Before you begin your investment journey in mutual funds, there’s some basic groundwork involved. Firstly, you need to assess why you wish to invest in mutual funds. This will help you to recognize your financial objectives and goals. The next step is to evaluate the time frame you need to achieve your goals. This will help you understand your investment horizon (short-term, mid-term, or long-term). Lastly, determine how much risk you are willing to take to achieve these goals. This will help you identify your risk profile. As a thumb rule of investing, if you are a conservative investor, you might consider investing in debt mutual funds. However, if you are willing to take risks in the hope to earn significant returns, equities might be the best bet for you. Now that you have grasped your investing basics, let’s understand how to invest in mutual funds online. Read on to learn how to invest in mutual funds both offline and online way.
How to invest in mutual funds?
If you wish to begin your investment journey in mutual funds, there is no single approach. Just like the different types of mutual funds offered to an investor, they can invest in these securities via different ways.
One of the methods involves submitting a properly filled application form along with a bank draft or cheque. You can send this application form at the Registrar and Transfer Agents (RTA) of the respective mutual funds or branch office or designated Investor Services Centres (ISC). This is the offline way of investing in mutual funds.
You can also invest in mutual funds via the online way with the help of a financial intermediary i.e., a mutual fund distributor registered with the primary regulator of the mutual funds in India – Association of Mutual Funds in India (AMFI). Further, you can also invest in mutual funds through the websites of the respective mutual funds. You can also invest through the mobile appof the mutual funds or mutual fund broking firms or AMC (asset management company). Additionally, as an investor you can choose to invest in mutual funds directly, i.e., without including or steering the investment through any investor. Of course, this way is only ideal if you are well versed with the workings of mutual fund industry. This basically means that you are taking matters in your own hand, without any third-party help.
Now that you have understood how to invest in mutual funds, what are you waiting for? Choose mutual funds that best aligns with your investment portfolio. While selecting the apt scheme for your portfolio, don’t forget to analyze the fund’s past performance and make decisions accordingly. Also, make a habit to regularly check the performance of your mutual fund schemes and your investment portfolio, in general. Happy investing!