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.
Is there any outside help I can get to plan my financial goals?
“My son is in 5th grade. I’m not sure what his interests are or what flow of education he should pursue. Should it go for science, commerce or the arts? Can anyone help?” Many parents have these concerns. This is where you can approach an education, or a career counselor, who has evaluated various options available to young people.
An investor seeking help planning for achieving financial goals would be in a similar position to the parent in the above case. The investor has access to so much information these days, it’s stunning. Being intimidated or making mistakes is highly possible.
This is when an investment advisor or mutual fund distributor is advisable.
They assess the investor’s financial situation and look at their financial goals. Based on this, he would recommend various schemes in which to invest. Now it is obvious that such a person should also understand a lot about the various schemes of mutual funds and regularly keep an eye on both the investor’s situation and the various recommended schemes. Such an approach helps the investor achieve financial goals through investments in mutual funds.