Skip to main content

Asset Allocation Funds

Tax Saving Mutual Funds Online

Current open Infra Bond Application form

   Investment experts ask investors to always stick to their asset allocation plan and rebalance it at regular intervals to create wealth in the long term. However, most investors find it difficult to do the allocation as well as rebalancing on their own. They also find it difficult to hire a professional for the job for a variety of reasons: stiff fees, lack of access and the small size of the portfolio and so on. These make many look at asset allocation fund of funds. Multi manager asset allocation fund helps investors to invest in the best of the mutual fund schemes investing in various assets as per a pre-determined asset allocation. It also helps to track, continue with good investments and weed out underperformers. Though an asset allocation fund cannot replace the financial planning exercise completely, it still deserves a closer look.

WHAT are Asset Allocation Funds?

For the beginners, asset alloction funds are fund of funds schemes that offer to invest in other equity and debt mutual fund schemes based on a certain mix of equity and fixed income. An aggressive asset allocation fund invests in a combination of equity and fixed income; say 70% in equity and the rest in fixed income, through MF schemes; whereas a cautious asset allocation fund ensures that all the money is invested in fixed income schemes investing in low-risk instruments. Asset allocation funds are of two types — single manager and multi manager. A single manager asset allocation fund invests in MF scheme managed by one manager — read schemes floated by the same mutual fund house, whereas a multi manager asset allocation fund invests in mutual funds schemes across fund houses. Keep aside the given benefit, investing as per asset allocation, there is more on offer.

BENEFITS

A multi manager asset allocation fund makes more sense for the first-time investor, as s/he may not be conversant with the functioning of each product in the mutual fund space and further may not have adequate information to choose the best funds. And that is not the only reason. Multi manager funds allow the fund manager to invest money in the best of the class mutual fund schemes to offer optimum risk-adjusted returns for naive investors which may not be the case with a single manager fund where the fund manager may not have much options. But if you are comfortable with the investment philosophy of a particular fund house, you can also look at single manager asset allocation fund floated by that fund house.


Asset allocation funds also offer the much-needed asset rebalancing. Asset rebalancing helps investors to move money from risky assets to non-risky assets or the other way round at regular intervals\. If you are a long term investor and do not have time, resources or knowledge to efficiently track your investments, you run the risk of remaining invested in a dud investment.


A professional fund manager while rebalancing ensures your money remains optimally employed. There is one more benefit investors have to keep in mind. The shelter of one fund saves the investors from heavy taxation. If you try to actively rebalance or continuously keep weeding underperformers to invest in scheme better positioned to deliver, you may end up paying short term capital gains. This is especially true in case of savvy investors actively tracking their investments. Instead, remain invested in a good multi-manager fund for long-term and enjoy lower taxation.


Though you have to pay for this job, there are some areas where you may see lower expenses too. Asset allocation schemes can invest in 'institutional plans' of other schemes that come with lower expense ratio. Small investors have to invest in retail plans with comparatively higher expenses. Though there are benefits of investing in an asset allocation funds, one cannot ignore the downside too.


The fund manager must stick to the mandate given to him. Too much portfolio churn and stepping out of mandate for maximisation of returns can increase risks. You have to keep in mind that these products are generic in nature. There is a limit to customisation when you opt for an asset allocation fund.

 

---------------------------------------------

Invest in Tax Saving Mutual Funds ( ELSS Mutual Funds ) to upto Rs 1 lakh and Save tax under Section 80C.

 

Invest Tax Saving Mutual Funds Online

Tax Saving Mutual Funds Online

These links can be used to Purchase Mutual Funds Online that are regular also (Investment, non-tax saving)

 

Download Tax Saving Mutual Fund Application Forms from all AMCs

Download Tax Saving Mutual Fund Applications

 

These Application Forms can be used for buying regular mutual funds also

 

Some of the best Tax Saving Mutual Funds available ( ELSS Mutual Funds )

  1. HDFC TaxSaver
  2. ICICI Prudential Tax Plan
  3. DSP BlackRock Tax Saver Fund
  4. Birla Sun Life Tax Relief '96
  5. Reliance Tax Saver (ELSS) Fund
  6. IDFC Tax Advantage (ELSS) Fund
  7. SBI Magnum Tax Gain Scheme 1993
  8. Sundaram Tax Saver

---------------------------------------------

Application form for Tax Saving Infrastructure Bond and more information

Current open Infra Bond Application form

 

Submit filled up application    Collection canter near you

 

 

 

------------------------------------------------
How to apply to REC Bonds?

