Investing in mutual funds without good knowledge is like driving a car without wheels while hoping you have a smooth journey and reach the destination in time. Investment is a significant decision that demands careful consideration and a thorough understanding of how the investment vehicle works.
Today, we’re gonna talk about one of the big names in mutual funds – Edelweiss Mutual Funds. We’re going to look at 5 things about this fund that will help you understand it better and make a decision that aligns with your financial goals.
About Edelweiss Mutual Funds
Edelweiss Mutual Funds, a part of the Edelweiss Group, is one of the prominent names in the Indian mutual fund industry. Set up in 2008, it has carved a niche for itself by offering a comprehensive suite of investment solutions designed to cater to the diverse needs of its investors.
Edelweiss Mutual Funds offers a wide range of mutual fund schemes spanning various categories such as equity, debt, and hybrid. Each of these categories is designed to cater to different risk appetites and investment horizons of investors.
For instance, equity funds are suitable for investors with a high-risk appetite and long-term investment horizon, while debt funds are ideal for conservative investors seeking stable returns.
Coming back to the point, it all depends on how much appetite you have for risk, what your financial goals are, and how long you are willing to stay in the game. Now, is Edelweiss a good investment decision? You can decide that by thoroughly doing your research on the following, you must know things about the fund.
Here are the top things you need to know.
1. Fund Performance
Edelweiss Mutual Funds have shown commendable performance over the years. However, it depends on the assets that the fund invests in, which you should check.
For instance, the Edelweiss Flexi Cap Fund, which invests 98% in domestic stocks, has delivered returns of 43.84% over 1 year, 23.27% over 3 years, and 15.50% since its launch.
2. Understand Risk vs. Return
Investing in mutual funds involves a balance between risk and return. Equity mutual funds, such as those offered by Edelweiss, pose a higher risk as they are more susceptible to market fluctuations. However, they also offer higher returns than debt or hybrid funds.
It is good to have a long-term horizon of more than three to five years for mutual funds to earn compounding returns and reduce downside risks.
3. Compare Expense Ratio
The expense ratio is a crucial factor to consider while investing in mutual funds. It includes the annual operating costs, management fees, allocation, and advertising costs of the fund.
For example, the expense ratio of the Edelweiss ELSS Tax Saver Fund and the Edelweiss Flexi Cap Fund are 0.63% and 0.45% respectively. Compare this to choose the best fund.
4. Understand Your Investment Horizon and Risk Appetite
The investment horizon can significantly impact the returns from a mutual fund. For instance, the suggested investment horizon for the Edelweiss Flexi Cap Fund is more than 3 years.
This duration helps reduce the downside risk and ensures that the returns become more predictable. Also, ensure that you know how much risk you can undertake before making an investment.
5. Align with Your Financial Goals
Aligning your investments with your financial goals is crucial. Edelweiss Mutual Funds offers a wide range of schemes to choose from, including debt, equity, and hybrid investment options.
You can use tools like the SIP Calculator or a lump sum calculator to determine how much you should invest to reach your financial goals.
Conclusion
Investing in mutual funds is a decision that should be made with careful consideration and thorough research. Edelweiss Mutual Funds, with its diverse range of offerings and a strong emphasis on transparency, presents a compelling choice for investors.
However, it’s important to remember that every investment comes with its own set of risks and returns. The key to successful investing is making smart choices, and having patience and consistency. To invest in mutual funds with ease, consider Dhan.
