What are the current mutual fund returns? This is the burning question in any investor mind always also makes you worry when you are investing in a mutual fund. Well in today’s digital world, it has become quite simple to track your investment portfolio and get a better idea of each and every mutual fund performance. Either you are a regular investor or first time, it is important to research regarding mutual fund returns well in advance.
Those who have already invested would be getting regular updates or statements to understand the performance of the schemes they have invested in. Apart from that, there are apps and websites which can help you with the same. Many finance related newspapers also give a brief idea of mutual fund performances regularly. There are many fund factsheets using which you can get to know about mutual fund performance. These fact sheets are just like report cards which gives you a clear picture of mutual fund returns.
Now let’s focus on the way to calculate any mutual fund returns. There is no need to worry, as, with the introduction of various mutual fund return calculator, this task has become quite easy.
So here is some mutual fund calculator:
Mutual Fund Calculator for Lump sum
In this tool you need to insert the lump sum amount (in rupees), number of Years and expected rate of return per annum. There are two ways in which one can try to analyze the return of their mutual fund such as- absolute terms and compound annual growth rate (CAGR).
Mutual Fund Calculator helps to facilitate the calculation of return on lump sum investment in absolute when invested for duration of 1 year or below. This can be in the form of a percentage or some calculator provides other metrics. You want to follow below method for calculating Absolute Returns
Absolute Return = Current Value – Initial Value * 100 Initial Value
But if the investment is held for multiple year, the mutual fund returns are calculated in terms of compounded increase. This will give a higher picture of year on year growth of your money. Below method is for calculating Compounded Annual Growth Rate (CAGR)
CAGR = (Current Value) 1/N -1 Initial Value
The current value is the amount on the day of redemption whereas initial value is the Investment amount and n stands for a number of years.
Mutual Fund Calculator for SIP – This kind of calculator tries to give you the approximate idea of expected returns of your monthly/quarterly SIP investment.
For this you need to enter following inputs:
- SIP installment amount
- The expected rate of return
- Tenure of the SIP
For example, if you want to do a SIP of Rs. 1000 for 12 months with an expected return of 15%, the calculator will give you the result as Rs. 13008. However, it is to be noted that mutual fund returns provided by a SIP calculator are general estimates based, which can change according to market situations.
Inflation Calculator
Inflation calculator is used to calculate the amount you will require to meet your future expenses. For example, if you are entering Rs. 20,000 as your current expenses, inflation rate as 7% and time period 30 years, the calculator will give your result as Rs 1.52 lac which you will need in future.
Different types of mutual funds are the best way to plan long-term planning whereas one have to check the mutual fund performance based on old returns, but that is not the only way to check the mutual fund. This can help an investor decide whether to continue or exit the fund and switch to a new one. Also, the mutual fund calculator of various types can help in comparing the performance of different funds and schemes of the same fund. Henceforth, the investor should investigate the fund well and analyze the mutual fund returns for taking any investment decisions.
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