Apply for REC Tax Free Bonds forms below

Download REC Tax Free Bond Application Forms

Submit the filled up form to Collection canter near you

Popular posts from this blog

All about "Derivatives"

What are derivatives? Derivatives are financial instruments, which as the name suggests, derive their value from another asset — called the underlying. What are the typical underlying assets? Any asset, whose price is dynamic, probably has a derivative contract today. The most popular ones being stocks, indices, precious metals, commodities, agro products, currencies, etc. Why were they invented? In an increasingly dynamic world, prices of virtually all assets keep changing, thereby exposing participants to price risks. Hence, derivatives were invented to negate these price fluctuations. For example, a wheat farmer expects to sell his crop at the current price of Rs 10/kg and make profits of Rs 2/kg. But, by the time his crop is ready, the price of wheat may have gone down to Rs 5/kg, making him sell his crop at a loss of Rs 3/kg. In order to avoid this, he may enter into a forward contract, agreeing to sell wheat at Rs 10/ kg, right at the outset. So, even if the price of wheat falls ...

Mutual Fund MIPs can give better returns than Post Office MIS

Post Office MIS vs  Mutual Fund MIPs   Post office Monthly Income Scheme has for long been a favourite with investors who want regular monthly income from their investments. They offer risk free 8.5% returns and are especially preferred by conservative investors, like retirees who need regular monthly income from their investments. However, top performing mutual fund monthly income plans (MIPs) have beaten Post Office Monthly Income Scheme (MIS), in terms of annualized returns over the last 5 years, by investing a small part of the corpus in equities which can give higher returns than fixed income investments. The value proposition of the mutual fund aggressive MIPs is that, the interest from debt investment is supplemented by an additional boost to equity returns. Please see the chart below for five year annualized returns from Post office MIS and top performing mutual fund MIPs, monthly d...

NRI Corner: The process of remittances abroad

The process of remittances abroad, and back, is cumbersome. Here’s how you can wade through without hassles Approach The Right Place Outward remittances or the process of sending money abroad is governed by many regulations. In India, outward remittances are made mainly through banks. At the outset, you need to remember that you just cannot trust any individual or a financial firm with the responsibility of sending your money. Experts recommend that you should always try to choose a bank with an international footprint, which will make your job easier. Choose Mode Of Transfer The next step is to choose the mode of transfer. One option is to get a Foreign Currency Demand Draft ( FCDD ). This draft will be denominated in foreign currency and should be drawn in favour of the recipient/ beneficiary. The beneficiary does not necessarily need to have an account with the same bank. The other option is to send money via wire transfer. Do not be puzzled if the bank official uses the word SWIFT ...

Zero Coupon Bonds or discount bond or deep discount bond

A ZERO-COUPON bond (also called a discount bond or deep discount bond ) is a bond bought at a price lower than its face value with the face value repaid at the time of maturity.   There is no coupon or interim payments, hence the term zero-coupon bond. Investors earn return from the compounded interest all paid at maturity plus the difference between the discounted price of the bond and its par (or redemption) value. In contrast, an investor who has a regular bond receives income from coupon payments, which are usually made semi-annually. The investor also receives the principal or face value of the investment when the bond matures. Zero-coupon bonds may be long or short-term investments.   Long term zero coupon maturity dates typically start at 10 years. The bonds can be held until maturity or sold on secondary bond markets.

SBI bonds FAQ

  Maximum retail subscription and over – subscription There is a lot of excitement around these bonds, so I won't be surprised if they get over-subscribed on the first day itself. So, I thought Sameer asked a very good question about over-subscription. Here is that discussion. Here are some other questions that you may find useful. Can I trade the SBI bonds on NSE after it lists? Yes, these can be traded after listing. Where can I get the application forms, and can I buy the bonds online? You can get the application from notified branches, and then fill it up there and submit it. To the best of my knowledge, there is no way to invest in them online, but if anyone knows otherwise then please leave a message, and let us know. Can NRIs apply for these bonds? NRIs can't apply for these bonds as they fall under one of the ineligible categories. Can you take a loan by keeping the SBI bonds as security? The terms of the issue in the prospectus state that the bank shall no...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now