Mutual funds are a great way to grow your wealth steadily, and as we approach 2024, it is important to know which funds can give you the best returns. In this article, we will tell you about the top 5 mutual funds that are expected to perform well in 2024, helping you make smart investment choices.
Why should you invest in mutual funds in 2024?
Mutual funds allow you to pool your money with other investors and invest in a mix of stocks, bonds and other assets. This gives you a chance to diversify and minimise risk, all while being managed by professionals. For 2024, it is all about choosing funds with a solid track record and a well-diversified portfolio to grow your investments.
Let’s look at the top 5 mutual funds for 2024 that have shown the potential for great returns.
1. Axis Bluechip Fund
The Axis Bluechip Fund focuses on large-cap companies and has consistently performed well. If you are looking for stable returns with low risk, this is a great option. Over the last 5 years, it has delivered around 15% annualised returns.
- Type: Large-cap
- Returns (5 years): ~15%
- Expense ratio: 1.59%
2. Mirae Asset Emerging Bluechip Fund
This fund invests in both large and mid-cap stocks, offering a good balance of risk and reward. It is perfect if you want to benefit from both established and growing companies. It has delivered 22% annualised returns over the last 5 years.
- Type: Large and mid-cap
- Returns (5 years): ~22%
- Expense ratio: 1.68%
3. ICICI Prudential Technology Fund
Tech stocks are booming, and this fund takes advantage of that growth. If you believe in the future of technology, this fund has delivered 26% annualized returns over the last 5 years.
- Type: Technology sector
- Returns (5 years): ~26%
- Expense ratio: 2.05%
4. SBI Small Cap Fund
This is for those who are comfortable taking a little more risk for potentially higher rewards. Such small-cap funds can be volatile, but they can also grow significantly. SBI Small Cap has delivered 30% annualized returns over 5 years.
- Type: Small-cap
- Returns (5 years): ~30%
- Expense ratio: 1.76%
5. Parag Parikh Flexi Cap Fund
Parag Parikh Flexi Cap Fund invests across different company sizes, allowing you to benefit from both safety and growth. It has delivered 18% annualized returns over the last 5 years.
- Type: Flexi-cap
- Returns (5 years): ~18%
- Expense ratio: 1.89%
How to get the best returns from mutual funds in 2024
Here are some tips that will help you make the most of your mutual fund investments:
Start early: The sooner you invest, the more time your money will have to grow.
Opt for SIPs: Systematic investment plans (SIPs) let you invest a small amount regularly, helping you ride out market fluctuations more easily.
Diversify: Don’t rely on one fund; invest in a variety of funds to reduce risk.
Monitor your investments: Check your funds regularly and make adjustments if needed.
Think long-term: Mutual funds work best when you give them time to grow. Be patient for big rewards.
FAQs
1. What are mutual funds and how do they work?
Mutual funds pool money from many investors and invest in a mix of stocks, bonds and other assets. A professional fund manager manages this, with the goal of giving you good returns.
2. Should I invest in mutual funds through SIP or lump sum?
SIP is better for most people as you invest regularly and take advantage of market fluctuations. If you have a large amount ready to invest, lump sum investment works, but it carries higher risk.
3. What taxes do I have to pay on mutual funds in India?
For equity mutual funds, profits above ₹1 lakh in a year are taxed at 10%. Short-term profits (less than 1 year) are taxed at 15%. Debt funds have different rules, long-term profits are taxed at 20% after indexation.
4. Can I lose money in mutual funds?
Yes, mutual funds are subject to market risks. However, they are generally safer than investing directly in stocks due to diversification.
5. How much should I invest in mutual funds?
This depends on your financial goals and risk appetite. Experts suggest investing 10-20% of your monthly income in mutual funds to build wealth over the long term.
Conclusion
Choosing the right mutual fund is crucial if you want to maximize your returns in 2024. Choose funds that have a good history, diversify your investments and be patient for long-term gains. The funds listed here are strong contenders to help you grow your wealth in the coming year.