Mutual funds, if experts are to be believed, are one of the effective tools for long term wealth building. Hybrid funds and index funds are two such options. AdvertisementAlso read: These 5 common mistakes can trigger notice from tax department; Know how to avoid themWhat are index mutual funds? Index mutual funds follow a specific market index such as the Nifty 50 or Sensex. Those comfortable with equity market volatility and looking for broad market exposure may consider equity index funds.