# How can mutual investors calculate their corpus amount for a certain investment period?

Predicting the returns of the mutual fund investments helps the investor understand whether their goals are being fulfilled and the change in the strategy they should implement if the returns are insignificant.

Mutual funds are one of the most prominent forms of investment in India. India has over 14.11 crore accounts used to invest in mutual funds. Like all forms of financial securities, the returns from investing in mutual funds are the investors' primary concern. Predicting the returns from mutual funds can be difficult, and the prediction may only sometimes be accurate considering the market's volatility. However, even a partially accurate prediction can allow the investor to understand whether the returns would fulfil their goals or if they need a change of strategy. Let us understand how to calculate the corpus amount of mutual fund investments after a certain period.

### How to calculate the corpus amount of mutual fund investments?

Calculating the corpus amount of mutual fund investments can be done in two ways:

1. Calculate the corpus amount or returns from each mutual fund investment and then add the investment returns to get an estimate.
2. Consider an average rate of return for all the mutual fund investments and calculate the corpus amount to get an estimate.

In either of the above cases, the formula for calculating the corpus amount of mutual fund investment remains the same, which is:

### CA (Corpus Amount)=MI (Monthly Investment)*((1+ROR)^(IP-1)*((1+ROR)/ROR)

• The Corpus amount would be the total expected amount obtained after investing for a certain period of years.
• The monthly investment would be the amount of money invested in the mutual funds each month.
• The ROR (Rate of Return) is the percentage of return which could be expected from the investment.
• The investment period (IP) is the number of months for which the investments have been made.

Let us consider the example of an individual who has been investing in the following mutual funds for the past 15 years:

1. HDFC Top 100 Fund – Rs 3000 per month
2. Parag Parikh Flexi Cap Fund: Rs 5,000 per month
3. Mirae Asset Emerging Bluechip Fund: Rs 5,000 per month
4. Axis Long Term Equity Fund: Rs 6,000 per month
5. Axis Bluechip Fund: Rs 2,500 per month
6. Axis Focused 25 Fund: Rs 3,000 per month
7. ICICI Prudential Balanced Advantage Fund: Rs 2,500 per month
8. Motilal Oswal S&P 500 Index Fund: Rs 4,000 per month

We have considered the average rate of return for the investments to be 12 per cent per annum.

Hence, the corpus amount of your investments using the above mentioned formula would be:

### CA (Corpus Amount)=1,54,86,000

If your investments provide an average return of 12 per cent, you would have a corpus amount of Rs 1.54 crores. However, it is crucial to understand that the actual and estimated corpus amounts can be different. The corpus amount depends upon the returns provided by the investments, which depend on multiple factors such as market volatility, the performance of the companies in the portfolio, the inflation rate, etc.

An investor must evaluate the performance of the investments at regular intervals to ensure profits and fulfil the goals in mind.

### Final Words

Mutual funds involve a certain risk that the investor must accept before deciding to invest. The investors must reevaluate their strategy per the market conditions, their fund performance, and their goals at regular intervals. Estimating the corpus amount using the above formula can provide the investor with an average of returns which can be expected. Still, multiple factors can lead to the increase or decrease of the corpus amount.