First half of year 2013 had immense volatility in equity and debt markets, which affected the performance of mutual fund schemes. Price of gold also depreciated in last six months, which affected performance of Gold ETF schemes. So, it’s recommended we review our mutual fund portfolio every year and analyse whether our mutual fund scheme is into profit or loss. If it’s not performing well from last couple of years, then discuss with your financial planner / advisor and see whether it make sense to stay invested or if you should take an exit from it. Also, if you are searching for new mutual fund scheme to invest and interested to diversify your portfolio, then its better you analyse which schemes are performing well in this year before taking a decision. In this article, Investmentyogi shares with you a ready reckoner guide for “Top Performing Mutual Funds in 2013” across the schemes.
Mutual Fund Scheme: Equity Large Cap
Large cap funds are those mutual funds which look for capital appreciation by investing primarily in stocks of large blue chip companies that have more potential of earning growth and higher profit.
Top Performing Large Cap Mutual Funds are as follows:
Mutual Fund Scheme: Large and Mid Cap
Large and mid cap funds are those mutual funds which invest the funds in large cap (blue chip) companies and mid cap companies with strong fundamentals, potential of earning growth and higher profit.
Top Performing Large and Mid Cap funds are as follows:
Mutual Fund Scheme: Mid and Small Cap
Mid and small cap funds invest the money mainly in stocks which have small market capitalization. There is high risk and high return matrix for such schemes. On long term, these schemes have the potential to outperform large cap schemes. Few such stocks selected by fund managers for investment could have immense upside in the market and give hefty returns to invested amount. However, when market is into losses for some period, then performance of these schemes could be worse.
Top Performing Mid and Small Cap funds are as follows:
Mutual Fund Scheme: Equity Linked Savings Scheme (ELSS)
An ELSS is a diversified equity mutual fund which invests majority of its funds into equities and balance in debt products. Since it is an equity fund, returns from an ELSS fund reflects returns from the equity markets. This type of mutual fund has a lock in period of 3 years from the date of investment.
Top Performing ELSS are as follows:
Mutual Fund Scheme: Balanced Fund
Balanced mutual fund scheme, as the name suggests, invests into equities to create wealth in long term and debt instrument products to maintain stability. Investing in this product helps to achieve your goals safely. This product satisfies investors’ appetite for equity as well as doesn’t take you on a bumpy ride during volatile sessions of markets. There is cushion from investing in debt which generates a minimum return for investors.
The asset allocation of balanced mutual fund schemes varies in each product offered by an asset management company. The ideal mix an investor should look for while investing in this product is at least 65% into equities and 35% into debt instruments.
Top Performing Balanced Funds are as follows:
Mutual Fund Scheme: Debt Long Term
These funds invest in corporate bonds, government bonds and money market instruments. However, they are highly vulnerable to the changes in interest rates and are suitable for investors who have a long term investment horizon and higher risk taking ability.
Top Performing Debt Long Term Schemes are as follows:
Mutual Fund Scheme: Ultra Short Term
This type of fund invests in very short term debt securities with a small portion in longer term debt securities. Ultra Short Term funds are preferred by investors who are willing to marginally increase their risk with an aim to earn adequate returns. Investors who have short term surplus for a time period of approximately 1 to 9 months should consider investing in these funds.
Top Performing Ultra Short Term Schemes are as follows:
Mutual Fund Scheme: Liquid Fund
These funds provide liquidity to investors and investment is mainly in highly liquid money market instruments. The investment in these funds could be as short as a day. Objective of these funds is to earn money market rates and serve as an alternative investment to corporate and individual investors to invest surplus cash for short duration. Returns on these funds tend to fluctuate less when compared with other funds.
Top Performing Liquid Funds are as follows:
Exchange Traded Funds (ETF): Gold ETF
Gold ETFs are open-ended mutual fund schemes that invest money collected from investors in standard gold bullion. The investor’s holding will be denoted in units, which will be listed on a stock exchange. These are passively managed funds and are designed to provide returns that would closely track the returns from physical gold in the spot market. An investor can buy and redeem the units either directly from the mutual fund or from the stock exchange.
Top Performing Gold ETF schemes are as follows:
While investing in mutual funds, you should analyse other important parameters besides past performance. These parameters are – experience of fund manager, performance of other schemes he / she looks, investment objective, risk and expense ratios, investment style of fund manager, tax implications, portfolio of funds, and exit load. Understand fact sheets of these mutual funds schemes before taking a decision to invest.
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