Mutual Funds

Mutual funds are investment vehicles where multiple investors pool their money, which is then managed by professional fund managers. These funds invest in various asset classes such as equities, bonds, gold, and other securities to generate returns.

Types of Mutual Funds

1. Equity Mutual Funds – Invest primarily in stocks.
2. Debt Mutual Funds – Invest in fixed-income securities like bonds.
3. Hybrid Funds – A mix of equity and debt investments.
4. Index Funds/ETFs – Track a specific market index.
5. Sectoral/Thematic Funds – Focus on specific industries or themes.

Benefits of Mutual Funds

• Diversification – Reduces risk by investing in multiple assets.
• Liquidity – Easy to buy and sell.
• Professional Management – Managed by experienced fund managers.
• Affordability – Start investing with as low as ₹500.
• Tax Benefits – Some funds offer tax exemptions under Section 80C.

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