How to invest in mutual funds?

What does ‘Mutual Fund is subjected to market risk’ really mean?


‘Mutual Fund Sahi Hai’ campaign has been very successful in attracting people to buy Mutual Funds. However, it can mislead people into thinking that it is safe, that there are actually no risks in Mutual Funds. It has the power to lull people into ignoring the statutory warning, ‘Mutual Funds are subjected to market risk….’, Just like cigarette smokers ignore the warning which is so much more threatening and conclusive, ‘Smoking Kills!’

While it’s true that Mutual Funds in India can be a good investment option, you shouldn’t forget that they have an inherent market risks associated with them. Risks are inevitable in stock investing, because we are dealing with future, and the future is uncertain. Understanding risks helps you take actions to control and manage them. And, then you expect returns that do justice to the risks you have taken.

What are the risks in Equity Mutual Funds?

1. Volatility Risk:

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