Stock Portfolio – How to Monitor your Stock Portfolio

Stock Portfolio – How to Monitor your Stock Portfolio

It is said that well begun is half done. But what about the other half? Smart investors like you know that their job does not end with stock selection or building a good portfolio. That is just half of the job done. To ensure wealth creation in the long-run, you need to monitor the stock portfolio on a regular periodic basis. But does that mean that you need to daily check the stock prices? The answer is a loud No.

Read on to know how you can monitor your stock market portfolio in a sane and effective manner.

1. Keep yourself updated

Remember when your parents or teachers would ask you to keep yourself updated with current affairs? Well, that will pay off even while monitoring your stock portfolio. You should read up about the company and also any new developments in the industry. This will ensure that you are abreast with any policy revisions, regulatory changes or any macro-economic factor that might impact the profitability of the sector or stock portfolio.

You do not need to rely only on newspapers. You can leverage technology for this task. Google Alerts make this task easier and more real-time. Especially for small or mid-cap companies which may not enjoy wide coverage by mainstream media. You can set Google Alerts for companies in your stock portfolio and enjoy information at the click of a button. Many financial service providers also provide important news and market highlights on their portals.

2. Check out corporate announcements

Listed companies need to inform the stock exchange about all important events or company decisions that may impact their stock price. This could be any new acquisition, employment or resignation of key/senior personnel, etc. You should keep an eye out for such corporate announcements. This information is easily available on the company’s as well as the stock exchange’s site. Some companies also inform the shareholders about such corporate announcements via emails.

Ensure to go through the details of corporate announcements as they will help you to monitor the stock portfolio. Moreover, it can influence you to buy more or sell from your share portfolio.

Go through the company results

Indian companies release their results on a quarterly basis. It is important to study the quarterly performance reports of your share portfolio. However, the important point is not to get overly concerned if the results are poor in a few quarters. Each company goes through ups and downs. The important factor is consistency. So, do not go into panic (and exit) mode if you notice a dip. Try to analyse the reason behind the poor performance and look at the overall economic scenarios before taking any decision. Continuous poor results (especially when the economy is doing fine) is a sign that you should consider removing that investment from the stock portfolio.

Annual reports also contain information about the company’s future growth plans or strategies. This can influence your decision to stick around or bid adieu to their stocks in the long-run.

4. Observe changes in the Shareholding Patterns of promoters

Companies declare their shareholding pattern on a quarterly basis. These details are published on the company’s and stock exchange’s website.

Shareholder pattern can be a great indicator of the overall health of the company and its future. While analysing the changes in the company’s shareholding pattern, you need to focus only on the promoter’s shares. Promoters increasing its stake in the company is a positive sign. Promoters have access to the most pertinent and intimate information about the company. Hence, they will go for a higher share in the company only when they feel that the prospects are good. On the other hand, if you notice that there is a consistent reduction in the promoter’s shareholding, take it as a red flag. Try to figure out the reason behind the same. Sometimes, it may so happen that they sell their stake to raise funds for some personal exigency. But such events are not usually recurrent in nature. Hence, do a thorough root-cause analysis. If you feel that the promoters are trying to move out of the business, it is a good enough indicator for you to follow suit.

5. Look if promoter’s shares are pledged

When promoters fall short of financial resources to meet the business’s working capital requirement or need to fund another venture, they can pledge their shares for loan money. Their shares act as a security or collateral for the borrowed funds.

Like the shareholding pattern, companies need to disclose the pledge details of the promoter’s shares on a quarterly basis. You should follow this information and look for any alert signs. Generally, an increase in the promoter’s share pledging is seen as a negative indicator. It indicates that the business is under financial stress. If the promoters are not able to repay the loan amount, the lender can sell the shares in the open market. This will adversely impact the market share prices and bring down the value of your stocks portfolio.

6. Credit Rating

Whenever a company raises debt, they need to get themselves assessed and rated by any of the accredited credit rating agencies (CRISIL, ICRA, CARE, India Ratings, etc.) These agencies review the company’s financial health at least on an annual basis and publish the information on their website. Along with the rating, they also give a summary document which gives an overview of the strengths and weakness of the concerned company.

