Mutual Funds- Who Says Market Linked Investment is a Man-Thing?

Written on Friday, June 9, 2017
By Shikha Bhatnagar - Executive Vice President, Private Banking, Bajaj Capital.

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We instantly relate Fashion with Women but when the talk is about investment, that too market linked investment, we see it as an exclusive “Man-Thing.” Women seem to be less aggressive than men when it comes to investing. Why is it so? There are various arguments on this. One of the most attributed reasons is that woman earn less or don't earn at all, thus investment doesn't fit her kitty of key responsibility areas.


But now the income trends are changing. A maximum number of women have started to make their own earnings, either through Govt. service, corporate professions or through entrepreneurial initiatives. Contemporary women understand the importance of wealth creation, wealth protection, and tax saving. 


Men, who are aggressive about investment, never fail to explore the potential of Mutual Funds. So what is so appealing about Mutual Funds? This blog has simplified the concept of mutual funds so that new women investors can also start with MF investments and reap benefits out of it.


Understanding Mutual Funds 


A mutual fund is an investment vehicle made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets.


Mutual funds are operated by money managers, who invest the fund's capital and attempt to produce capital gains and income for the fund's investors.




a) An equity fund is a mutual fund that invests principally in stocks. It can be actively or passively (index fund) managed.


b) These funds can be volatile in the short term due to market fluctuations and should be invested with a long-term perspective.




Debt funds are mutual funds that invest in fixed income securities like bonds and treasury bills. Gilt fund, monthly income plans (MIPs), short term plans (STPs), liquid funds, and fixed maturity plans (FMPs) are some of the investment options in debt funds.


a) Debt funds are less volatile.


b) Returns are low as compared to Equity funds.

A mutual fund that invests in short-term money market instruments such as commercial papers, commercial bills, treasury bills, certificate of deposit and other instruments specified by RBI. 
a) They are least risky. 
b) Returns are low. 
a) These funds invest in a mix of equities and debt. 
b) The risk is moderately high in case of an Equity balanced fund i.e minimum 65% of the portfolio comprises of Equity fund but Debt allocation of the fund supports the portfolio in case of any downturn in the case of volatility in capital markets. 
a) Mutual funds which invest in a particular sector or industry like Banking funds, Pharma funds, Technology funds, FMCG funds, etc. 
b) The risk is very high. 
a) These funds invest in the stocks of an index like the BSE – Sensex or the NSE – Nifty. 
b) Index funds are risky. 
a) These funds invest in varied market capitalization stocks. 
b) It helps to reduce tax burden under Section 80C of the Income Tax Act.


Investment is definitely every women's cup of tea as they are the 'Born Financial Planners' and they know how to earn and how to save. All they need is a little direction on where to invest. They can take help from investment experts in their family or friend circle or can directly take the guidance of professional investment service providers.


"Don't be intimidated by what you don't know. That can be your greatest strength and ensure that you do things differently from everyone else." By Sara Blakely, Founder, Spanx

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