Best Balanced Mutual Funds to Invest in 2017

Balanced mutual funds can be equity oriented or debt oriented hybrid funds.

If the average equity exposure of balanced fund is more than 60% and the remaining 40% is debt products then it is treated as Equity Oriented Balanced Fund. This means major portion of the funds are invested in equity.

If the average debt exposure is around 60% and equity is 40% then these funds are treated as Debt Oriented Balanced Funds.

If you do not wish to take too much risk, but wish to have exposure into equities, balanced funds are a good way forward. These funds are less volatile, and when the markets fall, they are hurt less than others.

Tax Efficiency

Balanced funds are a tax efficient way of having a debt exposure. These funds are treated like equity funds for taxation. Dividends from these funds are tax-free and there is no tax on long-term equity gains.

Best Mutual Funds to invest in 2017

Best ELSS Tax Saving Mutual Funds for 2017 

Balanced funds are suitable for investors with a moderate risk profile and investment horizon of over three years. On the equity side the fund is managed actively based on valuations in the market, as the portfolio is constructed keeping in mind the conservative risk profile of investors. This could also be a product for maiden investors to start off with, owing to lower volatility and tax benefits. Being a product that works across market cycles, and aims to offer the benefits of asset allocation, this product could form part of investors’ core portfolio.

Best Balanced Mutual Funds

Here is the list best balanced mutual funds you can invest in 2017

HDFC Balanced Fund

ICICI Prudential Balanced Fund

DSP BlackRock Balanced Fund

Birla Sun Life Balanced 95 Fund

Franklin India Balanced Fund

L & T India Prudence Fund

Canara Robeco Balance

SBI Magnum Balanced Fund

Tata Balanced Fund

Reliance Regular Savings Fund – Balanced

Best ELSS Tax Saving Mutual Funds to Invest in 2017

Equity Linked Savings Scheme (ELSS) is a diversified equity mutual fund, which is qualified for deduction of ₹ 1, 50,000 under section 80C of the Income Tax Act. ELSS tax saving fund has the shortest lock-in period to compare with other investment products like Public Provident Fund (PPF), National Savings Certificate (NSC). Dividend declared in ELSS funds is tax-free and no tax levied on the long-term capital gains.

You can make a lump-sum or one-time investment in an ELSS fund or using the SIP route.

Best Mutual Funds to Invest in 2017

Best Balanced Mutual Funds for 2017

Start a SIP

A Systematic Investment Plan (SIP) can create wealth by investing small sums of money every month over a period of time. The biggest advantage of a SIP is that the investor doesn’t have to time the market. When an investor times the market, he usually misses out on the rally or enters the market at the wrong time, either the valuations have peaked or the markets are on the verge of declining. Investing every month ensures that one is invested during the highs and the lows.

Moreover, SIPs also have the advantage of compounding, one must start investing at an early age as the longer the investment horizon, bigger the benefits. If you start early, equity funds should constitute 80% of your portfolio as this asset class has been found to be the best bet for growing money over the long term. SIPs can be an ideal way to accumulate money for retirement. After retirement, one can withdraw the money through a systematic withdrawal plan.

Equity investment is a higher risk over the short term. However, for investment periods of three to five years or longer, the risk on equity investments is considerably lower. In fact, when you take inflation into account, it is bank FDs and similar deposits that are suboptimal for the retiree because of inflation.

Like all equity investments, the best way of investing in ELSS funds is through monthly SIPs throughout the year. That’s also the way to avoid any last minute rush. At the beginning of every year, estimate the amount you have left over from the R1.5 lakh limit after statutory deductions, divide it by 12 and start an SIP.

Best ELSS Tax Saving Mutual Funds to Invest in 2017

Here is the list of best 10 ELSS tax saving mutual funds you can invest in 2017

Axis Long Term Equity Fund

Reliance Tax Saver

DSP-BlackRock Tax Saver Fund

Tata India Tax Savings Fund

Birla Sun Life Tax Plan

Birla Sun Life Tax Relief 96

Invesco India Tax Plan

IDBI Equity Advantage Fund

Franklin India Taxshield Fund

HDFC Long Term Advantage Fund

Best Mutual Funds to Invest in 2017

Thousands of mutual funds are currently available in the market. Choosing best mutual funds is a challenging task for any investor. A good mutual fund is the one that consistently manages to outperform its category return and its benchmark. Mutual funds are one of the best wealth creation tools for long-term financial goals like retirement planning, kids education, and marriage etc. For medium and small term financial goals, you can rely on balanced and short-term debt funds.

Equity Linked Savings Schemes (ELSS) offer tax benefits for Individual/HUF under Section 80C of Income Tax Act, 1961. An investor can claim up to 1 lakh as a deduction from his gross total income.

