Nippon India Equity Mutual Fund

Investment Objective

Nippon India equity mutual fund schemes aim to provide investors with the opportunity to grow their wealth over time. These funds primarily invest in equity and equity-related instruments in the proportion specified in the fund’s scheme information documents. Capital appreciation occurs when the underlying stock prices rise over a given investment horizon. It is also the best Nippon India equity mutual fund that does not guarantee that investment objectives will be met.

Risks Involved in Nippon India Equity Mutual Fund

Nippon India equity mutual fund risk is moderate to high when compared to debt and balanced funds. The fund’s value may fluctuate in response to stock market price and volume changes, interest rates, exchange rates, government policies, tax laws, and other economic developments. The degree of risk is also determined by the degree of portfolio diversification. Nippon India equity mutual fund risks in sector / theme-based are more volatile in the market than diversified equity funds. Similarly, large-cap equity funds will be less risky than small-cap/mid-cap equity funds. Before investing in a scheme, investors should consider their own risk tolerance.

Return Potential of Nippon India Equity Mutual Fund

Nippon India equity mutual fund returns are incidental to the risk that an investor takes. Nippon India equity mutual fund performance outperforms debt and balanced funds. Historically, these funds have delivered average returns of around 12% over a 5-year period. However, the returns are not guaranteed, and Nippon India equity mutual fund performance may vary from one period to the next.

Who Should Invest in Nippon India Equity Mutual Fund?

For investors looking for long-term capital growth over a period of five years or more, Nippon India equity mutual fund is a good option. These funds are intended for investors with a comparatively higher risk tolerance because the fund value may increase or decrease depending on market conditions. Nippon India equity mutual fund schemes are the best choice for achieving long-term objectives, including saving for a child’s education, planning for retirement, and purchasing a home because of their high return-producing potential. You must maintain your investment during the designated investment horizon, which is typically 10–12 years or even more, in order to realise the full potential of equity funds. This could also imply keeping only those surpluses in these accounts that are earmarked for long-term investments and that you won’t require anytime soon.

Things To Consider Before Investing in Nippon India Equity Mutual Fund

The following are the things to consider before investing in Nippon India Equity mutual funds.

• Investment goal
• Investment time horizon
• Risk appetite
• Mutual fund’s volatility
• Asset allocation

Tax on Nippon India Equity Mutual Fund

Nippon India Equity mutual funds classified as equity funds have an equity exposure of at least 65%. As previously stated, when you redeem your equity fund units during a holding period of one year, you realise short-term capital gains. Regardless of your income tax status, these gains are taxed at a flat rate of 15%.

When you sell your stock fund units after holding them for at least a year, you realise long-term capital gains. These capital gains are tax-free up to Rs 1 lakh each year. Any long-term capital gains in excess of this threshold are subject to 10% LTCG tax, with no benefit of indexation.