Mutual funds question?



I dont understand the calculations here NAV etc.
Can anyone tell how much will I get if I invest
50000 (for 1 year) in a mutual fund. Please tell me
according to the prevailing rates (NAV etc)
Which is the mutual fund which give more returns
as well as tax benefits (India)
can u say the approx value if not exact
for 3 years

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  1. No one can tell u that how much u will get after one year…. MF is for long term investment & one can consider for future savings. Then surely u will get unexpected benefits…
    To avail tax benefits, there is just locking period of 3 years…..
    Watch CNBC channel or http://www.moneycontrol.com to analyze best MF


  2. What Smarty is saying is correct but See they will give you unexpected benefits means u should be prepared for losing u r money value too.



  3. You need not understand about NAV calculations. All mutual funds calculate the NAV and publish the same ( in newspapers / on their websites / magazines etc). Even if you calculate, it won’t change the official figures.

    The NAV is dependent on what type of mutual fund scheme is? It also depends on the portfolio of the scheme. So comparisons between two different mutual fund schemes will be not fair and correct. It will be comparing apples to oranges.

    What you can do is:
    decide what your aim from the investment is? time frame? what you like ( e.g. steel companies / banks etc). Then try looking at the information of mutual fund schemes related to your likings etc. Then invest.

    Mean while you can ask questions in this forum whenever you have doubts and need clarifications about your study / analysis.

    Wish you lots of money in future.


  4. The NAV of a mutual fund is the total value of all assets of the fund house divided by the total number of outstanding units.

    A Mutual fund works as follows. (I am not getting into the technical terms. This is a very simple explanation)

    Mr. X who has a lot of experience in the share market decides to start a MF. He calls for prospective investors. Say investors A, B, C, D & E decide to invest Rs. 10000/- each, Mr. X would be starting his MF with a corpus of Rs. 50000/- X would be creating MF units of face value Rs. 10/- each and distribute it to all the investors. So each A, B, C, D & E would get 1000 units each.

    Inv amount = 10000 & Unit Face Value (NAV) = 10

    ==> No. of units given = 1000 (I have not taken into account the entry load since this is only a theoritical example)

    Using this Rs. 50000/- X would buy/sell shares and make profit. At the end of each trading day X would calcuate the total net worth of the initial investment. Say after 1 month of trading, the total value of the investment is Rs. 58000/- then the current NAV of the fund would be Rs. 11.60/- which means each of the investors has made a profit of Rs. 1.60 per unit they bought from Mr. X.

    Note: This 58000 would be the amount that is arrived at after subtracting the profit margin that Mr. X would take for using his expertise in forming this MF and making profit. This profit margin would vary from fund to fund but has an upper cut off set by SEBI.

    Say after one succesful year of operation the Net assets in the MF stands at Rs. 1,00,000/- then the NAV on that day would be Rs. 20/-


  5. I think it is not such an easy question to answer that how much returns you are going to get at the end of one year on your investment of Rs 50000 in mutual funds
    But since we are talking about mutual funds it is very important to keep in mind the risk factor attached to it.
    In your case i would suggest you not to follow anyone’s advice blindly because it is your hard earned money and first try to take the help of internet to gather information on this topic and then try to contact any expert or organization who can help you out in planning your investment.
    I know one such organization or website that is “mansukh.com” and can recommend it to you.Go through its research section and gather information about the market from their.You can also seek expert advice by contacting their in house expert which are very much approachable.Be very careful while taking your final decision.
    Good Luck


  6. In broader sense, NAV is the age of the fund and not the value or rate of the fund.
    To invest in Mutual fund, you dont have see NAV of the fund as this the false way to view the fund.
    http://www.freemutualfunds.com/story3.html

    Now for investing in mutual fund with a tenure of 1 year, you should invest in Good MIP (Monthly Income Plan Fund). In MIP 85% of your money is invested in debt instruments and upto 15% in Equity Shares. You can expect 8 to 10% safely in MIP for 1 year investment tenure.
    http://www.freemutualfunds.com/best-funds.html
    for more information please contact me at
    http://www.freemutualfunds.com/contact.html