You should review these credit rating reports. They are an easy way of tracking the financial well-being of a company. If you notice a rating downgrade, take it as a serious matter and analyse it in detail. It can significantly help you to save or grow your hard-earned money.


Now you know what are the “DOs and DONTs” when it comes to monitoring your stock market portfolio. But still, if you feel that you need some support, don’t worry. Help is just around the corner.

Many financial service companies collate all these data points and publish it on their website. This is highly useful for readers as all the relevant information is available in one commonplace. Also, their in-house analysts study the available information and give their expert opinion on the possible trends, etc. 

One such service provider is IndiaNivesh. It is a full-fledged financial solutions organization and offers a range of services in the domain of mutual funds,  equities, derivatives and commodities, insurance, strategic investments, wealth management, etc. IndiaNivesh’s team has a collective experience of 300 years. Their in-depth understanding of the Indian markets, ability to customise solutions and leverage technology gives them a clear edge. So, next time you find yourself wondering – How can I monitor my stocks portfolio? Reach out to the expert team at IndiaNivesh.

Disclaimer: Investment in securities market / Mutual Funds are subject to market risks, read all the related documents carefully before investing.


Investing in Mutual Funds vs. Direct Equity Investment in India

The ultimate goal for each investor is the same – wealth creation! While the destination is the same, there are different routes that you can take to reach it. You can either invest in mutual funds or you can directly buy equity share or stocks from the open market. Each route has its set of pros and cons. In this article, we will analyse these two options and help you figure out which is the better route based on your requirements. Direct Equity Investment Direct Equity Investment is an active approach to investing. In this route, the investor takes the decisions regarding which stocks to invest in, when to buy/exit, etc. While investing in direct equity, brokerage charges are applicable when transacting via an intermediary. Direct equity investments are best done by those who understand the workings of the stock market and have time and capability to monitor and research individual stocks. Mutual Funds This is the passive approach to investing. Mutual Funds pool in money from a large number of investors and invest across multiple stocks/asset categories as per the scheme’s objective. The portfolio is managed by professionals who are equipped with the required knowledge and resources. Direct Equity vs. Mutual Funds – which route should you take? To answer this question, you will need to consider the below factors:1. Market Expertise Stock investments are not lottery tickets where you can invest in anything and then wait for your luck to work its charm. It requires a great degree of knowledge, analytical skills and experience to choose the right stocks for your needs. There are too many dynamics to be considered. If you have a thorough understanding of the markets (and economic factors impacting it), direct equity investments are ideal for you. On the other hand, if you are a novice, mutual funds should be your go-to channel. If you are not comfortable choosing which mutual funds to invest in, you can take the help of financial advisors as well.2. Time for research Studying, tracking and analysing the stock market and related economic factors is a time-intensive activity. If you feel that you can devote adequate time in analysing the markets and monitoring their investments, you should opt for Direct Equity. Else, you can go the mutual fund route. Mutual