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Where Can You Find the Best Mutual Fund Apps
Let me begin with a fictional story. Riya, Soham, and Tara are friends and they just passed out of college and landed their first job.
Riya shifts a part of her salary into a savings account every month. The money is safe, but it grows at a pace slower than a snail’s race. Soham on the other hand locks his savings into fixed deposits. The returns are decent, but his money is imprisoned for a set period, inaccessible during sudden needs. But Tara, on the other hand, decides to explore the world of mutual funds. She understands that mutual funds collect and pool money from a large number of investors and invest this money in stocks, bonds, or other assets. She likes the idea of having professionals manage her investments and the potential for higher returns.
Tara started small, investing a little every month in a mutual fund which she understood as SIP (Systematic Investment Plan) that matches her long-term financial goal of building a beautiful house. As time passes, she watches her money grow, outpacing both Riya’s savings and Soham’s fixed deposits. Even with an exceedingly small continuous investment every month, Riya was able to build the corpus she required.
This story of Riya, Soham, and Tara introduces us to the power of mutual funds. Like Tara, any student like you can start investing in a mutual fund with an amount as low as Rs.500 every month. But there are risks and you need to do your research based on your financial goals.
In this article, we will look into some of the best mutual fund apps and how to start investing as a student.
What are Mutual Funds Exactly?
Mutual funds are a type of investment in which individual investors pool their resources to purchase stocks, bonds, and other securities. This pooling provides access to a broader set of investment opportunities. The beauty of mutual funds is their diversification; by holding a piece of the fund, investors may spread their investments over numerous assets, lowering total risk. It is like having a personal financial advisor without the high fees. Today, we have access to interest, and there are numerous excellent apps for mutual fund investing.
Benefits of Investing in Mutual Funds as a Student
Investing in mutual funds at an early age is recommended. It helps you save and allows your money to grow. Starting young provides you with an advantage of the power of compounding.
One of the best features of mutual funds is diversification, which reduces risk by distributing your money across multiple securities. What is more, professional fund managers manage your investment portfolio, so you need not worry.
Difference between SIP and Lumpsum Investment
Let us imagine you are offered a huge pizza to understand the difference between two common types of investments in mutual funds. Now, you have two options.
- Lumpsum Investment: You can finish the entire pizza at once. This is similar to making a lumpsum investment, in which you invest a substantial quantity of your money at once.
- Systematic Investment Plan (SIP): You can also eat your pizza slice by slice with a break in between. This is similar to a systematic investment plan (SIP), in which you invest a fixed amount in a mutual fund regularly (usually monthly).
Now, let us understand the differences a bit deeper:
- Risk: Eating the entire pizza at once may cause stomach pain. Similarly, investing a large money all at once (lumpsum) might be dangerous if market conditions are not favourable. On the other hand, SIPs distribute risk across time by allowing you to invest regularly regardless of market conditions just like eating slice after slice.
- Investment Amount: A huge amount of money is required for lumpsum investments. However, for SIP, you can begin with a smaller quantity as low as Rs.500/month.
- Timing: In case you invest in lumpsum, the timing of the market is extremely critical. However, under SIP, you do not need to time the market because your investment is spread over a period, and it can absorb all the difficulties of the market.
Both SIP and lumpsum are equally important and are suited for different sets of investors and their objectives. Before making any investing decisions, it is always recommended that you conduct extensive research or talk with a financial expert.
How Students Can Start Investing a Very Small Amount
You may think that investing requires a huge amount of money. However, mutual funds allow you to start investing, even with a small amount. Students can invest with as little as INR 500 every month as SIP. Another alternative is a direct purchase plan, allowing students to buy mutual funds directly from the company thus paying a low fee. But for most of us, searching for the right platform and office locations to start mutual fund investment becomes difficult. You need to look for user-friendly interfaces, reasonable fees, and diverse funds that align with investment goals and risk tolerance. With these options, students can begin their investment journey today, regardless of the initial investment amount.
Risks Involved in Mutual Fund Investment
Investing in mutual funds is a fantastic way to grow wealth over time, but it also comes with its share of risks. Market volatility is one of the big risks which can erode your investment’s value. Some funds have a lock-in period, you can also withdraw your money after a specific time. Hence understand all the risks associated with mutual funds and check the risk factors with each mutual fund. A seasoned financial expert will be able to help you out.
Which are the Best Mutual Fund Apps for Investing?
Now, the question arises – how to invest in mutual funds? The answer is right at your fingertips. There are numerous apps available that make investing in mutual funds a breeze. Let us dive into some of the best mutual fund apps suitable for teenagers in India.
Groww
Groww, an online platform launched in April 2016, offers a variety of investing options, including equities, mutual funds, exchange-traded funds, and initial public offerings. With over 1.5 crore registered members, Groww simplifies investing by offering a straightforward, accessible, transparent, and paperless experience. It also provides goal-based investing and more than 5,000 mutual funds.
ETMONEY
ETMONEY is a complete wealth management platform with over 1.2 crore registered users, offering 0% commission on direct mutual funds, equities, and expertly crafted multi-asset portfolios. Paytm Money is another pioneer in low-cost, commission-free investing, providing tools to help investors manage their money.
Kuvera
Kuvera is India’s first completely free platform for direct mutual funds, offering a variety of investment options and simplifying money management. The platform has been recognized as an Investment Advisor by the Securities and Exchange Board of India (SEBI).
Coin by Zerodha
Coin by Zerodha is India’s largest direct mutual fund platform, offering 0% fee mutual funds, government bonds, corporate bonds, and gold bonds. Investing in zero-commission direct mutual funds can save up to 1% in commission fees.
myCAMS
myCAMS is an online platform that offers mutual fund investing, management, services, and statements. CAMS (Computer Age Management Services) developed this web-based tool, allowing investors to create a single login user ID via the CAMS website or mobile app. The interface makes it convenient and easy to manage your mutual fund portfolio.
Take your First Step
Investing in mutual funds is a terrific way to start saving, but with so many options available, it can be tough to know where to start. Fortunately, as discussed, some of the best mutual fund apps are just a few clicks away! Numerous investors have tried and evaluated these applications, and they are highly recommended due to their user-friendly style, smart design, and valuable features. In the realm of investing, the sooner the better. So, if you can invest at least Rs.500 every month, I strongly recommend starting with mutual funds. The top mutual fund applications are there in front of you. Do not wait any longer to start building your corpus.
