Start Investing in Mutual Funds Online.
Looking to make your money work harder for you? Consider mutual funds as one of the safe investment option with high returns. With their diversified portfolios and professional management, mutual funds offer a reliable way to grow your wealth over time.
What are Mutual Funds?
Mutual funds are investment vehicles that pool money from multiple investors to invest in a diversified portfolio of stocks, bonds, money market instruments, or other assets.
They're managed by professional fund managers who make investment decisions on behalf of the investors. Know More
Companies that qualify to set up mutual funds, create Asset Management Companies (AMCs) or Fund Houses, which pool in the money from investors, market mutual funds, manage investments, and enable investor transactions.
Mutual Funds Growth in India.
The Mutual Funds industry has grown significantly in the last few years. The history of mutual funds in India can be broadly divided into five distinct phases:
FIRST PHASE - 1964-1987.
The Indian mutual fund industry began in 1963 with UTI, under RBI's oversight. By 1988, UTI managed ₹6,700 crores in assets.
SECOND PHASE - 1987-1993.
In 1987, public sector banks, LIC and GIC introduced mutual funds. By 1993, the industry accumulated assets worth ₹47,004 crore.
THIRD PHASE - 1993-2003.
In 1993, SEBI introduced mutual fund regulations, excluding UTI. The industry expanded with foreign sponsors setting up funds in India. As of January 2003,
there were 33 MFs with total AUM of ₹1,21,805 cr, out of which UTI alone had AUM of ₹44,541 cr.
FOURTH PHASE - 2003-2014.
The global financial crisis and SEBI's removal of Entry Load prolonged the challenges for Indian MFs. Recovery took two years, reflected in sluggish AUM growth from 2010 to 2013.
CURRENT PHASE.
Since May 2014, the Indian mutual fund industry has seen consistent growth in AUM and investor folios. As of March 31, 2024, AUM reached ₹53,40,195 crore.
Why Invest in Mutual Funds?
Let's see why you should invest in mutual funds? And what are the advantages of investing in mutual funds?
Professionally Managed.
Skilled experts navigate the markets, guiding you to investment success while you focus on your goals.
Returns.
Offers potential for growth through various investment avenues.
Diversification.
Spreads investments across a range of assets, reducing risk exposure.
Liquidity.
Allows easy access to funds, enabling quick withdrawals when needed.
Affordability.
Accessible to investors with varying budget sizes, offering cost-effective investment options.
Well Regulated.
Governed by stringent regulations, ensuring transparency and investor protection.
Ways to Invest in Mutual Funds.
Investing in mutual funds offers flexibility through two main avenues: SIP allows regular contributions, while Lumpsum entails a one-time investment.
SIP stands for Systematic Investment Plan. It is a method of investing in mutual funds where investors contribute a fixed amount at regular intervals, typically monthly or quarterly, into a chosen mutual fund scheme. SIPs offer the advantage of discipline and consistency in investing, regardless of market conditions. SIPs also employ rupee cost averaging, which helps mitigate the impact of market volatility by averaging the purchase cost of units over time. This approach is popular for its ability to promote long-term wealth accumulation through regular and systematic investments.
Lumpsum refers to a one-time investment of a significant sum of money into a mutual fund or other investment vehicle. Instead of making regular contributions over time, as with a systematic investment plan (SIP), lump sum investing involves deploying a larger amount of capital at once. This method allows investors to take advantage of market opportunities or allocate surplus funds efficiently.
Types of Mutual Funds Based on Asset Class.
Mutual funds in India are classified into different categories depending on the asset class they invest in. Some of the popular categories are as follows.
| Equity Mutual Funds
Equity funds invest a majority of their assets in stocks. These funds are classified into different categories based on the market cap of the stocks they invest in.
Types of Equity Funds
Large-Cap Funds
Invest at least 80% of assets in the top 100 companies by market capitalization.
Mid-Cap Funds
Allocate at least 65% of assets to companies ranked 101st to 250th by market capitalization.
Small-Cap Funds
Devote at least 65% of assets to companies ranked 251st and above by market capitalization.
Multi-Cap Funds
Invest at least 25% of assets in each of large, mid, and small-cap stocks.
Liquid Funds
Invest in highly liquid and low-risk securities with short maturities, usually up to 91 days.
Money Market Funds
Invest in short-term debt securities like treasury bills, commercial papers, and certificates of deposit.
Corporate Bond Funds
Invest primarily (at least 80%) in highest-rated corporate bonds.
