How to invest in mutual funds

Hello everyone welcome to your website. Earlier I have told you about Tesla stock, ford stock, Amazon stock, Disney stock etc. If you want to know about them then definitely read the articles written by us on them. In this article we are going to tell about “how to invest in mutual fund”. People have some question like what is mutual fund, how to invest in mutual funds, how do mutual funds work, why should you invest in mutual funds how to buy mutual funds how to start investing in mutual funds, if you want to know about this then stay with this article in last.

How do mutual funds work

If you work somewhere or do some work or do some business, then you must have earned money from something or the other and it must have come in your mind that how you can make money from money. You will be depositing all your money in the bank, due to which the bank will give you some percent interest, which is the most appropriate way to reduce the value of your money because the price of everything keeps increasing in the market and your money remains the same value. Most of the time people try to increase their money through these 5 ways Savings Account, Deposit Gold, Jewelery, Real Estate, Stock Market. Mutual fund is a method that makes a fund by mixing your mutual money and invests that fund in different place, if there is any loss to the mutual fund then that too It is only for the peopleand profit also. The right way to invest anywhere is that you keep investing little by little at all places, so that if any sector is in loss. For example, even if the stock market crash, you do not have crashes in other sectors and your account is maintained. Similarly, there is a mutual fund, a mutual fund works like an asset management company, which invests your money in different sectors like gold, silver, stock market, real-estate etc.

How do mutual fund work

A mutual fund works like an asset management company. It collects your money in one place and invests it in different sectors like stock market, gold, silver, real estate etc. If mutual fund invests in sectors like stock market then you will get more return but risk is also high but if mutual fund invest in government bond then low return but risk is also low.

Types of mutual funds

The type of mutual fund is seen according to where the mutual fund companies invest their money. There are mostly three types of Mutual Funds Equity, Debt, Hybrid.

1. Equity

Basically mutual fund invests your money in the stock market. There are also many types like in which company you are investing money, if you are investing money in big company then it is called large cap, if you are investing money in medium company then it is called Medicare and if you are investing money in small company If you are investing then it is called Small Cap Company Equity Fund. The risk in a large company is less as compared to the small company, but the large company does not grow as fast as it does in the small company, due to which there is more chance of getting inheritance in the small company but the risk is also the same. The second is a diversified equity fund, in which a small amount of investment is made in all three companies, both midcap and smallcap. Next is Equity Linked Savings Scheme ie ELSS, this is a special type of equity fund, in which you can save tax. Apart from this, Sector Mutual Funds in which you can invest in mutual funds of any one sector such as Agriculture Sector, Metal Sector, Communication Sector, Telecom Sector etc. And the last is index fund, it completely depends on the index of the stock market, if the stock market goes up then the index fund also goes up, if the stock market goes down then the index fund also goes down.

2. Debt mutual funds

Now let’s see friends, what is the debt mutual fund of the second category mutual fund, these are the mutual funds which are invested in the debt instruments, what are the gift instruments like bond debenture certificates etc. In this the risk is also less and the returns are also less. If you want to know what is a board, then an article has been written on our website on this, now you can get complete information about speaking.

3. Hybrid mutual funds

Hybrid mutual fund is a types of mutual fund which invest in both types debt mutual funds and equity mutual funds. It depends on mutual funds, how many percent they are investing in equity and how many percent they are investing in debt mutual funds.

How to start investing in mutual funds?

If you want to invest money in mutual fund then first you will need a broker who invest your money in mutual fund company. We take the example of groww app. First of all, you open a demat account here, then after that you can go to the section of mutual fund, you can get any mutual fund you want to buy. For this you will need some documents like your bank Account, Passbook, Pan Card, Aadhar Card, Phone Number. You can invest your money in mutual funds by opening a demat account.


The biggest advantage of investing in mutual funds is that you do not put your money in one place, but mutual funds invest your money in many places. Due to which the chances of profit are more and the rest is less. But there is also a risk that in which mutual fund you are investing your money, there are experts sitting to operate the mutual fund, who put your money in the right place, but this is also a disadvantage that you do not know. Who is putting your money where? Hope you guys liked this article.


1. Mutual funds only give you benefits?

No, it give you loss also

2. How mutual funds invest your money?

Like asset management company

3. Is it wrong to invest money in mutual funds?

No, if you are investing some money in right manner.

4. What is the safest mutual funds?

Government bonds funds, municipal bonds funds etc

5. Can I invest small money like 5 to 10 thousand in mutual fund?

Yes, you can.

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