Every investor, whether conservative or aggressive, wants to see wealth to grow. A conservative investor would probably stick
to bank fixed deposits, postal small savings, insurance policies, public provident fund (PPF), bonds etc. In contrast, an
aggressive one would probably look at equity, real estate, etc. Although the investment style of each group is different, the
objective is to accelerate wealth creation.
Investing through the mutual fund route over several years could accelerate the wealth creation objectives. And that too at a
lower cost and with lower risks. This is because Sebi mandates that mutual fund schemes cannot charge more than about
2.75% of your assets each year, and in most cases the actual charge is lower than this figure. By paying this charge, you get
access to professional fund managers with years of experience in investing. So your risk of losing money through investments
is also lower compared to if you decide to invest directly in the market but do not have the requisite expertise. Also, the mutual
fund industry in India is one of the most regulated sectors. This, in turn, leaves very low chance of you losing money through
fraudulent or illegal means.
