MUTUAL FUNDS :
A Mutual Fund is a company that gathers money from many people / investors and invest in stocks, assets or other bonds, The combined holdings of above mentioned assets are called as Portfolio, Each investor will own a share, which represent they are also part of the holdings.
Categories of mutual funds:
- Equity Funds
- Debt Funds
- Money Market Funds
- Hybrid Funds
The Key advantage of mutual funds is that each investor will get assisted by money management and expertise. It is also very difficult for a person to create a portfolio for small investment, with mutual funds each investor proportionally participates in a return scheme. Each investor will get a proportional share of gain or loss from the mutual fund.
SIP:
SIP known as Systematic Investment Plan is offered by mutual funds to investors to invest. It allows the investor to invest a predefined fixed amount of money at a regular interval of time in a selected mutual fund scheme, The predefined SIP Intervals can be any of the following Annually/Monthly/Quarterly/Weekly.
- Disciplined Saving
- Flexibility
- Long Term Gains
- Convenience