Most Mutual Funds do not carry any guarantee. Moreover, they are not insured by any bank or government agency. Even funds carrying a Bank's name do not offer guaranteed returns. Therefore, if an advertisement seems to promise attractive returns, it is wise to check out the basis on which such claims are being made. Mutual funds always carry one or the other investment risk depending on the asset allocation of the scheme.
Some types carry more risk than others.
While the offer document details the risk factors associated with the scheme, background research and inquisitive questioning is required to uncover all potential risks. Past performance is not a reliable indicator of future performance and there is no guarantee that the fund manager will be in a position to repeat the past performance on a consistent basis. It is necessary not to be overawed by the claims of spectacular past performance. All mutual funds carry costs and loads that go on to reduce effective returns. An investor needs to confirm all cost inputs before committing his money.