Investing money in mutual fund is how far wise?

There are good mutual funds and there are mutual funds that are not so good. At least 70% of mutual funds underperform the market in general. But some do have certain advantages.

For small investors and investors that do not have the desire to research individual companies, they are a good investment vehicle provided that you do the necessary research to pick a mutual fund with a good track record.

Mutual funds that invest in foreign stocks and small companies offer advantages that are generally not available to individual investors on their own. Individual investors do not have the access to the markets or the information that the mutual funds do. Mutual funds that invest in larger domestic companies are the ones that normally will not perform so well, because the market is made up mostly of those companies and those mutual funds offer no advantages over anyone else.

Another advantage of mutual funds is that the risk of you loosing much of your money is much less because you are more diversified with a mutual fund. But in a bear market, if you are invested you will loose money no matter how you invested it. That is the risk you take.

Buy medium risk stocks and dont spend more than you can afford to loose. Its a risky buisness but usually pays off.

Depends of what your risk tolerance is. They fluctuate less than individual issues. However choose no load funds that will not reducate the profitability of the funds with various surcharges.

Well it is much better than you investing directly in the stock markets. Typically the Mutual Fund Managers are "Fat-Cats' who have advanced degrees in financial services and thorough market contacts and knowledge thereby they are the ones who can move the market almost anyway that they want to... in India atleast! ;-)
So by taking the mutual fund route your money is managed by professionals and therefore the choices made should be wiser... though there are no guarantees in the share matrket.

If you are not an "investor".... than buying low cost, no-load mutual funds is the next best thing. Buy a book on investing. Buy two. This subject will effect you your whole life. The younger you get involved.... the better your future will be. Do not wait. Do it know.