Mutual Fund Schemes and Asset Class
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Mutual Funds offers a wide variety of product types to choose from. They can be classified on the basis of scheme structure as well as based on asset class in which mutual fund schemes invests in. Here are the Mutual Fund categorized:
Mutual Funds on the basis of scheme structure:
- Open Ended Scheme
- Close Ended Scheme
Mutual Funds based on asset class in which the scheme invests:
- Equity Scheme
- Debt Scheme
- Hybrid Scheme
Funds Basis Scheme Structure
Open Ended Schemes:
Open Ended Schemes are always open to investors, Investors can buy or sell units on a continuous basis.
Close Ended Schemes:
Close Ended Schemes have a lock-in period. Lock-In Period may vary from 3-5 years depending on the scheme objective.
Funds As Per The Asset Class
Equity Schemes:
Equity Schemes are suitable for long term investment. It can focus on individual sector or diversify across sectors.
Certain Equity Mutual Fund Schemes can also help save tax, Some equity schemes also invest in global markets.
Debt Schemes:
Debt Schemes aim to add stability to your equity portfolio and can provide stable returns.
Debt Mutual Fund Schemes Invests in interest bearing securities like Government & Corporate Bonds, Money Market Instruments & Term Deposits.
Some Debt Schemes provide easy liquidity suitable to park surplus cash for short term.
Some Debt Schemes also provide investment opportunities across different time periods.
And Some Debt Schemes try to benefit from changing interest rates.
Hybrid Schemes:
Hybrid Schemes provide blend of both equity and debt.
Hybrid Mutual Fund Schemes invest in range of securities like stocks & bonds depending upon the scheme.
There are also schemes that allow you to invest in gold units.
With such varied products and schemes, Mutual Funds are ideal to meet the long, medium or short term financial needs with different risk appetite.
ALWAYS PLAN & INVEST CORRECTLY IN MUTUAL FUNDS, FOR MORE INFORMATIONS & INVESTMENTS IN MUTUAL FUNDS CONTACT YOUR FINANCIAL PLANNER/ADVISOR NOW!
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Learn More About Equity Funds for your Investment needs in my next post, subscribe to my newsletter service to receive all posts directly in your inbox!
Hi, I’m Managing Director at Gurpreet Saluja Financial Services where I help my investors to invest in mutual funds and achieve their financial goals. I’m also a Value Investor and here I write about Personal Finance & Investing.
