Mutual fund investments are fast gaining momentum among the public. But, it is always tough for investors to choose the right fund. This is why most investment experts urge investors to choose funds that fulfill their investment goals. The investors are also advised to diversify their fund allocation as it helps them minimise the losses when the market is not in sync with their investment expectations.

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Tanveer Alam, MD at Fincart told Zee Business TV, "It has been found that people make an investment decision on the basis of how much return they would get rather looking at whether the investment would meet their goal or not. So, first, an investor needs to change the mindset here." 

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Giving an example, Alam said that if you have to go to London, you will take a flight, irrespective of the fare. He said that investors need to follow a similar strategy with mutual funds. "If you want to go to London, you have only one option to choose air route and for that one must have that much of money to pay for that. Similarly, when you need to travel from your home to the nearest grocery shop, you can't travel by the same, even though you have enough money in your kitty. So, the selection of the funds is completely dependent upon the goals of an investor," he said. 

Tanveer said that for long-term goals like 20 or 25 years equity funds are the best option and an investor should pick his or her fund in this category. Similarly, for mid-term goals like 5-7 years goal, one should invest in balanced mutual funds. If an investor does that, he or she would be able to do a goal-based mutual fund investment.