How to Pick a Mutual Fund

5 Things You Should Know Before Invest

BEST MUTUAL FUNDS TO INVEST IN 2017 (BY CATEGORY) ARE GIVEN BELOW.

Balanced Funds

  • HDFC Balanced Fund
  • ICICI Prudential Balanced Advantage
  • L&T India Prudence Fund
  • SBI Magnum Balanced Fund
  • Franklin India Balanced Fund

Diversified Equity Funds

  • ICICI Prudential Value Discovery Fund (G)
  • UTI MNC Fund
  • Franklin India Prima Plus Fund (G)
  • L & T India Value Fund (G)
  • Birla Sun Life Advantage Fund

Large Cap Funds

  • SBI Bluechip Fund
  • DSP BlackRock Focus 25 Fund
  • Kotak Select Focus Fund
  • Franklin India Opportunities Fund
  • ICICI Prudential Focused Bluechip

Small & Mid Cap Funds

  • DSP Blackrock Micro Cap Fund
  • Mirae Asset Emerging Bluechip Fund
  • HDFC Mid Cap Opportunities
  • Franklin India Smaller Companies
  • Reliance Small Cap Fund

Equity Linked Savings Scheme (ELSS)

  • Axis Long Term Equity Fund (G)
  • DSP BlackRock Tax Saver Fund
  • Birla Sun Life Tax Plan
  • Reliance tax Saver
  • Tata India Tax Savings Fund

Index Funds

  • Kotak Nifty ETF
  • G S Nifty BeES
  • ICICI Prudential Nifty iWIN ETF
  • IDBI Nifty Index Fund
  • UTI Nifty Index Fund

Long Tern Income Funds

  • ICICI Prudential Long Term Plan
  • HDFC High Interest – Dynamic
  • Birla Sun Life Dynamic Bond Fund
  • IDFC Dynamic Bond – Regular Plan
  • TATA Dynamic Bond – Regular Plan

Short Term Debt Funds

  • Birla Sun Life Short Term Fun
  • ICICI Prudential Banking & PSU Debt Fund
  • UTI Banking and PSU Debt Fund
  • IDFC Super Saver Income Fund – Medium Term
  • L&T Short Term Opportunities Fund

Ultra Short Term Funds

  • DSP BlackRock Ultra-Short Term Fund
  • ICICI Prudential Ultra Short Term Plan
  • SBI Ultra Short Term Bond
  • Religare  Invesco Credit Opportunities Fund
  • Birla Sun Life Savings Fund

Credit Opportunities Funds

  • Kotak Medium Term Fund
  • Reliance Corporate Bond Fund
  • Birla Sun Life Corporate Bond Fund
  • UTI Income Opportunities Fund
  • DSP BlackRock Income Opportunities Fund

How to Pick a Mutual Fund

Many investors try to pick the mutual fund based solely on the fund’s past performance. However, the advertised stellar performance is not a guarantee of future success, especially when it comes to relatively new or small funds. When you pick a mutual fund you should consider following factors.

Age and Size of the Mutual Fund

Before considering to invest in a particular fund, read the prospectus to see since when it has been operating and what is the assets size is. Often while funds are still small just a few successful stocks can have a great impact on their performance and lead to excellent short-term performance records. However, as funds grow such great results are more difficult to sustain. Since a larger number of stocks are owned by the fund and they cannot influence the fund’s performance.

Fund’s Risks

You should be well aware of the risks the fund takes to achieve its results. Higher rates of return are usually associated with higher risks, which may be beyond your comfort level or inconsistent with your financial goals. Always take into account your risk tolerance and long-term investment strategies when picking the right mutual fund.

Fund’s Volatility

Typically, higher volatility means higher investment risk. Therefore, if you are looking for a shorter-term investment you should avoid funds with a volatile history since you will not have much time to overcome eventual declines in the stock market.

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Funs’s Fees, Sales Charges, and Expenses

When you invest in a mutual fund you will be charged various fees and expenses. A low-cost fund may perform worse than a high-cost fund and still generate the same returns for you. Take time to calculate how the costs of different mutual funds will affect your returns since even small differences in the fees and expenses may lead to large differences in the returns.

Taxes that are due when you receive a distribution

Generally, you will owe taxes when you receive a capital gains distribution from a fund. Your tax bill will be affected even if the return has been negative since you invested in the fund so you should preliminarily find out when your fund will make its distributions and assess the right time to invest in it.

Recent Changes in the Fund’s Operations

If the fund has recently changed its investment strategy or its investment adviser, its performance may change too. Therefore, always inform yourself about any recent changes in the fund’s operations before considering investing in it. As you can see, other factors besides the fund’s past performance should be taken into account when deciding which mutual fund to pick. To get the most out of your money, whether you are interested in mutual funds, stocks,ETFs or options, you need two main things – the knowledge and the right trading platform.

