How to choose a mutual fund
- Start with your goal and time horizon. Money needed within 3 years belongs in liquid or short-duration debt funds; 7+ year goals can use equity funds.
- Pick the category before the fund. Large cap, flexi cap and index funds suit most first-time investors; mid and small caps add growth and volatility.
- Prefer Direct Growth plans. Same portfolio as the Regular plan, lower expense ratio, so more of the return stays with you.
- Look at consistency, not last year’s winner. Compare 3Y and 5Y returns and the worst fall (max drawdown) against other funds in the same category.
- Invest regularly. A SIP spreads purchases over time. Use the SIP backtest to see how SIPs behaved through past crashes.
Mutual fund investments are subject to market risks. Read all scheme-related documents carefully. Data source: AMFI; historical NAV via MFAPI. Education only — not investment advice.