complex and sensitive subjects that can significantly impact one's life, requiring careful consideration and management.

What does the speaker suggest about the performance of investment schemes?

The speaker notes that the best-performing schemes can change every three to five years, emphasizing the need for ongoing evaluation.