Mutual Fund is a trust that pools together the resources of investors to make a foray into investments in the capital market thereby making the investor to be a part owner of the assets of the Mutual Fund. While there is no legal definition of the term "mutual fund", it is most commonly applied only to those collective investment vehicles that are regulated and sold to the general public.
An investment programme funded by shareholders that trade in diversified holdings and is professionally managed. The fund is managed by a professional money manager who invests the money collected from different investors in various stocks, bonds or other securities according to specific investment objectives as established by the fund. If the value of the mutual fund investment goes up, the return on them increases and vice versa. The net income earned on the funds, along with the capital appreciation of the investment, is shared amongst the unit holders in proportion to the units owned by them. Mutual Fund is, therefore, an indirect vehicle for the investor investing in capital markets. In return for administering the fund and managing its investment portfolio, the fund manager charges fees based on the value of the fund’s assets.
An investment programme funded by shareholders that trade in diversified holdings and is professionally managed. The fund is managed by a professional money manager who invests the money collected from different investors in various stocks, bonds or other securities according to specific investment objectives as established by the fund. If the value of the mutual fund investment goes up, the return on them increases and vice versa. The net income earned on the funds, along with the capital appreciation of the investment, is shared amongst the unit holders in proportion to the units owned by them. Mutual Fund is, therefore, an indirect vehicle for the investor investing in capital markets. In return for administering the fund and managing its investment portfolio, the fund manager charges fees based on the value of the fund’s assets.
They are sometimes referred to as "investment companies" or "registered investment. Mutual funds have both advantages and disadvantages compared to direct investing in individual securities.
Investing in mutual funds is an expert's job in the present market scenario. A systematic investment in this instrument is bound to give rich dividends in the long-term.
Investing in mutual funds is an expert's job in the present market scenario. A systematic investment in this instrument is bound to give rich dividends in the long-term.
A mutual fund is a trust that pools the savings of a number of investors who share a common financial goal. It is the most suitable investment for the cautious investor as it offers an opportunity to invest in a diversified professionally managed basket of securities at a relatively low cost. So, we can say that Mutual Funds are trusts which pool resources from a large number of investors through issue of units for investments in capital market instruments such as shares, debentures and bonds and money-market instruments such as commercial papers, certificate of deposits and treasury bonds.
Who can invest in Mutual Funds?
Anybody with an investible surplus of as little as a few thousand rupees can invest in mutual funds by buying units of a particular mutual fund scheme that has a defined investment objective and strategy.
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