1. #1

    Risks involved in mutual funds

    I am a businessman. Now,I want to invest in mutual funds.But in the advertisement,they tell that mutual funds are subjected to market risks. What are the risks involved in mutual funds ? What are the benefits that can be achieved if such risks are taken?

  2. #2
    tarungupta_16 Array
    Join Date
    Oct 2012

    Re: Risks involved in mutual funds

    Re: Risks involved in mutual funds

    Some of the risks that are associated with the mutual funds are listed below-

    1) Call risk
    2) Country risk
    3) Credit Risk
    4) Currency Risk
    5) Income Risk
    6) Industry risk
    7) Inflation risk
    8) Interest rate risk


  3. #3
    randhirk.rk Array
    Join Date
    Aug 2012

    Re: Risks involved in mutual funds

    Mutual fund is a scheme where money is collected from large number of people.
    Now this money which is collected in invested in Stockmarkets, Debt Products and Government Securities.
    All the Money collected is managed by the fund managers of the Fund House to whom you have given the Money
    Customers who buys Mutual funds are given certain number of units against the money given.

    The risks that are involved are:
    >> Loss of Capital as money is invested in stockmarket and if the market starts going down, your investment also goes down.

    But Mutual funds is also a good way to invest money for the future.

    To get good returns from Mutual funds, you need to:
    >> Invest for long time say for example 10 years minimum
    >> Do not invest all the money in Lumpsum.
    >> Invest money in mutual funds through SIP or Systematic Investment Plan that is monthly investment.For example 5000 per month.
    >> To Reduce risks invest money in Balanced funds and Large Cap funds

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