There are various benefits of investing in mutual funds. It includes diversification for high profit, high liquidity, minimize risk of losses and professional wealth management services. Therefore, it is an income generating investment option or a low risk good profit, particularly for those who are looking to build up savings for their retirement years.
There are various types of schemes like debt, equity, value stocks, open ended schemes, growth schemes, close ended fund, etc. Consequently, it can turn out to be really confusing for novice investors. In such type of investment, a part of the profit made from investment is distributed to the investors from time to time when the fund declares dividends.
When a scheme announces dividend out of the profit earned, size of the fund amount decreases due to which the NAV or the Net Value Asset also drops. Then why should investors opt for mutual fund dividends? When dividends are declared as a host, new investors are attracted to the mutual fund. Moreover, a dividend that is produced from equity mutual fund is tax free. Long term capital gains and dividend distribution is also tax free.
How to decide which scheme or fund do you want to invest in? Regulate your goals like whether you want high returns or stable income, long term capital gains or short term investment, etc. Based on your long term tactics, you need to decide your investment portfolio. If you are convinced about investing in mutual fund dividend, then you need to check the dividend history of the funds online. Dividend history helps you to track down the dividend payments made by particular funds during a period of time. It makes it easy to locate the schemes, which have produced great amount of dividends in the past. This is a good way to predict the future performance of dividends. You can choose from dividends like Quantum pure equity, Quantum infrastructure fund or Quantum dividend yield fund.
