Generally, Mutual Funds are opted over any other investment option for one major reason - that is they provide market benefits without making losses, which could have been there if you invested in Stocks.
It is like being in the market indirectly, as you can get most of the benefits and not overcome the negative part of it easily through diversification. But, this extra piece of pie can only be attained if you are including a major part of your mutual fund investment in Equities. As it is that extra piece of the pie over and above the cake that helps you earn the extra income.
The question arises, Does people actually invest in Equities when they opt for Mutual Funds?
If you invest in Mutual Funds and input 95% of your MF Portfolio in Debt, then what is the use??
The below info-graph, with calculative figures, will show why Equities are important in a Mutual Fund Portfolio -