Master market turbulence: Insider tricks for big returns

As more Indians look to grow their returns through equity fund investments, what is the secret to consistently growing your returns over time? Read on to learn ten insider tricks that can help you earn high returns through your mutual fund investments.

Ten insider tricks to help you earn high returns:

Here are ten insider tricks that can help you as an investor grow your returns by investing in the best mutual funds:

• Note down your investment objective before investing: Defining an investment objective before investing can help you select the right investment scheme and regularly assess its performance. You can also easily decide on the ideal investment horizon by fixing an investment objective early on in your investment journey. This trick can also help you better analyse your risk appetite.

• Learn more about factors influencing market volatility: You must constantly read up on economic indicators and factors influencing market volatility to take better investment decisions and earn higher returns.

• Analyse your risk appetite: You must always invest according to your risk appetite. To do so, you must conduct a risk assessment of your investment portfolio before making any investment.

• Look for opportunities to diversify your investment portfolio: Several equity mutual fund schemes provide investors the opportunity to diversify their portfolios. You can invest in equity funds if most of your portfolio consists of debt funds and their types. This can help you safeguard your portfolio from the negative impact of poor-performing stocks during market volatility.

• Adopt a long-term perspective while investing: You must resist the urge to make hasty changes to your investment portfolio during market volatility. Market volatility is generally short-lived, and you must adopt a long-term perspective to earn high returns.

• Be conscious of the behavioural biases that could inform your investment decisions: Various behavioural biases can impact investor behaviour, regardless of how the market is doing at that moment. You must be aware of the overconfidence bias, the loss-aversion bias, and the confirmation bias while investing. Other important behavioural blind spots to be conscious of are the recency bias and the sunk cost fallacy.

• Consider using limit orders during volatile market conditions: Limit orders can help you fix a buying or selling price for a particular stock. Using them can help you avoid unexpected price fluctuations.

• Keep reviewing and analysing your portfolio: It is extremely crucial to continuously review your investment portfolio and check if your investments align well with your investment goals.

• Prioritise liquidity to have access to cash during emergencies: You must also account for unforeseen financial emergencies while investing. You can do this by investing in equity funds or liquid funds, depending on how much liquidity you require.
• Use online financial calculators to calculate your expected returns: Lastly, do not forget to plan for your equity fund investments by calculating your mutual fund returns in advance. You can do this by using an online SIP (Systematic Investment Plan) calculator to calculate your mutual fund returns before investing.

You must also learn more about the taxation of various mutual fund schemes to earn tax-efficient returns at the end of your investment tenure.

(Devdiscourse's journalists were not involved in the production of this article. The facts and opinions appearing in the article do not reflect the views of Devdiscourse and Devdiscourse does not claim any responsibility for the same.)