No, not necessary. Mutual funds can be divided into various types depending on asset classes. Investments can also be made in debt instruments such as bonds, debentures and government securities apart from equity.

All   mutual fund schemes are bound by the investment objectives outlined in its prospectus. The objectives specify the class of securities a fund can invest in. Based on such objectives, the following types of mutual funds currently operate in the country-

• Growth Schemes
• Income Schemes
• Balanced Schemes

Money Market Schemes