Mutual Funds Beginner

Best International Mutual Funds to Invest in India 2023

best international mutual funds

Unlike domestic mutual funds, international mutual funds seek investment opportunities abroad. They invest in stocks and stock-related instruments of the best-performing companies across the globe. Here is a list of some of the best international mutual funds in India in 2023. Read this list and do your own research to find great opportunities to diversify your portfolio.

The operation of global mutual funds

Investing in a foreign equity mutual fund is like investing in any other mutual fund. You invest some money, which the fund manager collects and invests for you. In the case of international mutual funds, though, the manager invests in shares of foreign companies which are trading on international exchanges.

The fund manager can allocate your money to foreign stocks in one of two ways.

  1. Through individual stock purchases and prudent portfolio management.
  2. Alternatively, you could purchase shares of foreign companies through a global fund that already has a diversified portfolio.

Indian mutual fund firms manage these funds no matter which option they choose. The Securities and Exchange Board of India (SEBI) governs them.

India’s five best-performing international mutual fund schemes in 2023

Here is a list of the top international mutual funds in India. However, as always, make sure you do your research. Because nobody cares about your money as much as you.

1. ICICI Prudential US Blue-Chip Equity Fund

The primary focus of the ICICI Prudential United States Blue-Chip Equity Fund’s portfolio is on equity and equity-based securities issued by established US corporations (called blue chips). The fund invests in companies that are leaders in a specific industry. It is one of the best US-specific options in India.

Expense ratio: 2.14%

2. Third PGIM India Global Equity Opportunities Fund

The PGIM India Mutual Fund has introduced another Mutual Fund Scheme called the PGIM India Global Equity Opportunities Fund. The money primarily flows to units of foreign mutual funds that focus on agriculture and/or are direct and indirect beneficiaries of the expected agribusiness boom and/or affiliated/allied sectors.

Expense ratio: 1.43%

3. Franklin India Feeder Franklin US Opportunities Fund

Franklin India Feeder Franklin US Opportunities Direct-Fund Growth is an international open-ended fund. It is hailed as a top-tier international mutual fund. Its primary focus is on making investments in high-growth US companies from many sectors and with a variety of market caps. The fund allows Indian investors to safely gain access to US stocks without a high tax.

Expense ratio: 1.55%

4. Edelweiss Greater China Offshore Fund

Edelweiss Greater China Equity Offshore Fund Direct-Growth is an “other” mutual fund scheme launched by Edelweiss Mutual Fund. The primary objective is to enhance the long-term appreciation of capital. It invests in a JPMorgan equity fund with a diversified portfolio of companies. These companies have their office registered in, or they derive the predominant part of their economic activity from, the Greater China region.

Expense ratio: 1.55%

5. Kotak Multi Asset Allocator Fund of Fund

On 9 January 2013, the Kotak Multi Asset Allocator Fund of Fund was introduced. This fund is regarded as one of the best-performing international mutual funds. It places 53.76% of its capital in equity investments, 23.23% in debt, and the rest in other types of investments. The mutual fund invests in the financial, commodities, capital goods, and automobile stock markets.

Expense ratio: 0.98%

Advantages of investing in foreign mutual funds

Investing in foreign-based funds has a number of advantages:

  • Investment in multiple economies is a great way to spread your risk. When gains in one region offset losses in another, the volatility of one’s portfolio decreases.
  • Diversifying your holdings beyond India allows you to capitalize on growth in foreign markets. When you invest in international mutual funds, you can expect higher returns even if the domestic economy is weak.
  • You can gain access to some of the world’s most successful companies—Google, Microsoft, Apple, Facebook, Amazon, etc.
  • You can benefit from gaining exposure to different currencies. Your profits will rise in proportion to the price of the other currency in relation to the rupee.

Reasons why you shouldn’t rush into buying international mutual funds

There is always the chance of losing money if you’re putting money into the stock market. Especially so with foreign markets. Because your investment may suffer as a result of political unrest, economic downturns, or policy shifts, and you may not have full visibility of these things. You should, therefore, evaluate the following things before investing.

1. Portfolio construction: International mutual funds take a wide variety of approaches. Depending on their mandate, some invest in domestic and international equities, while others focus on a market niche. You might want to verify that your portfolio’s asset allocation is consistent with your long-term objectives.

2. Expense ratio: All mutual fund companies charge a fee known as expense ratio to cover overhead costs. So the expense ratio affects the returns you receive. That means if you’re looking to invest in a global mutual fund, it’s important to consider how much money you’ll have to pay out of pocket each year. Since the fund managers in these mutual fund investments need to be extensively familiar with international markets, they tend to be a tad pricier. Investigate the firm’s and fund manager’s track record to assess whether its worth the cost.

Conclusion

International mutual funds offer a plethora of options when it comes to investing in companies across the globe. Through them, investors can capitalize on the growth in other economies. Before deciding on the top international mutual funds of 2023, though, always evaluate your investment objectives and tolerance for risk.

FAQs

How can I invest outside India?

Investing outside India: Research foreign markets, understand regulations, choose suitable investment options (e.g., global stocks, ETFs, mutual funds), open a foreign brokerage account, manage risk diversification, and consider tax implications. Consult financial advisors.

Are international mutual funds a good investment?

International mutual funds can be a good investment to diversify globally, access foreign markets, and potentially benefit from international growth. However, like all investments, it carries risks, so research and consider your financial goals and risk tolerance before investing.

What are the tax implications of investing in international mutual funds?

Tax implications of investing in international mutual funds depend on various factors, including your country of residence, tax treaties, and the fund’s structure. Commonly, you may face capital gains taxes, foreign tax credits, or withholding taxes. Consult a tax advisor for personalized advice.

Can NRIs invest in international mutual funds from India?

NRIs (Non-Resident Indians) were allowed to invest in international mutual funds from India through the Liberalized Remittance Scheme (LRS) for up to USD 250,000 per financial year. However, regulations may change, so it’s essential to check with relevant authorities or financial institutions for the latest guidelines.

Disclaimer: Investing in mutual funds is subject to market risks. Please read all scheme-related documents carefully before investing. Potential returns from a mutual fund product are not guaranteed. Past performance is not indicative of future results. None of our articles are intended to and should be considered investment/financial advice from CoinSwitch.

Share this:

IN THIS ARTICLE

Subscribe to our newsletter

Weekly crypto updates and insights delivered to your inbox.

Browse our Newsletter Archive for past editions.

SnowSnow

Thank you for subscribing!
Please verify your email to start receiving the latest issues from Switch in your Inbox.
Powered by

Weekly updates from the cryptosphere and the world of finance delivered to your inbox.

Build your crypto portfolio on the
CoinSwitch app today

Scan the QR code below or find us on Google Play
Store or Apple App Store.

Build your crypto portfolio on the
CoinSwitch app today

Scan the QR code below or find us on Google Play Store or Apple App Store.

Weekly updates from the cryptosphere and the world of finance delivered to your inbox.