Investment is must for everyone as we can see what happens during recession.I formulated an Investment strategy for me related to Mutual funds sharing with you all which might be helpful for you guys too.
As we know there are 2 types of Mutual funds
1. Dividend
2. Growth
In dividend option the Mutual fund company pays divident amount to the holder or us.
Where as
In Growth option the mutual fund company instead of paying money allocate more mutual fund units to us.
What I have found is it is better to have Dividend option because we get money in hand so we can reapply that to somewhere else or re-investment or utilize it.One more reason is the TIME VALUE OF MONEY or in simple terms the value of money changes every year to inflation etc.
Whereas if we go for growth option the units will get accumulated and will be able to get the entire money back only when its maturity period is over.
Investing is not a game so we need to be careful so please before investing in any mutual fund please go through the company policies manual whatever documents you will to have enough confidence.
Because what I have seen is sometimes you know the mutual fund is giving you very good returns but later on during recession due to certain other reasons it is not doing well.
So you can resell the same and invest into some other area in short KEEP MONITORING IT.we should not forgot the money after investing into something.
This becomes more important when we buy TAX relief mutual fund which comes with 3 years or so locking period.So if we don’t do a proper analysis and just invested into some mutual fund then have to be sure about it for next 3 years.
Difficult to predict but we need to be careful about it as it is our money which we investing.
Hope you guys appreciate it.
As we know there are 2 types of Mutual funds
1. Dividend
2. Growth
In dividend option the Mutual fund company pays divident amount to the holder or us.
Where as
In Growth option the mutual fund company instead of paying money allocate more mutual fund units to us.
What I have found is it is better to have Dividend option because we get money in hand so we can reapply that to somewhere else or re-investment or utilize it.One more reason is the TIME VALUE OF MONEY or in simple terms the value of money changes every year to inflation etc.
Whereas if we go for growth option the units will get accumulated and will be able to get the entire money back only when its maturity period is over.
Investing is not a game so we need to be careful so please before investing in any mutual fund please go through the company policies manual whatever documents you will to have enough confidence.
Because what I have seen is sometimes you know the mutual fund is giving you very good returns but later on during recession due to certain other reasons it is not doing well.
So you can resell the same and invest into some other area in short KEEP MONITORING IT.we should not forgot the money after investing into something.
This becomes more important when we buy TAX relief mutual fund which comes with 3 years or so locking period.So if we don’t do a proper analysis and just invested into some mutual fund then have to be sure about it for next 3 years.
Difficult to predict but we need to be careful about it as it is our money which we investing.
Hope you guys appreciate it.
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