revised mutul fund project

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MUTUAL FUND PROJECT Page 1

Role of AMFI & SEBI in Mutul Fund Industry..

INTRODUCTION

Mutual fund is a mechanism for pooling the resources by issuing unit to the

investors and investing funds in securities in accordance with the objective as

disclosed in offer document. Investment in securities is spread across a wide

section of industry and sector and the risk is reduced. Diversification reduces

the risk because all stock may or may not move in the same direction in the

same proportion to their proportion at the same time. Mutual fund issues units

to the investors in accordance with quantum of money invested by them.

Investor of mutual are called unit holders.The profit or losses are shared by the

investors in proportion to their investment. The mutual fund usually comes out

with a number of schemes with different investment objectives which are

launched from time to time. A mutual fund is required to be registered with the

SEBI, which regulates securities markets before it can collect fund from the

public.

The rationale behind a mutual fund is that there a large number of investors

who lack the time and or the skills to manage their money.

Hence, professional fund managers, acting on behalf of the Mutual Fund,

manage the investments (investors money) for their benefit in return for a


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management fee. The organization that manages the investment is called the

Asset Management Company (AMC). Thus, a Mutual Fund is the most suitable

investment for the common person as it offers an opportunity to invest in a

diversified, professionally managed basket of securities at a relatively low cost.

Anybody with an investible surplus of as little as a few thousand rupees can

invest in mutual fund .Each mutual fund scheme has defined investment

objective and strategy.

A Draft offer documents is to be prepared for launching a fund. Typically, it

specifies the investment objectives of the fund, the risk associated, the cost

involved in the process and the broad rules for entry into and exit from funds

and others areas of operation. As you probably know, mutual funds have become

extremely popular over the last couple of decades what was once just another

obscure instrument is now part of daily lives. More than 80 million people or

one half of the household in America invest in mutual funds. That means that, in

the United States alone, trillions of dollars alone are invested in mutual fund. In

fact, too many people, investing means buying mutual funds After all, its

common knowledge that investing in mutual fund is (or at least should be)

better than simply letting cash waste away in a saving account but for most

people, thats where the understanding of fund ends.


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In India, SEBI (Mutual Fund) Regulations, 1996 regulates the structure of

mutual funds. Mutual funds in India are constituted in the form of a Public

Trust created under The Indian Trusts Act, 1882

MUTUAL FUND AND ITS VARIOUS ASPECTS.

Mutual fund is a trust that pools the savings of a number of investors who share

a common financial goal. This pool of money is invested in accordance with a

stated objective. The joint ownership of the fund is thus Mutual, i.e. the fund

belongs to all investors. The money thus collected is then invested in capital

market instruments such as shares, debentures and other securities. The income

earned through these investments and the capital appreciations realized are

shared by its unit holders in proportion 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 a diversified, professionally managed basket of

securities at a relatively low cost. A Mutual Fund is an investment tool that

allows small investors access to a well-diversified portfolio of equities, bonds

and other securities. Each shareholder participates in the gain or loss of the

fund. Units are issued and can be redeemed as needed. The funds Net Asset

value (NAV) is determined each day.

Investments in securities are spread across a wide cross-section of industries


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and sectors and thus the risk is reduced. Diversification reduces the risk because

all stocks may not move in the same direction in the same proportion at the

same time. Mutual fund issues units to the investors in accordance with

quantum of money invested by them. Investors of mutual funds are known as

unit holders.

When an investor subscribes for the units of a mutual fund, he becomes part

owner of the assets of the fund in the same proportion as his contribution

amount put up with the (the total amount of the fund). Mutual Fund investor

is also known as a mutual fund shareholder or a unit holder.

Any change in the value of the investments made into capital market

instruments (such as shares, debentures etc) is reflected in the Net Asset Value

(NAV) of the scheme. NAV is defined as the market value of the Mutual Fund

scheme's assets net of its liabilities.


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HISTORY OF THE INDIAN MUTUAL FUND INDUSTRY

The mutual fund industry in India started in 1963 with the formation of Unit

Trust of India, at the initiative of the Government of India and Reserve Bank.

Though the growth was slow, but it accelerated from the year 1987 when non-

UTI players entered the Industry.

In the past decade, Indian mutual fund industry had seen a dramatic

improvement, both qualities wise as well as quantity wise. Before, the monopoly

of the market had seen an ending phase; the Assets Under Management (AUM)

was Rs67 billion. The private sector entry to the fund family raised the Aum to

Rs. 470 billion in March 1993 and till April 2004; it reached the height if Rs.

1540 billion.

