There are lots of misconceptions floating in common people's mind in India. They think mutual funds are unapproachable, difficult to understand and not for him/her. Wait a while, be ready to amaze by knowing the things like - thousand of investors already share their financial goals through mutual funds and they are not finance expert; they are just simply common man like me and you.

The main concept - using common financial instruments such as - shares, debentures and other instruments; organizations collect money and invest it into the capital market. The revenue earned from those investments distributed to its unit holders with their accrued proportion of units. A mutual fund is nothing but a basket which contains some investment plans or you can say investment instruments.

Now the question is why mutual fund? The answer is it is diversified, professionally managed and mutually beneficial investment instrument with a reasonably low cost. How it works? Well, conceptually it is working like a cyclic model. Investors invest their money through fund manager and fund manager will invest that money on securities and generates revenue and finally the revenue goes back to the investors.

Based on 3 (Three) basic things, experts classify this financial instrument under following categories -

1. By scheme structure

2. By scheme objective

3. By special schemes like Tax saving schemes.

Here is a small list of the most popular Mutual Fund available in India -

1. ICICI Prudential S.M.A.R.T (Structured Methodology Aiming at Returns over Tenure) Fund

2. ICICI Prudential Tax plan

3. Baroda Pioneer Gilt Fund

4. HDFC Index Fund - Sensex Plus Plan

A common person might not have enough knowledge about the stock market, status of the market also may not be aware of how securities works; If you are not being able to decide where to invest and how to invest, how to buy shares, how to track them and make the profit - this instrument will help you.

Each mutual fund has different investment and return scheme and unique investment aspiration; you can find your own between them.