Overview
Mutual funds are great for investors who wish to invest in different kinds of investment schemes that have different goals but don't have the time or expertise to choose the most profitable stocks. Mutual fund investments offer the benefit in professional oversight, less transaction costs, as well as diversification, liquidity, and tax benefits.
Advantages of Mutual Fund
- One of the main advantages of investing in mutual funds is the fact that your funds are handled by experienced money managers who have many years of experience investing.
- Its performance can be evaluated in relation to the returns they provide. Mutual funds have historically provided higher returns than any other investment option, including Bank FDs.
- Since mutual funds are invested in a mix of bonds, stocks and so on. It is possible to have an array of portfolios that are diverse even with a modest sum of money, which helps to reduce risk too.
- Mutual funds are regulated by SEBI. The strict regulations ensure that mutual funds adhere to transparent procedures and that the investors' rights are safeguarded.
- You can also invest into tax saving funds called ELSS which applicable for tax deduction up to Rs 1.5 lakh/annum under Section 80C of the Income Tax Act, 1961.
