Mutual Funds: International ELSS schemes can give better returns than domestic ones! See how

Mutual funds, especially equity-linked saving schemes or ELSS give highest returns, provided the investment is done for the long-term. According to investment experts, these funds are like icing on the cake as they also give Income Tax exemption to the investor under Section 80C as well. So, better returns and income tax exemption have made ELSS mutual fund schemes a hot product among the salaried class investors. However, there are some other tricks that investors can adopt, which can maximise returns and at the same time save income tax as well, say experts.

Elaborating upon what does an international Mutual Fund mean and what are its possible benefits for an investor that should convince him to buy an international mutual fund scheme, Deepesh Raghav, Investment Advisor at PersonalFinancePlan.com said, "Difference between International Mutual Funds and Indian Mutual Funds is simple. A mutual fund whose asset manager invests in the Indian indices is called Indian Mutual Fund whereas if an asset manager invests in stocks market outside India then such a mutual fund is called International Mutual Fund." Raghav added that investing in International Mutual Fund is nothing but an indication that the investor believes in extensive diversification of his portfolio.

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On how much one should allocate for in the International Mutual Funds while making his or her portfolio Kartik Jhaveri, Director — Wealth Management at Transcent Consultants said, "A mutual fund investor can allocate around 10-15 per cent of his or her portfolio fund into International Mutual Funds." He went on to add that International Mutual Funds are subject to various indicators like rupee-dollar deviation, political set up etc. He said that generally, a Mutual Fund investor gains when the rupee gains against the US dollar but in the case of International Mutual Funds, an Indian investor gains even when the Indian National Rupee (INR) falls against the US dollar (USD). Therefore, when the Indian equities fail to perform, International Mutual Funds came as a rescue for an investor from the international stock market.

"Mutual fund investors mainly invest in America, European and to some extent into the emerging economies like Brazil, Indonesia, etc.," said Raghav.