Balanced advantage funds come with the advantage of moving between equity and debt. In addition, they are also marketed as having lower risk than pure equity funds, but with the potential to give higher returns than pure debt funds while being classified as equity funds for tax purposes.
Balanced advantage funds are dynamically-managed equity mutual funds that typically alter their equity allocation between 30% and 80%, depending on market valuations and usually considering the price-earnings ratio.
Arbitrage Funds: is a type of mutual fund that leverages the price differential in the cash and derivatives market to generate returns. The returns are dependent on the volatility of the asset. These funds capitalise on the market fluctuations and generate profits for the investors. It is quite safe compared to actual Equity market investments in short to medium term.
Asset Allocation Funds: is a fund that provides investors with a diversified portfolio of investments across various asset classes. Popular asset categories for asset allocation funds include stocks, bonds and cash equivalents that may also be spread out geographically for additional diversification.
Dynamic Asset Allocation Fund: can invest in a mix of debt and equity. They increase/decrease their allocation to equities and debt depending on their view of the stock markets. Typically, when valuations are low, they increase equity in the portfolio, and when they are high, they reduce it.
Index Fund: As the name suggests, an Index Mutual Fund invests in stocks that imitate a stock market index like the NSE Nifty, BSE Sensex, etc. These are passively managed funds which means that the fund manager invests in the same securities as present in the underlying index in the same proportion and does not change the portfolio composition. These funds endeavour to offer returns comparable to the index that they track.
Post Office Schemes: The Post Office Saving Schemes include several products that offer reliability and risk-free returns on investment. These schemes are operated via 1.54 lakh post offices spread all over the country. Very less risky as Govt guarantee but comparative low returns. Also most of the schemes are having lock in period so liquidity risk is high.
Long Term Fund: The fund category includes the following products:
Direct Equity Fund: is all about long term growth. When one buy stocks, he/she becomes part-owners in that company. This way one becomes eligible to share both profit & loss made by company. Investors prefer equity because no other investment option promises long term growth as high as equity. One must master Value Investing in Equity and understand that investing in Direct Equity needs certain skill set and Knowledge with lot of patience…
Large Cap Equity Mutual Fund: A large-cap mutual fund companies typically has strong corporate practices and has been in the market for a long time, and hence some of the best performing large cap mutual funds, have generated steady returns for its investors. The returns are usually moderate, but steady.
Mid Cap Equity Mutual Funds: A mid–cap equity fund is a pooled investment, such as a mutual fund, that focuses on companies with a market capitalization in the middle range of listed stocks. Mid–cap stocks tend to offer investors greater growth potential than large cap stocks, but with less volatility and risk than small cap stocks
Small Cap Equity Mutual Funds: are invested in companies that below top 250 stocks in the exchange as per their market capitalisation.
Small cap mutual funds have turned out to be a popular investment option due to their high returns.
Future & Options Fund: are similar trading products that provide investors with the chance to make money and hedge current investments. An option gives the buyer the right, but not the obligation, to buy (or sell) an asset at a specific price at any time during the life of the contract.
Nifty Fifty:
S&P BSE Funds:
Specific Sectoral Fund: Mutual funds which invest in a particular sector or industry are said to be sector-specific funds. Since the portfolio of such mutual funds consists mainly of investment in one particular type of sector, they offer less amount of diversification and are considered to be risky. They are commonly structured as mutual funds or ETFs.
