2 Replies to “what is the difference between hedgefunds,equity and mutual funds?how are all of them traded?”

  1. For a beginner the equity and mutual funds are the best.
    Equities are shares of a company.The face value may be Rs.1 to 10. Sometimes upto 100. If one has to invest in a company he has to be very careful.You must know atleast the following details about the company.
    1.Group whom they belong like ambanis, tatas, godrej etc
    2.Board of directors and their background
    3.EPS. earnings per share
    4.PE ratio
    5.yearly dividend paid, rights issues and bonuses.

    Nowdays the markets are at its worst.Hence one has to be very very careful.The following campany shares i have purchased.
    NTPC,
    ONGC,
    PETRONET LNG,
    AMBUJA CEMENT
    FINOLEX CABLE
    IDFC

    Regarding Mutual funds they are run by certain banks or institutions.The face value is Rs.10 and the NAV changes on daily basis.Mutual funds invest in various sector like,
    INFRASTRUCTURE FUNDS
    TAX SAVING FUNDS
    FUSION FUNDS
    EQUITY FUNDS

    Equity funds are high yeilding but high risk.
    Balanced funds are 60% in equities 40% in debt instruments
    Debt funds are low risk 80% in debts and 20 % equities.
    You can also invest in SIP which means systemic investment plan. You can invest as low as Rs.100 per month.

    Personal experience: Investing in these is very risky.Do not listen to any one.Do your home work and invest in ony strong fundamental companies.Some people have burnt their fingers and some have burnt their hand itself.

    i


  2. Beginners should go with Mutual funds. Once u gain some perspective with them u can start investing in direct equities or stocks.

    In Mutual funds, the fund manager collects capital from individual investors and invests them in various instruments like stocks, debts etc.
    The advantage here is that the individual investor doesn;t have to do all the research about the stocks, their performance etc.. All this is done by the fund manager and the investor gets a share of this profit.





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