How much to invest in equity or debt as I am new to mutual funds

Great to hear that you want to invest in mutual funds. Please note that before investing in mutual funds, you must first ascertain how much risk you can take and what is your investment horizon.

Once these two aspects are clear to you, you can choose a scheme from an appropriate category and invest. We are giving some suggestions through few examples which you may find helpful for you -

Example - 1, Suppose you can take moderately high risk and your investment horizon is 5 years and above, you can invest in Large Cap Funds. Please see the top performing funds in this category here https://www.advisorkhoj.com/mutual-funds...

Example - 2, Suppose you can take moderate risk and your investment horizon is 5 years and above, you can invest in Balanced Funds. Please see the top performing funds in this category here https://www.advisorkhoj.com/mutual-funds...

Example - 3, Suppose you can take high risk and your investment horizon is 5 years and above, you can invest in Mid and Small Cap Funds and Diversified Equity Funds. Please see the top performing funds in these two categories here - https://www.advisorkhoj.com/mutual-funds... and https://www.advisorkhoj.com/mutual-funds...

As you can see in the above examples, the category of funds changes with the risk that you can take. if you can take higher risk the suggested funds would be more aggressive. In mutual funds, rewards in terms of returns are associated with the risk that you can take. Therefore, you can anticipate higher returns if you can take higher risk.

The other thing you might have noticed in the above examples is that the investment tenure in case of equity or balanced fund should be minimum 5 years. But what if your investment tenure is less then 5 years?

If your investment tenure is less than 5 years, you should invest in debt funds. Again, in debt funds there are various categories of debt funds. For example - For 3 years you can invest in long term bond funds/ income funds. In case the investment tenure is less than 3 years, you can invest in short term funds and in case your investment horizon is even less than that, you may invest in liquid or ultra short term funds.

All the top performing funds in these categories can be found in this link https://www.advisorkhoj.com/mutual-funds...

As you are new to mutual funds, our suggestion would be to connect to a mutual fund advisor in Ranchi and take his or her help in preparing your mutual KYC and your investments.

Thanks for writing to us and request you to revert in case you have further queries.