Need Guidance On Financial Investment

So mutual funds is basically a fund which has a fund manager/advisor who will invest the money in different areas. They pick the companies to invest in. So there is something called "active funds" and "index funds". An active fund is the fund-manager will manage the mutual fund. He/She will decide to invest in certain companies etc. An index fund also has a fund-manager but they will just have the fund computerized to follow the NIFTY-50-INDEX. It is a bench-mark for a fund. In a nutshell this is just a brief idea about mutual funds. I recommend going to this site and educating yourself on investing before starting to invest- Bogleheads (This is based on investing in the US but it will give you a good understanding about investing in India as well). When choosing an mutual-fund look at the expenses/fees a fund charges. So if the expense/fees annually is 2%, then if you invest Rs 10000, then 2% of that goes towards the expense of maintaining the fund. Generally an "direct option" fund will have a lower expense ratio. You can get this information by looking at the prospectus of the fund or the annual report as well. If you call the investment firm, they will be able to help you on this as well but before talking to them, I recommend reading about investing. Some financial advisors or firms may steer you towards a fund which gives them some commission...you don't want to fall into that .