Mutual fund investment is becoming a favorite investment scheme for everyone today. This will lead to higher returns for investors. However, it is important to make informed decisions about these investments. Many people don't know how to invest. The return and risk are different for each fund. So, let's take a look at the best mutual funds for beginners.

Equity Fund

Guaranteed return plans are the best for first-time investors. This is an equity fund for those who want to invest for the long term. These are mutual funds that invest in shares of companies. If you want to buy a car or house for retirement, children's education or marriage, then you can opt for this plan. They offer high tax-free returns.

Debt Fund

This is a good investment for those who want to invest for the short term. The volatility in the stock market will not affect the debt funds significantly. Debt funds give better returns than bank deposits. Such mutual funds invest in bonds, debt instruments, fixed deposits and government securities. These investments will be profitable. At the same time, it is less risky than equity funds. Debt funds are instruments that provide a regular return. Therefore, it is suitable for those who want to start investing in a new mutual fund.

Balanced Fund

Balanced funds invest in both debt and equity funds. Therefore, they are considered to be balanced. The risk is low compared to other funds. Therefore, it is suitable for beginners. Such mutual funds will not be significantly affected by stock market reversals. Only 40 per cent of the balance funds are invested in the market.

Liquid Fund

Liquid funds are also known as money market. The specialty of such funds is that they can invest in treasury bills and government bonds in a short period of time.

How to invest?

Customers can invest directly in mutual funds. One can invest directly in the asset management company either online or through mobile apps. It is also a good idea to check the investment strategy of the funds you plan to invest in.