Follow These Dos And Don'ts While Investing In Mutual Funds


BANGALORE: Investors all over the world are making fast money from Mutual Fund (MF) investments. It's true that mutual funds are volatile in nature and its return is subjected to market risk. But if you are a smart investor and are also quite aware of the well-performing MF in the market, then investment not only becomes easy but also profitable and risk free. Mutual FundThere are certain Dos and Don’ts that one should keep in mind while investing in mutual funds as compiled by Yahoo Finance.

Let’s first throw light on some of the Dos what one should follow. It is always advisable to get through the financial goals set by the mutual fund scheme you are investing in to get acknowledged if the those goals match your objectives or not. You should always ask for a copy of the offer document from the fund that you are investing in.

Every investment involves risk factors, so better make an investment that balances with your income. Also take a clear and quick look on the present performances of the MFs in the market in real time and not based on its past performances. Even after investing you can keep yourself updated with the performance of the mutual fund scheme that you have invested into. This can be done by tracking the Net asset Values (NAVs) of your investments on a daily basis. It indicates the performance of your fund.

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But, what could prevent you from taking any unwise decisions? First of all never invest in any scheme just because some of your friend or relative is offering you to invest in. Secondly, do not get carried away and fall prey for the schemes that promises high returns in future. You should not hesitate in asking any doubt or question to the concerned authority regarding the terms and policies of the scheme as it is a matter of concern for your own safety and future.

When it comes to investment, it is better to avoid dealing through an agent or broker, who is not registered with the Association of Mutual Funds in India (AMFI). The market regulator oversees their actions to ensure ethical and that the healthy standards are maintained, while promoting the interests of the mutual funds and their investors.

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