Business

5 mistakes to avoid if you want higher returns

Image credits: Freepik

1. Chasing top performing funds

Investors tend to invest in funds that have outperformed, overlooking fact that past performance doesn’t guarantee success. A wiser approach is to allow 2-3 yrs for performance.

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2. Reacting to market crashes

Market downturns actually present opportunities for long-term wealth creation. However, many investors react by withdrawing their investments, often at a loss or minimal profit.

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3. Discontinuing SIPs and withdrawing

Stopping SIPs disrupts the consistency of disciplined investments and hampers the accumulation of units. SIPs aid in averaging investment costs, crucial for compounding growth.

Image credits: FREEPIK

4. Not investing enough money

Ensuring the proportional alignment of your mutual fund investments with your future financial objectives is crucial. 

Image credits: FREEPIK

5. Short term focus

Avoid investing in mutual funds for short-term gains. It’s essential to have a long-term investment horizon of at least seven years, preferably longer.

Image credits: FREEPIK

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