Four Factors Everyone should Check Before Choosing A Mutual Fund

In the last two decades, we have seen a transformation in market investment with several Mutual Funds getting all the attention. Most of the AMC (Asset Management Company) offers mutual funds for investors to start their leeway to secure their future. As a beginner, you might get confused with several mutual funds for selecting the one to match your goals and expectations. In this post, we have provided five facts to help you give a detailed view of mutual funds.

In a short statement, Mutual Funds Investment is the easiest way of investing in multiple companies. Mutual funds are more secure, reliable and add versatility to your investment portfolio.

Steps To Choose the Right Mutual Fund

Wealthcare Securities is one of the leading Online Mutual Fund Investment companies providing services and options to start their journey in wealth creation. Here we have broken down factors that everyone should know before opting to start their Mutual funds.

Begin with Your Research

Start with a simple understanding of the mutual funds with shares of the companies it invests in, risk, market capitalization, experience, total fund, risk analysis, and check the past returns. You must basic understanding of the investing fund (Equity, Debt, Hybrid) and how you want to invest in that fund. This will help you in separating the preferred funds from other funds.

Specify Your Goal

Primary, the most important factor is your goal. For every investment, you must have a future projection or a target it should achieve. These mutual funds’ goals should match with the time duration, amount, and expectation to deliver things at a precise time.

A goal can be a down payment for a car, college, house, retirement, etc, and then you can plan more specifically the amount, years, and returns. Overall, goals take precedence over all factors. A goal becomes the pillar around which all factors are taken into consideration for decision-making.

Do a Risk Analysis

Markets will remain volatile always. Any small or major factor can become a booming or downward decision. Here one should have the appetite to take the right risk and analyze to achieve your futuristic goals. For instance, small-cap and MID-cap funds are generally more volatile with high returns while large caps are more stable though fewer returns.

Equity mutual funds have become the favourite for young and aggressive investors – as they offer better returns for higher risk, whereas debt funds are more stable for across duration. Many opt for Hybrid funds that have a specific ratio between Equity and Debt thus offering some sort of resistance to market volatility.

Consider the Taxes Your Investment Attracts

One can defer taxes with mutual funds. Not only that, you can invest in less funds, which allow you to save taxes under 80c.
Further, debt mutual funds are taxed post indexation adjustment in long term. Similarly, for the long term, in the case of equity funds, one can book capital gain up to Rs. 1 lakh, tax-free.

This may look more complex but once you start investing the whole process becomes like a hobby. Market jargon or terminology will help you understand the various fundamentals and enhance your financial journey. Using a professional wealth manager can help you put the fund in better mutual funds and create a large wealth creation for the future.


Mutual Funds have become quite the popular term for investing in the market. Currently, there are hundreds and hundreds of Mutual funds in the market. Many Asset management companies offer different scenarios for investment such as lump sum, Systematic Investment Plan (SIP), or a mix of both to give more freedom to investors. All these factors help investors to understand the mutual fund financial information and take a more informed decision for enhancing their future security.

Wealthcare offers Online Mutual Fund Investment to help individuals, companies, and corporates to start their future wealth creation with the right steps. We have the best industry leaders to bring optimized financial solutions.

CA Mukesh Gupta
CA Mukesh Gupta
Mukesh Gupta is the founder and director of Wealthcare. He is Fellow chartered accountant, Certified Financial Planner and Certified Public Financial advisor. He is in financial services industry since 1994. He conducts free money management sessions for corporates and associations on topics related to Personal finance. His previous engagement was with Birla Sunlife group. He regularly writes on topics related to Personal finance and occasionally appear on electronic media.

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