Funds corpus is managed by professional experts (fund managers) who are skilled and trained in that domain.3. Diversification The USP of mutual funds is diversification. They offer exposure to a wide range of stocks which form part of the portfolio. Even if you invest a small amount (let’s say Rs. 5,000), your money will be spread across multiple stocks. In the case of direct investments, you can purchase only a limited number of varied stocks. To achieve the same diversification level (as offered by Mutual Funds), you would need to have a higher investible corpus. It also depends on your risk appetite. If you are a conservative investor, mutual funds are a better bet as the risk is distributed. 4. Ownership Equity investments have dual benefits – capital appreciation and ownership rights. If you are someone who wants ownership rights of a company, then you should go for direct investing. You will be eligible to attend shareholders meeting, get voting rights, etc. With mutual funds, you will not get these privileges as the shares are held indirectly.5. Control When you invest via the mutual fund route, you have no say or control in the stock selection. That is at the discretion of the fund manager. So, even if you have good reason to believe that a particular stock is going to fall, you will not be able to take any action. However, if you opt for direct stock investments, you are your own fund manager. You get complete control over the buy or sell decisions. You can exit from single stocks, which is not possible with Mutual Funds.6. Taxation Some Mutual Funds (ELSS) qualify for deductions under Section 80C of the Income Tax Act. However, no such benefit is available with direct stock investments.7. Exit Load In direct equity investments, there is no exit load. However, in case of mutual funds, if you exit the scheme before the holding/ lock-in period, you may need to incur penalty charges in the form of exit load.8. Charges involved In mutual fund investments, you mainly incur transaction charges (when you go through an intermediary) and fund management charges (based on expense ratio). SEBI makes the guidelines for these expenses and fund houses need to adhere to the same. For direct equity investments, there are demat, brokerage as well as transaction charges. Mutual Funds have high trading volumes. This, in turn, brings down the per-transaction cost as compared to an individual investor with lower trade volumes. Conclusion There is no best investment channel that will hold good for each and every person. Both routes have their own merits & demerits. The final choice depends on you and your needs/ priorities. Direct equity investing can be highly rewarding for individuals with in-depth knowledge of the markets and high-risk appetite. However, usually, retail investors do not possess such thorough market understanding. Some may not be able to dedicate so much time to research or monitor the market trend or movements. In such situations, it is advisable to take the mutual fund route and leave the investment decisions to professionals or fund managers. They can suggest the best mutual funds to invest in as per your goals, needs and risk profile. Financial experts like IndiaNivesh have helped thousands of investors optimise the value of their investments. With more than 11 years of experience in the Indian markets, they are adept at understanding the specific needs of each investor. They offer a wide range of financial services including mutual funds, equities, derivatives, insurance, commodities, PMS, investment banking, corporate advisory, wealth management, etc.  With an expert like IndiaNivesh, you are sure to make the best out of your hard-earned money.Disclaimer: Investment in securities market / Mutual Funds are subject to market risks, read all the related documents carefully before investing.

