What is Mutual Fund?
• It is a pool of money, collected from investors, and is invested according to certain investment objectives
• The ownership of the fund is thus joint or mutual, the fund belongs to all investors.
A mutual funds business is to invest the funds thus collected, according to the the wishes of the investors who created the pool
• An equity fund will invest in Equity shares, Preference Shares,
Warrants etc.
Warrants etc.
• A Debt Fund will invest in Debt Instruments only.
Advantages of Mutual Funds to Inverstors
• Portfolio diversification
• Professional Management
• Reduction in Risk
• Reduction in Transaction costs
• Liquidity
• Convenience and Flexibility
• Safety – Well regulated by SEBI
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