Mutual Fund Merry

The people who intends to systematically invest in systematic investment plans (SIPs) rather than in investing in mutual funds, this is the time to think once again. A five year comparative analysis of return yielded through investing in SIPs and in one-time investment in mutual funds stand that the later has yielded nearly four times more than SIPs. Even for short durations ranging from 1-3 years, one-time investment option has given investors much more returns than SIPs.
Average yearly returns on investment (ROI) from equity schemes was a little over 21% compared to 19.5% ROI from the sensex and 23.7% from the nifty during the same period. In this situation a diversified well-managed equity is still in the profit side. Reliance diversified power standard chartered’s premier Equity Fund are two such equity funds with returns of 83% & 53.3% respectively in 2008. A similar positive trends in returns in mutual funds plans has been witnessed in all most all mutual funds. The lumpsum option can give better returns than SIPs. But if one considers longer periods, which consists 2-3 years of ups & downs in the market, SIP gives consistent returns. SIP is an option offered by mutual funds in the line of recurring deposits with post office or bank, to help investors for making regular savings.
Expert says this investment strategy could hold good in 2008-2009 too. The advise from the experts desk is to focus on buying into quality stocks either directly or through the funds route. Asset allocation strategy is key in the current scenario too. There should be a bias towards the large-cap stocks and diversified mutual funds according to some experts. Last fiscal, investors also made good money by entering sectors that were market favorites.
Powers & infrastructure related companies saw phenomenon rally and were market leaders during the later half of 2007. However experts say that on the current global situation, investors should steer clear of sector- specific funds since market conditions are volatile and leading sectors are likely to rotate and anything can happen at any point of time. Of course diversified power funds are doing great job for mutual fund investors presently. So better option for the investors is to go for diversified power funds after quality scrutiny as the performance of these funds are quite better since its inception.