Risk and Reward in Mutual Funds by Pranita Jagtap

Risk and Reward in Mutual Funds

by @ Pranita Jagtap

What are the Risks and Rewards of Mutual Fund Investment?

Mutual funds are regarded as one of the safest investments around as they diversify the money across a multitude of equity and debt instruments. The experienced fund managers use their years of expertise to balance the portfolio and ensure a good return for the investors. Besides, these managers also keep an eye on the investment objectives of different funds. So, their mode of operation and investment strategy can differ from funds to funds. A fund manager ensures a proper mix of asset allocation to counter varied market situations and fulfill the objectives. The hard work put in by the manager often leads to a series of rewards for the investors to earn. So, let’s read out the rewards you can have while investing in a mutual fund.

Types of Rewards

Mutual funds have the potential to appreciate the growth of capital, generate regular income, provide liquidity, etc. All these can make your MF journey a memorable one.


The return potential, particularly in the case of equity funds, is expected to be on the higher side. These funds invest predominantly in the stocks of different companies with distinct market capitalizations. The fund managers also look to widen the portfolio of investors by investing in various sectors of the economy. The capital appreciates on the back of positive cues developing in several sectors like automobile, information & technology, FMCG and others.

So, if you have a long-term investment approach, you can invest in equity funds and get the inflation-adjusted returns, which can be in the form of capital gains and dividends.

Pranita Jagtap

Fintech Manager

Air Crew Aviation Pvt Ltd.


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