5 factors to consider before starting investment in SIP
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1. Past performance of the funds
When selecting optimal SIP for investment, it is essential to analyse return performance of these funds. It is advisable to review the trends over the past 5 to 10 years.
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2. Determine your goal
Assessing the timeframe and required funds for these goals can guide your decision regarding the appropriate mutual fund category for investment.
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3. Choose a fund house
Selecting a fund house holds the same level of significance as selecting a specific fund. It is essential to acquaint oneself with the range of schemes.
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4. The AUM factor
Assets Under Management denotes a measurement indicating the scale of a mutual fund's portfolio, representing the aggregate value of all assets managed by a financial institution.
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5. Understanding of expense ratio
Mutual funds with a high expense ratio have the potential to negatively impact your fund's performance. The expense ratio comprises the management fee and administrative costs.