Here is a collection of must-see videos that will help you understand the world of mutual funds. Happy Investing!

Financial discipline is similar to going on a diet. It is never easy. There are plenty of temptations - an urge to over spend, letting emotions control your investments and confusion due to the problem of plenty - look at the plethora of options available in the market, with the returns of one scheme trying to beat the other. Who does one turn to for advice? Dependency on one person or your financial advisor alone is also tricky. Which is why people often turn to mutual funds.

The argument here is that experts are taking care of your investments. Depending on your investment appetite and risk appetite, mutual funds come with a good mix of both equity and debt, which helps you earn an interest of 12-15% or more depending on the type of investment schteme you have picked and how the markets have performed overall. Yet, selecting a mutual fund can be confounding due to the raft of choices available.

Episode 1 I Beginner


What is a portfolio?

The sum-total of all your investments in different financial assets like stocks, bonds, commodities, real estate, art, mutual funds, etc., is your portfolio.

Your portfolio could be either managed by you personally or by financial professionals and money managers.

Choosing a portfolio

To begin investing and creating a portfolio, you first need to assess your risk appetite. If you seek a portfolio with stable returns you can invest in balanced funds who invest nearly 60% to 65% in equities. If you are a conservative investor then you could look at an equity allocation of around 20% to 25%. However, if you have high risk appetite for higher returns, then you can pick aggressive funds who invest nearly 90% of your money in equities. These three forms of investments could be managed via long-term SIPs (Systematic Investment Plans).

Why diversify?

The purpose of diversification is to reduce risk across asset classes. If you put all your investments in one asset class, there is a high-risk of you losing all your capital. Therefore, diversifying or dividing your capital across a variety of asset classes would help you lower risk. This will also help offsetting losses in one asset class with gains from another. Mutual funds do offer you the advantage of diversification as you can invest in multiple funds based on your risk appetite. Also, each fund is managed by a professional fund manager who keeps track of the market movements and re-balances the portfolio to ensure better returns.