-–Santosujit Mohanty
We always ask readers to choose mutual funds based on their goals, investment horizon, and risk profile. Since you are investing for a long-term goal, you can invest in equity mutual funds. However, you should choose the category based on your risk appetite. For example, if you have a conservative risk profile, you should invest in aggressive hybrid schemes or large cap funds. Flexi cap schemes are recommended to moderate risk-takers. Aggressive investors can invest in mid cap, small cap, sector/thematic schemes.
Do not assume or take extra risk to earn better returns. Always take a quiz to find out your risk profile. Your assumption and real risk tolerance level needs to be the same. Often the mismatch results in unnecessary anxiety and heartburn. Many investors stop or sell their investments if they are not comfortable with the risk and volatility associated with their schemes.
If you are looking for recommendations, read: Best mutual funds to invest in 2023
