Mutual funds are a popular investment for people seeking long-term wealth creation. Some investors may be seeking mutual funds with an investment duration of 3 years. You can align your investment strategy with your financial goals under consideration.
We’ll look at:
- Five among the best mutual funds for a 3-year period,
- With common financial metrics under consideration.
For the investor,
Comprehending financial metrics for a 3-year investment via mutual funds – the fundamentals
Before initiating a 3-year investment in a mutual fund, consider these three financial metrics, among others, to help you understand if the chosen mutual fund aligns with your investment goals.
- Expense Ratio: Represents the annual fee charged by the mutual fund for managing the fund. A lower expense ratio means a higher portion of your investment goes towards generating returns.
- Minimum Investment: Is the minimum amount an investor must contribute to initiate or maintain an investment, in a particular mutual fund. The minimum investment can vary based on the type of mutual fund and investment objective
- Annual Average Return: Measures the annualised rate of return on a mutual fund investment over a specific time period. It calculates the geometric mean of the fund's annual returns, taking into account the compounding effect. Longer time periods provide a more comprehensive perspective of the fund's potential to generate returns.
By analysing these three essential metrics in context with other factors, investors can develop a well-rounded investment strategy. It is important to note that no single metric provides the complete picture. Investors should consider a comprehensive analysis before making investment decisions. Remember to do your independent research, consult with a financial advisor and review your investment strategy regularly, to know if it aligns with your financial goals.
5 Mutual Funds to consider for a 3-year investment
-
Mirae Asset Tax Saver Fund
| Fund Details
| |
| Expense Ratio
represents the annual fee charged by the mutual fund for managing the fund
| 0.5% |
| Minimum Investment – One Time
the minimum amount an investor must contribute to initiate or maintain an investment
| ₹500 |
| 3-Year Return
| 27% |
-
Kotak Tax Saver
| Fund Details
| |
| Expense Ratio
represents the annual fee charged by the mutual fund for managing the fund
| 0.6% |
| Minimum Investment – One Time
the minimum amount an investor must contribute to initiate or maintain an investment
| ₹500 |
| 3-Year Return
| 27% |
-
Tata India Tax Savers Fund
| Fund Details
| |
| Expense Ratio
represents the annual fee charged by the mutual fund for managing the fund
| 0.7% |
| Minimum Investment – One Time
the minimum amount an investor must contribute to initiate or maintain an investment
| ₹500 |
| 3-Year Return
| 25% |
-
Franklin India Taxshield
| Fund Details
| |
| Expense Ratio
represents the annual fee charged by the mutual fund for managing the fund
| 0.8% |
| Minimum Investment – One Time
the minimum amount an investor must contribute to initiate or maintain an investment
| ₹500 |
| 3-Year Return
| 28% |
-
Edelweiss Long Term Equity Plan
| Fund Details
| |
| Expense Ratio
represents the annual fee charged by the mutual fund for managing the fund
| 0.7% |
| Minimum Investment – One Time
the minimum amount an investor must contribute to initiate or maintain an investment
| ₹500 |
| 3-Year Return
| 24% |
In conclusion,
Investing in mutual funds in India for a 3-year period requires careful consideration of various financial metrics and allied factors. Remember, it's always recommended to consult with a financial advisor and conduct independent research before investing in mutual funds.
*Past performance is not indicative of future results. Investing in mutual funds involves market risks.
Disclaimer
The investment options and stocks mentioned here are not recommendations. Please go through your own due diligence and conduct thorough research before investing. Investment in the securities market is subject to market risks. Please read the Risk Disclosure documents carefully before investing. Past performance of instruments/securities does not indicate their future performance. Due to the price fluctuation risk and the market risk, there is no guarantee that your personal investment objectives will be achieved.