Mutual Fund Returns Calculator
Total investment
₹
Time Period
years
Expected Return Rate (p.a)
%
Invested amount
₹ 25,000
Estimated returns
₹ 76,139
Total value
₹ 1,01,139
What is a Mutual Fund Calculator?
A mutual fund calculator is an easy-to-use tool that helps investors understand how much their investment could grow over time. By entering details like the amount you plan to invest, how long you want to invest, and the expected rate of return, the calculator gives you an idea of the future value of your investment.
It’s a great way to see if you’re on track to meet your financial goals. You can also use it to compare different mutual funds to find one that suits your needs. Just keep in mind that the calculator doesn't include things like taxes or fees, and past performance doesn’t always predict future results.
How Can a Mutual Fund Return Calculator Help You?
A mutual fund return calculator is a helpful tool that shows how much your investment might grow over time. By entering basic details like the amount you're investing, the time period, and expected returns, the calculator gives you an estimate of your future value. It simplifies planning for your financial goals, whether it's saving for a big purchase or planning for your child's education.
The calculator allows you to explore different investment strategies, whether you are investing in a lump sum or through regular SIPs (Systematic Investment Plans). It helps you see how small changes in your investment plan can impact your returns, giving you more control over your decisions.
What’s great about this tool is its simplicity. You don’t need to be a financial expert to use it. In just a few clicks, you can estimate your potential returns and make smarter investment decisions.
How Does a Mutual Fund Return Calculator Work?
With a mutual fund return calculator, you can estimate the future value of your investment. Whether you choose to invest through a lump sum or opt for a SIP, the calculator makes it easy to see how your money could grow over time. Here’s how it works:
- Investment type: You start by selecting whether you want to invest a one-time lump sum or contribute regularly through a SIP.
- Investment amount: Enter the amount you wish to invest. For SIPs, this is the amount you plan to invest every month.
- Duration: Choose the time period for which you plan to stay invested.
- Expected rate of return: Input the expected annual return rate based on historical performance or your own expectations for the mutual fund.
The calculator provides a clear estimate of your potential returns. For SIPs, it takes into account the changing NAV (Net Asset Value) of the mutual fund each month, adjusting the number of units you can buy as the price fluctuates.
Mutual Fund Calculation Formula
When you invest in mutual funds, there are two main ways to calculate your returns: through a lump sum investment or a systematic investment plan (SIP). Let’s break them down in simple terms.
1. Lump Sum Investment
A lump sum investment means you invest a certain amount all at once. The formula for calculating the future value of that amount is:
FV = P (1 + r/n) ^ nt
where
FV = future value
P = present value of the invested amount
r = estimated rate of return (in %)
t = total duration of investment
n = number of times interest is compounded in a year
For instance, suppose you invest ₹10,00,000 in a mutual fund for 10 years, expecting an average return of 12% per annum. The interest is assumed to be compounded annually.
The formula for lump sum calculations can be used as follows:
FV = ₹10,00,000 {(1+00.12/1)^10}
FV = ₹31,05,848
2. SIP Investment
SIP is when you invest a fixed amount regularly, like monthly. The formula to calculate the future value of SIP investments is a bit different:
Future Value (FV) = P [(1+i)^n-1]*(1+i)/i
where
FV = Future Value
P = Principal amount you invest through SIP
i = Compounded rate of return (in %)
n = Investment duration in months
r = Expected rate of return
For instance, suppose you invest ₹1,000 every month in a mutual fund for 10 years, expecting an average return of 8% per annum, compounded monthly.
Using the SIP formula, the future value of your SIP investment will be approximately ₹1,83,493.53.
How to use Kotak Securities' Mutual Fund Returns Calculator?
Using Kotak's Mutual Fund Returns Calculator is straightforward and user-friendly. Follow these simple steps to estimate your potential investment returns:
Step 1: Choose your investment type: Select whether you want to calculate returns for a lump sum investment or a SIP.
Step 2: Enter your investment details
- For a lump sum, input the total amount you plan to invest.
- For SIP, enter the monthly investment amount instead.
Step 3: Specify the investment duration. This can be in years for lump sums or months for SIPs.
Step 4: Set your expected rate of return.
Step 5: Once you enter the details, the calculator will display your estimated maturity amount, including both the invested principal and the earned returns.
Frequently Asked Questions
Can there be negative returns on mutual funds?
Yes, mutual funds can sometimes give negative returns, especially when the market is down. The value can go up or down since they invest in stocks or bonds.
How many mutual fund schemes are there in India?
India has over 2500 mutual fund schemes across different categories like equity, debt, and hybrid. 44 fund houses registered with the Association of Mutual Funds in India (AMFI) offer these schemes.
Can I use the mutual fund calculator for tax-saving funds?
Absolutely, the mutual fund calculator can be used for tax-saving funds like ELSS. It helps estimate returns while considering the tax benefits you may gain under Section 80C. You can explore the ELSS Calculator here.
Are there any hidden charges or fees included in the calculation?
No, the mutual fund calculator does not include hidden charges. However, mutual funds do have expense ratios and other fees, which might affect actual returns, but the fund provider discloses these.
Can I calculate returns on past investments using this calculator?
Yes, you can input details of your past investments into the mutual fund calculator to get an estimate of their potential growth over a specific period.
How can I choose the right tenure for my mutual fund investments?
Choosing the right tenure depends on your financial goals and risk tolerance. Equity funds often suit long tenures, while debt funds might be better for short tenures.
What is the formula used in the mutual fund calculator?
The formula used in a mutual fund calculator depends on whether the investment is a lump sum or a SIP.
The formula for lump sum is:
Future Value = Present Value (1 + r/100)^n,
where:
P is the principal amount
r is the estimated rate of return
n is the duration of the investment
The formula for SIP is:
Future Value = P [(1+i)^n-1]*(1+i)/i,
where:
P is the principal amount invested through SIP
i is the compounded rate of return
n is the investment duration in a month
What is the importance of the expected rate of return in a mutual fund return calculator?
The expected rate of return is key to estimating your investment's growth. A higher or lower rate can dramatically alter your future returns, helping you evaluate if you’re on track for your goals.
Does a mutual fund calculator guarantee accurate future returns?
No, the calculator only provides estimates based on past performance and assumptions. Actual future returns may differ due to market fluctuations and other factors.
