Types of Mutual Funds

The objectives of a Mutual Fund are as follows:

• To provide an opportunity for lower income groups to acquire property without much difficulty in the form of shares.
• To cater mainly to the need of individual investors whose means are small.
• To manage investors' portfolios in a manner that provides regular income, growth, safety, liquidity and diversification.

Mutual Funds can be classified into the following three broad categories:

1. Portfolio Classification of Mutual Funds.
2. Functional Classification of Mutual Funds.
3. Geographical Classification of Mutual Funds.

Portfolio Classification of Mutual Funds

Mutual Funds differ with reference to the type of instruments in which the money has been invested as per the requirements of the investors. These are specified Mutual Funds structured for feeding a particular investible purpose.