It’s true that a lot of people in today’s generation just can’t get enough and always #WantMore!
While some individuals are happy with market returns, some individuals wish to earn more. With that objective in mind, they invest in active mutual funds. Depending on his/her risk profile, an individual can choose from various active mutual funds, some of which include:
These mutual funds invest a majority of their money (80% or more) in equity shares of large companies. These are the top 100 companies by market capitalisation and are leaders in their industry. They have steady earnings and have created wealth for their shareholders. Investors willing to take the risk associated with equities can invest in these funds and expect to generate alpha over the underlying index.
These mutual funds invest a majority of their money (65% or more) in equity shares of mid cap companies. These are 101st – 250th companies by market capitalisation. These companies have generated some wealth for their shareholders but have a long way to go further. Investors who have a higher risk appetite than large-cap fund investors can invest in these funds. The return expectation of these investors is higher than that of large-cap fund investors.
These mutual funds invest a majority of their money (65% or more) in equity shares of small-cap companies. These companies have a lot of growth potential and can generate a lot of wealth for their shareholders. But, at the same time, these companies carry the highest risk. Investors with a very high risk profile can invest in these funds. The return expectation of these investors is higher than that of mid-cap fund investors.
- Large-Cap Funds
- Mid-Cap Funds
- Small-Cap Funds