I want to invest in 2 mutual funds, one for the long-term and one for the short-term. In which funds should I invest? -Ghanshyam
If you're investing in mutual funds for the first time, choose 1 or 2 balanced funds for your long-term investments. When you choose a fund, look for ones that have a long history of consistent performance. Some good balanced funds to pick from are DSP BlackRock Balanced, UTI Balanced and Birla Sun Life 95. After a couple of years, once you have a fair idea of how fund investing works, you can move to relatively less risky equity funds. For the short-term investment, pick a short-term bond fund that will give you better returns than a bank fixed deposit and your money will be more liquid. If the money you're investing is relatively large, it will be more tax efficient as well.
This article was originally published on August 31, 2012.
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