A mutual fund is a type of investment where a number of investors’ money is pooled together and used by the fund manager (referred to as the AMC) to invest in underlying securities in line with the objectives of the scheme.. It is generally accepted that by spreading your investment you are spreading your risk, therefore investing in mutual funds is considered to be lower risk than direct investment. When you invest in mutual funds you do not own the underlying investments but have a claim to a number of units in the fund representing the size of your investment. The value of each unit of the mutual fund scheme, calculated based on the market value of the underlying investments after deducting expenses and liabilities, is referred to as the ’Net Asset Value’ or NAV.

Growth Plan: dividends are not paid out, and the investor realizes only the capital appreciation on the investment(by increase in NAV).

Dividend Payout Plan: dividends are paid out to investors; however, the NAV of the plan falls to the extent of the dividend payout.

Dividend Re-investment Plan: dividends paid out are automatically re-invested in purchasing additional units in the scheme, however, the NAV of the plan falls to the extent of the dividend reinvested.

Systematic Investment Plan (SIP): allows the investor to invest a pre-determined amount, at a predetermined frequency into a specific fund option.

Systematic Withdrawal Plan (SWP): allows the investor to withdraw a pre-determined amount/number of units, at a predetermined frequency from his investments in the Mutual Fund.

 Systematic Transfer Plan (STP): allows the investor to switch a pre-determined amount/units from one scheme of the Mutual Fund to another scheme of the same Mutual Fund, at a predetermined frequency.

Multi Cap Fund  :Minimum investment in equity & equity related instruments- 65% of total assets

Large Cap Fund: Minimum investment in equity & equity related instruments of large cap companies- 80% of total assets

Large & Mid Cap Fund: Minimum investment in equity & equity related instruments of large cap companies- 35% of total assets Minimum investment in equity & equity related instruments of mid cap stocks- 35% of total assets

Mid Cap Fund: Minimum investment in equity & equity related instruments of mid cap companies- 65% of total assets

Small cap Fund: Minimum investment in equity & equity related instruments of small cap companies- 65% of total assets

Dividend Yield Fund: Scheme should predominantly invest in dividend yielding stocks. Minimum investment in equity- 65% of total assets

Value Fund: Scheme should follow a value investment strategy. Minimum investment in equity & equity related instruments – 65% of total assets

Contra Fund: Scheme should follow a contrarian investment strategy. Minimum investment in equity & equity related instruments – 65% of total assets

Focused Fund: A scheme focused on the number of stocks (maximum 30). Minimum investment in equity & equity related instruments – 65% of total assets. Funds will mention where the scheme intends to focus, viz.,multi cap, large cap, mid cap, small cap

Sectoral/ Thematic Fund: FundMinimum investment in equity & equity related instruments of a particular sector/ particular theme- 80% of total assets

ELSS ( Equity Linked Savings Scheme) :Minimum investment in equity & equity related instruments – 80% of total assets. An open ended equity linked saving scheme with a statutory lock in of 3 years and tax benefit

Overnight funds: These open-ended debt schemes will invest in overnight securities. Investment in overnight securities with a maturity of one day. 

Liquid funds: These schemes will invest in debt and money market securities with a maturity of up to 91 days. 

Ultra short duration funds: These open ended ultra-short term debt schemes will invest in instruments with a maturity between three months and six months. 

Low duration fund: These open-ended debt schemes will invest in instruments with a duration between six months and 12 months. 

Money market funds: These open-ended debt schemes will invest in money market instruments with a maturity of up to one year. 

Short duration funds: These open-ended debt schemes will invest in instruments with a duration between one year and three years. 

Medium duration funds: These open ended debt schemes will invest in instruments with a duration between three years and four years. 

Medium to long duration funds: These open-ended debt schemes will invest in instruments with a duration between four years and seven years. 

Long duration funds: These open-ended debt schemes will invest in instruments with a duration of greater than seven years. 

Dynamic bonds: These open-ended debt schemes will invest across durations. 

Corporate bond funds: These open-ended debt schemes will predominantly invest in highest-rated corporate bonds. These schemes should invest at least 80 per cent of total assets in corporate bonds, only in highest-rated instruments. 

Credit risk funds: These open-ended debt schemes will invest in below highest-rated corporate bonds. They should invest at least 65 per cent of the total assets in corporate bonds. 

Banking and PSU funds: These open-ended debt schemes will predominantly invest (80 per cent of assets) in debt instruments of banks, public sector undertakings and public financial institutions. 

Gilt funds: These are open-ended debt schemes will invest in government securities across maturity. These schemes should invest a minimum of 80 per cent of its total assets in G-secs. 

Gilt fund with 10-year constant duration: These open-ended debt schemes will investing in government securities with a constant maturity of 10 years. These schemes should invest at least 80 per cent of the total assets in G-secs. 

Floater funds: These open-ended debt schemes will mostly invest in floating rate instruments. These schemes will invest at least 65 per cent of the total asses in floating rate instruments. 

Conservative Hybrid Fund: Investment in equity & equity related instruments- between 10% and 25% of total assets; Investment in Debt instruments- between 75% and 90% of total assets

Balanced Hybrid Fund: Equity & Equity related instruments- between 40% and 60% of total assets; Debt instruments- between 40% and 60% of total assets. No arbitrage would be permitted in this scheme

Aggressive Hybrid Fund: Equity & Equity related instruments- between 65% and 80% of total assets; Debt instruments- between 20% 35% of total assets

Dynamic Asset Allocation or Balanced Advantage: Investment in equity/ debt that is managed dynamically

Multi Asset Allocation Fund: Invests in at least three asset classes with a minimum allocation of at least 10% each in all three asset classes

Arbitrage Fund :Scheme following arbitrage strategy. Minimum investment in equity & equity related instruments- 65% of total assets

Equity Savings Fund: Minimum investment in equity & equity related instruments- 65% of total assets and minimum investment in debt- 10% of total assets. Minimum hedged & unhedged to be stated in the SID.

Retirement Fund: Scheme having a lock-in for at least 5 years or till retirement age whichever is earlier

Children’s Fund :Scheme having a lock-in for at least 5 years or till the child attains age of majority whichever is earlier