Mutual funds are highly liquid and with you, that one can easily sell or purchase units. In case of an open-ended mutual fund, one can redeem his/her units at any time at the existing net asset value (NAV) of the fund, thus making available your funds within a very short notice if desired.
4. Cost-effectiveness: Since the initial requirement is considered a very minimal investment in most cases, mutual funds are accessible to all types of investors. As SIPs allow investing small amounts on a regular basis, mutual funds are inexpensive to those belonging to different income classes.
5. Tax Benefits: There exist mutual funds which have tax deduction benefits like ELSS in certain countries, where there is a lock-in period for the funds, but they provide excellent opportunities for saving taxes with investment in the equity market.