Investing in Mutual Funds?

Question

In simple lay man terms whats equity fund and debt funds ? .Open ended or closed fund ? When you invest in Mutual Funds do we have to specify the type of fund you want to invest . Secondly is there a compulsion to invest very month .Any assurance on the money that you have invested initially is guaranteed back when failure of the fund investment occurs ? I am just new to this area and the internet post 's lot of articles , but it quite difficult to really understand how this mutual fund works Any simple examples ?

Answer 1

Mutual funds are those collective investment schemes where the participants money is pooled and invested on their behalf by experts. There is no gurantee either on return or on principal. But the regualtions by SEBI has made things easier for the investors. The offer documents lists the type of investments where money will be invested. If major portion is invested in debt instruments, then it is a debt fund. If major portion is invested in equity then it is an equity fund.
with the economy tilting towards private invesment, stock market is one of the places where the returns on investment will be better but also riskier. Hence those desiring better returns look at mutual funds which reduces such risks by spreading the investment and shuffling investments and through various strategies.
if you are desirous of such investment you can approach me by mail.

Answer 2

Investing in a mutual funds have no guarantees.

Equit funds invest primarily in stocks. Debt funds invest mainly in corporate and government bonds. Many funds invest in some mix of equities and stocks.


Open ended funds are purchased and sold directly from the fund complex (i.e. fidelity). They are always prices at net asset value next computer. (i.e. after you by or sell, the price at the next close of the NYSE). This is what you would likely invest in.

A closed end fund is a basket of securities that are sold on an exchange (a secondary market). The price can therefore differ from the total value of the fund's assets.

A mutual fund is like any other investment, you risk loss. A mutual fund is a way to have some professional management. It is also used as a way to diversify ones portfolio.

Answer 3

1. Mutual funds investsed in equity in higher percentage than debt instruments the other way.
2. open ended funds accept funds without any closing date and close ended with date of closer to accept funds.
3.yes, you have to select the Mutual fund company and its various plans.
4. If you opt for systematic investment plan then you have to pay regulary (monthly/qly/hly) upto the agreed period or you can opt for one time payment.
5. No such guarantee. But you can redeem the fund when you feel it looses.
6.Mutual fund company collects funds by selling the units. Units are the small parts of the investment. It decides the funds management like the various percentages amounts to be invested in which type of investments and you can decide of your risk tolering capacity and invest.

visit www.valueresearchonline.com and learn a lot

HAPPY INVESTING

Answer 4

invest in long term funds and yes you have to specify which one you want t last look there are over 4000 of them. Mutual funds are NOT guranateed and you could lose everything if it goes to zero. one of the best ways to learn is sign up at morningstar.com go to the personal finance tab and click on investing classroom (this is free) good luck

Answer 5

i would recommend calling someone like vanguard and ask for info. free. also pick up a "money" mag. at the store read it and pick up a couple more after . you will start to understand alot about them very quickly. and the more you are informed the better you will be. I like no load index funds the best. and for long term only .

Answer 6

first of all, ignore the first guy that posted trying to sell you his software. Your money can go down in a mutual fund, but there is zero chance that it will go to $0. I like the other poster's advice to go to morningstar.com and looking there.