Mutual funds are investment products that are managed by mutual fund company . While making an investment in mutual funds , investor must be aware of its merits and demerits . The beginners mostly invest without identifying their financial goals . Investors must identify their financial goals , plan and choose wisely by analysing the risk factors and time horizon. Another mistake is making ad-hoc investment based on tax saving criteria . It better to invest in ELSS ( equity linked savings scheme ) if your goal is few years away. ELSS have a shorter lock in period and delivers good return in long run. Other mistake is that the investors invest in too many funds . Beginners will have a mindset of getting quick rewards and may invest without having a clear vision .
Prioritize your goal , make a plan and choose best way to invest !