Best Edelweiss Equity Mutual Funds

Edelweiss Mutual Fund was founded in August 2007 to provide financing solutions for wealth investment and creation. A part of the Edelweiss Group, the asset management company has gained a reputation since it acquired JP Morgan India Asset Management and introduced MSCI in the Indian market.

Edelweiss offers wealth creation, investment advisory, and insurance solutions. The company’s market capitalisation stands at Rs.7368.92 crore, while the QAAUM stood at Rs.46849.31 crore for the quarter ending 31 March. 

Prospective investors can get a wide range of schemes to choose from, including debt, equity, and hybrid investment options. One can select depending on their financial expectations and propensity to market risks. Including the best Edelweiss equity mutual funds schemes, the company offers more than 30 schemes.

Equity MFs allocate their fund corpus primarily to equity-related investments. Alongside these, the rest of the portfolio of such funds includes debt and money market instruments. As per SEBI (Securities and Exchange Board of India) guidelines, a minimum of 65% of the corpus of an equity MF needs to be invested in stocks.

These investments are made pertaining to a strategy, prioritising particular sectors, market caps, etc. Classification of equity mutual funds is based on this strategy or investment priority. These include large-cap funds, mid-cap funds, small-cap funds, tax-saving funds, etc. 

However, the tax applicable from mutual funds, including the top Edelweiss equity mutual funds, varies depending on the investment period.

Taxability

Short-term Capital Gains Tax: If an investor wants to redeem their equity MF units in less than a year from the investment date, a 15% tax is applicable, excluding cess and surcharges, on the returns.

Long-term Capital Gains Tax: However, if an investor redeems their MF units after more than a year of investment, no taxes are applicable for returns less than or equal to Rs.1 lakh. For amounts exceeding Rs.1 lakh, returns are taxed at 10% on the returns plus cess and other surcharges.

On ELSS: Investments in tax-saving funds up to Rs.1.5 lakh are exempt from tax u/s 80C. 

TDS: 10% TDS applies to dividends exceeding Rs.5000.

The top Edelweiss equity mutual funds include various schemes with different returns and fund objectives. Moreover, the performances fluctuate due to factors like stock performance, market fluctuations, etc. Therefore, investors must consider some crucial aspects of equity mutual fund investments to minimise investment risks while meeting their financial objectives.

Factors to Consider Before Investing

Investment goal: Investors may want to set a particular objective and expectations from their investment. It is paramount to understand whether one is looking for aggressive returns or better stability from the deposit before finalising. It can be an effective means of shortlisting schemes.

Risk appetite: Equity mutual funds pose a higher risk as they are more susceptible to market fluctuations than debt or hybrid MFs. However, they also offer higher returns than the other two instruments. Nonetheless, individuals must assess their risk-bearing capacity before investing in any of the best Edelweiss equity mutual funds 2023. 

Past fund performance: One may also want to consider past fund performances regarding stability in returns, fulfilment of scheme objectives, etc. This helps assess a fund’s ability to generate expected returns despite various market risks by checking its year-over-year growth, returns, etc. Hence, besides checking personal risk-taking ability, gauging the vulnerability of even the top Edelweiss equity mutual funds to market conditions is essential.

Expense ratio: Every AMC charges an annual fee to cover fund expenses like marketing, administrative, and management costs, among others. It is a small amount of the fund’s total capital, levied on returns. This is why investors may prefer to compare the expense ratios of the best Edelweiss equity mutual funds or other funds before investing. A lower expense ratio will enable a higher return on investments.

Exit load: AMCs levy a penalty on investors should they choose to redeem their MF units before the maturity period. This is to curb down the number of investors divesting from a scheme prematurely. Although there are schemes available, those do not charge any exit load. Nonetheless, it is wise to note exit loads when choosing from the top Edelweiss equity mutual funds.

Experience of fund manager: Fund managers are responsible for allocating fund corpus to various stocks to fulfil scheme objectives. Therefore, fund managers need sufficient expertise in buy-sell of equity instruments and successfully managing a fund portfolio. Hence, it is essential to check the fund manager’s track record before investing in the best Edelweiss equity mutual funds.

Choose investment route: One can invest in mutual funds in two methods depending on their financial strategy – SIP or Systematic Investment Plan and lump-sum. In the case of SIP, investors can choose to make monthly, quarterly, or annual investments, while for a lump sum mode of investment, they need to deposit the entire capital at one go.

Regular or direct plan: For regular plans, investors need to apply through a broker or other similar third party, resulting in a higher expense ratio. Direct plans, on the contrary, require investors to invest in the funds directly, mitigating third-party service charges.