What is Mutual Funds and SIP Please explain in detail.Which investment is best and safe?

Question

What is Mutual Funds and SIP Please explain in detail.Which investment is best and safe?

Answer 1

Mutual Funds are funds managed by a Fund Manager under a financial institution. Investments by various individuals are pooled by this Fund Manager and he decides on the type of exposure or investments. But, the Fund Manager doesn't have complete flexibility over it as some of the MFs are industry specific were as some others have only a part of the fund invested in stocks the remaining are parked in debt funds.

SIP stands for Systematic Investment Plan and is similar to MFs only that you decide to invest a fixed amount of money every month or every year for a fixed duration in an SIP whereas you invest a lump sum in MFs. You can have your own SIP in the stock market. Select a set of stable stocks or having a strong base and buy them very month for a fixed value.

SIP is considered better as it evens out the bears and bulls in the market.

Answer 2

A mutual fund is an instrument of investment and is managed by an asset management company. You can make investments by buying units of the fund from the company at the prevailing price, which is published daily as its net asset value (NAV). The fund may have an entry fee and an exit fee. The fund manager invests the money obtained by selling the units in the stock market, in shares, debentures, and other money-market instruments. There are different types of mutual funds like equity funds, debt funds, balanced funds, monthly income plans, close-ended funds etc. You can invest in the type of fund you wish. The fund may be dividend paying or growth funds. In the former, the fund declares dividends periodically from surplus money. In the growth fund no dividend is given, but the NAV of the fund increases with time.

SIP means systematic investment plan in which you can invest an amount every month for a fixed period and your investment grows with time.

Mutual fund is a mechanism for you to participate in the stock market without really bothering to know anything about stock market investing. It gives much higher returns than bank fixed deposits etc, but with added risk.

Answer 3

Hold stock for long term

Market is moving volatile so do not invest all your money single time, invest in mutual fund SIP, this are best mutual fund.

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Answer 4

Mutual fund companies collecting money from various investors and buying stocks/debt instrument for them. They will share the profit among investors as well as lose too..

SIP is systematic investment plan. When you fill and give SIP form, you are authorizing the mutual fund company to withdraw certain amount from your account in each month, a particular date, and purchase mutual fund units in your name.

Equity MF for investors who has risk taking capacity,

Balanced fund for those who has medium risk taking capacity

Debt funds are there for those who has less risk taking capacity

does this make sense

Answer 5

A mutual fund is a pool of money that is professionally managed for the benefit of all shareholders. As an investor in a mutual fund, you own a portion of the fund, sharing in any increases or decreases in the value of the fund. A mutual fund may focus on stocks, bonds, cash, or a combination of these asset classes.

The beauty of mutual funds

Mutual funds offer a number of advantages, including diversification, professional management, cost efficiency and liquidity.

Reliance Mutual fund is ranked No 1

Which company is the best to invest amount?

Depends on your age, Investment Plan, Risk taking ability, how long would you like to hold this funds.

SIP is one of the best investment option while investing in equity segment.rupee cost averaging will be worked out in SIP,and u will get good returns over a long period.money will be safe in fluctuations of the stock market.if u targeting for a longterm SIP is very very good option.u will be purchase units in different rates of the unit depending on the stock market.

invest in SIP

For further clarification mail me.

Answer 6

Mutual Fund is an investment company where investors with similar objective come together to achieve their financial objection. The common funds are invested and managed by a Fund Manager appointed for each fund separately.

There are two modes of investing one being lumpsum and other is Systematic Investment Plan (SIP). SIP works on principle similar to Recurring Deposits. One has to contribute similar amount every month or quarter.