How Many Type of Mutual Fund? Skip to main content

How Many Type of Mutual Fund?

Hello Friends Today, we will learn about mutual funds, how many types are there?
According to the investment assets, mutual funds are of 3 different types.

Equity Mutual Fund

Equity Mutual Funds who invest in the stock market.

*Large Cap Fund 

*Midcap Fund

*Small Cap Fund

*DividendYield  Schemes


*Thematic Fund

*Sector Fund  Diversified Equity Fund


Large Cap Fund

According to the company's capitalization, the large cap is mid-cap and smallcap divides. Whose capitalization is less than 5000 crore between 5000 million to 100000 million a small cap.Large caps of companies whose market capitalization is above one lakh croresThey are called Large-Cap Companies.

*Large-cap companies are large and well-established. Their Strong Market presence. All the large-cap companies are leaders in their respective sectors. Financial Strength is very good for large-cap companies to survive in bad times. Due to this, there is less risk than mid-cap and small-cap companies in large-cap companies.

* Larsen and Toubro
*Reliance Industries
*TCS etc.

It has already sketched the successes. For this reason, these companies have Growth Opportunity Limited.

Midcap Fund -

The small-cap company is in the early days of its development, so there is a lot of potential in the development. But the failure rate is high and the risk is higher. Those funds that invest in large-cap companies are called large-cap funds and the funds that invest in the midcap companies are called a midcap fund and the funds that they invest in small-cap companies are called small-cap.

Sector Fund  Diversified Equity Fund-

Those funds that invest in a particular sector, they invest in sectors such as
 Reliance Media, and Entertainment Fund. 
SBI Pharma Fund only invests in the pharma sector. 


Diversified Equity Fund

Those who invest in different market capitalization of different sectors are called diversified sector funds such as Large Cap, Mid Cap, Small Cap.

DividendYield  Schemes- 

The next fund is the dividend yield fund company that shares some part of its city with the investor, it is called the dividend yield fund. It is not mandatory for companies to give dividends, it is decided by the Board of Directors of the companies Dividend Yield Fund Invest In Companies, which have stable regular consistent and low volatility And also give a good regular dividend. 

Equity Linked Savings Scheme( ELSS )

This is a tax saver investment scheme, It gets locked for 3 years In ELSS, you can not invest for less than 3 years time periodUnder section 80C of this scheme, you can get an income tax deduction up to 1.5 lakh

The next fund is the thematic fund-
Thematic funds invest in the theme, Such as the 

*Rural India Theme 
*E-Commerce" Theme etc. 

for example, the HDFC Housing Opportunities Fund This is a thematic fund Whose theme is housing This fund buys stocks related to housing Such as Paint, Metal, Cement, Construction

Talk about debt fund 

Government or company borrow money through debt instrument. Then returns the money with
interest Funds bond instruments such as Debenture Bond Certificates of Deposit etc. They are called Debt Funds. In this, there is less risk than equity funds and returns are also lower. Types of Debt Mutual Funds-

Gilt Fund - Those debt funds invest in government securities are called gilt funds Government Securities Issues Government, for this reason, it has zero default risk. 


*Short-term and

Junk Bond Schemes -

Jung Bond means garbage The default risk in the Junk bond fund is very high but returns are also high. The funds that are invested in such funds are called junk food 

The next type of debt fund is a 

Fixed Maturity Schemes.

There is a specific, predetermined fixed maturity plan like a bank FD Mainly they invest in certificate of deposit commercial paper corporate bonds. Their returns are good with bank FD

Next Fund is Liquid Fund

Liquid Schemes -

 The Liquid fund is a debt fund that invests in the money market. This fund comes in the financial instrument through which the company Borrow money from an investor for short term
So Maturity Plan Invest in a very short period of maturity. Such as the Certificate of Deposit, Commercial Paper, Treasury Bills, Term Deposit etc. It gives more returns than the savings account and there is less risk in is a very low volatile. The biggest thing is you can ever withdraw your money from a liquid fund.

Hybrid Mutual Fund

Hybrid Fund Invests In Debt Fund And Equity FundThere are mainly three types of Hybrid Funds

*Monthly Income Plan that is MIP
*Balanced Fund
*Arbitrage Fund

Monthly Income Plan MIP-

Most of the money invested in the MIP is loan fund is about 60% to 90% and the rest is done in equities. For this reason, it is safer than equity mutual funds. This does not mean that MIP is fully risk-free and fixed maturity plan A small portion of the investment is invested in the equity market, for this reason, there is a little risk. 

The next fund of the Hybrid Fund is the

Balance Fund-

60% of this fund is invested in equity funds and the rest is invested in debt funds, most of the shares are invested in equities. Sometimes the share of 60% to 85% is invested in equities. Here equity helps to bring good returns to this balanced fund. The same debt fund helps reduce the risk of fund balance. 

Arbitrage Fund-In the coming days, you will learn about this fund from detail.
To explain this, almost like the Future Perfect Continuous Tense.ha. ha.

According to the structure of a mutual fund, it has two types.

*Open-Ended Fund-The investor can get the unit of that fund anytime in the open-ended fund.

*Close-Ended Fund -But in a closed-end fund, you can invest when NFO is issued (new fund offers.) You can not SELL the funds whenever you want, but you will have to stay till maturity

*Interval fund-Very few funds are interval funds. 

Stay tuned with this blog for further information.

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