Over the years, technology has increasingly simplified the process of investing. Previously, investors made mutual fund investments via distributors. However, today, the same can be done instantly with an array of apps.
But is it safe to invest in mutual funds through such apps? Here is what you as an investor should know.
Yes, it is safe to invest in mutual funds through mobile applications. This is because an investor’s money cannot reside with these entities, nor can they keep the money with themselves. So if your money is not invested on a particular day, these entities are mandated to refund the same back to the individual on the same day.
Besides, such applications employ the latest security measures and encryption to eliminate any potential miscreant. The ownership of mutual fund units is transferred to investors through direct transactions with their bank accounts. As a result, the entire procedure of online investment in mutual funds via apps is designed to ensure the security of every transaction and of investors’ funds.
In addition, the market regulator, i.e., the Securities and Exchange Board of India (SEBI), constantly monitors and reviews all transactions to guarantee no foul play.
Investors choosing to invest in mutual funds online by way of apps can enjoy several benefits. These includes:
Investing in mutual funds online through mobile applications allows you to check the schemes or plans of almost all the fund houses. You can monitor schemes, buy and sell mutual funds units at any time. These can be done from anywhere across the globe, as long as investors have a smartphone with an internet connection.
When investing in mutual funds via apps, at no point in time is an investor required to receive or send physical documents. Instead, each exchange is paperless and totally digital.
Given that the entire process is digital and paperless, investing in mutual funds through apps consumes less time. Therefore, investors can save considerable time and resources while investing.
Contrary to common perception, it is recommended that investors do not try to time the market. However, this is a mistake that most investors make at one point in their investment journey. In fact, trying to time the market can lead to missed opportunities while hampering the growth of one’s portfolio.
So, it is critical to note here that an investor’s time or duration in the market is far more important than the timing of the market.
Therefore, it is wise to have a long-term investment strategy as it allows one to ride out market volatility. Moreover, the purchase and sale of mutual fund units should be based on an individual’s risk appetite, investment horizon, and objectives.
That said, one can assume that this question is arising due to the on-going pandemic and its impact on India’s economy. In that case, he/she must also bear in mind that the same will eventually be controlled, and markets will recover. But right now, considering the valuation of most of the stocks being high, as per market experts, correction too can be expected.
While there is no method to predict the market’s direction in the future, potential investors can evaluate the past performance of markets during similar economic crises. As a result, they can make an informed decision before investing in mutual funds.
Moreover, when it comes to mutual funds market fluctuations matter considerably less. But having said that, it is better to refrain from making rushed decisions.
It is important that they ascertain their tolerance for risk, duration of the investment, and financial objectives, alongside ensuring that their chosen mutual fund scheme aligns with these factors.
|SIP Calculator||PPF Calculator||EMI Calculator|
|Lumpsum Calculator||PF Calculator||Car Loan EMI Calculator|
|Mutual Fund Return Calculator||Gratuity Calculator||Personal Loan EMI Calculator|
|SWP Calculator||HRA Calculator||Home Loan EMI Calculator|
|Sukanya Samriddhi Yojana Calculator||CAGR Calculator||SBI EMI Calculator|
|FD Calculator||GST Calculator||SBI Personal Loan EMI Calculator|
|RD Calculator||HDFC EMI Calculator||SBI Home Loan EMI Calculator|
|NPS Calculator||HDFC Personal Loan EMI Calculator||SBI PPF Calculator|
|Simple Interest Calculator||HDFC Home Loan EMI Calculator||SBI RD Calculator|
|Compound Interest Calculator||HDFC FD Calculator||SBI SIP Calculator|
|Interest Rate Calculator||HDFC RD Calculator||SBI FD Calculator|