A mutual fund bags money from many investors and invests the money in stocks, short-term money market instruments, other securities or some combination of these investments. Share market tips providers consider mutual funds are as a safer investment option.
Features of Mutual Funds
• Scalable Economy: A mutual fund deals with large amounts of securities, its cost of transactions are comparatively lower other securities transactions.
• Liquidity: Just like individual shares, mutual fund units are convertible into money by way of sale in the market.
• Simplicity: Buying a mutual fund unit is simple. Any bank has its own line of mutual funds, and the minimum investment amount is small.
Types of Mutual Funds
Each fund has a predetermined investment objective that tailors the fund’s assets, regions of investments and investment strategies. At the fundamental level, there are three varieties of mutual funds:
• Equity funds
• Fixed-income funds
• Money market funds
Every type of mutual fund is a member of any of these classes. For example, while equity funds that invest in fast-growing companies are known as growth funds, equity funds that invest only in companies of the same sector or region are known as specialty funds.
Mutual funds are totally different from commodity market deals, people who have their interest in commodity dealing should opt for free commodity tips.