Personal finance: Know the different kinds of mutual funds

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Personal finance: Know the different kinds of mutual funds

Last week, we discussed why investing a certain amount of money in a joint venture is not a bad option, as long as you have a basic understanding of what your investment objectives are: do you want to save for retirement or repay a student loan? What is your risk tolerance, and how many years do you have to work? Here’s a look at some of the types of mutual funds available.

Tax savings
When planning your retirement savings plan, you should not ignore the tax element. There are certain types of joint ventures called cavity-linked savings schemes (ELSS), which Provide double with the benefits of tax cuts and wealth creation over time. The money in these funds is used to invest mainly in the stock market earning a return of 10-12 percent, which is twice the interest rate charged on tax savings deposits.

Open funds
These types of currencies allow you to stay invested in any land option without guaranteeing any high or monetary restrictions. This means that you can buy or redeem any number of these parts of the mutual fund year-round with registration and redemption allowed on the amount of the remaining assets available. Investors prefer to invest in open portfolios due to the ease of investment at a low cost.

Equity Funds
These joint ventures are best suited for investors who tend to profit from the high and low equity stock market (shares). In addition to earning a return and benefiting from common gains in stock instruments, investors are saved from the risk of losing the total investment as long as you maintain a long-term investment vision. Risks are usually industry-based, for example, the IT sector looks more stable than it is, the oil industry, at present.

Debt funds
If you are wary of risky investments or opt for options that promise consistent returns and financial security, your credit will work toward your goal. This is because loans are investments in government bonds and securities, corporate bonds, or other fixed-income instruments. So the initial investment you invest in does not change, which will vary the return on your investment, which is much lower than the returns you get from the same fund. 

Pension funds
These are the types of social media that work well if you are looking for a common and permanent source of income. Designed for investors with a long-term view of income and returns, pension funds begin to make a steady profit as you reach your retirement age. Investment in equity and debt helps to solidify the retirement corpus while ensuring greater financial security. 

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