#1: Learn The Basics

You can’t speak the language if you don’t know the words. So if you want to invest in mutual funds, learn the jargon. We’ve compiled a list of mutual fund jargon for you:

1. AMC: The Asset Management Company that invests the pool of money collected in various securities and assets 
   

2. AUM: Asset Under Management is basically the total market value of all the financial assets controlled by a Mutual Fund 
   

3. Benchmark: Tells you how a particular Fund is performing in comparison to the Market and other similar Funds 
   

4. Entry Load: This is the fee charged (in %) when a Mutual Fund scheme is purchased. This fee is deducted from the amount invested in the scheme
   

5. Exit Load: Similar to Entry Load but the opposite. This is the fee charged (in %) when a Mutual Fund scheme is sold
   

Head here to see simple explanations to mutual fund & investment jargon.

This will help you understand what is going on in the mutual fund industry. Plus, if you decide to get a wealth advisor, you’ll know exactly what they are talking about.  

#2: Understand What Type Of Investor You Are - DIY or Advisor

Knowing what type of investor you are can save you time & effort. If you can keep up with the market and spare time on rigorous research, DIY can be the best way for you. 

On the flip side of the coin, if you’re a busy professional who has too many responsibilities & too little time, getting an investment advisor can be the best gift you give to yourself. 

But until recently, investment advisory was available only to HNIs. But Cube has changed the way the investment game is played. The Cube Wealth app gives you access to world-class wealth advisors from India & around the world.

Wondering if you need a financial advisor? Explore Cube Wealth to know more

#3: Invest Based On Goals

You must have short term goals such as buying a car or pursuing an MBA or long term goals such as buying a house or sponsoring your child’s US education. But you also have to be prepared for emergencies and opportunities. To achieve these goals, you must target mutual funds that are tailored to give returns over the short, medium and long term.

If you’re a young & budding investor, read these 17 tips from our founder & CEO, Satyen Kothari.

#4: Build A Balanced Portfolio

The ideal investment portfolio differs from investor to investor based on specific investment goals and risk appetite. An under diversified or over diversified portfolio is simply chaotic and unreliable. So how do you strike the right balance?

If you’re investing via Cube, you get the unique advantage of building a perfect portfolio of well-balanced funds based on Cube’s bucket philosophy. What’s the bucket philosophy?

#5: Decide Between SIPs Or Lump Sum

A Systematic Investment Plan allows you to invest in mutual funds in small chunks over a fixed period of time. It is easy on the pocket and you don't have to worry about intermittent market fluctuations. When you invest a lump sum amount, the market phase you invest in matters a lot. Plus, you’ll have to allocate a large chunk of money.

Both methods have their own pros and cons. Finding the right investment mode for you can be difficult since it will depend on factors such as affordability, risk, age, etc. Consulting a wealth coach can help you get a clear idea of what is right for you. 

#6: Know When To Sell

This is perhaps the most important factor when it comes to mutual fund investments. There’s no point buying a fund if you can’t sell it for profit. So when should you sell a fund? Here’s a list:

1. Your investment goals have been met
2. You need to rebalance your portfolio
3. For tax benefits
4. There’s an emergency
5. The fund is underperforming
6. There’s a change in the strategy & objective of the fund
7. The fund size increases tenfold
   

A whole host of people on the internet will tell you what to buy. But no one really tells you when to sell. Not if you’re a Cube user though. How? Read on to know more.

Q. How do beginners invest in mutual funds?

Ans. Beginners can invest in mutual funds with a reliable and powerful app like Cube Wealth. Cube simplifies mutual fund investments by giving you access to handpicked mutual funds that work for you. These funds are based on your investment goals and risk appetite. Learn more about curated mutual funds on Cube Wealth today.

Q. Can I invest 1000 Rs in mutual funds?

Ans. Yes, you can start investing in mutual funds for as low as ₹1000 on the Cube Wealth app. Cube gives you access to curated mutual funds from categories like liquid funds, internatinoal funds, equity funds, debt funds, ELSS funds, and more. Start investing today.

Q. How can beginners invest in mutual funds?

Ans.  Beginners can invest in mutual funds through various methods, including online brokerage accounts, mutual fund companies, or financial advisors. Many platforms offer easy-to-use tools for buying and managing mutual fund investments.

Q. What fees are associated with mutual funds? 

Ans. Mutual funds may have fees like expense ratios, which cover management costs, and sales loads, which are sales commissions. It's essential for beginners to understand these costs and choose funds with lower expenses.