There are many ways to invest your money for which a person can get a good return. Most of the people are very much conservative when it comes to investment. The think many times to put their money in some of the other investment product. Mutual funds are also a platform of getting your money invested in some of the other assets. But the question comes how to invest in equity Mutual fund. There are multiple ways it to investing your money in me which one finds and there are multiple platforms too.
Kinds of equity funds
Tax saver funds– Most of the tax saver funds are equity-oriented. In this equity fund, most of the money is invested in cash and equity-oriented funds. The return that the client gets from investing in this type of fund is 100% tax-free that a customer can declare under 80c.
Equity funds– these are the funds in which 100% allocation is invested into the market. These are taxed like equity-oriented and the client has to only pay long-term capital gain apart from any tax.
Balanced funds– Another category of the fund is a balanced fund, which is also known as the debt and equity fund. In this kind of fund, the client has only a 65% share of equity and 35% of the money is invested in government bonds, commercial papers, etc. These are an of-balanced category where the taxation applies to this fund is of equity.
Categories of mutual funds
Mutual funds generally have two categories
Open-ended mutual fund– These are the mutual funds which can be redeemed anytime whenever a client needs the money. Some mutual funds have a 1% fee of redemption if they redeem it before 1 year. But some can be redeemed the very next day of its setup.
Close-ended mutual funds– Another a mutual fund is a closed-ended mutual fund. These are the funds which have a fixed maturity period. Some are having a specified date and others have a specified year of lock-in.
Why mutual fund is a good source of investment?
People say do not put all eggs in one basket, and this statement is completely correct. If one has a savings of 100 Rs then they should put the latest 50 rs in mutual funds and at least for a period of 5 years. When a client gives 5 years to the fund manager then he would help to give a promised return to the client. Equity mutual fund has a little risk as it goes up when Sensex moves up and goes down when sensed goes down.
But the question comes how to invest in equity mutual fund? There are two ways of investing in equity mutual funds. Firstly, the client can directly fill an application or can visit online and pay to the AMC in which he has to invest. Secondly, Client can go to brokers who are directly associated with AMC’s.