What's the difference between investing in Equity Mutual Funds and ULIPs?

The main difference between the two is ULIP has an insurance component attached to it, whereas the Equity Mutual Fund is pure investment. The insurance premium is deducted from the investment you are making.

Equity Mutual Funds invest in the shares of the universe mentioned in the offer document (in could be as per market caps- large, mid and/or small; as per investment style- growth, value or blend; as per sectors- diversified or specific sectors like, banking, infrastructure, pharma etc.

ULIPs (unit linked insurance plans) are primarily a two in one. They combine investments and insurance. They provide a risk cover to the extent of the current value of the investments made. 

Mostly the expenses of ULIP are multiple times those of equity MFs. This often makes the Equity MFs superior in performance to ULIPs

 

All the data/information shared above are opinions/ views that solely belong to the Mutual Fund Distributors. UTI Mutual Fund (acting through UTI Trustee Company Pvt Limited) / UTI Asset Management Company) owes no responsibility/ liability whatsoever in this regards. The information contained should not be construed as forecast or promise, and the only objective of this initiative is to educate the consumers to take a more informed investment decision. Any investment decision taken based on the information provided in the content above shall be at sole risks, cost and consequences of the user.



 


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