Global Funds

Well, ofcourse there is a surge in the number of Global funds in the Mutual Fund market in the recent months, but do we really need to invest in them? Before taking a step forward here are all the points to be considered.

1. All funds are new to the market & may be in a year they'll all change from Rs.10 to Rs12. If you are going to be satisfied with 20% returns then you have green. But if you are looking into long term, then let's wait till the funds perform for some time.
2. If you are thinking for diversification, then this is not the right choice because most of the funds are giving 65% equities from Indian market. The remaining are also from similar markets like Emerging, Chinese, South east asian countries. So, essentially we are not looking into diversification. But, we can probably consider Birla Sunlife Intl. Equity Fund Plan A.
3. In longer term , think about the currency value change and the risk we are taking because of the same. The profit may become a loss.
   
4. I did some more research on FoF terminology and realized that these funds deposit money in global mutual funds and they are not going to invest directly in foreign equities. It is only double fund management expense from the customer end which goes hidden in NAV.
5. Atlast, the AMCs are so immature in global funds.

So, my point - Sit back, relax, watch it out & then go for them.