If you are an investor with an appetite for risk and long-term goals like saving for retirement, a child’s education or marriage, equity plus funds can be useful either on a standalone basis or in combination with other investment options. Equity Plus Funds are launched by unit-linked insurance plans, mutual funds, and other investment categories. It generates a return higher than the 10-year government bond by taking on limited risk through equities.

The equity plus funds invest in accordance with the mandate given to the fund manager. Risk is usually controlled by the fund manager, who would be making sure that the predefined objectives are met. The investment guidelines vary across ULIPs / mutual funds and investors can check these guidelines on company websites. Equity funds invest in equities, corporate bonds and government securities with limited equity investments.