ELSS – Save Tax & Earn Higher Return

ELSS – Equity Linked Savings Scheme is a diversified equity mutual fund which has a majority of the corpus invested in equities. This type of mutual fund has a lock-in period of 3 years. This means if you start a Systematic Investment Plan (SIP) in an ELSS, then each of your investments will be locked in for three years from the respective investment date.

Like other mutual funds, Equity Linked Savings Scheme has both growth and dividend options. In growth option, investors get a lump sum on the expiry. On the other hand, investors get a regular dividend income in dividend option.

The investor can claim up to ₹1 lakh as a deduction from his gross taxable income under section 80C of the Income Tax Act. ELSS fall under the exempt – exempt – exempt (EEE) category. That means investments get tax deduction under section 80C. The capital gains generated by the fund are exempt from tax. Finally, withdrawals are also tax-free.

ELSS

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The primary purpose of Equity Linked Saving Scheme investment should be to achieve a future financial goal or to create long-term wealth for distant goals like retirement planning etc. and tax saving in the year of investment should be an incidental benefit or a secondary objective. This mutual fund is preferred to open-ended Equity Schemes because of two reasons, namely tax saving and discipline of holding for a longer period.

Advantages of ELSS over other tax Saving Instruments

Compared to other tax saving instruments like bank fixed deposits, Public Provident Fund (PPF) and National Savings Certificate (NSC); the lock-in period of Equity Savings Scheme is much lower. While ELSS investment is locked for 3 years, PPF is locked for 15 years, NSC is locked in 5 years and bank fixed deposits eligible for tax deduction are locked in for 5 years. As ELSS is an investment in equity markets and investing in this for a long-term can give better returns compared to other asset classes over a long-term.

Best ELSS Funds

Following are the best ELSS funds:-

  • Axis Long Term Equity Funds.
  • Birla Sun Life Tax Relief 96.
  • Birla Sun Life Tax Plan.
  • Reliance Tax Saver.
  • Religare Invesco Tax Plan.
  • BNP Paribas Long Term Equity Fund.
  • Franklin India Taxshield Fund.
  • ICICI Prudential Long Term Equity (Tax Saving).
  • DSP BlackRock Tax Saver Fund.
  • IDFC Tax Advantage (ELSS) Fund.

Best Mutual Funds for 2016

Thousands of mutual funds are currently available in the market. Choosing best mutual funds is a challenging task for any investor. A good mutual fund is the one that consistently manages to outperform its category return and its benchmark. Mutual funds are one of the best wealth creation tools for long-term financial goals like retirement planning, kids education, and marriage etc. For medium and small term financial goals, you can rely on balanced and short-term debt funds.

Equity Linked Savings Schemes (ELSS) offer tax benefits for Individual/HUF under Section 80C of Income Tax Act, 1961. An investor can claim up to 1 lakh as a deduction from his gross total income.

How to Pick a Mutual Fund

5 Things You Should Know About Investment

Best Mutual Funds

Best Mutual Funds for 2016 (by category) are given below.

Diversified Equity Funds

  • ICICI Prudential Value Discovery Fund (G)
  • UTI MNC Fund
  • Franklin India Prima Plus Fund (G)

Large Cap Funds

  • SBI Bluechip Fund
  • ICICI Prudential Focused Bluechip
  • Franklin India Opportunities Fund

Mid Cap Funds

Small Cap Funds

  • Franklin India Smaller Companies
  • DSP Blackrock Micro Cap Fund
  • Reliance Small Cap

Equity Linked Savings Scheme (ELSS) Funds

  • Axis Long Term Equity Fund (G)
  • Birla Sun Life Tax Plan
  • Reliance tax Saver

Balanced Funds

  • ICICI Prudential Balanced Advantage
  • Tata Balanced Fund – Regular
  • L&T India Prudence Fund

Credit Opportunities Funds

  • Franklin India Dynamic Accrual
  • ICICI Prudential Corporate Bond
  • SBI Corporate Bond Fund

Ultra Short Term Funds

  • Religare  Invesco Credit Opportunities Fund
  • ICICI Prudential Ultra Short Term Plan
  • SBI Ultra Short Term Bond

Long Tern Debt Funds

  • IDFC Dynamic Bond – Regular Plan
  • TATA Dynamic Bond – Regular Plan
  • HDFC High Interest – Dynamic

Short Term Debt Funds

  • Birla SL Short Term Fund
  • L&T Short Term Opportunities Fund
  • DWS Banking & PSU Debt – Regular Plan