ITI Equity Mutual Fund:

ITI Equity Mutual Fund's investment objective is long-term capital appreciation and preservation through a diversified portfolio of equity securities. The fund will invest a minimum of 65% of its assets in equity and equity-related securities of Indian companies. The fund managers also invest in debt and money market instruments for liquidity management. The critical investment objective is to generate returns above the benchmark indices such as the Nifty 50 and the BSE Sensex.

Risks Involved in ITI Equity Mutual Fund

Here's the list of risks associated with ITI Equity Mutual Funds:

1. Market Risk: This is the risk associated with fluctuations in the stock market, which can affect the overall performance of the Equity Mutual Fund.

2. Interest Rate Risk: This is the risk associated with changes in the interest rates, which can affect the fund's performance.

3. Credit Risk: This risk is associated with default or inability to pay back the loans taken by the fund manager.

4. Liquidity Risk: This is the risk associated with the fund's ability to sell off its assets quickly to meet its obligations.
5. Rebalancing Risk: This is the risk associated with rebalancing the fund's portfolio to maintain the fund's desired risk-return profile.

6. Political Risk: This is the risk associated with changes in the political environment, which can, directly and indirectly, impact the fund's performance.

Return Potential of ITI Equity Mutual Fund Schemes

The potential return of an ITI Equity Mutual Fund will depend on the specific fund you choose and the performance of the stocks in the fund. Generally speaking, the potential return of mutual funds depends on the performance of their underlying investments. Equity mutual funds typically have higher potential returns than other types of mutual funds due to their higher risk. However, they also potentially lose value if the stocks in the fund underperform. Researching a mutual fund before investing is essential to ensure it is suitable for your goals and risk tolerance.

Who Should Invest in ITI Equity Mutual Fund?

Investors looking for long-term capital appreciation and willing to take the associated market risk can consider investing in the ITI Equity Mutual Fund. Investors should also have a moderate to high-risk appetite and a long-term investment horizon of more than five years.

Things To Consider Before Investing in ITI Equity Mutual Fund

There are certain things that you must take into consideration before investing in ITI Equity Mutual Funds. The key considerations are:

1. Investment objectives: It is essential to clearly understand your investment objectives before investing in any equity mutual fund. Some key factors are risk tolerance, investment horizon, expected returns and total investment amount.

2. Investment strategy: ITI Equity Mutual Fund follows a 'growth-at-a-reasonable-price' strategy. In simple words, the fund's portfolio is primarily composed of stocks with the potential for significant capital appreciation over the long term. It is essential to understand the fund's investment strategy before investing.

3. Fund performance: The investor must look at the fund's past performance before investing. It helps to gauge the fund's potential to generate returns in the future.
4. Fund management: Research the fund manager to understand better their investment style, track record and portfolio construction process.

5. Fund expenses: Equity mutual funds incur several expenses, such as management fees, brokerage, and custodial fees. So, getting familiar with the costs and expenses associated with the fund is essential before investing.

Tax on ITI Equity Mutual Fund

The tax on ITI Equity Mutual Fund is 15%. For investments over one year, long-term capital gain tax is nil. For investments under one year, short-term capital gain tax is applicable as per the individual's income tax slab.