Learn all about Mutual Funds
What is a Broad Market Index Fund?
10 September 2025 | 11 mins read
In the diverse landscape of investment vehicles, index funds occupy a distinct and often discussed position. Among these, the "broad market index fund" stands out as a particular type of investment designed to provide comprehensive exposure to a significant segment of the financial markets. These funds aim to replicate the performance of a wide-ranging market benchmark, offering investors a way to participate in the overall growth of an economy or a major market segment without the complexities of active stock picking.
What is No Load Mutual Funds?
10 September 2025 | 8 mins read
The terrain of mutual funds offers a range of structures and fee schemes each with its own implications for the investor. Of these, the term "no load mutual funds" is of specific concern to investors looking to gain the maximum on their investment by saving costs. These funds are meant to offer exposure to investments without charging certain fees while buying or redeeming. It is essential to understand this difference for any investor venturing into the mutual fund industry since these fee arrangements can have a real-world effect on the net worth an investor ultimately derives from their investments. This investigation looks at how no-load funds work, setting them apart from their load-carrying brethren, and addresses the possibilities that they provide for a varied array of investors.
Which are the Tax Free Mutual Funds?
10 September 2025 | 12 mins read
As one goes about understanding the universe of mutual funds in India, there are numerous choices before the investor, each with its unique characteristics. Some of them are unique in that they promise tax benefits. Although the description "tax-free" for mutual funds can be confusing at times, it would be better to qualify those schemes or funds that provide tax relief or are tax-optimal in design. These investment vehicles are designed not only to generate returns but also to provide pathways for investors to lower their taxable income or benefit from more favorable tax treatment on their earnings. Grasping these differences is helpful for individuals aiming to optimize their financial planning and investment approaches.
Choose the Right Mutual Fund for Your Financial Goals
10 September 2025 | 8 mins read
Choosing the correct mutual fund is crucial in achieving your financial objectives. Whether you are saving for a home, creating a college fund for your child, or saving for retirement, mutual funds are a method of investing regularly. Every fund has a risk profile and an investment strategy, so how they match your individual goals is what needs to be known. Understanding your risk tolerance and time horizon of your objectives can assist you in choosing funds that fit your requirements, whether these are short-term, mid-term, or long-term.
Offshore Mutual Funds: Meaning, Risks and Benefits
10 September 2025 | 8 mins read
Offshore mutual funds are investment funds with the objective of focusing on assets in countries other than the investor's home country. By pooling funds to invest in overseas markets, offshore funds offer exposure to foreign economies and industries that are not available through domestic investments. This method enables investors to geographically diversify their portfolios, which can offset risks related to local market exposure. They are handled by experts who assess the foreign economic environment, political stability, and market trends to choose appropriate investments. Knowing what offshore mutual funds are assists investors in comprehending how these funds work and what they can anticipate from their performance.
Understanding the Risks and Rewards of Sectoral Mutual Funds
10 September 2025 | 7 mins read
Industry mutual funds enable investors to focus their investment in a particular industry because they have faith or are interested in that industry's outlook. Such a concentrated investment means the performance of the fund is highly dependent on the sector's financial condition, regulatory landscape, and market movements. When the chosen sector performs steadily or improves, these funds may benefit from that growth. However, because they do not spread investments across multiple sectors, they are more vulnerable to downturns within the selected industry.
How to Handle Negative Returns in Mutual Funds
10 September 2025 | 9 mins read
Mutual fund investment enables investors to gain exposure to various asset classes through a professionally managed platform. This method enhances the dispersion of investment risk and allows for exposure to various sectors and instruments. Mutual funds are, nevertheless, subject to the fortunes of the overall financial markets, and hence, they can be volatile in value. These ups and downs can at times result in phases where the returns are not favorable to the investor, giving negative results for a period of time.
How to Set up an SWP in Mutual Funds
10 September 2025 | 8 mins read
Mutual funds offer investors several structured tools to manage their finances efficiently, and one such method is the Systematic Withdrawal Plan (SWP). SWP in mutual fund investing allows an individual to withdraw a predetermined sum at regular intervals—monthly, quarterly, or annually from an existing mutual fund holding. This method is often preferred by those who require consistent income, such as retirees, or those looking to supplement their regular earnings without redeeming their entire investment.
What are Alpha and Beta in Mutual Funds?
10 September 2025 | 8 mins read
Performance and risk assessment are important in the context of mutual fund investment. Alpha and beta are two important measures that help investors make this assessment. Alpha is a measure of a fund manager's capability to return more than a benchmark, reflecting active management value added. Beta is a measure of the relative volatility of a fund compared to the market and shows its sensitivity to market movement. Knowledge of these measures allows investors to match their investment decisions with their risk tolerance and expected returns.
Can Mutual Fund Schemes Invest in Upcoming IPOs?
