Ajax - How risky it is to invest in these funds...
How risky it is to invest in these funds even if I might need it in 2-3 years because of the higher returns?
I understand that temporary reductions in value or worse (Like covid) can happen but I want to know how bad it'd be.
I'm currently investing in Liquids funds too and plan on using it to stash away excess funds and funds I might need in a few years but just wanted to understand the risks of investing in Flexi and Multi asset funds in a shorter period like 2-3y.
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On second thought, it seems self explainatory. The liquid fund I'm investing in is icici's so im thinking of investing in their banking and psu fund instead or parag's hybrid
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Solution
On second thought, it seems self explainatory. The liquid fund I'm investing in is icici's so im thinking of investing in their banking and psu fund instead or parag's hybrid
Unknown User•3mo ago
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Oh? It was what recommended in the getting started wiki for those that are using icici liquid fund like I am for the "Money needed in under 5-7 years" basket
I currently have PFFAS flexi so it's fine if I need it in 2-3 years then?
Since from my understanding, Flexi cap and some index funds are equity too so can i know what makes them different from others?
Unknown User•3mo ago
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Right, that I do know. I still don't quite get why flexi caps are safer in shorter holding periods, though my guess is that the manager has more freedom and well, flexibility to adjust to the current market situation
And PFFAS's manager seems quite well regarded on top
Oh, I just realised Multi cap and Flexi cap aren't the same thing
Where does it say that multi-asset and flexicap are safer for shorter holding periods?
Find official definitions here. https://www.amfiindia.com/investor-corner/knowledge-center/SEBI-categorization-of-mutual-fund-schemes.html
Association of Mutual Funds in India
Project: Description
It's also helpful to look at a scheme documents as provided by the AMC on how they plan to invest.
The SS I listed didn't mention, it was implication I picked up from what John said.
Don't invest in equity if you need the funds in 2 years. Keep that stashed away in Liquid funds Don't go for sectoral funds like banking/psu, just go for a flexi-cap fund or index funds
Gotcha. In any case, equity or even hybrid funds (except for arbitrage funds, which are classified as such) are not suitable for short durations.
Unknown User•3mo ago
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Got it, short term as in under five years?
Is banking and psu ones fine too for this?
Since John said to avoid sectoral ones and I do know the risks of them on a very surface level but I did see them listed on the wiki so I want to make sure
Unknown User•3mo ago
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I'll stick to icic liquid fund for now then, don't have the time to study which other fund to invest properly into and by now I know it's best to not ask others for what to invest into and doesn't seem like this server allows that anyways. Thanks to you all!