In a rapidly changing financial environment, selecting mutual funds for long-term investment necessitates more than just examining historical returns. According to Rakesh Agrawal, Founder of Tulsi Finserve, “a well-chosen mutual fund SIP can help investors ride India’s growth wave while balancing market risks.” This emphasises the importance of strategic fund selection in building lasting wealth.
Key factors in choosing mutual funds include robust fund management, portfolio diversification, and a consistent track record. For investors aiming at retirement or long-term financial goals, four SEBI-registered schemes stand out.
The Motilal Oswal Midcap Fund employs a QGLP framework—Quality, Growth, Longevity, and Price—to target scalable, mid-sized companies. While midcap funds face short-term volatility, this strategic approach is designed for systematic investment plan (SIP) investors focused on long-term wealth creation. Market corrections often present buying opportunities that reward patient investors, making this fund a reliable choice for those committed to long-term goals. Additionally, the fund’s emphasis on quality and growth ensures that investors are aligned with companies that have strong fundamentals and growth potential. This alignment is crucial for achieving substantial returns over time.
The Nippon India Growth Fund, recognised as one of India’s oldest midcap performers, offers agile sector rotation and stable management. It is distinguished by its resilience across market cycles and compliance with SEBI regulations, providing transparency and a diversified investment portfolio. Historical data shows that long-term SIPs during market downturns have allowed investors to leverage compounding advantages effectively. This fund’s ability to adapt to changing market conditions while maintaining a stable management team is a testament to its reliability. Moreover, its diverse sector exposure helps mitigate risks associated with market volatility, offering investors peace of mind.
The Parag Parikh Flexi Cap Fund diversifies globally, investing in large, mid, and small caps, while also holding assets in international equities. This geographic and sectoral diversification, backed by SEBI compliance on overseas exposure, is suitable for investors who seek to look beyond Indian markets but are prepared for higher risk with a long-term outlook. By incorporating international equities, the fund not only mitigates domestic market risks but also taps into global growth opportunities. This strategy allows investors to benefit from the economic growth of various regions, enhancing the potential for returns and providing a broader investment perspective.
Lastly, the Bandhan Small Cap Fund focuses on early-stage companies in high-growth sectors such as manufacturing, green energy, and technology. Although small-cap investments come with volatility, they offer potential for substantial long-term returns for investors with a high risk tolerance and a commitment of 15 years or more.
The importance of adhering to SEBI norms on disclosures, asset allocation, and risk labelling is underscored, ensuring informed and compliant investment decisions.
(Views expressed by the expert are his/her own. E-mail us your investment queries at askmoneytoday@intoday.com. We will get your queries answered by our panel of experts.)