What are the potential risks of investing in mutual funds?

Mutual fund advertisements that end with "Mutual funds investments are subject to markets risks, please carefully read all scheme-related documents" are unlikely to have been missed. These are the risks mutual funds face:

Interest rate risk

Fixed income securities are a type of debt fund that invests in fixed rate securities. This can expose them to interest rate risk from changes in interest rates.

Credit risk

This applies to mutual fund underlying fixed-income securities. A bond issuer that cannot repay a bond may make it a useless investment.

Controllability is not an option

Mutual funds are convenient for investors, but they cannot decide the composition of a fund's fund portfolio or influence the selection of securities that the fund manager can purchase. Investors should also be aware of regulatory changes and risks while investing.

Both Risk and Rewards

Diversification is key to reducing risk. Mutual funds offer diversification which can offset losses in some securities by gains in other.

What are the ways through which mutual fund operates?

Types of mutual funds

A Short Brief on Net Asset Value

A brief on Mutual Funds

What are the advantages of investing in mutual funds

What is the process of setting up a mutual fund?

Basics of Mutual Funds

How do mutual funds work?

Different types of mutual fund schemes

Investment objectives and their classification

Choices in number of investment options/plans to the Investors

Benefits of investing in Mutual Funds

Some of the Myths about Mutual Fund