What is a Mutual Fund – Complete Information in Mutual Fund

What is a Mutual Fund - Complete Information in Mutual Fund

The advantage of investing in a direct plan of a mutual fund is that you do not have to pay commission to any broker or distributor. Many people are scared to hear about mutual funds because many people think that mutual funds carry a lot of risk. So it is not that in today’s post I will give you all the information about mutual funds.

What is a Mutual fund?

In mutual funds, the money of many big and small investors is deposited in one place and the companies invest this fund again in the market.

Mutual funds are a very good platform for long term and short term investment where you get very good returns on your investment.

Mutual funds are managed by asset management companies (AMC). Each AMC usually has several mutual fund schemes.

Mutual funds are a good option for those who do not know much about investing in the stock market.

You can choose the scheme of mutual funds according to your financial goals. There are many mutual fund companies in the market and their schemes are also very good in which even small investors can invest comfortably.

How to invest in Mutual Funds

Investing in mutual funds is very easy, for this you do not need to go anywhere You can make your investment from your phone as well as track the investment.

There are many brokers in the market to invest in mutual funds and many websites and apps are also active, you can invest from any website or app.

But always keep in mind that you do not have to pay any brokerage fee to invest in mutual funds. Investment and withdrawal are all free.

I would suggest you to invest from Groww App or Groww Website. Groww App and websites are also very easy to understand and from here you can easily invest in both mutual funds and the stock market.

You can also invest directly from the website of a mutual fund. And you can also go to the office of a mutual fund company with your documents.

If you wish, you can also use the service of a mutual funds advisor.

Mutual Funds Give Better Returns than Banks

Mutual funds offer better returns than banks. Even if you make a fixed deposit (FD) in banks, you still get only 7 – 8% interest every year.

But if you invest in mutual funds, you can get up to 55% interest every year.

Basically any mutual fund company invests in various companies or stock market or elsewhere.

Mutual fund companies invest investors’ money in many different places. And when the company of the mutual fund benefits, you will also benefit.

Is it Safe to Invest in Mutual Funds?

Regarding mutual funds, many people are confused as to whether mutual funds are safe.

Mutual funds are market related investments and thus they can never be fully secured.

However, mutual funds have several rules that are implemented to reduce the risk.

As I also told you above, money from mutual funds is invested in many sectors, thus there is less risk in mutual funds than stocks and bonds.

Minimum investment required in Mutual Funds

You can invest in mutual fund companies every month as per your savings. Just you have to choose the right mutual fund company according to your savings,

Because there are many mutual funds where you can start investing from Rs.100 and Rs.500. And there are many mutual fund companies where you can start investing even with minimum investment of Rs.5000 and Rs.10000.

It is up to you which mutual fund company you like to choose according to your savings.

You Can Withdraw Money from Mutual Funds Anytime

You can also do systematic investment plans (one-time investments) and one-time investments in mutual funds. You can invest in any mutual fund at any time without any deposit charge.

And whenever you need money, you can also break your SIP and one time investment from mutual funds without any withdrawal fee.

This is a big advantage of mutual funds, you can withdraw your money when you want.

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