What kind of assets are permitted to be included in mutual funds MFs Equity Debt bills issued by com...........

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What kind of assets are permitted to be included in mutual funds (MFs)?

Equity
Debt bills issued by companies
Government bonds

Select the correct answer using the codes below.

1 only

2 and 3 only

1 and 3 only

1, 2 and 3

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Explanation:

MFs are polled funds of various investors, managed by an active fund manager. There are various type of mutual funds in the market. Income Funds invest in corporate bonds, government bonds and money market instruments with long maturities. Money market funds invest in short-term fixed income securities such as government bonds, treasury bills, bankers’ acceptances, commercial paper and certificates of deposit. There are MFs dedicated to each of these instruments or handling a mixture of these instruments.