Hi there! welcome to Gift-Nifty, where you can explore investing in international Mutual Funds. Are you interested in spreading out your investments? If so, you might be interested in foreign mutual funds. These funds take money from many investors and put it in a wide range of foreign securities. This gives you access to markets around the world.
If you’re a smart investor, looking into International Mutual Funds can help you grow your money in countries other than your own.
Check out this piece to learn why investing in international mutual funds is a good idea, how to do it, and which international funds are the best ones to buy.
International Mutual Funds
International mutual funds are ways for buyers to put their money to work by investing in a wide range of assets outside of their home country.
These funds give you access to financial markets around the world, in many different countries and areas.
International Mutual Funds, which are run by skilled fund managers, try to increase the value of their investments and spread out their holdings.
Fund managers help investors find their way around the world’s markets, so investors don’t have to pick stocks or do market research themselves.
How do International Funds Work?
The steps for investing in foreign mutual funds are the same as those for investing in any equity mutual fund. When you pay with rupees, your money is converted into units.
The fund manager then invests these funds in stocks of companies that are listed in other countries. There are two ways to do it:
- Make direct stock buying to build a custom portfolio
- Or putting your money into a well-known global fund (Fund of Fund) that already has a set mix of foreign stocks.
No matter what method is taken, Indian mutual fund companies oversee these investments. They do this by following the rules set by the Securities Exchange Board of India (SEBI) and making sure that established standards are met, just like other mutual funds.
Purpose of International Mutual Funds
By giving investors access to global markets, international mutual funds help to spread out their investments. Exposure to foreign assets is good for investors because it lowers the risk that comes with relying too much on local markets.
By investing in economies other than one’s own, these funds offer chances for capital growth and maybe even better returns.
They also make it easy for people to invest in foreign stocks without having to deal with all the hassles of direct investment.
The main goal is to make portfolios more stable, get the best profits, and take advantage of the global economies.
How to Invest in International Mutual Funds?
First, you should figure out if investing in foreign funds fits with your risk tolerance and financial goals. There are two main ways to invest in foreign funds: online and offline.
- Online choices include investment sites like Dhan and asset management firms that offer mutual funds that invest in different countries. Before you can spend, you have to go through the Know Your Customer (KYC) steps.
- You can also go the old-fashioned way, which involves brokers or sending a filled-out form straight to a fund house. But this takes time and isn’t always easy.
Also, think about the tax effects, especially in India, where non-equity funds like foreign funds and Funds of Funds (FOFs) are known. Short-term gains are taxed at higher rates than gains from regular stocks.
Best International Mutual Funds for 2024
Below are some of the best international funds to invest in (data as of 26th April 2024):
DSP World Mining Fund Direct
The main focus of the DSP World Mining Fund is on well-known global companies in the metals and mining industry.
This fund is mostly made up of companies that make base metals and industrial metals, like iron ore and coal. It does this by investing in the BGF World Mining Fund.
This represents a chance to get richer by investing in the global mining business.
NAV: ₹17.8377
Fund Size: ₹152.70 cr
PGIM India Global Equity Opportunities Fund Direct
The PGIM India Global Equity Opportunities Fund Direct-Growth is a “Other” mutual fund scheme that was launched by PGIM India Mutual Fund.
The main goal of this plan is to get long-term cash growth that stays strong. It does this by putting money into units of foreign mutual funds that focus on agriculture.
The fund is meant to help businesses that will directly or indirectly gain from the expected growth in agriculture and the industries that work with it.
NAV: ₹43.0400
Fund Size: ₹1,444.20 cr
Franklin India Feeder – Franklin US Opportunities Fund Direct
As an international open-ended fund-of-funds plan, the Franklin India Feeder Franklin US Opportunities Fund (Growth) stands out as one of the best mutual funds in the world.
It focuses on top growth companies in the US across a wide range of market caps and sectors, giving Indian investors a chance to share in the success of American businesses.
Investors who buy shares in the fund get direct access to the success and possible growth of well-known US companies.
NAV: ₹69.4434
Fund Size: ₹3,616.19 cr
DSP US Flexible Equity Fund Direct
This fund invests in big US companies on purpose, mostly tech companies that are big in their field. You can learn about the tech business around the world and make your portfolio more diverse.
Focusing on long-lasting, profitable, and reasonably priced (value) tech companies, DSP US Flexible Equity Fund puts a lot of weight on how well these companies do financially.
NAV: ₹55.7772
Fund Size: ₹889.25 cr
Also Read: Multi Cap Mutual Funds: Gate To Diversification and Growth Potential
Sundaram Global Brand Fund Direct
Sundaram Global Brand Fund – Direct Plan is a unique mutual fund that mostly buys shares of companies in other countries. As a fund of funds, it carefully invests its money in a carefully chosen group of mutual fund schemes, which provides diversification.
As a prudent measure, this fund limits its exposure to Unclassified categories compared to its peers.
NAV: ₹32.3018
Fund Size: ₹120.25 cr
Conclusion
Finally, putting your money into foreign mutual funds is a smart way to spread out your investments and take advantage of the growth potential of markets around the world. These funds, which are managed by experts, let you invest in a wide range of foreign securities without having to pick individual stocks or do a market study. You can lower the risks that come with focusing on your home market by putting your money into different countries and businesses.
Top picks for 2024 include the DSP World Mining Fund, the PGIM India Global Equity Opportunities Fund, the Franklin India Feeder – Franklin US Opportunities Fund, the DSP US Flexible Equity Fund, and the Sundaram Global Brand Fund. These funds offer chances for big capital growth and portfolio stability.
FAQs
What are International Mutual Funds?
International mutual funds are a type of investment vehicle that lets many investors pool their money to buy a wide range of foreign securities. This gives buyers access to markets around the world.
Why should I consider investing in International Mutual Funds?
Putting your money into international mutual funds can help you spread out your risk, make your portfolio less reliant on the domestic market, and maybe even get better returns by taking advantage of global economic growth.
How do International Mutual Funds work?
Your money is turned into units when you invest in overseas mutual funds, and fund managers use these units to buy stocks in other countries. You can invest your own money or use global funds (Funds of Funds) to do it.
What is the role of fund managers in International Mutual Funds?
Fund managers keep an eye on investments, know how to trade on global markets, and run the fund to get the best returns and spread out holdings. This way, investors don’t have to pick stocks and do a market study.
How can I invest in International Mutual Funds?
You can use investment platforms or asset management firms to put money into investments online, or you can use brokers or fund houses to do it in person. Before buying, you need to go through the Know Your Customer (KYC) process.