MUTUAL FUNDS: A mutual fund is a professionally managed fund that pools money from many investors to purchase securities bonds stocks debts etc. People who invest in mutual funds purchase shares in mutual funds schemes, also known as UNITS. There are lots of mutual funds schemes in which investor invest their funds which is managed by professional fund managers.

Why do people buy mutual funds?

In the recent days mutual funds become the most popular financial products for investments because of its following characterstics:

Proffessionally Managed : It is Managed by a professional managers who do research for purchasing security bonds stocks etc for the investors and closely monitor the performences to achieves the Higher Return Also known as alpha.

Liquidity : In Mutual Funds there is always a huge liquidity means the investors can take entry or exit at any point of time or in simple words they can redeem their Units at Current NAV and plus Exit Load if Applicable.

Initial Amount : In most mutual Funds amount of initaial invest in SIPs is from Rs 100 & in LUMP SUMP Rs 500.

Diversification : As you all heard a quote that “Don’t put all your eggs in one basket.” In term of investment. Mutual funds  typically work with this concept. There is range of companies and industry in which muntual fund company invest the funds so that there is a low risk if any company fails.