18 July 2025 | 7 mins read
Can Mutual Fund Schemes Invest in Upcoming IPOs? - H1 Initial Public Offerings (IPOs) have become a buzzword among investors looking for high-growth opportunities. Whether it’s a unicorn startup going public or a reputed company entering the equity market, IPOs attract substantial interest. But what about mutual funds — can they participate in IPOs? And if yes, how does it impact you as an investor in a mutual fund? This article explores the role of mutual funds that invest in IPOs, the process behind such investments, and how you can benefit from this strategy. You’ll also gain insights into how fund managers evaluate IPO opportunities and which mutual funds are more likely to invest in them. Role of Mutual Funds in Equity Markets - H2 Mutual funds play a vital role in India’s equity markets. Managed by professional fund managers, these pooled investment vehicles collect money from multiple investors and allocate it across a portfolio of stocks, bonds, or other assets based on the fund's mandate. In the context of equity investing, mutual funds: Provide diversification to small investors Help in price discovery and market depth Act as long-term institutional investors Reduce risk through strategic asset allocation Given their market presence and influence, mutual funds also participate in IPOs, often subscribing to large portions of new issuances. But this activity is more nuanced than simply bidding for shares. Are Mutual Funds Allowed to Invest in IPOs? - H2 Yes, mutual funds in India are allowed to invest in IPOs — both in the primary market (where shares are first issued) and in the secondary market (where stocks are traded after listing). This means mutual funds can apply for shares during an IPO’s book-building process just like retail investors, high-net-worth individuals (HNIs), and institutional investors. SEBI regulations allow fund managers to allocate a portion of the fund’s assets to IPOs, provided the investment aligns with the scheme's objectives and risk profile. For instance: A large-cap fund may only invest in IPOs of companies expected to be included in large-cap indices A multi-cap or flexi-cap fund has more flexibility to take exposure across market capitalisations, including IPOs An ELSS fund (Equity-Linked Savings Scheme) can also participate in IPOs if it aligns with its tax-saving and equity investment objective So, the short answer is: Yes, mutual funds can and do invest in IPOs — but not all funds, and not always. Why and When Do Mutual Funds Invest in IPOs? - H2 Investing in IPOs offers mutual fund managers several strategic advantages, including: 1. Access to Early Growth Potential - H3 Many IPOs are of young, fast-growing companies. By investing early, mutual funds aim to capture the growth upside before the stock gains mainstream popularity. 2. Price Arbitrage Opportunities - H3 If a mutual fund believes that the IPO is underpriced relative to its intrinsic value, it may invest with the intent of benefiting from listing gains or long-term appreciation. 3. Portfolio Enhancement - H3 Some IPOs bring fresh sector exposure or innovation to the market. Fund managers may invest to diversify or rebalance the portfolio with new-age businesses, like fintech or EV startups. 4. Long-Term Bets - H3 Fund managers often look at IPOs with a long-term lens. The goal isn’t always listing gains but building a position in a company expected to perform well over years. 5. Demand and Liquidity Trends - H3 In bullish markets, IPOs tend to be oversubscribed and see strong listing premiums. Mutual funds may participate to ride the market momentum, especially when investor confidence is high. Factors Fund Managers Consider Before Investing in IPOs - H2 While IPOs are exciting, they are also risky and speculative, especially for companies with no prior listing record. Fund managers conduct rigorous due diligence before deciding to allocate your money to an IPO. Here are the key factors considered: 1. Company Fundamentals - H3 This includes examining the company’s: Revenue and earnings trends Debt levels and capital structure Profit margins and business scalability Competitive advantage and market share 2. Valuation Metrics - H3 Fund managers analyse: Price-to-Earnings (P/E) ratio Price-to-Book (P/B) ratio Enterprise Value to EBITDA (EV/EBITDA) These are compared with listed peers in the same sector. 3. Promoter and Management Track Record - H3 A critical evaluation is made on the credibility, governance standards, and historical performance of the promoters and top management. 4. Utilisation of IPO Proceeds - H3 Fund managers study how the company plans to use the funds—whether for debt repayment, expansion, or general corporate purposes. 5. Macroeconomic and Sector Trends - H3 Sectoral outlooks, regulatory policies, and broader market sentiments also influence IPO investment decisions. 6. Anchor Book Participation - H3 Strong interest from anchor investors (like global funds or sovereign wealth funds) signals confidence in the issue, making it more attractive for mutual fund participation. Best IPO Mutual Funds: What to Look For - H2 If you're keen on gaining exposure to IPOs through mutual funds, it's important to choose the right type of fund. While there’s no official category called “IPO mutual funds,” some schemes actively participate in upcoming IPOs. Here’s what you should look for when selecting such a fund: 1. Fund Category and Investment Mandate - H3 Start by checking the category of the fund. Flexi-cap, multi-cap, and mid-cap funds generally have more leeway to invest in IPOs. These funds are not restricted to a single market capitalisation and often aim to capture high-growth opportunities, making them ideal for IPO exposure. 