| Mutual Fund is basically a trust which through its | | | | the best option for you. These are |
| various schemes safeguards the investments of | | | | • Expense Ratio – This ratio points to |
| small and big investors. Every scheme of each of | | | | the expenses of funds annually, including the |
| these mutual funds has different terms and | | | | administrative and management cost. |
| conditions. By nature mutual funds are not tax | | | | • Sharpe Ratio – This ratio works as |
| saving instruments. However, investment | | | | an indicator that your returns are either due to |
| products in these funds may offer tax savings. | | | | smart investing decisions or due to excess risk. |
| ELSS schemes which are commonly known as | | | | Remember, higher Sharpe Ratio is always better. |
| tax mutual fund is a category where equity and | | | | • Alpha Ratio – It is an indicator of |
| equity related instruments are invested. | | | | risk relative to the benchmark Index. If the alpha |
| Investment up to 1 lakh is tax exempted under | | | | is more then it is always better for an investor. |
| section 80C. However, these schemes have a | | | | • R-squared – It is method to |
| lock in period of 3 years before which you cannot | | | | measure the percentage of an investment's |
| withdraw. | | | | movement. |
| The dividends received by the investor are also | | | | Today mutual fund online have created great |
| tax free. ELSS is a very good tax saving | | | | opportunities to manage your account easily. You |
| instrument which ensures good returns. However, | | | | can sell and redeem units online without any |
| you need to invest carefully after devoting | | | | hassle. Having an access to your account 24/7, |
| sufficient time to select the right fund. There are | | | | no manual filling of application form and keeping a |
| different types of ELSS schemes which are | | | | track of investments 24/7 are few of the |
| categorized as growth and dividend options. | | | | benefits of choosing online investments. |
| In the Growth option of ELSS scheme, the | | | | Most of the banks and institutions have mutual |
| investor does not get money during the | | | | fund online options with easy accessibility. You can |
| investment tenure. He gets the entire lump sum | | | | apply for an E-PIN number to manage and access |
| amount at the time of maturity. On the contrary | | | | your account comfortably. However, it is |
| dividend option of tax mutual fund has two | | | | important to consider your risk taking aptitude |
| choices and they are | | | | before you select a mutual fund. |
| • The investor can either cash on the | | | | Mutual funds in India are gaining grounds. It has |
| dividends | | | | become one of the most popular choices for |
| • The Investor can opt for dividend | | | | investing money. The flexibility, diversification, |
| re-investment option. | | | | professional management, less risk, easy to |
| The choice of growth or dividend options solely | | | | redeem are all few of the benefits of mutual |
| depends upon your priorities. Just by going | | | | funds. |
| through the track records does not mean that | | | | You will need to understand yourself as an |
| you have got the best mutual funds. | | | | investor first and then opt for mutual fund |
| Mutual Funds in India have some quantitative | | | | schemes. Market being volatile, you will need to |
| measures that you should consider to evaluate | | | | analyze your behavior in handling risk. |