What Should you Do after Investing in Mutual Funds?
In the recent past, the market has shown negative phases for almost a week. A good number of investors flocked themselves out of the investments due to the fear of big losses. On the other side, many have invested flawlessly knowing what opportunities a bear market situation can provide. So, a significant number of new investors have been attracted to the world of mutual fund investment during the recent market fall. They deployed their hard-earned income with the expectation to multiply it by the time.
Among all the newly entered investors, not everyone is informed & proficient in making the appropriate investment decisions. If you are also one of them and trying to jot down the steps that should be taken next, then you must adopt the below-mentioned habits to ensure the profitability of your investments.
Here’s what should be done to ensure that your investments are running on the right track:
- Portfolio Review: You must have invested in the funds matching your requirements and maybe expecting them to meet your objectives efficiently in the required time. However, not imposed but there are possibilities that your scheme may not perform as per your requirements due to one or the other changes in the market, operations, management, etc. Therefore, you just need to keep a regular check on the performance of the scheme in which you have invested. The habit of portfolio-review helps you to keep an eye on your investments whether they are moving on the right track or not. Do not panic as you need not put in much efforts to review your portfolio; all you need to do is just monitor these two aspects:
Comparison with the Benchmark: Compare the performance of the scheme in which you have invested with its benchmark on a periodical basis. If the scheme is going through a good phase and providing good returns, then you can relax, but be cautious if the situation is otherwise. When the fund is running below its benchmark for more than a period of two-three reviews, consult your advisor or switch to a better fund.
Comparison with the Category: Not only with the benchmark, but you also need to compare the performance of the fund among its peers. A satisfactory performance can be accepted but if it is not showing any signs of improvement, it’s better to switch.
- Rebalancing: It means realising the value of the assets on a periodical basis. Rebalancing your investment portfolio is as important as the regular maintenance of your important assets like car, home, etc. In this process, you need to rebalance the allocation of the money in the different categories of the funds because with the changes in time, the objectives also change or get modified. So, as per your latest financial goals, you need to shape-up your investment portfolio to get the best out of it.
- Stay Invested for Long Term: The job does not gets over once you have deployed your money into mutual funds. To ensure an adequate growth or handsome profits on your investments, you need to stay invested for a long term. Until and unless you do not see any unfavorable conditions or unanticipated moves in your funds, stay with it to reap the long-term benefits. Do not make frequent switches and try to be invested in a fund for an adequate time to fetch the best out of it.
- Take a Step Ahead Each Time: With the increasing responsibilities of a family, along with the regular expenses you are already bearing, and the pressure of retirement planning, it becomes difficult to manage the funds to fulfil your dreams. So, you need to make your investment stronger to attain all your financial goals efficiently. Therefore, each time you get a salary hike or when your income increases, try to add up the value of your investments by deploying your additional income into the suitable funds. There are various options to increase the value of your portfolio which include:
Additional Purchase: You can invest in any mutual fund through a lumpsum mode of investment. It is best suitable when you get any bonus or incentive as they are non-periodical by nature. So, invest your such irregular income through an additional purchase.
Increase SIP: In case you are already investing in the SIP of any mutual fund and want to increase the value of the instalment, you can opt for an increase SIP and get more benefits from your investments.
It’s time to reach your financial goals efficiently by practicing the exercises as mentioned above after investing in the suitable mutual fund. We, at MySIPonline, provide our clients with the fantastic experience of online mutual fund investment along with the instant solutions. To start your investment journey, get associated with us right away!
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