Large, Mid, Small, Flexi and Value Funds, which has least risk!
If you are thinking of investing and this is the first time you are thinking of investing somewhere, then it may be a little difficult for you to understand the stocks in the beginning. In such a situation, you should first invest in mutual funds. However, now the question arises that if you want to invest in mutual funds, then which can be the best mutual fund. Actually, there are many types of mutual funds - like large cap, mid cap, small cap and other mutual funds. In such a situation, when a new investor has so many options, he may get confused as to where to invest. Come, in this news, we tell you what is the difference between all these mutual funds and where it is safer to invest.
What is a large cap fund?
As the name suggests, this fund means large companies. The large cap category includes the top 100 companies of the country, whose market cap is the highest in the market. Large cap funds are also called blue-chip stocks. Investing in large cap means investing in the shares of the top 100 companies.
Let us tell you that due to the fluctuations in the market, they are not affected as much as small and mid cap companies. Being large cap, their hold in the market is very strong and their growth is also balanced. There is not much volatility in them during market correction and this is the reason why experts advise new investors or investors who do not want to take risk to invest in large cap.
What is a mid cap fund?
Mid cap funds include those companies, whose ranking is from 101 to 250 on the basis of market cap. These companies remain in the middle position in the market. Investing in these funds is also beneficial. You can get good returns on investment in these funds. But mid cap funds are more risky than large cap and less risky than small cap, hence mid cap is considered a fund that balances risk and return. Mid cap companies have the potential to become large cap companies in the future.
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