Investment Tips: A mutual fund’s track record is no guarantee of good returns. So how do you know which option is right?

New Delhi. Most people typically rely on past returns when choosing mutual funds. The challenge with past returns, however, is that there is no guarantee a fund will continue to deliver the same returns in the future. Then what’s the trick to getting consistent returns? The trick is to focus on it through the fund house and only invest money on the advice of a fund house that has consistently had good returns.

When it comes to investing in mutual funds, the biggest mistake investors make is not being able to choose fund houses properly. Investors always trust the names of those fund houses, fund managers, so-called YouTube experts, from whom they have heard a lot. One should not be selected just because a person has been successful in the past, there is no guarantee that they will be successful in the future. In addition, personal biases, investment methods and different beliefs can also negatively impact consistency.

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then how to make the right choice
The Nippon India Mutual Fund’s recent investor awareness campaign focuses on the fact that the fund house has more robust processes than the manager. These processes are the beauty of a fund house and every investor should keep this in mind. Investors should look to the methodology and structures that have led to the fund house’s success and ask themselves whether the methodology is robust enough for the future. The goal of Nippon Campaign is to train investors to make the right investment decisions.

When and where to invest money
A fund manager must deal with market complexity, volatility and an uncertain economic environment, all of which can cloud the best investment decisions. This is because fund house processes are important to risk mitigation. Nippon India Mutual Fund has put in place robust systems and processes to help know where to invest, when to invest and when to exit.

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Monitoring of fund managers is required
Nippon’s process also includes guidelines for fund managers to know what kind of risk they can take. How much risk can be taken with the investor’s money and how do you recognize such a risk that should never be taken? This process also ensures the avoidance of personal bias and concentration risks. Analysts assume that fund houses with robust processes potentially generate higher returns for investors. Therefore, if you want to get consistent returns from mutual funds, it is extremely important to choose a better fund house. Investors cannot individually assess market risks and options.

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