I wish to park cash (round Rs. 5,000 a month) for 3 years to save lots of for marriage. Can you counsel which forms of funds I ought to go for? Will debt funds be viable? And if sure, are you able to counsel some good funds on this class?
Dhruv Bhanushali
You can take into account investing in hybrid funds as an alternative of debt funds to your aim which has three years to go. Hybrid funds spend money on a mix of fairness and debt devices and might, subsequently, assist you generate extra returns in comparison with debt funds. But in addition they carry extra threat as part of their portfolio is invested in fairness. There are completely different sorts of hybrid funds. One is aggressive hybrid funds which is able to all the time have a excessive allocation to fairness often round 70 – 80%, and conservative hybrid funds which is able to all the time have a better allocation to debt devices and restricted funding in fairness devices.
You can spend money on balanced benefit funds the place the fund supervisor will increase or decreases the allocation to fairness and debt primarily based on their market outlook, that’s, the fairness and debt allocation is managed dynamically over time. These funds can have a better fairness allocation when the fund supervisor’s outlook for fairness is extraordinarily optimistic, and if the fund supervisor expects the market to be unstable and consolidate additional, then the allocation in fairness is decreased and debt may be elevated. Hence, balanced benefit funds generally is a higher choice contemplating the current market circumstances and provided that your aim is three years away. You can make investments each month by SIPs (systematic funding plan) within the following balanced benefit funds – ICICI Balanced Advantage Fund and Edelweiss Balanced Advantage Fund.
Query answered by Harshad Chetanwala, co-founder, MyWealthGrowth.com.
(Send in your queries at [email protected] and get them answered by business specialists.)
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