Purchasing shares is never an accomplished task but especially if it is done for the first time in the market. However there are numerous funds to choose from and this making it very important for one to choose the most appropriate fund in relation to their investment goal and appetite to risks. In the recent past, most of the investors based in India must have heard about the parag parikh flexi cap fund. In this article, you’ll explore five powerful arguments of why, perhaps, this fund should be included into your investment portfolio.
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Flexibility in Investment Approach
A flexi cap mutual fund is what the Parag Parikh Flexi Cap Fund is, as its name implies. Additionally, it implies that fund managers are free to make investments in small, medium, and large-cap stocks. This feature gives the fund the flair to maneuver around the market and invest in several sectors and sizes of the company.
Hence, the opportunity of a flexible approach to the portfolio construction can be especially valuable when a volatile market is considered. Additionally, high degree of flexibility can be utilised by the fund managers in a way that they can establish targets for the various segments of the market that they are considering for investment when they realise that some segments are not as productive as others.
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Focus on Value Investing
Another interesting feature for the Parag Parikh Flexi Cap Fund is that by investing in businesses, the fund adopts the value investment approach. This investment technique involves looking for and putting capital in equities that are thought to be severely underrated by the market. The fund managers identify companies with solid economic profile, competent management, a product or service with good growth prospects and a stock whose market price has not yet fully captured the value.
It can also be advocating for value investment since this approach shall be appealing to investor with low risk taking propensity. Instead, the fund targets stable and established companies to invest in the common high-quality equities that can bring stable returns for years.
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Experienced Fund Management Team
Ultilising this benchmark it can be established that each and every successful mutual fund has capable and experienced fund managers. The Parag Parikh Flexi Cap Fund has a professional fund management team that has vast experience on the investment field. These people come to the table with years of accumulated experience and skills which can prove invaluable in the vastly unpredictable area of stock market investments.
Specifically, the skillfulness, experience, and judgment of the fund managers can be most useful in terms of searching for new investment opportunities and in the assessment of the risks associated with such opportunities.
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Potential for Higher Returns
The performance of Parag Parikh Flexi Cap Fund has indicated that it has the capability to provide competitive returns though the past performance is no guarantee of future performance. The strategies deployed by the fund include the ability to invest in almost any kind of company, as well as based on value investing, secure as many opportunities in the market as possible.
Because the fund is an equity fund, it is able to invest in stocks of different market capitalizations and harness the growth in various segment of the market. For example, while value stocks give the security of mature large-capitalized organizations, growth stocks can be relatively risky but potentially rewarding small to medium capitalized companies.
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Transparency and Investor-Friendly Practices
Transparency is an important area of consideration in mutual funds, and the Parag Parikh Flexi Cap Fund has been exhibited to be highly transparent and investor friendly. The fund offers constant and extensive reports regarding assets and their portfolios and how the money is spent so the clients can be aware of where their money goes.
This is true also in terms of the fund’s investment approach and choice-making mechanism. Often the fund managers provide investors with a narrative explanation of the key decision making processes in relation to the fund’s investment portfolio.
Conclusion
The stock market investment seems to be a worthy investment decision but it should be done with due diligence. The principal advantages of the hdfc flexi cap fund are the flexibility of investments, value approach, experience, high profitability, and full transparency that can seem to be interesting many investors. But, as in any investment decision, it is necessary to evaluate the specific features of one’s financial plans, the individual’s capacity to withstand market fluctuations, as well as the required time to obtain good results. For those, who is eager to proceed with the research on this fund or other issues connected with stock market investments, there is useful option in the form of courses at 5paisa.