A mutual fund has several schemes you ca`n invest in. there are structure based schemes distinguished by their maturity periods. Then there are objective based schemes that offer different risk-reward options. Lastly, you have special schemes that invest in specific sectors.

Structure Based Schemes		Objective Based Schemes		Special Schemes

These can be categorized into three types.

• Open-ended Schemes
  These have no fixed maturity period. Open-ended schemes are available for subscription and redemption (purchase and sale) on an ongoing basis. The units are bought and sold at NAV related prices.
• Close-ended Schemes
  These schemes have stipulated maturity period. Typically, you can invest in them for between 3 to 10 years. These schemes are open for subscription only during a specified period at the time of their launch. In case of listed schemes, you can invest in the scheme at the time of the initial issue and thereafter units of the scheme can be bought or sold on the stock exchange where the scheme is listed.
• Interval Schemes
  Interval schemes are a combination of open-ended and close-ended schemes. These schemes remain open for sale andrepurchase only during a specified period.

There are six types of objectives based schemes.

• Growth Schemes
  Growth schemes are designed to provide optimum returns through capital appreciation over medium to long term. A major part of their fund are invested in equities. So, though there could be a decline in their value in the short- term these schemes deliver results in the long run. It is an ideal option for those in their prime earning years.
• Income Schemes
  If you are looking for regular and steady returns go for income schemes. These schemes generally invest in fixed income securities such as bond and corporate debentures. Their returns may not be as attractive as growth schemes but they are steady and less risky as compared to equity schemes. If you have retired or need capital stability and income to supplement your current earning opt for an income scheme.
• Balanced Schemes
  Balanced funds give you the best of growth and income schemes. A balanced fund invests both in equities and fixed income securities. Their returns are generally less volatile as compared to pure equity fund.
• Liquid Schemes
  Liquid schemes are also known as money market schemes. These schemes generally invest in safer short-term instruments such as treasury bills, certificated of deposit, commercial paper and government securities. It is a good idea to invest your surplus funds for short periods in liquid schemes.
• Gilt Fund
  If you are among the safe players, invest in a gilt fund. These funds invest exclusively in government securities which have zero credit risk. The NAVs of these schemes are determined by changes in interest rates and other economic factors as is the case with income or debt oriented schemes.
• Tax Saving Schemes
  If you are investing because you want to save tax, go for these schemes. They offer deduction from gross total income to the investors, at present, under Sec. 80C of the Income Tax Act. The investment made to any Equity Linked Saving Scheme (ELSS) are eligible for deduction up to Rs. 100000 every financial year. Tax saving schemes are growth oriented and invest predominantly in equities.
  
  

• Index Funds
  Index Funds replicate the portfolio index such as the BSE Sensitive index, S&P NSE 50 index (Nifty), etc. These schemes invest in the securities in the same weightage comprising of an index.
• Sector Specific Funds
  Sector specific funds take advantage of the boom or expected upturn in a particular industry or sector by investing in them. So if software or pharmaceuticals is expected to do well, you have funds that invest in the stocks of only these sectors. The returns in these funds are dependent on the performance of the respective sectors or industries. While these funds may give optimized returns, they are riskier as compared to diversified equity funds that invest across different sectors.
• Hedge Funds
  A hedge fund is a fund that can take both long and short positions, use arbitrage, buy and sell undervalued securities, trade options or bonds, and invest in almost any opportunity in any market where it foresees impressive gains at reduced risk.