What are the low-risk equity funds for investing as a student?

[Siya]

Hi

I am a 3rd year student. I am currently earning 15k through freelance work. Now I want to invest this money. I know that the risk factors involved in PPFs and FDs are very low, but they also have very low returns. And I want some good, decent returns. So suggest me where I should invest. Should I invest in stocks or in mutual funds, as I don’t want to put my money at risk?

[Ritika]

Mutual funds are the best option for you at this age compared to direct stocks. Mutual funds give you better growth and have a low risk factor, and it is better than FDs or PPFs. You can start with a SIP in a diversified equity mutual fund, which can help you grow your money over time.

[Kiara]

I wanted to start investing in mutual funds with a 7K SIP right now. Which is the best approach? Should I diversify this in 4–5 funds or in the same fund I should invest in? I don't want to take more risk. And in which funds should I invest?

[Siddarth]

@Kiara It's always better to diversify your funds to get better exposure to different sectors and a low-risk factor. So you should definitely diversify your SIP into different mutual funds.

The best funds to invest right now are:

1. Large-cap equity funds.
2. Flexi Cap Funds.
3. Hybrid funds.

All these funds will give you stable growth on a low-risk basis.