The 7 Best Mutual Funds to Invest in 2022

Are you one of those investors who are searching for the ‘top 7 mutual funds on the internet to invest in?

Most new mutual fund investors ask various versions of these questions before investing to friends or colleagues or in some mutual fund forums to ensure their invested money while starting their investment journey. 

But this search for top schemes or best mutual funds often confuses investors further. Don’t get us wrong. Let us explain and let’s dive into the article below to find out the best mutual funds to invest in. 

What is a mutual fund?

A mutual fund is refered to as a pool of money that is managed by a professional Fund Manager.

Basically, it is a trust or financial institution that collects money from a number of people or investors. All the investors of the mutual fund share a common investment objective and they invest a certain amount in equities, bonds, money market instruments, and many other securities. 

Moreover, the gains that are generated from this collective investment are distributed proportionately amongst the number of investors after deducting applicable expenses, and by calculating the  “Net Asset Value” or the NAV of the scheme.

In simple words, the total amount of money that is pooled by a large number of investors sharing a common goal and common proportionate of money is what makes up a Mutual Fund.

Mutual funds provide different small or individual investors access to managed portfolios of equities, shares, bonds, and other securities professionally. Therefore, each shareholder or investor of the mutual fund participates proportionally in the gains as well as the loss of the fund. 

Any mutual fund invests in a large number of securities, and their performance is usually tracked as the change in the total market capitalization of the fund which is derived from the aggregate performance of the underlying investments.

What do you mean by the best mutual fund? 

There are a lot of varieties of mutual funds. These mutual funds are segregated from each other based on their underlying assets like equity, debt, or gold into a variety of categories, for example, equity mutual funds, debt mutual funds, and hybrid funds. Different mutual funds have other investment objectives and different risk profiles. 

Thus, we can’t say that there is not one mutual fund that is best for everyone. The best mutual fund varies from each individual’s requirements. So you should choose the best mutual fund which is best suitable for you as per your investment objectives, risk tolerance, and investment horizon.

Best mutual funds to invest in 2022

There are a lot of mutual funds to invest in the year 2022 offered by different mutual fund companies, financial institutions, and banks. But we have categorized 7 of the best mutual funds to invest in the year 2022.

SBI small cap fund

SBI Small Cap Fund is a mutual fund which is provided by SBI which aims to provide their investors with a great opportunity for long-term growth in capital or investment by investing their capital predominantly in a well-diversified basket of equity stocks of different small-cap companies.

The SBI small capital fund predominantly tends to invest at least 65% in small-cap stocks.

This mutual fund of SBI can also take up to the rest 35% exposure in other equities that includes large and mid-cap companies and/or other debt and money market instruments.

The SBI small-cap fund follows a blend of growth and value style of investing and thus it will follow a bottom-up investment strategy for selecting its stocks. 

SBI equity hybrid fund

The primary of the SBI Equity Hybrid Fund is to provide its investors with opportunities for long-term capital appreciation along with the liquidity of an open-ended scheme. They aim to attain this by investing in a mix of debt as well as equity.

This mutual fund of SBI invests in a diversified portfolio of stocks of only high-growth companies and they balance the risk by investing the rest of the capital in fixed-income securities.

SBI Equity Hybrid Fund generally invests a minimum of 65% in equity along with equity-related instruments. At any point in time, if the fund tends to allocate its assets in the range of 20-35% towards debt along with the money market instruments.

UTI Flexi cap fund

The UTI Flexi cap fund has positioned itself as a multi-cap fund investing across the different market capitalization spectrum. This mutual Fund scheme of UTI is comprised of different high-quality businesses that have the potential ability to show stronger growth for a long period of time and thus it can be run by seasoned management.

As per the UTI Flexi cap fund quality companies performs across market cycles, they mitigate drawdown and rebound faster based on the strong bases of their balance sheets & business models. 

This mutual fund generally follows a bottom-up stock selection along with well-defined metrics of capital efficiency, free cash flows, and ability to compound earnings

Axis blue chip fund

The primary investment objective of axis blue chip fund is to achieve long-term capital appreciation by investing predominantly in a 

diversified portfolio. These portfolios generally consist of equity and equity-related securities of different large-cap companies including derivatives. 

The large company that this scheme invests in are traded frequently. Thus they are liquid and less volatile as their stocks have proven track records, and business models and they are also capable enough to deliver long-term consistent returns. 

This mutual fund aims to outperform the benchmark along with risk lower than the benchmark. 

Investing in this mutual fund will have long-term benefits as equity as an asset class has the potential to beat inflation. 

This mutual fund scheme is best suitable for the person who is seeking long-term goals such as education and the future of their children, retirement, or any other long-term goals that need wealth creation plans. 

Kotak Emerging Equity Fund

The primary objective of Kotak Emerging Equity Fund in investment is to generate long-term capital appreciation from a variety of portfolios of equity and equity-related securities, by investing the capital of investors 

predominantly in midcap companies.

The companies they select to invest in are either at their nascent or developing stage and they are basically under-researched. Although these look relatively volatile in the short term, these midcap companies have the potential to deliver a higher rate of growth in the longer run.

Mirae Asset Large Cap Fund

Mirae asset Large Cap Fund is one of the very popular and open-ended equity schemes of Mirae company that predominantly invests across large-cap stocks. 

Basically, this company invests 80% of its capital in large-cap stocks like the top 100 companies by market capitalization. The primary of this scheme is to combine the consistency of large caps along with a few conviction midcap ideas maximum up to 20%).

The Mirae asset large Cap fund runs with the flexibility of investing across sectors and themes.

The investment approach of this mutual fund is basically centered around participation in both high-quality businesses up to a reasonable price and holding the same capital over an extended period of time.

Thus this scheme tries to identify different companies that have a sustainable competitive advantage like stocks which has different strong pricing power and are sector leaders.

Parag parikh flexi cap fund

The Parag Parikh Flexi cap fund is best suitable for investors who are seeking to invest their money for at least 3-4 years and will get high returns. At the same time, these investors should also be always ready for the possibility of certain moderate losses in their investments. 

The primary investment objective of this product is to seek and generate long-term capital growth from an actively managed portfolio basically of Equity and Equity Related Securities. This mutual fund scheme invests greatly in Indian equities, foreign equities, and other related instruments and debt securities. 

This fund has 70.89% investment of its capital in domestic equities of which around 57.47% is in Large Cap stocks, 3.72% is in Mid Cap stocks, and 8.63% is in Small Cap stocks.

Conclusion

As you read this article this far, you might have gotten an idea of all the mutual funds to invest on to achieve future goals. 

Then what are you waiting for? 

Invest in those mutual funds and have your long-term goals.

*image source from Google

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