There are two very common ways to earn from Mutual Funds. The first one is through dividends and interest income, and the second one is through capital gains.
1. Dividends and Interest Income
A dividend is a distribution of profits by a corporation to its shareholders that is generally done every quarter. Therefore, if you own stocks of dividend-paying companies through mutual funds, you are eligible to receive dividends. On the other hand, if the fund focuses on bonds, investors will earn through interest income.
An increase in the price or value of securities generates income. The income will then be passed to investors of the fund. This happens when securities your fund is invested in appreciates.