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Questions and Answers
What is the biggest advantage of investing in mutual funds compared to traditional investments like fixed deposits?
What is the biggest advantage of investing in mutual funds compared to traditional investments like fixed deposits?
- Fixed annual income
- Higher returns over the long term (correct)
- Guaranteed safety of principal amount
- No professional management required
According to data, how much return have equity mutual funds in India provided over the last 10 years on average?
According to data, how much return have equity mutual funds in India provided over the last 10 years on average?
- 5-7% annually
- 12-15% annually (correct)
- 20-25% annually
- 8-10% annually
Why is diversification important in investment, and how does mutual funds help?
Why is diversification important in investment, and how does mutual funds help?
In India, which type of mutual fund offers tax benefits under Section 80C of the Income Tax Act?
In India, which type of mutual fund offers tax benefits under Section 80C of the Income Tax Act?
What role does a financial advisor play in mutual fund investment?
What role does a financial advisor play in mutual fund investment?
Flashcards
Diversification
Diversification
Investing in a variety of assets, aiming to reduce risk by spreading investments across different sectors, asset classes, and geographic locations.
What is a mutual fund?
What is a mutual fund?
Mutual funds are a type of investment where money from multiple investors is pooled together and invested in a diversified portfolio of securities, typically stocks, bonds, or a combination of both.
Professional Management in Mutual Funds
Professional Management in Mutual Funds
Mutual funds managed by professional fund managers who research and select securities based on the fund's investment objective and strategy.
Benefits of Mutual Fund Diversification
Benefits of Mutual Fund Diversification
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Higher Returns Potential of Mutual Funds
Higher Returns Potential of Mutual Funds
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Fixed Annual Income from Mutual Funds?
Fixed Annual Income from Mutual Funds?
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Average Return of Equity Mutual Funds in India
Average Return of Equity Mutual Funds in India
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What is ELSS?
What is ELSS?
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Role of a Financial Advisor in Mutual Fund Investment
Role of a Financial Advisor in Mutual Fund Investment
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Capital of France (example flashcard)
Capital of France (example flashcard)
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Study Notes
Mutual Funds Quiz Study Notes
- Mutual Fund Advantages: Higher returns over the long term are the biggest advantage compared to fixed deposits.
- Mutual Fund Returns (India): Equity mutual funds in India have averaged 12-15% annually over the past 10 years.
- Diversification Importance: Diversification minimizes investment risks by spreading investments across different assets. Mutual funds achieve this.
- Tax-Advantaged Mutual Funds (India): Equity-Linked Savings Schemes (ELSS) offer tax benefits under Section 80C of the Income Tax Act.
- Financial Advisor Role: Financial advisors assist in choosing the right mutual fund based on investment goals, ensuring portfolios remain on track with market conditions and providing guidance for tax-saving investments.
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