Invest in Markets through Mutual Funds

The smarter way to invest

Mutual Funds are the preferred choice of investors when it comes to investing in Equity Markets.

Like most investors, you may also have the following queries:

There are certain myths regarding

investment in Equity Markets

through Mutual Funds. Let’s

demystify those!

Why should you invest in Equity

Markets through Mutual Funds?

How should you invest in Equity

Mutual Funds?

How should you choose the right

Equity Mutual Fund scheme for

investment?

Let us answer these, one by one

To begin with, let’s first understand - What is a Mutual Fund and how does it work?

What is a Mutual Fund?

A Mutual Fund is an investment vehicle that pools money from investors to invest in securities like

stocks and is professionally managed by experts called Fund Managers.

Investors

Fund House

Stocks

Returns

Pool their

money with

Fund Manager

invests in

Generates

Passed

back to

Let us first understand.. What is a Mutual Fund?

How do Equity Mutual Funds work?

Let’s first understand.. What is a Mutual Fund?

Liquidity

Higher Return Potential

Click to view the advantages in details.

Advantages

Professional

Management

Diversification

Lower cost

of investing

Investment

Choice

Convenient

Investment

Options

Liquidity

Advantages of investing in Equity Markets through Mutual Funds:

Why should you invest in Equity Markets

through Mutual Funds?

Equity Mutual Funds have consistently given more returns than their benchmarks.

This is why we say that Mutual Funds are the smarter way to invest in Equity Markets.

Above 90% of the amount invested of Equity Funds* have given more returns (out-performed) than

their benchmarks over the time periods ranging from 1 year to 20 years.

Source: Accord FinTech, ICICIdirect Research, Data as on September 21, 2016

* Equity Large Cap Funds

Why should you invest in Equity Markets

through Mutual Funds?

90.10%

100.00%

98.50%

97.40% 97.60%

100.00%

84.00%

86.00%

88.00%

90.00%

92.00%

94.00%

96.00%

98.00%

100.00%

1 Year 3 Years 5 Years 10 Years 15 Years 20 Years

3.9

9.6

27.5

50.3

4.8

10.1

53.0

181.7

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

180.0

200.0

5 Years 10 Years 15 Years 20 Years

Sensex Our Recommended SIP schemes Average

Average Returns w.r.t. benchmark of ICICIdirect Research Recommended Equity Schemes for SIP from Rs. 5,000

invested monthly.

Am

ou

nt

in₹

Lakh

s

Source: Accord FinTech, ICICIdirect Research, Data as on September 21, 2016

Why should you invest in Equity Markets

through Mutual Funds?

The longer the period of investment, more is the out-

performance by our recommended schemes.

~1.2 times the

final value of

Sensex

~1.1 times the

final value of

Sensex

~1.9 times the

final value of

Sensex

~3.6 times the

final value of

Sensex

Advantages of investing through a SIP Our Research recommended Equity schemes have given up to ~2.6 times more returns than

Sensex!!l

Demystifying - Myths related to Mutual Fund investments

Mutual funds require large amount of investment

Investment through a Systematic Investment Plan(SIP) can be started with an amount as low as Rs

1000 per month and in case of Lump Sum with Rs 5000.

Mutual Funds are not transparent

Fund Houses are obliged to follow strict regulations by SEBI designed to protect investors. All

operations are also regularly monitored by the SEBI ensuring high level of transparency.

Mutual Funds are not exciting as stocks

Equity Mutual Funds are designed to deliver superior returns in the long term. Historically, over the

long term Equity Mutual Funds have consistently delivered higher returns than Sensex (market).

Myths related to Mutual Fund Investments

Investment in Equity Mutual Fund can be done in either of the following ways:

How should you invest in

Equity Mutual Funds?

You want to invest fixed amounts in a disciplined way on a regular basis.

Lump Sum Systematic Investment Plan(SIP)

You should invest when you want to

invest one-time.

You should invest when you want to

invest on a regular basis.

How should you invest in

Equity Mutual Funds?

59.7%

40.3%

For other reasons

For long term wealth creation

Source: ICICIdirect Survey

Why do you invest in Equity Mutual Funds?

SIP is the preferred choice of investment of majority of our customers for long term wealth creation.

3 out of our 5 customers prefer to

invest in Equity Mutual Funds for

long term wealth creation.

SIP is an excellent tool for long term

wealth creation.

Let us understand the

benefits of investing through

SIP.

Through SIP Through other modes

49.1%

50.9%

Out of these customers, every

second customer prefers to invest

through Systematic Investment Plan.

Why should you invest through SIPs?

Advantages of investing through a SIP

0.00

5.00

10.00

15.00

20.00

25.00

30.00

35.00

Aug-13 Nov-13 Feb-14 May-14 Aug-14 Nov-14 Feb-15 May-15 Aug-15 Nov-15 Feb-16 May-16

Average Cost per Unit through SIP

NAV movements of a scheme

Average Cost per Unit through SIP is always at a lower level as you get

more units at lower NAV and less units at higher NAV.

Do away with the worry to time the market

Disciplined approach of investment

SIP inculcates discipline in your investments – i.e. it makes you invest regularly. Disciplined approach in your

investments helps in wealth creation over long term. For example, a monthly SIP of ₹ 5,000 per month growing at

10% p.a., 15% p.a. and 20% p.a. would grow to:

Period (in years)

Principal

Invested

(₹ lakhs)

Final Amount

(₹ lakhs)

@ 10% p.a.

Final Amount

(₹ lakhs)

@ 15% p.a.

Final Amount

(₹ lakhs)

@ 20% p.a.

15 9.00 20.90 33.84 56.71

20 12.00 38.28 75.80 158.07

25 15.00 66.89 164.20 431.34

Assumed returns for illustration purposes only, Systematic Investment Plan at beginning of the month.

Why should you invest through SIPs?

Advantages of investing through a SIP

Get benefit of more time spent in the market

For illustration purposes only. The returns are assumed returns and SIP is at beginning of the period.

With smaller amounts to invest through a SIP, you start investing early thereby giving your investments more time in

the market. This increases the final value of your investments.

Easy on Pockets: Investment through a SIP is possible with amounts as low as Rs 1000 per

month

Select the right scheme for investing from our Research recommendations

Research Recommendations:

Easily select top-rated Equity Mutual Fund scheme(s) recommended by our award-winning

Research after extensive analysis. These recommendations are available on “Mutual Funds Place

Order” page in the login section.

How should you select the right Equity MF scheme?

Start investing NOW!!! Click to know - How to invest in Mutual Funds through ICICIdirect.com.

Thank You