Reason for Good Performance of Top Mutual Funds in India

For an investor of the today, the avenues available to him to invest their hard earned money are multiple. It would not be an exaggeration to say that today’s investors are spoil for choice. They have the traditional way of fixed deposit or the new age mutual fund. The contemporary investor is more educated and cognizant of the market trends than any of their predecessors. This has come at a time when the market is rallying and the fundamentals of the economy seem strong. Indian investors are traditionally classified under the category of “savers”. Also the risk appetite of the Indian populace is not noteworthy.

Hence, with this back drop; mutual funds seem to be a god send gift for the Indian investors. It not only is a considerably safe avenue when compared with equity but also enables the investor to take advantage of the market trends. It’s therefore no surprise that the mutual funds industry has scaled great heights in the relatively small time since it was introduced in the financial markets. In the race to make the most of the market opportunities many well-known fund managers have put up their shop in the country. The investor sentiments is also buoyed by the fact that the sector is highly regulated and therefore considerable secure.

In the market place the following 10 mutual funds have set the floor on fire by their performance.

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Now Foreign Individuals Can Invest in Mutual Funds in India

Good days are just around the horizon for the mutual fund industry. The finance ministry is about to open the flood gates of foreign investment which was hitherto under regulation. With this new scheme of things, foreign individuals would be allowed to make investment directly in to the mutual fund market in India. Initially, the government has proposed a cap of $ 10 billion or Rs 45,000 crores subject to revision every six months. For the mutual fund industry which was running dry due to the entry load ban will now see their coffers slush with foreign investment.

As of now total assets under the management of the mutual fund bosses is up to the tune of Rs 731,448 crores. The Securities and Exchange Board of India (Sebi) will unveil the guidelines pertaining to this de-regulation on August 1. The entry of this new type of foreign investment would potentially prove to be instrumental in the growth of mutual fund industry.

The obvious advantages cited by the pundits are basically twofold. One, the average period for which a foreign individual holds the mutual fund is greater than their local counterparts. Second, the mutual fund investors in other countries do it on a larger scale. So this will ultimately culminate in to greater depth of the financial markets, needless to say, would be beneficial towards the stability of the market.

It is not all hunky dory for the markets as the reverse also holds true. Market sentiments, these days are decided by the inflow or the outflow of foreign capital. The current dip in the market is also attributed to this phenomenon.

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