Advantages of Investing In Mutual Funds In India
There are many different methods for Mutual investment and every plan has its kind of advantages. Mutual Fund investment can be of short term or long tern investment. In this article we will talk about Advantages of Investing In Mutual Funds In India.
Indian investors like to invest in mutual funds as they have insufficient knowledge about financial management. Here we will know about what are the benefits of investing in mutual funds specially in India and how is this beneficial to Indian investors. The Mutual Fund can be classified based on Risk. The Higher return scheme have higher risk.
The Mutual fund offer advantages and Disadvantages. Before choosing any mutual fund scheme, you should consider duration of Investment and Risk appetite. The Indian Mutual Fund Market regulated by Rules and Regulation framed by SEBI. The Association of Mutual Funds in India known as AMFI is Regulatory body. The Legal framework provided to investor to protect their investment.
The Advantages of investing In mutual funds in India are
- it provides you with high liquidity
When you invest in mutual funds, surely, you will get the benefit of liquidity unlike other schemes here you can redeem your points at any given time. But you have to deal with some of the small factors like the the penalty of the re-exit and exit load should be kept in mind.
After 2020, the Capital flow in Mutual fund increased. Many new investor are looking for more and more investment opportunity in Indian Market. So there is so much liquidity running in Indian Stock market and Mutual Fund industries. Liquidity is biggest Advantages of Investing In Mutual Funds In India.
- It provides you with diversification
Here you will be provided with the benefit of diversification. when the value of your investment decreased. It is that for the second value your value will increase. In this way, you will never go to a full loss at any point in time this way it provides you with great diversification.
In India, the Mutual fund Houses are offering huge diversification to the customer. The customer can invest their hard earned money based on Risk and Asset type. The Fund house offer huge verity in their offering which give flexibilities in the investment.
- Availability of expert management
If you do not have any expertise in this field then management of the portfolio is done by an expert. who has a great grip over all this so by this you can be tension free about all these?
The expert will do his work and manage all this you just need to do invest and rest things will be get managed by The expert who has experience in this field. this provides you with one of the greatest benefits of investing in mutual funds in India.
- provides you Flexibility in Investment amount
If you don’t have any huge amount in your hand and still you want to invest in mutual then it is the best platform for you to invest in the Indian market. here you have the freedom of how much to invest because you can start with a very small amount.
If you are doing the job and your investment amount is in the form of salary then you can opt for SIP means a systematic investment plan in this small fixed portion of salary will be invested in According to your ability to invest
- provides you easy accessibility:
In India, it is very easy to buy mutual funds from the market .you can do it from any point of the world in a fraction of the time. and this provides you with the benefit of easy accessibility. companies like asset management companies provide you with a channel to Access all this easily
- Firms of brokerage
- Karvy and CAMS like Registrars
- Banks and Agents
- platforms on online mode of mutual funds
The customer can buy and sell mutual fund units via online and offline method.
- Super solid security and transparency:
It provides you with great security and transparency as SEBI has made guidelines for its color coding. It means every mutual fund will need to have a different color coding this will help investors in knowing the risk and other factors
There are 3 color coding in this which indicates different items like
- Blue: low risk
- Yellow: medium risk
- Brown: High risk
- Offered at very low cost
All funds are collected from different investors and all this is used to invest in to buy securities. this saves the cost of all small transactions .and all this saving cost will be distributed to investors this way they will gain benefits of investing in mutual funds.
8. Tax saving option
It is one of the ways to save tax because in this ELSS mutual funds you will get a tax exemption of around Rs.1.50.lakh under section 80C of the income tax.
All these are the benefits of investing in mutual funds in India if you are interested in investing you must go for it and Have good earnings. Advantages of Investing In Mutual Funds In India increases because of legal framework. In Franklin Templeton Mutual fund case SEBI and Indian Court played strong role.
The active participation of AMFI, SEBI increase investor confidence. The Advantages of Investing In Mutual Funds In India make favorable market for the new investors.