Liquid funds are debt funds that lend to companies for a period of up to 91 days. These are the safest funds amongst all the mutual fund categories, owing to their extremely low lending duration.
2. Debt Funds
3. Arbitrage Funds
Arbitrage funds are hybrid mutual funds that generate returns by using the strategy of simultaneously buying and selling of securities in different markets to take advantage of different prices.
4. Dynamic Asset Allocation Funds
Dynamic Asset Allocation Funds invest in a mix of stocks and FD-like instruments. However, they keep changing this allocation based on the market conditions to provide you optimal returns with minimal risk
5. Balanced Fund / Balance Fund
Balanced funds invest an equal amount in stocks and FD-like instruments. These funds provide you a truly balanced portfolio that combines growth and stability.
6. Hybrid Funds
Hybrid Funds are balanced funds invest primarily in stocks with some allocation to FD-like instruments. Spreading out of investments means these funds are less risky than pure equity funds with almost similar returns in the long run.
7. Diversified Equity Funds
A diversified equity fund invests in companies regardless of size and sector. It diversifies investments across the stock market in a bid to maximize gains for investors. They are offered by unit-linked insurance plans / ULIPs, mutual funds and other investment firms.
8. Multi Cap
Multi cap equity funds invest in companies of all sizes and across sectors. Unlike large or mid cap funds, they can decide how money gets allocated between big, mid-sized, and small companies. This flexibility also allows them to make changes in the portfolio as market conditions change.
9. Large Cap Funds
Large cap mutual funds are equity funds that invest primarily in the top 100 companies of India. These companies are some of the biggest brands in our country, and most Indians use their products daily.
10. Large & Mid Cap Funds
Large and Mid Cap Mutual Funds are equity funds that invest in India's top 200 companies. These funds bring together India's biggest companies, and mid-sized companies that are challenging those big companies for the top slot.
11. Mid Cap Funds
Mid Cap Mutual Funds are equity funds that invest in the mid-sized companies of India. The companies are some of the fastest-growing companies in India and are at a stage today's leaders were a few years back.
12. Small Cap Funds
Small Cap equity funds invest in the smallest companies in India. These companies are beyond the top 250 companies and are mostly unheard in our daily lives. While they can deliver fantastic returns, small cap companies are incredibly volatile, and you can see losses in short to medium term
13. Sectorial Funds
Sectoral mutual funds are equity funds that put the entire money in one sector. For instance, an IT sector fund invests only in IT companies, a banking sector fund only in banks and so on. This one sector only exposure make them one of the riskiest mutual funds.
14. Thematic Funds
Thematic funds are equity mutual funds that invest in stocks tied to a theme. These funds are more broad-based then sectoral fund, as they pick companies and sectors united by an idea. For instance, an infrastructure theme fund will invest in cement, power, steel, among other sectors
15. International / Global Funds
International funds or Global Funds are equity funds that invest in stocks of companies listed outside of India. These funds help you invest in some of the biggest companies in the world. Like Amazon, Microsoft.
16. ELSS ( Equity Linked Saving Scheme)
ELSS funds are equity funds that allow you to save tax while you invest for your long term goals. Investment in these funds can are eligible for deduction under Section 80c. ELSS is a kind of mutual fund which provides deduction of upto 1.5lakhs from total income under section 80C