Traits of a good equity mutual fund investor

Posted On Wednesday, Sep 23, 2020

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Everyone knows that Indians have an inherent capacity to save money.

This is good.

But do we have an 'investors' mentality?

Today, fortunately we see many investors allocating their hard-earned money to different mutual fund schemes.

However, before investing in mutual funds, we need to ask ourselves do we have what it takes to be a good investor?

Are we on the right track to make our equity mutual fund investments?

Let us look at some traits of a good equity mutual fund investor:


• Has good awareness and is unafraid of market movements

We have always been told that knowledge is empowering.

A good investor has sound knowledge of mutual funds and how they work.

This investor understands equities are higher risk instruments compared to fixed income instruments like Bonds, but both carry risks. Since mutual funds are vehicles with these underlying assets, they too carry that risk.


• Keeps it simple

Yes, diversification is the key to generate risk adjusted long term returns when investing in equity mutual funds. However going overboard could cost you a lot.

One common mistake investors make while investing in equity mutual funds is to over diversify.

No matter how many financial goals you might have, a good investor knows the key to enhance returns is by keeping it simple.

Ideally, an investor needs investment in around 5 - 7 schemes to prudently diversify their equity portfolio. That's it.

If you don't want the hassle of even selecting the 5 - 7 funds, opt for a fund of funds. Consider investing in the Quantum Equity Fund of Funds.


• Is realistic

Sure, we hear stories of great stocks that made investors millionaires overnight.

Honestly, mutual funds are not meant for such thrills. Yes, even equity mutual funds. And a good investor realizes this fact.

Being realistic about your expectations regarding returns on investments helps you reach your financial goals slowly but steadily.


• Understands market

In our communication, we always keep stressing on the fact that markets are volatile in nature, when they go down you invest, when markets surge you wait and only redeem when you are close to your financial goals.

A good investor is someone who understands markets.

He or She understands investing in markets is meant for long term.


• Avoids noise

By noise we mean the excitement when markets shoot up and fear when markets fall.

A good investor knows this is not the time to let your emotions take control.

Investors resent investing in equity mutual funds generally because they have heard about some bad experience or probably even experienced themselves.

What you need to ideally focus on is your own financial journey and stay invested.

Be calm and let the chaos pass.

Let's say, to be a good investor actually means to keep it simple.

No complications. Just choose an equity mutual fund of your choice, or an equity fund of funds and stay invested until you reach your financial goals.


Editor's note: To know more about our equity funds write to us at [email protected] Or give us a missed call at +91-22-68293807 and we will call you back.



Product Labeling

Name of the Scheme & Primary BenchmarkThis product is suitable for investors who are seeking*Risk-o-meter of Scheme
Quantum Equity Fund of Funds

An Open Ended Fund of Funds scheme Investing in Open Ended Diversified Equity Schemes of Mutual Funds
• Long term capital appreciation

• Investments in portfolio of open-ended diversified equity schemes of mutual funds registered with SEBI whose underlying investments are in equity and equity related securities of diversified companies
Quantum Equity Fund of Funds
Investors understand that their principal will be at Very High Risk


* Investors should consult their financial advisers if in doubt about whether the product is suitable for them.


Disclaimer, Statutory Details & Risk Factors:


The views expressed here in this article / video are for general information and reading purpose only and do not constitute any guidelines and recommendations on any course of action to be followed by the reader. Quantum AMC / Quantum Mutual Fund is not guaranteeing / offering / communicating any indicative yield on investments made in the scheme(s). The views are not meant to serve as a professional guide / investment advice / intended to be an offer or solicitation for the purchase or sale of any financial product or instrument or mutual fund units for the reader. The article has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Whilst no action has been solicited based upon the information provided herein, due care has been taken to ensure that the facts are accurate and views given are fair and reasonable as on date. Readers of this article should rely on information/data arising out of their own investigations and advised to seek independent professional advice and arrive at an informed decision before making any investments. Please visit – www.quantumamc.com/disclaimer to read scheme specific risk factors.

Above article is authored by Quantum.

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