Wednesday, December 16, 2009

How Much Money Will You Get After 10 Years from Your Mutual Fund?

If I Invest 50,000 rupees in Mutual Funds today than How much I will get after 10 years?

The above is one of the commonest query of the Mutual Fund Investor. Many people think that Mutual Funds can go only in one direction and that is UP.

But well, This is not true. However, 10 years is a long enough time horizon that by which you will be in profit only. How much your money will be worth in equity mutual funds after 10 years really depends on several factors.

Such as the country in which You live (USA, India, China or any other), the past performance of the mutual fund, the fund manager’s investment strategy, and many more factors.

If we talk about the developed countries than the mutual funds give you on and average 10% annual return in the long run. While in developing countries like India, You can expect 15-20% annual return in the long run. Everything above 20% is your Bonus.

So if you run the Compound Interest Calculator than Rs.50,000 invested in Indian Mutual Funds will become Rs.3,70,000 after 10 years at the rate of 20% return per annum. And if you make more than this than everything above Rs.3.70 Lakhs is your Bonus.

However, this is the assumption from Past performance of the Indian Stock Market. You can make much more or less than this depending on the market conditions of the next decade.

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