A mutual funds is a collection of stocks and bonds that are combined into a pool, which are purchased and sold. When you invest into these funds you are buying a part of the stocks and or bonds that an investment has been made in. When there is a payment of a fee on a regular cycle, like the annual fee, it is usually based on a fixed percentage of the fund’s net assets.Insurance today is not just the market trend; it’s the requirement of the day.
Unit Linked Insurance Policies are termed as ULIPs in short.Unit Linked Insurance Plans or ULIPS as they are called, are the insurance policies which rolled out the premium paid by the insurer in the stock market.ULIPs invest in equities.However it can be assumed that if a person stays invested for a long period of time in equity markets, the results will be positive.ULIPs are ideal for young people who can keep their money locked in for a longer period of time. It is an ideal product for babies who may need a substantial amount of money for their education in the later part of their life. Equity markets do give positive results if an investment is made into it for a long period of time.
Units allotted under ULIP schemes have Net Asset Values (NAV) declared regularly, like a mutual fund. Investors can invest as a lump sum (single premium) or make premium payments on an annual, half-yearly, quarterly or monthly basis. Premium amounts can be changed over the course of ULIP’s life.