What are the 4 types of mutual funds with examples?
There are four broad types of mutual funds: Equity (stocks), fixed-income (bonds), money market funds (short-term debt), or both stocks and bonds (balanced or hybrid funds).
- Stock funds.
- Index funds.
- Bond funds.
- Money market funds.
- Income funds.
- Hybrid funds.
- Specialty funds.
And to go one step further, we recommend dividing your mutual fund investments equally between four types of funds: growth and income, growth, aggressive growth, and international.
Ticker | Name | 5-year return (%) |
---|---|---|
PBFDX | Payson Total Return | 16.73% |
FGRTX | Fidelity Mega Cap Stock | 16.52% |
STSEX | BlackRock Exchange BlackRock | 16.27% |
USBOX | Pear Tree Quality Ordinary | 16.13% |
Money market mutual funds
These mutual funds own safe securities such as cash and very short-term debt, making them generally safer than either stock- or bond-based mutual funds but also lower-return.
A mutual fund's level of risk is determined by the investments it makes. Typically, the risk will increase as the potential returns do. For instance, an equity fund is typically riskier than a fixed income fund because stocks are typically riskier than bonds.
- Mirae Asset Midcap Fund. EQUITY Mid Cap. ...
- Kotak Emerging Equity Fund. EQUITY Mid Cap. ...
- PGIM India Midcap Opportunities Fund. EQUITY Mid Cap. ...
- Nippon India Small Cap Fund. ...
- Nippon India Growth Fund. ...
- Kotak Small Cap Fund. ...
- HDFC Small Cap Fund. ...
- Edelweiss Mid Cap Fund.
Highlights: Average Mutual Fund Return Statistics
The average mutual fund return for a balanced mutual fund for the last 10 years as of 2021 is nearly 9-10%. In 2019, the average return on mutual funds was 16.3%. As of 2020, the average five-year return for large-cap mutual funds was around 11.9%.
In the category of market-linked securities, mutual funds are a relatively safe investment. There are risks involved but those can be ascertained by conducting proper due diligence.
The 4% rule limits annual withdrawals from your retirement accounts to 4% of the total balance in your first year of retirement. That means if you retire with $1 million saved, you'd take out $40,000. According to the rule, this amount is safe enough that you won't risk running out of money during a 30-year retirement.
What is the 1234 financial rule?
One simple rule of thumb I tend to adopt is going by the 4-3-2-1 ratios to budgeting. This ratio allocates 40% of your income towards expenses, 30% towards housing, 20% towards savings and investments and 10% towards insurance.
To build a three-fund portfolio, invest in a total stock market index fund, a total international stock index fund, and a total bond market fund. These can be either mutual funds or ETFs (exchange-traded funds).
- The Best Retirement Income Funds of April 2024.
- American Funds Tax-Aware Conservative Growth and Income Portfolio (TAIFX)
- Schwab Balanced Fund (SWOBX)
- Vanguard Wellington Fund (VWELX)
- Dodge and Cox Income Fund (DODIX)
- PGIM High Yield Fund (PHYZX)
- T. ...
- Schwab International Index Fund (SWISX)
- High-yield savings accounts.
- Money market funds.
- Short-term certificates of deposit.
- Series I savings bonds.
- Treasury bills, notes, bonds and TIPS.
- Corporate bonds.
- Dividend-paying stocks.
- Preferred stocks.
- ICICI Prudential Focused Bluechip Equity Fund.
- Aditya Birla Sun Life Small & Midcap Fund.
- Tata Equity PE Fund.
- HDFC Monthly Income Plan – MTP.
- L&T Tax Advantage Fund.
- SBI Nifty Index Fund.
- Kotak Corporate Bond Fund.
- Canara Robeco Gilt PGS.
What Is Downside Risk? Downside risk is an estimation of a security's potential loss in value if market conditions precipitate a decline in that security's price. Depending on the measure used, downside risk explains a worst-case scenario for an investment and indicates how much the investor stands to lose.
- Quant Multi Asset Fund. The Quant Multi Asset Fund is an open-ended multi-asset allocation scheme from Quant Mutual Fund. ...
- ICICI Prudential Equity & Debt Fund. ...
- ICICI Prudential Multi Asset Fund. ...
- Edelweiss Aggressive Hybrid Fund. ...
- Baroda BNP Paribas Aggressive Hybrid Fund.
Money Market Mutual Funds
Money market mutual funds invest in various fixed-income securities with short maturities and very low credit risks. They tend to pay a modest amount of interest, but unlike other kinds of mutual funds there's very little chance to make money from appreciation.
- Understanding risk, including the risks involved in investing in the major asset classes, is important research for any investor.
- Generally, CDs, savings accounts, cash, U.S. Savings Bonds and U.S. Treasury bills are the safest options, but they also offer the least in terms of profits.
All investments carry some degree of risk and can lose value if the overall market declines or, in the case of individual stocks, the company folds. Still, mutual funds are generally considered safer than stocks because they are inherently diversified, which helps mitigate the risk and volatility in your portfolio.
What is a safe investment right now?
Key Takeaways. Safe assets are those that allow investors to preserve capital without a high risk of potential losses. Such assets include treasuries, CDs, money market funds, and annuities. There is, of course, a risk-return tradeoff, such that safer assets typically offer comparatively lower expected returns.
ELSS Funds | 3-year-returns (%) (regular) |
---|---|
JM ELSS Tax Saver Fund | 22.40 |
Kotak ELSS Tax Saver Fund | 21.11 |
Motilal Oswal ELSS Tax Saver Fund | 25.21 |
Nippon India ELSS Tax Saver Fund | 21.96 |
There are eight large cap mutual funds which have delivered over 40 percent return in the past one year. These include Quant Large Cap Fund, Bank of India Bluechip Fund, JM Large Cap Fund and Nippon India Large Cap Fund, among others.
- Zerodha Mutual Fund.
- Small cap funds.
- WhiteOak Capital Mutual Fund.
- Mirae Asset Mutual Fund.
- Best arbitrage mutual funds.
- Gilt funds investment.
- Mutual funds equity portfolio.
- Kotak Multi Asset Allocation Fund.
Disadvantages include high fees, tax inefficiency, poor trade execution, and the potential for management abuses.
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