Solution Oriented Mutual Funds


What is Solution Oriented Mutual Funds?

What is solution oriented Mutual Fund
What is solution oriented Mutual Fund?

Solution Oriented mutual funds as the name suggests “solution” gives solution for your long-term goals or any future plans. Basically, Solution Oriented mutual funds solve two problems and creates wealth for your retirement or children. This category of mutual fund is introduced by keeping in mind some basic future goals.


Solution Oriented mutual funds are made for long-term goals and removes burden from your head for long term goals does and basic financial planning.

Solution Oriented mutual funds are schemes that are sub divided into two types. One is the Retirement Fund, and the other one is Children Fund.

Types of Solution-Oriented Mutual Funds

Retirement fund – Investment objective of this scheme is to provide capital appreciation and consistent income to the investor which will be in line with retirement goals by investing in a mix of securities comprising of equity, equity related instrument, fixed income and different money market securities.

There is a lock-in in this scheme for 5 years or till retirement age which ever is earlier. Many funds take’s an exit load of 1% if redeemed earlier.

Person who wants capital appreciation and wants to create a fund for their retirement this is a choice for that goal. However, in last few years returns are quite low choose the AMC/scheme carefully.

Category Returns in last 5 years - 2% , 3 years - 4% & 1 year – 3.2%

Example – Tata Retirement Savings Fund Conservative Plan Direct (Returns 6.7% in one year, 6.8% in 3 years, 8.8% in 5 years and 10.4% since inception.

However, there can be no assurance or guarantee that the investment objective of the scheme will be achieved.

(Open your Mutual fund investment account with the number 1 App Groww )

Now we shall discuss about the second sub-category of solution oriented mutual fund which is:

Children’s fund – The investment objective of Children’s fund is to provide attractive returns to unit holder by means of capital appreciation through actively managed portfolio of debt equity and money market instruments. It is a low risk fund. Minors i.e., children below 18 are also eligible to invest in this category. Like, retirement this fund also has a lock in for at least for 5 years or till the children attains majority whichever is earlier.

Anyone who wants to create wealth for their future child or children who wants capital appreciation for their future goals can invest in this category. However, returns are quite low as compared to other mutual funds categories, but can be good for long term. Please read the offer document carefully.

Category Returns in last 5 years - 2% , 3 years - 4%  , 1 year – 1.6%.

Example – 1. SBI Magnum Children's Benefit Fund Direct (Returns 1.6% in one year, 6.4% in 3 years,10.4% in 5 years and since inception  it has given 11.0% growth.

(Both Scheme Data taken from Groww)

Note that there can be no assurance or guarantee that the investment objective of the scheme will be achieved.

IMPORTANT LINKS

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