A Critical Study of Risk and Return Analysis Between Mutual Fund and Fixed Deposit

Abstract

In Today’s scenario, people are more concerned about their plans than present due to the uncertain environment. Everyone wants financial freedom and financial growth. For this, it is necessary to make an investment decision. Awareness and knowledge about investment instruments available in the market are extremely important to make the right investment decision. The present paper mainly focuses on risk and return analysis of mutual funds and fixed deposits. Investors seek to manage risk by diversifying their investments and evaluating risk-return trade-offs. Return is the reward for taking on risk. This paper also emphasizes the pros and cons of mutual fund and fixed deposits and their workings. Due to the vast array of savings and investment companies, the products they offer, the terms and conditions of investments, and the numerous complex rules and regulations in the financial market it is a very difficult task to invest funds according to choices. The majority of investors, especially those in rural areas, are found to be unaware of the available investment options and applicable laws. So, this paper addresses the benefits of investment instruments which help investors to choose the best available investment option according to their numerous life living purposes such as medical, education of children, retirement purposes etc.