Diwali 2019: Want to become Kuber? Money will rain after buying these 10 Mutual Funds

Who doesn't want to become rich in life? Everyone wants to be Kuber of his social circle? However, it takes loads of confidence, patience and smartness to multiply your money several times. This Diwali you can invest your money to get maximum returns. Mutual fund investments are subject to market risk but in the long-term horizon, this risk factor goes down as the averaging of the NAV minimizes the risk factor involved in mutual fund investments. Therefore, if someone begins investing with a small amount, it can become a big maturity amount after a certain period. According to tax and investment experts, long-term mutual funds give at least 12 per cent returns in terms of profit, however, in certain cases, it may even go up to whopping 16 per cent. Pankaj Mathpal, Managing Director, Optima Money Managers has selected 10 such funds which can give you consistent returns in the long term.

1 Liquid Fund

This is an ideal fund for parking money for the short term. One can invest in Liquid funds when he/she wants to set up a Systematic Transfer Plan. You can also transfer the money from liquid funds to equity funds systematically.

Recommended scheme: Aditya Birla Sun Life Liquid Fund

Returns:

1 Year        3 year         5 year

7.17%          7.01%           7.50%

The scheme has exposure in Fixed Deposits and high-quality Bonds, Certificates of deposits and Commercial Papers.

2. Debt Fund

Debt provides stability to the portfolio. The holding period is more than 3 years qualify for long term capital gain. The long term capital gain from the debt scheme is taxed at 20% with the benefit of indexation and hence, it's more tax-efficient compared to fixed deposits.

Recommended Scheme: Nippon India Nivesh Lakshya Fund

The scheme was introduced in July 2018 and it has delivered 20.29% returns in one year. It has major exposure in Government Securities and Central Government loans with a long maturity. There is no credit risk or default risk in the scheme as there is a sovereign guarantee.

3. Equity Saving Funds

These are debt-oriented Hybrid Schemes. Have exposure in Equity, debt, and arbitrage. It qualifies for equity taxation through actual exposure inequity is low. Equity exposure is around 25% in these schemes. It is ideal for investors who are looking for investment around 1 year to 2 years or senior citizens who want limited equity exposure.

Recommended Scheme: ICICI Prudential Equity Saving Fund

The scheme has around 35% in equity as on date and has delivered a 9.52% return in the last one year.

4. Aggressive Hybrid Funds

Equity exposure is 35% and debt exposure by 35%. It is an ideal combination of safety and growth. It is ideal scheme for new investors. The scheme also qualifies for equity taxation.

SBI Equity Hybrid Fund

1 year       3 year        5 year

17.38%       9.10%         11%

5. Equity Large Cap

One can invest in the top 100 companies by their market capitalization. The large-cap companies witness lower drawdown as compared to mid and small-sized companies. The Blue-chip stocks are less volatile mid-cap and small-cap stocks. The fund focuses on companies and sectors that are expected to perform better than the general market. Fund uses inputs from the internal quant model to identify investable companies.

Recommended Scheme: Canara Robeco Bluechip Equity Fund

1 year        3 year         5 year

18.65%      10.61%       9.84%

6- Equity- Midcap

One can invest in the companies with ranking from 101 to 250 by market capitalization. An investor with time horizon for more than 5 years should consider mid-cap funds in their portfolio. Suitable for SIP.

Recommended Scheme: Kotak Emerging Equity Fund

Returns:

1 year       3 year       5 year

12.84%       5.59%       12.53%

The scheme focuses on mid-cap stocks which are either in the nascent stage, developing stage or under research. They find companies that have high growth potential.

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7. Equity- Small Cap

The investor should have limited exposure in small-cap funds and only when the time horizon is very long. The small caps are highly volatile but outperform the large caps during the market rally.

Recommended Scheme: SBI Small Cap

Returns:

1 year      3 year       5 year

9.64%       10.74%      17.32%

8- Equity Multi cap

These schemes invest across market capitalization. The fund manager decides the allocation in large-cap, mid-cap and small-cap stocks based on the market situation.

Recommended Scheme- Canara Robeco Equity Diversified Fund

Returns:

1 year      3 year      5 year

16.69%    10.69%      9.28%

9. International Funds

Investors can take benefits by investing in companies like Apple, Facebook, Google, and Amazon, etc. This scheme has exposure in companies like Amazon, Intel, and Nike, etc. The investors are benefited from the performance of international companies that are not listed in India.

Recommended Scheme- ICICI Prudential US Bluechip Equity Fund

1 year    3 year     5 year

10.33%    16.45%    12.33%

It is ideal for portfolio diversification. The investors should have limited exposure to such schemes.

10- Tax Saving Funds

This one is an ideal tax saving scheme u/s 80C of the Income Tax act. It has a lock-in for 3 years and provides the opportunity for tax saving and growth. The investors should link their investment in ELSS to their long term goals.

Mirae Asset Tax Saver Fund

1 year     3 year

15.47%    12.47%

Note: Mutual Funds are subject to market risk. Please research and read all scheme related documents carefully before investing. We do not endorse any scheme or fund.