An equity fund is a fund that predominantly invests in stocks of a company. These funds can be open ended or closed ended. Open ended funds are those which the investors can sell off at the end of each day. They are bought back at the Net Asset Value (NAV) of the day by the fund. Close ended funds are offered through IPOs (Initial Public Offerings). They are then listed on stock markets and are traded regularly. In close ended funds, the investor has to seek for a buyer in the stock market, not as open ended where they can sell back their shares to the fund.
India's 43 mutual fund houses offer various types of equity funds. Aggressive Growth Funds is one of the types. It involves investing using speculative strategies to achieve capital appreciation. The investments are done in companies that have aggressive growth traits but the fund also involves maximum risk. Such funds perform well with the boost in economy and also develop a dent with a slump in economy. Small Company Funds, as the name hints, are those that invest in companies having small market capitalization. Growth Funds are those that have investments in companies that are in a growing phase. They seek to achieve capital appreciation with the growth of the company. Growth and Income Fund is slightly different from Growth Funds. This fund aims to not only achieve capital appreciation with the growth of company but also aims to receive dividends at regular intervals. Equity-Income Funds invests in stocks that pay dividends at regular intervals.
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