Mutual Fund

A pool of money from many investors that a SEBI-registered fund house invests in shares, bonds or both. You own units, not the shares themselves. Each unit's value is the NAV, which moves with the market every business day.

About Rs 99.9 lakh at an assumed 12% a year, from Rs 24 lakh of your own money. At 10% it would be much less, so treat 12% as a planning number, not a promise. Raise the SIP by 10% every year and the same 20 years gets you about Rs 1.99 crore on Rs 68.7 lakh invested.

No. This is the most common NAV mistake I see. Rs 10,000 buys 1,000 units at a NAV of Rs 10 or 100 units at Rs 100. If both portfolios rise 10%, both holdings become Rs 11,000. What matters is the return, cost and portfolio, not the unit price.

Most schemes must publish NAV on the AMC and AMFI websites by 11 pm on each business day, as per SEBI's investor FAQs (September 2024). Fund of funds and schemes with large overseas holdings get until 10 am the next business day. For purchases, you get the NAV of the day the money reaches the fund within the cut-off time, not the day you click buy.

If you already have a large sum and a 10-year horizon, lumpsum has historically had more time in the market. Most of us don't, though. We earn monthly, so a SIP fits how money actually arrives, and it spares you from guessing the market's peak. For a windfall I'd split it into a SIP over 6 to 12 months into equity.

For five years, I wouldn't put the whole amount in a pure equity fund. A bad year near the end can wipe out a large part of the gain. A hybrid fund, or a mix of an index fund and a short-term debt fund, is safer for that horizon. The best fund list you see online changes every year; your horizon doesn't.

For most beginners, yes. It holds India's 50 largest listed companies, costs little in a direct plan and saves you from choosing a fund manager. Add a flexi cap fund later if you want some mid and small cap exposure.

An equity fund that must keep at least 65% in shares and can invest across large, mid and small companies in any proportion. SEBI created the category on 6 November 2020. The manager decides the mix, so two flexi cap funds can behave very differently.

Only in the old regime. ELSS has a three-year lock-in and counts towards the Rs 1.5 lakh deduction under section 80C, now section 123 of the Income-tax Act, 2025. In the new regime there's no deduction, so judge it as an ordinary equity fund.

The fund house skips that month. It doesn't fine you, but your bank may charge for a failed auto-debit, and after repeated failures most fund houses cancel the SIP. If money is tight, cut the amount rather than stopping.