In this Blog, I have given in detail guide to learn about how to Earn more money, compared to other investment options by investing in Mutual Funds, their working and what are the advantages of investing in them, the different types of the mutual funds present in the market, its classification, classes and categories and last but not the least how to invest in them, by reading the blog you get the complete picture of it to any common man, who do not know anything about it
ADVANTAGES OF MUTUAL FUND INVESTMENT TO THE INVESTOR
The investor enjoys the following advantages :
Professional Management: The funds are invested by the professional fund management team that analyzes the performance and prospects of companies and selects suitable investments in line with the objective of the schemes.
Diversifications: It is difficult for small investors to diversify across different investment schemes as well as over a large number of companies. The investor has a risk of non-diversification on his investments because of low capital. A mutual fund provides him the best option for the small capital, in which the unitholder or the investor gets a diversified portfolio.
Convenient Administration: Investing in a mutual fund reduces paperwork, also avoids many problems such as bad deliveries, delayed payments, and following up with the brokers and companies. Mutual funds save your time by making it easy and convenient.
Higher Return Potential: With a view of medium to long term, mutual funds have the potential of generating higher returns as they invest in a diversified portfolio of selected securities.
Transparency: The Net Asset Value of open-ended funds is disclosed on day to day basis, whereas the value of the portfolio is disclosed every month which ensures transparency to the investors.
Low Cost: Mutual Funds are cheap to invest in as compared to directly investing in the capital market because of the benefits in brokerage, and other fees, which are avoided in mutual funds which translates to lower costs for the investors.
Liquidity: In the case of Open-ended which we had seen in the previous blog which is redeemed at any time at the prevailing NAV rate. For the close-ended schemes, you can sell your units on a stock exchange at the prevailing market price or avail of the facility of repurchase.
Flexibility: When it comes to mutual funds they offer a lot of flexibility where the investments can be made in a lump sum or in a systematic investment form on a monthly or quarterly basis starting with a very small amount of investments in which withdrawal can be in full or part or on a systematic basis.
Choice of the Scheme: Mutual Funds offer a variety of options for the selection of the schemes to suit your varying needs and requirement over a lifetime.
Well Regulated: As the Mutual Funds are registered with SEBI and are functioning as per the strict regulations designed to protect the investor interest and also the operations are monitored by the SEBI.