It is always better to plan your retirement in advance and hence you must certainly save for your future. Moreover, it is not just about planning your retirement but it is about planning for contingencies and your future. You have plans to purchase your dream car or a dream home in the next few years and you surely need to save money to achieve your dream.
Do you know that you can expedite your progress by letting your money work and grow? You must be thinking that how that is possible but well if you know what are mutual funds then you already have the answer to the question. You can choose to invest in different types of mutual funds and move closer to your goal.
What is the Best Way to Invest?
As per our recommendation, there is should be a lot of disciple in investments and it is quite easy to bring in discipline when we talk about mutual funds. The only thing that you need to do is that you need to select the funds before you buy mutual funds.After the selection, you can simply automate your investments by setting up Systematic Investment Plans. If you wish to invest more in a certain month then you can add the money to the mutual fund investments.
Apart from bringing in discipline, this approach also helps you in reducing the volatility risk as the NAV of the mutual fund averages out because of the market fluctuations in the regular course of time. Now, a lot of people ask us about the type of mutual fund they should invest in.
Which Mutual Funds Should I Invest in?
This is a very subjective question and the type of mutual fund that someone should invest in actually depends on the type of risk profile you have. If you have a high risk profile then you can also invest in small cap funds or medium cap funds which certainly promises higher growth.
In this article, we have listed some of the best mutual funds available in the market and after analysing 100s of funds, we came up with the top 5 Mutual Funds where you can invest your money in 2018.
Top Mutual Funds to Invest in 2018
5. Eaton Vance Atlanta Capital SMID – Cap I
On number 5, we have a small cap fund from Eaton Vance and the fund is known to have a good return. The only negative part of the fund is the high expense ratio which stands at 0.94% and this is well above the market average.
The fund has almost all the capital allocated towards US Stocks and it has holdings in Industrials, Technology, Financial Services, Health Care and Consumer Cyclicals. As mentioned earlier, the fund has a high risk profile and talking about the returns, the returns for the funds had been 17.64% for last three years and a little over 15.5% for the last 5 years.
4. Brown Capital Management Small Co Inv
Next on our list is Brown Capital Company’s mutual fund which is known for following a good model to help people in getting good returns. Since the fund invests in small cap, the risk profile is quite aggressive and the fund has holdings in various sectors.
The sectors of the holdings include Technology, Healthcare, Industrials, Basic Materials and Consumer Cyclicals. In terms of performance, the 3 year return of the mutual fund is 16.7% and the 5 year returns are 13.7%. You can certainly have a portion of this mutual fund in your portfolio as it offers a good option for a healthy return.
3. Virtus KAR Small-Cap Growth I
Another fund on our list is Virtus KAR Small Cap Growth Fund and this could be a perfect fund for long term capital growth. In addition to this, the fund invests your money in lesser-known companies which have a high potential for growth. For 5 years, the fund has given a return of 21.48% which is certainly the best in the group.
If you do not mind taking some extra risk then you must consider this fund as there are good chances of getting a high return in next few years because of the dynamics of the American market.
2. T Rowe Price New Horizons
If you want a small cap fund with average risk then this could be your choice. The fund has an average risk profile with a decent return. This fund has most of the capital allocated towards the US Stocks but almost 11% of capital is also allocated in non-US stock.
In terms of sector, the fund has its capital allocated in stocks from Technology, Industrials, healthcare, Consumer Cyclical and Financial Services. The fund has added a value of 19.12% in last one year for the investors and the average of 3 years stands at 16.7%
1. Prime Cap Odyssey Aggressive Growth
If you are a type of investor who loves to take the risk then this mutual fund should certainly be able to find a place in your portfolio. The fund is a mid cap fund with its holdings in sectors like Healthcare, Technology, Industrials, Consumer Cyclicals and Financial Services. Three year return of this fund is 20.98% and the 5 year return is 17.9%. Because of the sudden surge in the market, this fund is presently returning 32.4% if you consider the returns for past one year.You must go through the performance sheet of the fund as the expense ratio of the fund is 0.64% only.
These are some of the best mutual funds available to you and you can also explore other options. If you feel that a fund is not giving returns as per your expectations then you can divert your money to some other funds.
Disclaimer – Mutual Funds Investments are subjected to market risk and hence we do not guarantee any type of fixed return. The returns of these mutual funds are dependent on market conditions and performance.