Stock Market + Experience + Low Risk + Simple = Equity mutual funds

Mutual funds is

  • Money pooled from various individuals (investors)
  • Well-regulated (by SEBI)
  • Invest in multiple portfolio by single fund
  • Experience & Professionally Managed
  • Higher returns than Fixed deposit, insurance and PPF
  • Allows to invest in small amounts. Can be started with 500 rupees monthly.
Equity Mutual Funds:

Equity mutual funds are Mutual Funds that Invest primarily in Stocks of Companies.  They offer widespread diversification to investors with a low, medium and high risk appetite.  They even help you to Save Taxes.  Also, it provides access to a professional fund manager with a low transaction cost. They’re your typical experts in money markets.  This makes Equity Mutual Funds a very good investment choice for initial and small investors as well as the professional investors with the long-term goal of growth in wealth at a higher rate of return.

Equity mutual funds invests mostly in stock market

Equity Mutual Funds(stock funds) are funds that invest chiefly in stocks that are traded in stock exchanges. The funds invest in stock markets. So, an Equity Fund is the one where it invests 65% or more of its assets in Equity shares of companies i.e. Stocks in distinguished quantity in accordance with their Investment mandate. The focus is either growth-oriented or value-oriented. The remaining amount may be invested in debt mutual funds and bonds to diversify the investment. It would lower the risk of the equity mutual fund.

Equity Funds Types:

Large-Cap Funds:   Invest into large-sized companies and possess comparatively a lower risk within the equity category.
Mid-Cap Funds:   Invest into mid-sized companies relatively hold a higher risk than large-cap category of funds. Returns is higher than Large-cap funds
Small-Cap Funds:  Invest into small-sized companies and are known to have the highest risk within equity category. Returns is higher than mid-cap funds
Multi-Cap Funds:   Invest into companies across any market capitalization i.e. either large-cap or mid-cap or small-cap.

There can be a further classification on basis of Sectors and Themes:

Sector Funds:  So, these are basically Equity Funds which invest in a particular sector. For example:

Pharma Mutual Funds  – Invest in Pharmacy companies
IT Mutual Funds  – Invest in software companies
FMCG Mutual Funds – Invest in food and FMCG companies

Thematic Funds:  These are funds that Invest as per a particular theme which they have decided to follow. For example:

Digital India
Consumption Story
Emerging Businesses

And, then there are special Tax Saving Mutual Funds:

ELSS Funds:  These are basically Equity Linked Savings Scheme, investments in which are exempted from Taxation up to INR 1.5 Lakhs under Section 80C of Income Tax Act, India. They invest across market-caps, across sectors, across themes. And, Investments in ELSS Mutual Funds have a lock-in period of 3 years.

Large Cap Mutual Fund: ICICI Prudential Bluechip Fund Growth
Mid Cap Mutual Fund: L&T Midcap Fund Growth
Small Cap Mutual Fund: HDFC Small Cap Fund Growth
Multi Cap Mutual Fund: Aditya Birla Sun Life Pure Value Fund Growth
ELSS Mutual Fund: Axis Long Term Equity Fund Growth

Equity mutual funds are another way to invest in stock market with lower risk.  It can be used to build wealth and long-term investment. Mutual funds investment can be started with 500 rupees. It is cheapest investment in india with better returns in long term. Mutual fund investment is easy to start. Contact mutual fund aggregator platform to start investing on mutual funds. Happy Investing:)



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