Mutual fund is a hope that pools money from a group of investors and invest the money thus composed into asset classes that match the stated investment objectives of the plan. Since the stated investment objectives of a mutual fund scheme usually form the basis for an investor's decision to contribute money to the pool, a mutual fund can not diverge from its stated objectives at any point of time. Stock funds may also be classified according to the market capitalization of the companies in which they invest.
It is the number of outstanding shares of the company times the price of those shares. There are three main types of cap funds: large-cap, mid-cap, and small-cap. Some mutual funds also add a fourth category called micro-cap funds to describe funds that invest in companies worth less than $250 million. In general, the smaller the average market cap of the fund's holdings, the more volatile the return and micro-cap funds can be especially risky. Focused funds are funds which hold large positions in a small number of stocks. While many mutual funds hold 100 positions or more, focused funds usually have 10 to 40 positions at any given time. They emphasize quality over quantity, and would rather hold just the stocks they have the most confidence in, rather than diversifying across a large number of holdings. Every Mutual Fund is managed by a fund manager, who using his investment management skills and necessary research works ensures much better return than what an investor can manage on his own.
What do you mean Market potential of mutual fund?