read more


Debt vs Equity – Striking Balance between Debt and Equity

With a wide variety of investment vehicles available in the market, it can be challenging to select the right one to invest your hard-earned money. From company stocks, gold, real estate, bank FDs, debentures and bonds, to mutual funds and more, there are numerous avenues for investment.  But even before you decide the right investment scheme, the first task is to determine if you are looking to invest in equity or invest in debt. Most investments are typically categorised between debt investments and equity investments. For instance, if you invest in an equity-based investment, it means you are directly or indirectly purchasing company stocks, and your returns will be related to how that companies perform. Say, you purchase 100 shares of a leading tech company; here, your returns will be based on the stock dividend which the tech company will pay and the rise or fall of the value of the company shares. Equity-based investments can be risky. And because of its high-risk factor, they typically offer a higher return rate in the long run. On the other hand, when you invest in debt, you lend money to an individual, a company or a government establishment. With debt investments, your returns may not be directly related to how the borrower performs. For instance, if you purchase corporate bonds worth Rs. 10,000 and the company makes a profit, the returns will be the same as if the company had earned no profit at all. Debt-based investments are considered stable. And hence, they earn a low rate of return.As an investor, you aim at profiting from your investments. However, to gain optimum profit, you need to analyse your risk profile. Once you know that you can choose between the two avenues once you know which option offers what benefits. Hence, it is essential to know the difference between debt and equity capital to get the best out of your investment. Most people assume that all mutual funds are alike. On the contrary, there are various types of mutual funds, and primary among these are equity funds and debt funds. The chief difference between equity fund vs debt fund lies in the way the money is invested. When you invest in debt funds, you are investing in fixed income securities. On the other hand, equity funds primarily invest in equity shares and related securities. Equity funds and debt funds have sharply contrasting features that decide how the respective schemes invest and behave, determining their outcome.To ensure you receive the best out of your investment, look into asset allocation. It can mitigate risks and help you enjoy the benefit of diversification, while at the same time offering you control over your assets and investments. Asset allocation is a strategy an investor uses to structure their portfolio. Depending on your financial goals and risk tolerance, you can spread your investments between equity and debt. For instance, two friends may have the same financial goal but different asset allocations. While one may have a greater risk tolerance and thus be inclined towards assigning higher resources to equity capital, the other with a lower risk tolerance would look towards debt investments after evaluating the risk and capital needed towards the goal.Wealth creation requires continual and planned investments to determine your financial goals. It is wise not to place all your eggs in one basket; financial experts advise allocating investments among various asset classes. As a critical strategy that can lower your risk and potentially enhance your returns, it is vital to understand debt-vs-equity and how it can work for you.Striking a balance between equity and debt is a powerful concept that is mostly ignored. Regardless, it is easy to execute. Depending on the time frame of your investments and the amount of risk you can bear, you may want to maintain a specific portion of your financial investments in equities and the rest in debt and fixed income. This means that if the proportion of a particular asset class veers away from the desired ratio, you can move your investments from that asset class to another one to balance your portfolio. Accurate asset allocation is critical to financial empowerment. Prudent asset allocation requires you to answer• Where you should invest?• How much do you need to invest?• How can you invest?When answering these questions, you identify asset classes and the amount you wish to hold in your investment portfolio. Here, one’s age becomes a critical factor in asset allocation as it changes according to the investor's life stages. For instance, a young investor may have a different financial goal as compared to a middle-aged investor. With regards to long-term financial goals, asset allocations must be adjusted periodically based on market conditions and the investor's age.Typically, equity-based investments are pegged to provide higher yields than debt-based investment. If you are considering equity in the form of stock investment, it requires careful financial analysis to gauge the health of the company. Typically, it can prove beneficial to examine the balance sheet and cash flow statement of the company, and its profit and loss account. Analysing a company's financial health can be crucial in making smart equity investment decisions. Doing so can help you to know the company's performance and compare it with its contemporaries in the same industry.On the other hand, while debt-based investments may offer lower returns, they are critical and serve useful purposes. For instance, they are often used to maintain one's money temporarily while waiting for a suitable equity-based investment. The goal of allocating your assets is to get a return on your investment while managing and controlling the risk at the same time. That being said, there will always be market risk, and it can be impossible to eliminate risks altogether. However, with intelligent asset allocation, you can cut down investment risks, particularly, risks that come with just one specific investment. For example, if you invest entirely in the shares of one company, it could make you vulnerable to the risks that the particular investment could reduce in value. By diversifying your finances, you eliminate this risk while giving your investment the opportunity of making money with one asset class even if the other is declining.TakeawayIt is always an excellent time to look into your asset allocation and understand if your investment portfolio is where you would like it to be. For example, if you observe that your current portfolio is heavily dependent on equities, you may want to consider adding debt investments. You can merely purchase more of debt investments such as debt mutual funds or exchange one asset for another until you have accomplished your expected allocation. Disclaimer: Investment in securities market / Mutual Funds are subject to market risks, read all the related documents carefully before investing.

read more

Are you Investment ready?

