Yuva Patrkaar, New Delhi : Today in this new article what are the benefits of investing in mutual funds. Will give information about it. If you also want to know about it, then please do read this article completely.

Friends, by the way, any method or investment plan to generate savings has its own advantages. And it can be either for a short time or for a long time.

Friends, if you are thinking of investing for the first time. Then you should start with Mutual Fund, because the manager of Mutual Fund gives you the knowledge of investment in detail.

And he invests your money in this way, estimating your potential profits and losses in the future. So that you have minimum loss and get good returns. That's why financial experts also recommend investing in mutual funds for the first time.

So today in this article we are going to know about the benefits of investing in mutual funds. But before that, once I tell you about what is Mutual Fund, so that you can understand better.

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What is Mutual Fund 

Friends, today in this article you are going to know about the benefits of investing in mutual funds. But before that let us know what is Mutual Fund?

The Hindi meaning of Mutual Funds is mutual fund. Speaking in simple language, the amount shared by many people is called Mutual Fund. Actually Mutual Fund collects people's money and invests it in the stock market and investment schemes.

In this way, the mutual fund makes a group investment of your shared money and whatever profit it makes is distributed according to the investment of you and other people.

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What are the benefits of investing in mutual funds

You people must have known about what is a mutual fund. So friends, now let us know about the benefits of investing in mutual funds –

What are the benefits of mutual funds? We have given detailed information about it below-

1. Diversification is available

What is the benefit of investing in mutual funds, let us tell you that equity mutual has its own share of risk. Because their performance is based on the movements of the stock market. So the fund manager invests your money in shares of companies from different industries and different sectors, the whole process is called diversification.

Friends Mutual Fund provides you an opportunity to invest your money in many sectors. Hence, losses in one asset class are easily offset by gains in another sector or asset class. In this, your money is invested in that sector whose growth can happen in the future.

Due to which you get a very strong benefit. Here, in no time, a fund becomes a fund of crores of rupees.

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2. Cost is less

The cost of mutual funds is currently very low in India. The fund management fee charged by mutual funds is only 1 to 2.50 percent. Which is very less and better. Friends, the cost in mutual funds is very low and yet it gives high returns.

It is not that you have to invest thousands or lakhs of rupees in it. You can start investing in mutual funds from as low as ₹100. Meaning that if your budget is low, then you can invest money in it keeping in mind your budget. This is a very good benefit of investing in mutual funds.

3. Tax is also less

What are the benefits of investing in Mutual Funds: Tax Planning Equity Linked Savings Scheme or LIC is one such tax saving instrument. On which any person can easily invest. Which is eligible for tax deduction of up to Rs 1.5 lakh per year under Section 80C of the Income Tax Act, 1961.

However, only 10% tax is applicable on long-term capital gains (LTCG) of more than Rs 1 lakh. The benefit of which became more and more for the people getting more returns from mutual funds.

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4. Convenience in investment

Friends, the payment mode of mutual funds is very convenient as compared to other investment methods. The entire process is done digitally, that is, in a contactless manner. The only limit for your monthly investment is with the fund house.

With which you have linked your bank account. That much money is deducted every month from there. Although you still have control over these things, but these payments are done automatically. Which is very nice and convenient.

Apart from this, you can also make mutual fund payments easily from your mobile app.

5.Transparency

Friends, there is complete transparency in investing in mutual funds. How much of your money is the fund manager investing? You can see its complete details online whenever you want. Apart from this, you can also check the performance of your scheme daily.

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6. You can start investing with a small amount

Friends, a while ago I told you that you can start investing with a small amount i.e. just ₹ 100 savings. Monthly SIP of around ₹ 100 can be invested in some schemes of Mutual Fund.

And tell that if you invest in SIP for long term then only it can be beneficial for you and there are many such funds here. Those who prepare funds worth crores with monthly investment and now investors are getting daily SIP option. Which means now the investor can invest everyday through SIP.

FAQs:

Question1. What is the percentage of interest available in mutual funds?

Answer- Friends, large cap mutual funds get annual returns of 12% to 15%. While small cap funds get 20% to 25% interest.

Question2. When to invest money in mutual funds?

Answer- You should invest in mutual funds when your investment portfolio is in the red.

Question3. For how many years should the mutual fund be held?

Answer- Talking about the long term, you should keep the mutual fund for at least 5 to 10 years.

Question4. When does a loss occur from a mutual fund?

Answer- Losses from mutual funds happen then. When the stock market declines. That's why you should pay special attention to the market.

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