For anyone who enters the stock market, there are plenty of opportunities to invest. Some get stuck up in the initial selection of investment avenue itself as they are not clear about which asset to choose. Assets have to be chosen as per one’s objectives, risk appetite, etc. Equity, bonds, mutual funds are among the several options available in the stock market. I will talk in detail about what mutual funds are and certain tips on investing in them in this article.

Anyone can start investing in mutual funds as it is simple and does not require stock market knowledge or expertise to begin investing. I will explain it in a very simple way. You are an investor and you invest money in a mutual fund. What happens after that? Many people like you invest in the same mutual fund as well. These become pooled investments. The fund manager who is in charge of the mutual fund selects stocks, bonds, etc. after careful research and in turn invests investors’ money in all these in accordance with the fund’s objectives. Mutual funds are sold to investors in the form of units. Based on NAV (Net Asset Value), the units allocated to you vary on a day to day basis. The returns generated from the investment are passed back to the investors. The fund managers review the performance of the fund on a regular basis and take the necessary investment strategy. I was also introduced to mutual funds only when I was a beginner in the share market. As I didn’t have any knowledge about shares or equity, I preferred to make money through mutual funds in the beginning. Reading a lot about mutual funds helped me a lot.

You can invest in mutual funds online these days. There are several kinds of mutual funds based on equity and debt. If you are unwilling to invest into equity directly, you can start putting your money into equity mutual funds wherein indirectly you can take your initial step in the equity segment. Mutual fund investment provides better returns than other assets. This is my personal observation. I need substantial amount of money to buy my home in about 10 years and hence I decided to invest in mutual fund through SIP (Systematic Investment Plan). SIP is a mutual fund tool; I have another SIP that would help me in funding my daughter’s education after 15 years. So you may think why am I advocating mutual funds when there are other investment opportunities like bank FDs, gold, land, etc. I have checked the returns from all these in comparison to mutual funds and I bet you mutual fund investment emerges the clear winner. The liquidity factor in mutual fund attracts me whereas that is difficult in case of land and the returns from bank FDs are also low these days. Before you end up in choosing a mutual fund, do a thorough research on various mutual funds and compare their performances over a period of 3 or 5 years to know if they are consistent in delivering good performance or not. Invest in mutual funds online and leave all your investment related worries aside.

The market is highly volatile and so don’t wait for the right time to enter markets. Anytime is the best time to carve a secured future by way of investing. SIP is the best mutual fund tool with which you can overcome the volatile market. When the markets are low, you can buy more mutual fund units and when the markets are high, you can buy less mutual fund units. Have a proper financial plan and start investing in mutual funds today to fulfill all your dreams.