A mutual fund is a professionally managed company that collects money from many investors and invests it in securities such as stocks, bonds and short-term debt, equity or bond funds and money market funds.
Mutual funds are a good investment for investors looking to diversify their portfolio. Instead of betting everything on one company or sector, a mutual fund invests in different stocks to try to minimize portfolio risk.
The term is typically used in the US, Canada and India, while similar structures around the world include the SICAV in Europe and the open-ended investment firm in the UK.
How can I regularly monitor my investments?
Investors often wonder how to follow the progress of my investments.
It’s like chasing a target in a cricket match. In a cricket match, the batting team knows the equation: how many runs, how many wickets and how many overs.
It is very similar when it comes to investing also for the achievement of the financial goal. Consider the financial goal as the goal score-
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The amount you have accumulated so far
- is the number of rides you have scored so far.
- The amount still to be accumulated are the races to be scored and the time left is the overs left.
- The condition of wickets and the quality of bowlers can be compared with various risks, whether they are related to the national or global economy; global capital flows; political situation in the country; changes in laws, regulations and taxes, etc.
- The board in this case is the bank statement you get when investing in a mutual fund scheme.
- There are also online tools and mobile apps available to check the value of your investments: the scoreboard.
