Mutual funds are a suitable investment option for investors with limited knowledge, time or money. It offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost.

Mutual funds: Mutual funds allow investors to pool in their money for a diversified selection of securities, managed by a professional fund manager. Whether the objective is financial gains or convenience, mutual funds offer many benefits to its investors.

Broad Classification of schemes offered by Mutual Fund:

Equity Funds – An equity fund is a mutual fund that invests principally in stocks. There are several types of equity funds like Diversified, Sector and thematic, Large-cap, Mid-cap, Small-cap, Multi-cap, Index funds etc. Equity Linked Savings Scheme (ELSS) qualifies for tax exemptions up to Rs. 1.50 Lakhs under section (u/s) 80C of the Indian Income Tax Act.

Debt Funds – Debt funds are a type of mutual fund that generates returns from their investors' money by investing in bonds or deposits of various kinds and are a good option for investors averse to idea of taking risk associated with equities. Debt Mutual Funds mainly invest in a mix of debt or fixed income securities such as Government Securities, Corporate Bonds, other debt securities of
different time horizons.

• MIPs
• FMPs
• Income Funds
• Gilt funds

Liquid Funds – It is a category of mutual fund which invests primarily in money market instruments like certificate of deposits, treasury bills, commercial papers and term deposits. Lower maturity period of
these underlying assets helps a fund manager in meeting the redemption demand from investors. Liquid Fund focuses on maintaining liquidity and safety of the investments.

A. Diversification: With mutual fund investments, your money can be spread in small bits across varied companies. This way you reap the benefits of a diversified portfolio with small investments
B. Professional Management: The pool of money collected by a mutual fund is managed by professionals who possess considerable expertise, resources and experience.
C. Disciplined Investment: SIPs in best Mutual Fund help to curb unnecessary expenses and develop a disciplined approach towards investing
D. Low Transaction Costs: Mutual funds take advantage of their buying and selling volume to reduce transaction costs for their investors
E. Liquidity: Mutual funds are considered as being extremely liquid since they are simple to buy and sell in the short term during market hours.
F. Tax Benefits: Save taxes by investing in Best ELSS Mutual Fund schemes U/S 80C.