20-80% debt equity funds, to cross loan, 11%
i want to take 5lacks loan 11% rate of intest per anam, i want to buy best mutual funds 20%-80% dept,equity flexi mutual fund for 3 years. suggest me, mutual funds give best results direct , growth, lumsum, on 27th dec,24 to buy?
Investing a ₹5 lakh loan at an 11% annual interest rate into mutual funds requires careful consideration, especially when targeting a 20% debt and 80% equity allocation over a 3-year horizon. Here are some recommended mutual funds that align with your criteria:
Parag Parikh Flexi Cap Fund (Direct Growth)
This fund offers a diversified portfolio across various market capitalizations and sectors, aiming for long-term capital appreciation. It has demonstrated consistent performance over the past three years.
Canara Robeco Flexi Cap Fund (Direct Growth)
Known for its prudent investment strategy, this fund invests across large, mid, and small-cap stocks, seeking to optimize returns while managing risks. It has shown a return of around 17.7% over the last three years.
PGIM India Flexi Cap Fund (Direct Growth)
This fund focuses on identifying high-growth potential companies across market capitalizations, aiming for substantial capital appreciation. It has delivered competitive returns in recent years.
SBI Flexi Cap Fund (Direct Growth)
With a flexible investment approach, this fund allocates assets across different market segments based on prevailing market conditions, striving for optimal returns. It has been among the top performers in its category.
UTI Flexi Cap Fund (Direct Growth)
This fund invests in a diversified portfolio of stocks across market capitalizations, aiming for long-term capital growth. It has offered a return of around 16.3% over the last three years.
Key Considerations:
Interest Costs: Your loan accrues interest at 11% per annum, totaling approximately ₹1,65,000 over three years. Ensure that your investment returns exceed this cost to achieve net gains.
Investment Horizon: While a 3-year period is moderate, equity investments typically yield better results over longer horizons. Be prepared for short-term volatility.
Risk Assessment: Investing borrowed funds amplifies financial risk. It's crucial to assess your risk tolerance and have a contingency plan if the investments underperform.
Diversification: While flexi-cap funds offer diversification across market capitalizations, ensure your overall investment portfolio is diversified across asset classes to mitigate risks.
Conclusion:
Investing in flexi-cap funds like the ones mentioned can potentially yield returns that surpass your loan interest over a 3-year period. However, this strategy carries inherent risks, especially when using borrowed capital. It's advisable to consult with a financial advisor to tailor an investment plan that aligns with your financial goals and risk tolerance.