Mutual funds schemes are all in the hype now. But, what is all this buzz about? These mutual funds schemes are professionally managed investment programs. But, it might seem difficult to get started, right? Actually, it is not that hard. These 10 tips will help you breeze through your first investment in a mutual fund scheme.
Set your time horizon and goal
A time period of your investment as well as the amount you want to have by the end of the term should be fixed beforehand. For example, equity fund schemes should only be bought if you have a 5-7 years of time horizon. This will help you choose appropriate mutual fund schemes.
How much can you risk?
Are you a low risk taker, medium risk taker or a high-risk taker? Ascertain your risk limits and then go for the mutual fund schemes. Remember though, higher the risk is, higher will the returns be, and vice versa. Equity funds have the highest risks while liquid funds have the least risk. So, choose your scheme properly, and d not go out of your risk appetite.