*All fields are mandatory

related stories view all

  • Value Investing - What is Value Investing & its Fundamentals

    Value investing is the dark horse of stock markets. And this dark horse has created huge wealth for none other than Warren Buffet. Read on to know what value investing is, and what are the critical factors in this strategy. All that glitters is not gold and all that is gold does not always glitter. This holds true for investment decisions as well and forms the core principle of value investing. What is Value Investing? The value investment strategy was popularised by Benjamin Graham along with David Dodd after successfully surviving the period of the great depression. It involves proactively identifying stocks which are trading at a significantly lower value than their intrinsic value. Intrinsic Value refers to the true value of a stock. The two factors behind value investing are market price and value. Price is the amount you pay, and the value is what you get in return. Value investing believes that the stock market does not always remain in an efficient or balanced state. It sometimes overreacts to events such as political announcements, organisational restructuring, economic conditions and results in stock price fluctuations which do not correspond to the company’s actual worth or long-term fundamentals. Hence, there is a good probability that there are undervalued or overvalued stocks in the market. Value Investing and Behavioral Finance Value Investing and Behavioral Finance are two sides of the same coin. Value investing aims to exploit irrational or impulsive behaviour of investors. Emotions heavily influence investment-related decisions. Greed, fear, peer-pressure lead to poor investment decisions. This creates a huge potential for dispassionate or objective investors. Value investors do not get carried away by market sentiments or herd mentality, instead, they look at the real value of a stock in the long run. They also do not fall into a “growth trap” without actually understanding the history or behaviour of stocks. Fundamentals of Value Investing1. Find the intrinsic value Investors who follow value investing strategy are more interested in a stock’s intrinsic value and not just the current market price. There are multiple ways and valuation methods that are used to identify the intrinsic or true value of a stock. Such as discounted cash flow analysis, dividend discount model, Earning per Share valuation, etc. There is also a formula coined by Benjamin Graham to arrive at the true value of a stock. It is:  Intrinsic Value = Earnings Per Share (EPS) multiplied by (8.5+ Twice the growth rate of the company in the coming 7-10 years).  This formula has been now tweaked to reflect the current market conditions correctly. It is now:  Intrinsic Value = [Earnings Per Share (EPS) multiplied by (8.5+ Twice the growth rate of the company in the coming 7-10 years) multiplied by 4.4] divided by current corporate bond (AAA) yield.  4.4 in the above formula referred to the minimum rate of return in the USA in the year 1962. For the purpose of valuation of Indian stocks, 4.4 should be replaced by the corporate bond yield in the same year in India. When the stock’s market value goes below the calculated intrinsic value, investors purchase those stocks. Then they sit back and relax till the time the market corrects itself and the stock price reaches its actual value.  2. Margin of Safety Margin of Safety enables value investors to manage risks and avoid losses. It is also the key element which distinguishes value investing from mere speculation. It refers to the difference between the stock’s current market price and its intrinsic value. Higher the gap, greater is the safety margin. By investing in a stock with an adequate security margin, investors know that any negative event or volatility will not adversely impact the value of the investment. 3. Don’t follow the crowd Value investing is not for those who like to follow the herd. Value investors focus on stocks which are overlooked or avoided by others because of their low valuations but are inherently solid stocks.   Are there risks in Value Investing? Yes. Just like all the other things in our life, there are risks involved in Value Investing as well. One of the biggest risks is falling into Value Traps. All cheap stocks do not translate into good investment decisions. Value traps are stocks which seem to cheap due to low PE multiple or cash flows, but never go up in value. It is important to do full due- diligence before investing. This includes not just financial metrics, but also qualitative aspects such as quality of management, stability, competition, etc. Final Words Value investing is a proven strategy for wealth appreciation in the long run. But it can be an intimidating way of investing without the right support. A partner like IndiaNivesh can make the process smooth and more fruitful for investors. IndiaNivesh is a reputable financial service provider which offers a wide range of services related to Broking, Institutional equities, strategic investments, wealth management, investment banking and corporate finance. With their in-depth understanding of the Indian markets, the organisational experience of three centuries and cutting-edge technological tools, they help investors make well-informed and profitable decisions.Disclaimer: "Investment in securities market and Mutual Funds are subject to market risks, read all the related documents carefully before investing."

