A mutual fund is a scheme where the money invested by people is managed by expert market professionals to choose the right investment place. The investment is managed by an Asset Management Company who acts as a mediator for the retail investors. The prime motive behind investing in a mutual fund is getting decent returns. The return on investment can be calculated using Mutual Fund Calculators. The calculator helps the investor to know if the investment is generating returns as per the expectation or not. It calculates the fund returns as per the horizon of investment and shows the final investment value at the time of maturity.
Mutual Fund Calculator
Mutual Fund Calculator is a market tool that helps to calculate the overall return on the investment. The calculation is done using the principal investment amount and the expected rate of return. Systematic Investment Plan (SIP) and Lump-sum plan are the two major routes of investment that are taken into consideration while finding out the returns.
Working of Mutual Fund Calculator
In today’s modern world, you no longer need a pen paper and memorize a formula to calculate a result. The SIP calculator or mutual fund calculator online is provided by so many fund houses. Visit the official website of the company you desire to invest in and search for SIP Calculator. It is free of cost. One important thing that every person should keep in mind is that the end result, calculated after filling up all the details, is based on factors like the rate of inflation and capital gain taxes.
For example- Given,
Monthly investment amount = Rs. 10,000
SIP Duration = 12 Months
Therefore, the annual rate of expected return= 12%
Hence, Rs. 1200
Types of Mutual Fund Calculators:
Mutual fund calculators are of two types:
- Inflation calculator– As the name suggests, the Inflation calculator helps to calculate the after-effects of inflation The calculator provides the investors with an idea about the amount needed in the future to fulfill the current investment requirements while keeping up with inflation.
- SIP Calculator- SIP calculator helps to calculate the amount of wealth gained by investing in Mutual funds and the expected return for SIP returns on a monthly basis. The amount of return are based on the projected rate of return. It also has a Goal SIP Calculator which determines the investment required to make on a monthly basis to real the estimated goal.
Uses of a Mutual Fund Calculator
Mutual Fund Calculator is a simple tool that quickly processes the estimated rate of returns against monthly investments. It will help the investors to strategize their investment plan to meet their long term financial goals.
The calculator needs basic information like the monthly investment of the investor, tenure period and the average rate of return on the invested funds to generate the result. It is indeed a very user-friendly tool, accessible by all. It is very useful for people going to land on the mutual fund market for the first time. The calculator helps them to determine the pros and cons of SIP investment.
Mutual fund calculator is one of the most dependable instruments. It is used by both small and big level investors to meet their financial goals.