Post on 07-Apr-2018
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INVESTMENT in
MUTUAL FUND
Presented by:
Ankit chhabraMBA/08/48
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Where to invest ??
We always think ,where should weinvest our money infinancial market ....
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Concept of mutual fund
A mutual fund is a professionally-managedfirm of collective investments that poolsmoney from many investors and invest it in
stocks, bonds etc.
Mutual fund have a fund manager who
invests the money on behalf of theinvestors by buying/selling stocks, bondsetc.
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Why investor prefer Mutual fund ?
They can buy their shares directly from market.
But this require spending time to find out theperformance of the company whose share isbeing purchased, understanding the futurebusiness prospects of the company, finding outthe track record of the promoters & the dividend,bonus issue, history of the company etc. Itshere to do research before investing.
However investor prefer the mutual fund route. Besides this, in this LOW RISK & HIGH
RETURN.
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Who manages investors money?
This is the role of asset managementcompany (AMC), to manage investors
money.
AMCs in return charges a fee for the
services provided & this fee is borne bythe investor as it is deducted from the
money.
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ORGANISATION OF MUTUAL FUND
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Working of mutual fund
Two methods-
Lump sum or one time payment method
Systematic investment plan (SIP)
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SYSTEMATIC INVESTMENTPLAN
Under this a fixed sum isinvested each month on afixed date of a month.
Payment is made throughpost dated cheques ordirect debit facilities.
The investor gets fewerunits when the NAV ishigh and more units when
the NAV is low. This is called as the
benefit of Rupee CostAveraging (RCA).
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Load structure
Two types of loads are there in:
Entry load
Exit load
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TYPES OF MUTUAL FUNDBY STRUCTURE
Openended funds Close-ended funds
BY INVESTMENT OBJECTIVE Growth Funds Income funds Balance Funds Money Market Funds Gilt Funds Index Funds
ON THE BASIS OF LOAD Load Funds No Load Funds
OTHER SCHEMES Tax Saving schemes
Industry Specific schemes Sector schemes
Return ??
Risk factor ??
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Open-ended funds
An open-end fund is one that is availablefor subscription all through the year.
These do not have a fixed maturity.
Investors can conveniently buy and sellunits at Net Asset Value (NAV) relatedprices.
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Closed-ended schemes
A closed-end fund has a stipulatedmaturity period which generally rangingfrom 3 to 15 years.
The fund is open for subscription onlyduring a specified period.
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RISK Vs. RETURN
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ADVANTAGES OF MUTUALFUND
Portfolio diversification
Professional Management
Liquidity
Affordability
Variety
Tax BenefitsConvenient & flexibility
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DISADVANTAGES OF MUTUAL FUND
No Tailor-made-Portfolios
No control over costs
Managing a Portfolio of Funds
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Major Mutual Fund Companiesin India
There are around 33 AMCs in india.
http://www.taurusmutualfund.com/