2. Track Record of Participating in IPOs - H3 Review the fund’s portfolio history. Some mutual funds consistently allocate a portion of their assets to new listings. You can find this information in the fund’s monthly factsheet or portfolio disclosure. Look for funds that have a pattern of investing in IPOs over time—not just as a one-off move. 3. Fund Manager's Experience and Strategy - H3 A skilled fund manager makes a significant difference. The manager's ability to evaluate IPO valuations, industry potential, and company fundamentals is crucial. Look for funds managed by professionals with a proven track record in equity investing and a sound IPO selection approach. 4. Diversification and Risk Management - H3 An ideal fund won’t rely heavily on IPOs alone. Instead, it will use IPO investments as part of a broader equity strategy. Ensure that the fund holds a well-diversified portfolio alongside its IPO allocations to reduce volatility and balance risk. 5. Consistent Performance Over Market Cycles - H3 While past performance isn’t a guarantee of future returns, funds that have consistently performed well across different market cycles often reflect strong management and strategy. Look at long-term performance metrics like 3-year or 5-year returns instead of just recent gains. 6. Transparency and Reporting - H3 Good IPO-investing funds are transparent about their holdings. Choose funds that provide detailed disclosures about their portfolio, including new IPO allocations, so you can track how your money is being deployed. Also, read the scheme information document (SID) to understand the fund’s mandate and whether it allows active IPO participation. Should You Invest in a Mutual Fund That Invests in IPOs? - H2 Pros: Access to IPOs without applying individually Professional due diligence and analysis Built-in diversification Potential to capture high-growth opportunities Cons: IPO investments may not always succeed May increase portfolio volatility Returns can be affected by market timing and sentiment If you're a long-term investor, funds that occasionally invest in IPOs can be a good addition to your portfolio — but don’t chase IPO exposure alone. Always assess the fund holistically. Conclusion - H2 Yes, mutual fund schemes in India can and do invest in IPOs, but they do so strategically — not emotionally or impulsively. Fund managers assess multiple factors before deciding to put your money in newly-listed companies. As a retail investor, you benefit from their expertise and risk management process without having to analyse IPOs on your own. If you're looking for exposure to IPOs but want to avoid direct stock-picking, investing in a mutual fund that invest in IPO offers a smart, diversified route. However, always match the fund’s strategy with your risk tolerance, time horizon, and financial goals.
Mistakes People Make While Investing and How to Fix Them
10 July 2025 | 7 mins read
Investing can be one of the most effective ways to build wealth over time. Whether you’re investing in mutual funds or stocks, the goal is simple: earning returns that beat inflation and help you achieve financial freedom. However, investing isn’t just about selecting the right stocks or funds — it’s also about avoiding costly mistakes that can slow your progress down.
How Can ELSS Funds Be Redeemed? Rules for ELSS Withdrawal
26 June 2025 | 9 mins read
Equity-linked Savings Schemes (ELSS) are a type of mutual fund in India that provide tax relief under Section 80C of the Income Tax Act. ELSS have a three-year lock-in period, during which the amount invested cannot be withdrawn. It is important for investors to know the ELSS redemption process, rules, and tax implications while making their financial plans. This article explores the intricacies of ELSS mutual fund redemption, shedding light on the procedures and considerations.
How Many Mutual Funds Should I Include In My Portfolio?
24 June 2025 | 7 mins read
When building a mutual fund portfolio, most investors are taught the value of diversification. Spread your money across various funds, and you reduce risk; right? While that’s true, many investors go overboard and end up owning too many funds that overlap or add little value. This is known as mutual fund over-diversification, which can hurt rather than help your returns. So, how many mutual funds should you really own? Is there a magic number? And how do you ensure your portfolio is truly diversified, not just cluttered? This guide will walk you through the pitfalls of over-diversification, the ideal number of mutual funds to include, and best practices for creating a well-structured mutual fund portfolio.
ETF Liquidity: Understanding Bid-Ask Spreads and Trading Volumes
18 June 2025 | 7 mins read
Exchange-Traded Funds (ETFs) have become a popular investment vehicle in India due to their low costs, flexibility, and transparency. However, when it comes to trading ETFs efficiently, many investors overlook a crucial factor — liquidity. If you’ve ever wondered why your ETF buy or sell order didn’t execute at your expected price, chanc
The Future of ETFs: Trends and Predictions
18 June 2025 | 7 mins read
Exchange-traded funds (ETFs) are investment funds traded on stock exchanges, offering diversified portfolios like mutual funds but with the flexibility of stock trading. In the recent few years, passive investing is surging worldwide and in India too, ETF investment has grown rapidly. AMFI data shows that passive fund AUM (largely ETFs and index funds) hit ₹11.13 lakh crore by March 2025, up 21% year-on-year.