How easy is it to choose the leading Funds from about 40 Mutual Funds and Hundreds of Schemes? unquestionably not easy. assume we do choose a few. Will those funds be the Leading? Not Sure
So, in this painful and uncertain tasks, how do we go about choosing the Leading Funds?
Firstly, Don’t go for Leading. choose what’s Right for you.
Let’s see an example to understand things, fitter. Examine you went shopping for Clothing. You don’t just pull what looks good. You firstly look for what type of clothes you require. Whether casual or formal. Then you choose your size. Then you see which one looks good. Afterwards, the question is about whether the rate is justified or not. Finally, you go for the one which suits you. This is how you shop for what’s good for you
The fund choose should be based on your goals, time horizon, risk hunger which tells you what asset allotment and categories you should look for and then choose the one which suits supreme in the categories laid down.
It explains the goal for which you are investing in. It provides an idea that whether you are looking for long term wealth maximization or over-diversification wealth assembly. It would provide you with an idea about how much should you invest in outreach your goals and how much can you invest based on your prices and other commitments.
This is associated with your objective. Your time Perception proposes which approach fits prime for you whether Traditionalist, Modest or an Energetic.
Based on your time Perception you can choose what percentage of debt should you have in your portfolio, for e.g. if your time mounting is for 3-4 years, you can go for absolute debt in low maturity category. As you time perception expands you can add Equity in your portfolio.
This is where you conclude yourself that whether you are okay with less liquidity and tolerating a loss in the short run for long-term advantages or loosing on capital in times of changeful frighten you. You can then determine which of the right Debt-Equity mix is meant for you.
Now once you realize how much Debt and Equity is required and which categories you have to involve in the portfolio, you begin looking for the funds in those categories. This will help you to follow a concentrated approach and avoid over-diversification. Therefore, the upcoming time you don’t have to look for those 100s of funds to invest more or track you know you replica core portfolio and you follow it till the time you think it is time to go for some other scheme.