Mutual funds are investment vehicles that pool money from multiple investors to purchase securities like stocks, bonds, or other assets. Professional managers run these funds, aiming to achieve the best possible returns according to the specified investment goals.
Types of Mutual Funds in India
Equity Funds: Invest primarily in stocks. They carry higher risk but have the potential for higher returns.
Debt Funds: Invest in fixed-income securities like bonds and treasury bills. They are generally less risky compared to equity funds.
Hybrid Funds: Invest in a mix of equity and debt instruments, balancing risk and return.
Tax-Saving Funds (ELSS): Provide tax benefits under Section 80C of the Income Tax Act. They primarily invest in equities and have a lock-in period of three years.
Index Funds: Aim to replicate the performance of a specific index like the Nifty 50 or Sensex.
Sectoral/Thematic Funds: Focus on specific sectors or themes like technology, pharmaceuticals, etc.
Liquid Funds: Invest in short-term market instruments and are used for short-term investments.
Gilt Funds: Invest in government securities. These are considered low-risk.
Current AUM (Assets Under Management) of AMC in India. As of the latest data, the total Assets Under Management (AUM) of the Indian mutual fund industry stands at approximately INR 46 trillion (as of September 2023). This is a dynamic figure, continuously changing based on market performance, new investments, and redemptions.
Excited to learn from the insights of writer and investor, Irshad Mushtaq, Founder of MI Securities and Business Partner at Sharekhan! Reach out to him at Irshad@bp.sharekhan.com for valuable knowledge on financial matters.
