Mutual Fund

A mutual fund is an investment scheme which is managed by a highly qualified professional fund manager, usually run by an asset management company. It is an investment vehicle that pools investors’ money and invests the same for and on behalf of investors into stocks, bonds, money market instruments, and other assets. The money is received by the AMC with a promise that it will be invested in a particular manner by professional managers (commonly known as fund managers). The fund managers are expected to honor this promise. The SEBI and the Board of Trustees ensure that this actually happens.

As an investor, you can buy mutual fund ‘units’, which basically represent your share of holdings in a particular scheme. These units can be purchased or redeemed as needed at the fund’s current net asset value (NAV). These NAVs keep fluctuating, according to the fund’s holdings. So, each investor participates proportionally in the gain or loss of the fund.

Advantage
1.) Professional Management
2.) Diversification – Lesser Risk
3.) Economies of Scale
4.) Liquidity
5.) Simplicity
6.) Easiest Tracking
7.) Ple Choice
8.) Excellent Return
9.) Secure
10.) Transparency
11.) Tax Benefit
12.) Well Regulated
13.) Multi