Educational content on mutual funds, SIPs, NAV, AMC and fund categories.
A mutual fund is a professionally managed investment vehicle that pools money from many investors to purchase a diversified portfolio of securities on their behalf.
A Systematic Investment Plan (SIP) is a method of investing a fixed amount in a mutual fund at regular intervals - daily, weekly, or monthly - rather than as a one-time lump sum.
Net Asset Value (NAV) is the per-unit market value of a mutual fund, calculated by dividing the fund's total net assets by the number of units outstanding.
The expense ratio is the annual fee a mutual fund charges investors as a percentage of average assets under management, covering fund management and operational costs.
Assets Under Management (AUM) is the total market value of all investments that a fund house or portfolio manager oversees on behalf of its investors at any given point in time.
A Systematic Withdrawal Plan (SWP) lets you redeem a fixed or variable amount from a mutual fund at regular intervals, creating a steady income stream.
A Systematic Transfer Plan (STP) allows an investor to periodically transfer a fixed or variable amount from one mutual fund scheme to another within the same fund house.
A lump sum investment means deploying a large amount of money at one go, while a SIP (Systematic Investment Plan) spreads the investment in smaller, regular instalments over time.
An index fund is a mutual fund or ETF that replicates the composition and returns of a market index, such as the Nifty 50 or Sensex, without active stock selection.
An Exchange-Traded Fund (ETF) is a basket of securities that tracks an index, commodity, or asset class and trades on a stock exchange like a share throughout the day.
Equity mutual funds are professionally managed investment vehicles that pool money from multiple investors to buy shares listed on stock exchanges such as the NSE and BSE.
Debt mutual funds are professionally managed investment vehicles that pool money from investors and deploy it primarily into fixed-income instruments such as government securities, corporate bonds, treasury bills and money-market instruments.
Hybrid funds are mutual funds that invest in a mix of equity and debt instruments, aiming to balance growth potential with capital protection within a single scheme.
A liquid fund is a type of debt mutual fund that invests in very short-term money market instruments with maturities up to 91 days, offering high liquidity and relative capital stability.
ELSS (Equity Linked Savings Scheme) is a type of equity mutual fund that qualifies for tax deductions under Section 80C of the Income Tax Act, with a mandatory three-year lock-in period.
A flexi-cap mutual fund is an open-ended equity scheme that can invest across large-cap, mid-cap, and small-cap stocks in any proportion at the fund manager's discretion.
A multi-cap mutual fund is a SEBI-regulated equity scheme that must invest at least 25% each in large-cap, mid-cap, and small-cap stocks, with the remaining 25% allocated at the fund manager's discretion.
Large-cap funds are equity mutual funds that invest at least 80% of their assets in the top 100 companies by market capitalisation listed on Indian stock exchanges.
Mid-cap mutual funds are equity schemes that invest at least 65% of their corpus in companies ranked 101st to 250th by market capitalisation on Indian stock exchanges.
Small-cap funds are equity mutual funds that invest predominantly in companies ranked 251st and beyond by market capitalisation on Indian stock exchanges, as defined by SEBI.
Sectoral and thematic mutual funds concentrate their portfolio in a specific industry sector or a broader investment theme, offering focused exposure but carrying higher concentration risk than diversified funds.
International mutual funds are SEBI-registered schemes that invest in equity or debt securities listed outside India, giving Indian investors exposure to global markets through a rupee-denominated vehicle.
Gold Mutual Funds, Gold ETFs and Sovereign Gold Bonds are three distinct ways to invest in gold electronically in India, each with different structures, costs, tax treatments and liquidity profiles.
A Fund of Funds (FoF) is a mutual fund that invests in other mutual funds rather than directly in stocks, bonds, or commodities.
A mutual fund cut-off time is the daily deadline set by SEBI before which an investor must submit a valid transaction request and ensure funds are realised to receive that day's NAV.
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