Types Of Mutual Funds In India

By Author: Avendusgroup
Total Articles: 136
Comment this article

Many of the investors lookout for top investment options where they expect high returns within few months with either little or no risk. The reason being, they want multiply the returns as fast as possible without losing the principal amount.

Now, combination of high-returns and low-risk in an investment option unfortunately doesn’t exist, maybe in the future but not at present. The returns directly depend on the level of risk you are ready to bear, the higher the risk, higher are the returns and vice versa.

While you select an investment option which is available to you, you also have to make sure that your risk profile matches the risk of your investment. There are investments which carry high risk and have the potential to get higher returns in long term and investments with low risk get you lower returns. But, how to figure out whether your risk profile matches with your investment risk? Which investment option is feasible and profitable for you? This is when the asset management company come in the picture who help you to make the right investment.

When you approach a wealth management company, they ...
... provide you all the best investment options for you according to your preferences and requirements. Mutual funds are one of the best investment choices when it comes to comprehensive, easy and flexible way to diversify your portfolio. There are different types of mutual funds like hybrid funds, equity funds, debt funds, esg funds and more. Let's take a look at the various types of mutual funds available in India:

Equity Fund
Equity funds are most popular ones of all the other options. These funds help investors to participate in stock markets. It has the potential to generate high returns in the long run, but as you know with expectations of high returns, high risk is to borne. This helps the investors in the initial stage to build a portfolio.

Debt Fund
There are different debt instruments like government securities, bonds, debentures, etc where some investors have their money invested. Here the risk to be borne is low and so is the return. Investors looking for low-risk options, debt fund is ideal for them.

Hybrid Fund
These funds have the proportion of equity assets lesser compared to debt. Hence, it is also called as marginal equity funds. They are suitable for investors who are retired and want normal returns with low risk.

ESG Fund
ESG stands for Environmental, Social, and Governance. It is a new style of sustainable investing in the markets. Sustainable investing is basically creating portfolio of stocks which focus on environmental, social, and governance factors. Investing in esg funds india aims to reduce the non-financial risk for long term. These funds help the companies to be ready for future uncertainties. Some companies have an advantage of superior returns by investing in ESG investment.

There are different factors to be looked into before taking any decisions regarding investments by the investors, fund managers to experience significant investment success. If each factor is placed at right stage of the investment process, then the fund management is more likely to be efficient and profitable for long run.