    read more
  • Online Trading – 5 Essential Tips for Trading Online in 2020

    Technological advancements and digitalisation have changed the online arena for every business, and the online share trading is no exception to the trend. Over the last few years, online trading has become very popular, especially amongst the millennials and generation Y. Prevalence of smartphones, lower costs, opportunity to earn extra income, low entry barriers, ease of access, etc has had a profound impact on online trading. Even though online stock trading today is huge, and many people are motivated to explore online trading for a rewarding career, by no figment of imagination it should be assumed that it is easy, and they can become financially self-sufficient in a short period. Here are 5 essential online trading tips to help improve your chances of success in your endeavours as a trader-1. Do the research and gain relevant information about the markets The economic conditions are constantly changing and it has a significant impact on the stock markets. To be successful in online share trading you have to do your research, collect relevant information and be updated about matters relating to markets. With information being available at the click of a button, it is easy to get access to information from various sources. Keeping your eyes and ears open about the official announcements being made, reading up market-related articles and financial publications can help you ace the game of online stock trading and avoid making whimsical trade calls.  2. Get acquainted with the trading terminologies and tools Getting yourself familiar with various terminologies and trading tools beforehand is extremely important so that you do not falter when you start trading. Clearing your basics about the important workings, different types of trades, important terms are critical. If you are not clear about the basics, then you may end up placing a wrong order. Once you are trading online, you are investing real capital and you cannot undo the trade. So, it is essential that you must be familiar with the features and the functions of the trading platform which you are going to use. Practice trading on dummy versions to get a hang of the trading interface before you can start with online trading. Once you have enough practice you will not be flustered and confused at the time of real trading. 3. Start with small capital and practice risk management There are infinite opportunities in the trading world and you do not want one experience to be the deciding factor for you. As online trading is risky, you should always make a small start in the beginning and invest little capital. Even the most successful traders do not put their entire investible surplus for trading but use only the capital which they have to spare after they have put aside for their long-term goals such as retirement. So, invest only the capital which you can afford to lose and which will not affect your financial planning. Another important thing to keep in mind at the time of executing trades is that the risk associated with trading is high and hence you should take adequate measures to minimise risk. Setting a stop-loss to your order will automatically stop a trade if the losses hit a particular mark and help minimise your losses. 4. Be patient and disciplined Online trading is a great way to make an income and many have successfully made a career out of it. If the success stories of other traders have motivated you to take the plunge, then, let’s be honest, online trading is risky and not for the light-hearted. Moreover, it is not something you can master overnight or become rich overnight on a single trade. To be successful, you need to have the right mindset and should be disciplined in your approach. Make a trade plan and stick to it. Trading out of impulse or greed will not help you become successful but following a plan and trading when you see opportunities can help you achieve the desired results. 5. Select the right broker and trading platform Last but not least, choosing the right broker and opening the best trading account online is important, and hence you should be careful about your selection. Choose a trading platform that best meets your needs and has a user-friendly interface. You should be comfortable using their software. Your success rate would be greatly affected by the timely execution of your orders. Other aspects to consider are a level of customer service and satisfaction, market reputation and competitive fee structure.   Conclusion With the above essential online trading tips, you can give your income a boost. We at IndiaNivesh have one of the best online trading platforms at the most competitive price and also offer expert advisory and research to meet your investment needs.Disclaimer: "Investment in securities market and Mutual Funds are subject to market risks, read all the related documents carefully before investing."

