Everyone has a single question- What is Mutual Fund Investment? Mutual Fund Investments are a collaborative which is made up after pooling in money from various investors and buyers for the sole purpose of them investing the money into securities such as bonds, stocks, other money market instruments and even assets. Mutual fund Investments are regulated by professionals known as Mutual fund Managers who on behalf of the individual or small investors collect money from them and then re-distribute or allocate the fund to various investment categories so that most of the capital gains or rather monetary income is achieved for the investors.
A mutual fund is basically collection of money from different investors and then investing the money on their behalf. Nominal or small fees for managing the investments are charged by the professionals who do so for the investors.
When the investors are new to the field of investing then Mutual funds is an ideal way of investing. Mutual fund Investors can choose a mutual fund scheme according to their risk appetite and the financial goal they have to fulfill.
Buying a mutual fund unit is like buying a cup of coffee, each owner of unit will get equal share of its losses, gains, expenses or incomes.
Mutual Fund Objective:
Each mutual fund is different from another and has a stated objective that is particularly mentioned. The Prospectus is a legal document that contains all the necessary details of the fund like its specific object. The fund’s past performance, history, etc.
Some of the popular fund objectives are:
1. Equity (Growth): The fund will particularly invest in stocks.
2. Debt (Income): The fund will specifically invest in fixed-income securities.
3. Money market (including Gilt): These kinds of funds will particularly invest in short-term Money market instrument which even includes government securities.
4. Balanced: As the name suggests these funds maintain a balanced risk profile therefore they invest partly in stocks and partly in fixed-income securities to maintain a balanced portfolio.
What is Mutual Fund Investment? The answer to this question is not very tricky to understand and above we have tried to explain it in the best possible way. Furthermore if one needs detailed overview they can visit online mutual fund information websites and get a clear idea. So Happy Investing!
