Mutual fund is a company that brings together money from many people and invests it in stocks, bonds or other assets. The combined holdings of stocks, bonds or other assets the fund owns are known as its portfolio. Each investor in the fund owns shares, which represent a part of these holdings.
Mutual funds are created as baskets of investments, which invest in financial instruments like stocks and bonds according to their defined investment objectives. Investing in them allows an investor to gain access to asset classes like equities, bonds or fixed income securities, commodities, and even bullion.
Different Types of Mutual Funds
- Equity or growth schemes. These are one of the most popular mutual fund schemes. ...
- Money market funds or liquid funds: ...
- Fixed income or debt mutual funds: ...
- Balanced funds: ...
- Hybrid / Monthly Income Plans (MIP): ...
- Gilt funds: