Basic mind set of any type of Investor is to manage the risk and maximize the returns. The common phenomenon in managing the risk is, not to put all the eggs in one basket in financial markets and this phenomenon is known as diversification. The diversification required choosing which baskets to put your eggs in; and most importantly how much? This question and lack of expertise to invest in the financial markets given birth to the mutual funds, along with the entrepreneurial mind set of the financial market experts. The financial market experts found a gap and translated it in to the win-win situation for those who doesn’t exactly know when and where to invest and minimizing the risk through efficient management of funds through large portfolios, having enough capital to divest.