Aditya Birla Sun Life Mutual Fund is one of the leading asset management companies in India. With a wide range of mutual fund schemes to choose from, it can be overwhelming for new investors to decide where to put their money. Here are 5 simple tips to help you get started with investing in aditya birla mutual fund schemes.
1. Understand Your Risk Appetite and Investment Goals
The first step is to understand your own risk tolerance and financial goals. Are you looking for long term capital appreciation or regular income? Do you want to play it safe or are you comfortable taking on more risk? Different mutual fund categories like equity, debt and hybrid cater to different risk profiles and time horizons. Evaluate your needs before choosing suitable schemes.
2. Research Top Performing Funds
Once you know your goals and risk profile, research Aditya Birla Mutual Fund schemes that match these criteria. Look at the past performance track record over different time periods (3 years, 5 years, since inception) to identify the top performing funds in different categories. Also study the fund manager details, investment strategy and portfolio holdings. This will help shortlist schemes that suit your requirements.
3. Start With Lump Sum or SIP
You can enter a mutual fund either through lump sum investment or systematic investment plan (SIP). Lump sum is suitable if you have a large corpus to invest in one go. SIP allows you to invest small amounts regularly, say Rs. 500-1000 every month, and benefit from rupee cost averaging. SIPs are best for long term wealth creation through discipline of monthly investments. Choose the mode based on your investment amount and preference.
4. Diversify Across Categories
Instead of putting all your eggs in one basket, diversify your investments across different mutual fund categories like large cap, mid cap, small cap, debt, etc. within your risk budget. This reduces portfolio volatility. For example, you can invest 40% in large cap equity funds, 30% in mid cap, 20% in debt and 10% in gold ETF for a balanced portfolio. Rebalance periodically to maintain desired asset allocation.
5. Stay Invested for Long Term
Mutual funds are long term investments and the power of compounding really kicks in over a period of 5-7 years. Resist the temptation of withdrawing prematurely during market downturns. Continue your SIPs and utilize market corrections to increase your investments at lower NAVs. Staying invested for the long haul is key to achieving your financial goals through mutual funds.
The aditya birla sun life mutual fund offers a wide range of options for investors with different risk appetites and financial goals. By understanding your profile, researching top funds, choosing the right investment mode and diversifying your portfolio across categories, you can build long term wealth through mutual funds. Remember to stay invested for 5-7 years at least to benefit from the power of compounding returns. Follow these simple tips to start your investment journey with one of India’s leading fund houses.