Basically their are three major types of MF's
Funds that have a mandate to invest into stocks of public limited company in accordance with its objectives. Generally the investment objective here is to attain Long Term Capital Growth. Equity Funds can future be divided into LargeCap's, MidCap's, Multi-Caps. Balanced etc.
Fixed Income Funds
Fixed Income Funds invests in Bonds or debt securities. Their purpose is to provide safety and returns on regular basis. They invest primary into Goverment or corporate debt.
Money Market Funds
The money market funds consists of short-term debt instruments, mostly Treasury Bills. This is a safe place to park your money. A typical return is twice the amount you would earn in a regular checking/savings account and a little less than the average Certificate of Deposits.