    read more
  • Tips on Investing Money in Mutual Funds

    Mutual Funds are the cynosure of the financial world. And rightly so! These investment havens pool in money from multiple investors and then invest the corpus across asset categories in line with the scheme’s objective. They are a great option for retail investors who would otherwise find it difficult to get exposure to such varied investment opportunities. What makes Mutual Funds a good investment tool? ·         Professional Management The USP of Mutual Funds is that they are managed by a team of experts. They are equipped with the necessary resources and information to continuously monitor the markets, analyze market trends and conduct in-depth research. As a result, the fund managers can devise the best investment strategy for the investors and guide them regarding the best mutual funds to invest in. ·         Financial Discipline One of the common problems faced by investors is that they lack the rigour or discipline to stick to their financial resolutions. Mutual Funds take care of this issue easily. Systematic Investment Plans ensure that investors continue to invest regularly. ·         Flexibility Mutual Funds offer a great deal of flexibility to investors. You can choose the frequency of contribution as well as opt to increase or reduce the investment amount as per cash flows. ·         Affordable Systematic Investment Plan (SIP) facility makes Mutual Funds affordable to everyone. One can start mutual fund investments with just Rs. 500. That is basically the cost of one pizza these days! They are perfect for novice investors who are overwhelmed or scared of equities but still want some exposure. ·         Tax savings ELSS are tax-saving Mutual Funds. Investment in these mutual funds qualifies for tax deductions (till Rs. 1.5 Lakhs) as per Section 80C. Owing to their potential of higher returns and shorter lock-in period, as compared to other tax-saving alternatives, ELSS have become a preferred choice for many investors.   Mutual Fund investment tips Now that you know what makes Mutual Funds a great investment tool, here are some mutual fund investment tips to help you make the most out of your hard-earned money. ·         Set a goal It is rightly said that “Dreams do not come true. Goals do”. The same rationale applies to investments too. Investments bring the best results when they have a purpose. So, the first step in mutual fund investments should be setting an investment goal. You should consider factors like budget, investment horizon, financial ambitions and most importantly your risk appetite.  ·         Select the right fund type When it comes to mutual fund investments, one size does not fit all. Just because your friend is investing in a fund does not mean it will benefit you as well.  Mutual Funds invest across a range of asset classes. Hence deciding which mutual fund to invest in can be slightly tricky. It is important to choose a scheme that is in sync with your needs and risk profile. For instance, if you are an experienced investor and can afford to take risks, you can easily go for equity funds. However, if you are a novice then most mutual fund tips for beginners will suggest going for debt or balanced funds. It is important to understand the risk-return relationship inherent in each asset category before making a decision. Rule of thumb being – higher the risk, higher the return! The asset allocation should be in sync with your risk appetite. Also, ask yourselves why you are investing in mutual funds. Is it to save taxes? Then ELSS Funds are your best bet. If you have a short investment horizon and want a fund type with high liquidity, then you can go with Liquid Funds. ·         AMC Credibility Check The right fund house can not only help you decide which mutual fund to invest in but optimize the potential of your overall portfolio. It is important to look at factors such as the credentials of the fund managers, expense ratio, components of the portfolio and AUM (Assets Under Management) of the Fund House. ·         Diversification is the key You should not put all your eggs in the same basket. Diversification across asset categories and investment styles is important. It helps to lower the risk quotient as it gets spread over different investments. Even if one fund underperforms, the other can compensate for it. The value of the entire portfolio is not at risk. ·         SIPs vs Lump-sum One of the best mutual fund tips for beginners is choose the SIP way. Especially if you are venturing into equity or equity oriented mutual funds. A SIP will allow you to spread out your investments over a longer duration of time. You will invest at different points in the market cycle and hence even out the associated risk. Also, the power of rupee-cost averaging in SIPs helps to generate higher returns in the long-term. ·         KYC KYC has become a necessity these days. Government of India has mandated KYC for most of the financial transactions including mutual fund investments. So, ensure that you have documents such as PAN Card, valid address proof, etc. before you venture into mutual fund investments. ·         Have a long-term view Mutual Funds are like a committed relationship and not a one-night stand. You need to remain invested for a longer duration in order to get the best rewards. Especially in the case of equity funds. This is because markets tend to be volatile in the short run but tend to move up in the long-term. The best combination is to invest in a mix of debt and equity to get best of both the worlds. Debt Funds would help to lower the overall risk of the portfolio and could help meet emergency fund requirements in the short run. While your equity funds work on wealth appreciation in the long run. ·         Ask the Expert Just like KBC, Mutual Funds also come with a helpline – Ask the Expert! There are so many options available in Mutual Funds. It can become rather overwhelming for a new investor to select the right mutual fund to invest in. A professional expert will not only help to select the right funds and schemes but will also constantly monitor the market on your behalf. One such expert is IndiaNivesh. They offer a wide variety of financial solutions related to broking and distribution, strategic investments, institutional equities, corporate advisory, investment banking and private wealth management. The team at IndiaNivesh has a combined experience of more than 300 years. With their cutting-edge technological and research capabilities, competent team and “client-first” approach, you can be rest assured that you are in safe hands.   Final Words Now that the mystery is solved about how you can select the best mutual funds to invest in, what are you waiting for? Especially when you know that you have a guide like IndiaNivesh available at the click of a button.Disclaimer: "Investment in securities market and Mutual Funds are subject to market risks, read all the related documents carefully before investing."

    read more