Hello Everyone! Today, in this article, we shall discuss about the nifty next 50 index funds. This is related to the mutual funds, and could be considered as the article up above the laymen concepts of Mutual funds. Please read about Mutual Funds if you have no idea what they are.
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What are index funds?
Invest funds are those mutual funds which track particular indices, per say nifty index following the nifty stocks. S&P index etc. The returns offered by these funds are always in line with the index that they are tracking.
How do the index funds work?
Let us talk about the Nifty 50 index. These funds track only the top fifty stocks that are listed in NSE/BSE market accordingly. These are most passive kind unlike the other normal mutual funds. In the normal funds, the MF manager will have the ability to change the portfolio according to the speculations after a deep down analysis. This adds an essence of risk as well. These risks does not arise in index funds. They are moderate risk, low to moderate returns funds.
Nifty Next 50 index funds – Mutual funds india
These are the companies that come in the list right after the top 50 stocks in NIFTY. There are high possibilities of them becoming the next big companies in future. Some of the next 50 NIFTY index stocks are below.
- Adani Enterprises
- Transmission
- Adani Green Energy
- Avenue Supermarkets
- Vedanta
- Mindtree
- Seimens
- Pidilite Industries
Things to Consider before investing in Index funds:
1. Expense ratio: Expense ratio is the percentage of total assets of the funds charged by the fund houses to manage and for other expenses. Expense ratio should be as low as possible. That too for an index funds, it should be way too low as they don’t need to pick in particular, but to just follow the index and investment. So, investors need to understand and invest accordingly.
2. Investment amount: Another uninteresting advise to consider while investing is to invest only those amounts that can be invested for long. There literally is no use in investing for a very short time. Go long, be consistent. As the indexes grow, so will the mutual fund portfolio. Stay invested for at least 10 years to see a very good reasonable return.
3. Tax in dividend distribution: When the fund houses decide to pay the tax, they deduct 10 % upfront at source as per the income tax rules, this should be known to the investor investing in these mutual funds.
4. Capital Gains tax: If these funds are closed in a shirt period, the capital gains are charged as well with the applicable rate under the IT rules.
People also consider investing in Fixed deposits as against the mutual funds. People who are over 60 should not invest in these variable funds and should rather consider in investing fixed deposits. Please read the comparison of Fixed deposit vs Mutual Funds to understand about the same.
People in early 20s to 40 should consider investing in mutual funds. They should know the fact that they are subjected to market risk. Though the research can be done on the wide availability of the things available, the investment should solely by done after studying in detail. If you want a decent return with low risk, then you can invest in Bluechip funds
If you want to try your bet in IPO, please read about the basics of IPO before investing.
Please feel free to drop any comments in case of any doubts.
Together!!