Different Types Of Mutual Funds

                                            Types Of Mutual Funds In Stock Market 

In Our Earlier Posts We Already Have Talked About Mutual Funds And Also Had Compared It To Stocks. If You Have Not Read Those Posts I Highly Recommend To Read Them First. Let Us Understand Main Types Of Mutual Funds In India Whether They Would Be Investing In Stock Market Or Other Investing Instruments. If We Talk Broadly An Mutual Funds Can Invest In Equities, Debt Instruments Or Could Invest In Both. On The Basis Of That There Are Two Main Types Of Mutual Funds:-                                                                                                                                                          1. Open Ended Funds.                                                                                                                                2.  Close Ended Funds.

Open Ended Funds:- Open Ended Funds Are The Funds In Which Investors Could Enter Or Exit At Any Time They Want And It Also Does Not Have a Fixed Rate Of Return, The Rate Of Returns May Vary Whether It Could Be High Or Low. If Calculated Risk Is Taken High Rate Of Return Can Be Expected From Open Ended Funds. Equities Or Shares Are Best Example Of Open Ended Funds.

Close Ended Funds:- Close Ended Funds Are The Funds In Which Which Investors Can Invest In a Specific Period Of Time Mentioned There And Investors Could Not Take Entry And Exit At Any Time As Close Ended Funds Have a Fixed Maturity Period And Fixed Rate Of Returns So Risk Involved In Close Ended Funds Is Less But Return Rate May Be Low Than Equities. Best Example Of Close Ended Funds Are Bonds And Government Securities That Are The Debt Instruments.

Further There Are Also Various Types Of Funds Coming Inside The Categories Of Equity Mutual Funds And Debt Mutual Funds Such As:-  Sector Specific Fund, Index Funds, Tax Saving Funds, Money Market Funds, etc. As An Beginner These Might Be Very Hard Topics For You To Understand Which Is The Best But They Are Very Simple To Understand And Also Involves Less Risk From Directly Investing In Stocks As Your Money Is Managed By Highly Professional And Educated People Working In The Field Of Investment From Very Long Time And That Is The Main Features And Benifit Of Investing In These Types Of Funds. We Would Be Discussing Another Topic Next Time 

 Until Then,

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