The goal for all growth funds is capital appreciation, not regular income or price stability. This makes them an unwise choice for people who need extra cash on a regular basis or who may have to use the money for short-term goals or in an emergency. But investors who want to earn higher returns cannot afford to ignore equity funds. Key Points to Remember Equity funds invest in stocks. A stock is a share in a corporation's assets.
Stocks provide higher returns over the long term.
All equity funds are risky as short-term investments.