Before investing in International Mutual Funds, one must understand their finances, thus one must talk to their financial advisors.
International funds are equity funds that invest in stocks of companies listed outside of India. These funds can help one expand their portfolio by investment in some of the biggest companies in the world, help with additional growth opportunities and hedge risk associated with a single market.
The most preferred investment vehicle is through domestic fund houses as data and performance is readily available.
Just like investing in domestic mutual funds, there are two ways of investing in International Mutual funds. · One can invest online through online investment portals or through asset management companies that offer the international mutual fund · One can also invest using the conventional, offline method where they can invest through a broker or submit a filled form at a fund house
The investment can be made in Indian Rupees and redemption is in Indian rupees. Investing in an overseas Mutual Fund which is non-domestic has its own challenges in terms of methodology of payment, foreign exchange fluctuation and taxation.
However, all international funds and FOFs are treated as non-equity funds. Hence, holding up to 3 years will be considered short term gains and the tax rates applicable are higher than regular equity funds.