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Equity Savings Mutual Funds
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Pure Equity Mutual Funds will carry risks that inherently come with Equity asset class such as volatility, negative returns at times etc.
However, equities do give several advantages, such as tax efficiency, for instance.
There is a special class of Equity-oriented hybrid / balanced schemes called the Equity Savings Mutual Funds.
These are relatively low risk hybrid schemes that use a mix of debt and arbitrage (equity) opportunities.
Thes schemes will generate income by investing in arbitrage opportunities in the cash and derivatives segment of the equity market.
The capital appreciation is usually taken care through a moderate exposure in equity.
This fund endeavours to wraps 3 benefits together - income opportunity, the growth potential of equity and tax efficiency as it is classified as an equity fund.
This fund is suitable for an investor who wants to combine the potential for capital appreciation along with regular income & medium volatility.
This makes these schemes to be tax efficient and relatively safer (compared to pure equity schemes).
Related Topics
- Debt Mutual Funds
- Balanced Funds
- Diversified Equity Funds
- Equity Linked Savings Schemes (ELSS)
- Liquid Mutual Fund Schemes
- Short-term Debt Mutual Fund Schemes
- Arbitrage Mutual Fund Schemes
- Monthly Income Plans
- Exchange Traded Funds
- International Mutual Fund Schemes
- Smallcap Mutual Fund Schemes
- Thematic Mutual Fund Schemes
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