When you talk about investment, experts usually recommend mutual funds. Because mutual funds are the best option for investment. But there are 3 investment options in mutual funds as well. First- equity fund, second debt, and third hybrid fund. These are the investment options where you have to choose where you want to invest your money. But before that, you have to keep three things in mind. First return, second risk, and third time.

It is important to keep these three things in mind!

1. Return means how much profit can be made. Profit is usually calculated in %. If the inflation rate is 6%, then the return should be at least this. If you are not getting more return than the inflation rate, then there is no point in investing.

2. Risk means how many chances there are that you will lose the invested money and incur a loss.

3. Time means how long you are investing. Therefore, before investing anywhere, it is important to understand the difference between equity fund, debt, and hybrid fund. Let us understand them in detail in simple language.

Equity Mutual Fund (Stock)

In this scheme, the investors' money is invested directly in the shares of companies. The return in this depends on the performance of the share. This scheme can be risky for a short time. But it is considered to give excellent returns in the long run. Investors who are comfortable investing for 10 years can invest in these mutual fund schemes.

Debt Mutual Fund (Bond)

A debt mutual fund can be an excellent option for investment. Investment is made in government and corporate bonds in debt mutual funds. That is, your return will be returned from the interest received by lending. Meaning, the return is fixed. These are less risky than equity funds.

Hybrid Mutual Fund Scheme

In this type of mutual fund scheme, investment is made in both equity and debt. It is also called a balanced fund. There is diversification here. But there is also a little risk in the return. Therefore, while choosing a scheme, definitely analyze your risk capacity.

Apart from this, there is also a fund.

There is another fund. Which is called- Money Market Mutual Fund. This is a type of debt fund. In this, the AMC lends your money to companies for the short term. If you are looking for an alternative to FD, then Money Market Mutual Fund can be an option.

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