A SMALL PRESENTATION ON,

MUTUAL FUND

PRESENTED BY,

VIDYADHARA.G

LEARNING OUTCOMESWhat is mutual fund.Concept of Mutual funds.TYPES OF MUTUAL FUNDsObjectivesAdvantagesdisadvantagesBuying A mutual fund.Services offered by mutual funds

What is…

MUTUAL FUND

MUTUAL FUND

A mutual fund is a professionally managed type of collective investment scheme that pools money from many investors to buy stocks, bonds, short-term money market instruments, and/or other securities.

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Concept of Mutual funds

A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal.

The income earned through these investments and the capital appreciation realized are shared by its unit holders in proportion to the number of units owned by them.

Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in diversified professionally managed basket of securities at a relatively low cost.

Cycle of Mutual Fund

.

TYPES OF MUTUAL FUNDsMutual Funds

By Maturity Period

Open ended

Close ended

By Investment Objective

Equity

Income

Balance fund

Money market

Gilt fund

Index fund

Maturity period

A)Open ended Subscription and repurchase on continuous basis .Does not have fixed maturity period

B)Close ended Stipulated maturity period

Investment objectiveEquity• To provide capital appreciation over the medium to long-

term• High risk

Income• Regular and steady income to investors.• Bonds, corporate debentures, Government securities and

money market instruments.

Investment objectiveBalance fund• Provide both growth and regular income• Equities and fixed income securities

Money market• To provide easy liquidity, preservation of capital and

moderate income• Treasury bills, commercial paper and government

securities, etc.

Investment objective`

Gilt fund• In government securities. • No default risk.Index fund• Rise or fall in accordance with the rise or fall in the

index

Objectives

Money market Mutual Funds

Asset Allocation Funds

Stock Mutual Funds

Bond Funds

advantages

Instant DiversificationLevel the playing field between professional and individual investorsShare administrative expensesLiquidityMinimal transaction costsConvenience

disadvantages

Lower than Market Performance

Costs

Services offered by mutual funds

Automatic investments and withdrawal plansAutomatic re-investment of interest, dividends and capital gainsWiring and funds express optionsPhone or internet switchingCheck writingBook keeping and help with taxes

Buying A mutual fund

STEP 1 – Determine risk preferences

STEP 2 – Determine asset allocation

STEP 3 – Identify family of funds that meet your objective

STEP 4 – Evaluate the funds

THANK YOU

THANK YOU