Is it advisable to take loan and invest in mutual funds?
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Is it advisable to take loan and invest in mutual funds?
As stated earlier, it does not make any sense to invest the borrowed money in risky investment options like stocks, IPOs, mutual funds, etc. While options like debt oriented schemes and fixed deposits, etc. offer guaranteed returns, they will not be able to generate higher returns to cover the cost of the loan.
Which investment is best for 5 years?
Best SIP Plans for 5 And 3 Years in Equity Funds and Debt Funds
| Fund Name | 5 years Return | Monthly Investment |
|---|---|---|
| ICICI Prudential Technology Fund | 33.91\% | 5000 |
| HDFC Balance Advantage Fund | 15.50\% | 5000 |
| ICICI Prudential Bluechip Fund | 10.81\% | 5000 |
| Kotak Standard Multicap Fund | 13.24\% | 5000 |
Can teenagers buy mutual funds?
In May, Fidelity Investments launched a Fidelity Youth Account, a brokerage account designed for 13 to 17 year olds. While a parent or guardian must establish the account for the teen, the account will be set up with the child’s own name and user info.
Is it legal to use loan money to invest?
Investing student loan money is not illegal. However, such investing does fall in a legal and moral gray area. Borrowers of government-subsidized loans could face legal action if they invest the money, which may include repaying subsidized interest.
What is Max time in mutual fund?
The minimum tenure for investment in Mutual Funds is a day and the maximum tenure is ‘perpetual’.
How should I invest at 13?
If you are a minor, you can make investments only under the supervision of your parent through a custodial account. You parent will have to sign you up for a custodial account offered by an online broker.
What is the minimum age to open a mutual fund?
18 years
The minimum age to invest in mutual funds in India on one’s account is 18 years.
Should I take a loan to invest in mutual funds?
To sum it, do not ever take a loan to make an investment. (If you have any mutual fund queries, message us on ET Mutual Funds on Facebook. We will get it answered by our panel of experts.)
When does it make sense to borrow money to invest?
The only time it makes sense to borrow money for an investment—known in financial lingo as “invest a loan”—is when the return on investment of the loan is high and the risk level of the investment is low. It is inadvisable for an investor to invest a loan in a risky vehicle, like the stock market or derivatives.
Should you cash in your mutual funds to become debt free?
Cashing in your mutual fund is not the best way to become debt free unless you have very high interest rates and an inability to pay on current loans.
Should you take a personal loan at 16\% to invest?
When you are taking a personal loan at 16\% to invest, your investment should make at least 16\% annually to avoid making losses. In other words, you need more than 16\% annual returns to make a profit.