Mutual Funds Investment : Wastage of money

Discussion in 'Money Matters' started by shravanicool, Oct 23, 2009.

  1. shravanicool

    shravanicool Junior IL'ite

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    HI,

    From the past few years my parents have been investing in mutual funds like ICICI, Birla but they have not benefited at all. Recently, my fathe also invested in Sbi Mutual fund . Initially, he got some dividends but after that it all stopped.

    So,I strongly feel mutual funds are wastage of money and time.

    Shravanicool:rant
     
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  2. Devinaren

    Devinaren New IL'ite

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    Yes, I too agree with you, its simply waste of money buying MFs.
     
  3. hotcolain

    hotcolain New IL'ite

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    I tend to disagree on this. You need to contact a financial advisor who can guide you which MF to choose. If you went for sectoral funds, risk is on the higher side. But when it is largecap equity diversified fund, it is bound to get you good returns such as DSP top 100, HDFC top 200 etc. And one more thing I have observed / going to practise is to book profit when I reach my goal of 15-20% returns instead of investing for years in MF.

    Thanks,

    RB
     
  4. Shanvy

    Shanvy IL Hall of Fame

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    Going outright and saying that investing in MF is a waste is negating many investor sentiments even in this forum.

    Dear friends, each of us has a risk taking capacity and a set of goals. a person who is happy with 6-8% will be happy with FD's. when you are trying to invest in MF's, there are many criteria to be looked into. there are open end, close end, diversified, sector oriented.

    when the whole market was not performing, you cannot expect miracles when the mutual funds are also governed by the market performance.

    Apart from this there was entry and exit load. now there is a little relaxation.

    last but not least, there is a fine print, that gives you warning do read, judge your risk appetite and invest.

    There have been good yielding mfs and not so performing ones too.

    if you do not have much idea, do consult a good financial consultant, who will guide you based on your requirement and risk appetite.
     
  5. Devinaren

    Devinaren New IL'ite

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    Investing in broad based mutual funds have not worked over the past decade or so. Targeting certain sectors is a better strategy since your performance will not be impacted by under-performing areas of the market.


    Happy investing:coffee
    Devi Naren
     
  6. Shanvy

    Shanvy IL Hall of Fame

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    Devinaren,

    this is what i meant. i completely am against in misleading people with our opinions, though it is a public forum. though the onus of decision making is on the original poster, there is a percentage of moral responsibility, according to me, but you as a Financial consultant(? assuredgain) may differ.

    that is why i requested to please refrain from giving vague comments like the on in #2.

    most of the people who look at these threads are people who would like to make some money out of playing the market.

    Sectoral based MF's have given good returns. and some of the old MF's are still doing good.

    (Disclaimer..i am long term investor. i do not do mf's nor trading)
     
  7. hotcolain

    hotcolain New IL'ite

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    Finally, it is the decision of the investor to see what works for him/her - wheter it's sectoral funds or diversified funds. May be sectoral funds worked for you, may be diversified fund worked for me. it's just my opinion. You can go through materials in valueresearchonline.com and such financial sites. The general idea they give is if you are sure of a sector that it will bounce back, go for sectoral fund otherwise go with MFs with diversified fund.

    Again, all these are opinions - It is upto the investor to decide. what worked for one maynot work for other. just because one got losses in MF doesn't mean that MFs are waste of money.

    Thanks,

    RB
     
  8. Dlr.binu

    Dlr.binu New IL'ite

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    MF are not a waste of money for sure.One has to be patient to reap the benefits of MF.A long term investment in MF gives about 150% returns.But as the MF documents mention" Subjected to market risk" and one must never judge MF when the market is low.
     
  9. Cali233

    Cali233 New IL'ite

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    MF are definitely not a waste of money. Its been a bad market during 2007 until March 2009. Some mutual funds however charge high fees. I think the trick is to get funds with very low fees. Another poster on another thread put up a link to a Cheap Quiz and there was an article that I read on the site livecheap.com that talked about buying mutual funds with very low fees. If the fees are low enough then you are buying the stock market and over the long haul, the stock market delivers 8 to 10percent. I have to tell you that by March my husband was pretty concerned about our stock investments but they have come back nicely.

    The Buy the market cheaply article. Hopefully the link works for you.
     

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