Types of Debt Funds
| Debt Funds
Debt funds invest in bonds and other fixed-income securities. They aim to provide stable returns through interest payments while preserving the invested capital. These funds are suitable for investors looking for steady income with lower risk compared to stocks.
Overnight funds
Invest in very short-term debt instruments, typically for one business day.
| Hybrid Funds
Hybrid funds invest in a mix of stocks (equities) and bonds (fixed income). They aim to balance growth and stability by diversifying across asset classes. These funds offer investors the opportunity for both capital appreciation and income generation.
Types of Hybrid Funds
Aggressive Hybrid
Invest at least 65% but not more than 80% in equities, with the remainder in debt.
Multi-Asset Allocation
Allocate at least 10% across three or more asset classes like equities, debt, gold, etc
Arbitrage Funds
Generate returns by exploiting price differences of securities in different markets
Dynamic Asset Allocation funds
Known as Balanced Advantage Funds, they adjust equity and debt exposure based on predefined models.
How to start your investment with us?
Follow some simple steps to start your investment journey with Kartikey Traders.
Contact us
Click on Contact us button and submit your details.
Schedule meeting
We will schedule a meeting on voice/video call.
Portfolio Bucket
We will create portfolio bucket according to your needs.
Documentation
Complete your documentation and KYC process.
Make Payment
Start your investment by making your first payment.
Why Choose Kartikey Traders?
At Kartikey Traders, we prioritize your financial aspirations and provide personalized investment solutions tailored to your needs.
We offers expert guidance every step of the way, helping you make informed wealth management decisions aligned with your goals.
With a wide range of mutual funds and other investment products available, we offer diversified options to suit your risk tolerance and investment preferences.
Transparency is at the core of our operations. We believe in building long-term relationships based on trust, integrity, and clear communication.
Mutual Funds Facts.
The mutual fund industry in India has experienced rapid growth in recent years, with assets under management (AUM) witnessing significant expansion. As of March 31, 2024, the AUM of the Indian mutual fund industry stood at ₹53,40,195 crore, reflecting the increasing popularity of mutual funds among investors.
Mutual funds in India offer a diverse range of investment options catering to various investor needs and preferences. From equity funds and debt funds to hybrid funds and thematic funds, investors have access to a wide array of investment avenues to choose from.
Mutual funds have emerged as a preferred investment choice for retail investors in India. The ease of investing, professional management, and potential for higher returns have attracted a growing number of individual investors to mutual funds as compared to traditional investment avenues like fixed deposits and real estate.
Systematic Investment Plans (SIPs) have gained popularity among investors as a disciplined and convenient way to invest in mutual funds. SIPs allow investors to contribute small amounts at regular intervals, enabling them to benefit from rupee cost averaging and potentially accumulate wealth over the long term.
The mutual fund industry in India is well-regulated by the Securities and Exchange Board of India (SEBI), ensuring transparency, investor protection, and adherence to regulatory guidelines. SEBI regulates various aspects of mutual funds, including fund management, disclosure norms, and investor grievance redressal.
FAQs.
- Mutual funds provide the facility of investing money in large groups with the objective of having a diversified portfolio of investments such as stocks, bonds, money market instruments, or any other assets. This money is put in the custody of professional fund managers and, based on the instructions given by the fund managers, the investors buy and sell the said securities.
- Mutual funds collect money from investors and invest it in various assets based on the fund's investment objective. Investors own units or shares of the mutual fund, and their returns are based on the performance of the underlying assets in the fund's portfolio.
- Mutual funds in India are classified into various categories based on their investment objectives and asset allocation. Some common types include equity funds, debt funds, hybrid funds, index funds, and thematic funds.
-
The SIP is the way to invest money to mutual funds in which investors set aside a fixed amount and invested into a chosen mutual fund scheme at fixed frequency, generally it is monthly or quarterly. SIPs ensure that discipline and consistency keep one’s investments robust during good market times, and also good for the investor during bad market times
- Mutual funds offer several benefits, including diversification, professional management, liquidity, affordability, and potential for higher returns compared to traditional investment options like fixed deposits or savings accounts.
- As mutual funds can generate high returns, they are linked with risks that include market risk, credit risk, interest rate risk and liquidity risk. A key thing that can help the investors is to evaluate their risk tolerance levels and their investment goals before investing in mutual funds.
How can I invest in mutual funds in India?
- Investors can invest in mutual funds through various channels in India, including online platforms, mutual fund distributors, registered investment advisors (RIAs), and asset management companies (AMCs). At Kartikey Traders we provide convenient and hassle-free ways to invest in mutual funds.