The Mutual Fund Industry is obviously growing at a tremendous space with

the mutual fund industry can be broadly put into four phases according to the

development of the sector. Each phase is briefly described as under.


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First Phase 1964-87

Unit Trust of India (UTI) was established on 1963 by an Act of Parliament by

the Reserve Bank of India and functioned under the Regulatory and

administrative control of the Reserve Bank of India. In 1978 UTI was de-linked

from the RBI and the Industrial Development Bank of India (IDBI) took over

the regulatory and administrative control in place of RBI. The first scheme

launched by UTI was Unit Scheme 1964. At the end of 1988 UTI had Rs.6,700

crores of assets under management.

Second Phase 1987-1993 (Entry of Public Sector Funds)

1987 marked the entry of non- UTI, public sector mutual funds set up by public

sector banks and Life Insurance Corporation of India (LIC) and General

Insurance Corporation of India (GIC). SBI Mutual Fund was the first non- UTI

Mutual Fund established in June 1987 followed by Canbank Mutual Fund (Dec

87), Punjab National Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund

(Nov 89), Bank of India (Jun 90), Bank of Baroda Mutual Fund (Oct 92). LIC

established its mutual fund in June 1989 while GIC had set up its mutual fund

in December 1990.At the end of 1993, the mutual fund industry had assets

under management of Rs.47,004 crores.


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Third Phase 1993-2003 (Entry of Private Sector Funds)

1993 was the year in which the first Mutual Fund Regulations came into being,

under which all mutual funds, except UTI were to be registered and governed.

The erstwhile Kothari Pioneer (now merged with Franklin Templeton) was the

first private sector mutual fund registered in July 1993.

The 1993 SEBI (Mutual Fund) Regulations were substituted by a more

comprehensive and revised Mutual Fund Regulations in 1996. The industry

now functions under the SEBI (Mutual Fund) Regulations 1996. As at the end

of January 2003, there were 33 mutual funds with total assets of Rs. 1,21,805

crores.

Fourth Phase since February 2003

In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI

was bifurcated into two separate entities. One is the Specified Undertaking of

the Unit Trust of India with assets under management of Rs.29,835 crores as at

the end of January 2003, representing broadly, the assets of US 64 scheme,

assured return and certain other schemes


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The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and

LIC. It is registered with SEBI and functions under the Mutual Fund

Regulations. consolidation and growth. As at the end of September, 2004, there

were 29 funds, which manage assets of Rs.153108 crores under 421 schemes.

ORGANISATION OF A MUTUAL FUND

There are many entities involved and the diagram below illustrates theorganisational set up of a mutual fund:


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ADVANTAGES OF MUTUAL FUNDS

The advantages of investing in a Mutual Fund are: Professional Management Diversification Convenient Administration Return Potential Low Costs Liquidity Transparency Flexibility Choice of schemes Tax benefits Well regulated

DISADVANTAGE OF MUTUAL FUND

y No control over Cost in the Hands of an Investory No tailor-made Portfoliosy Managing a Portfolio Fundsy Difficulty in selecting a Suitable Fund Scheme.


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Structure of the Indian mutual fund industry:

The Indian mutual fund industry is dominated by the Unit Trust of India and

which has a total corpus of Rs 700bn collected from more than 20 million

investors .The UTI has many fund /schemes in all categories i.e. equity, balanced,

income etc with some being open ended and some being closed ended. The United

Scheme 1964 commonly referred to as US64, which is a balanced fund, is the

biggest scheme with a corpus of about Rs 200bn URI was floated by financial

institution and is governed by a special act of the parliament. Most of its investors

believe that the UTI is government owned and controlled, which, while legally

incorrect, is true for all practical purposes.

The second largest categories of mutual funds are the ones floated by nationalized

banks. Can bank Asset management floated by Canara Bank and SBI Funds

Management floated by the State Bank of India are the largest of these. GIC AMC

floated by General Insurance Corporation and Jeevan Bima Sahayog AMC floated

by the LIC are some of the prominent ones. The aggregate corpus of funds

managed by this category of AMCs is about Rs 150 billion

The third largest categories of the mutual funds are the once floated by the

private sector and by the foreign asset management companies. The largest of

these are Prudential ICICI AMC and Birla SUN LIFE AMC. The aggregate


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corpus of the asset managed by this category of AMC s is in excess of Rs 250bn.

Market structure of mutual fund industry:

Recent trends in the mutual fund industry:

The most important in the mutual fund industry is the aggressive expansion of

the foreign owned mutual fund companies and the decline of the companies floated

by the nationalized bank and smaller private sector players. Many nationalized

banks got into the mutual fund business in the early nineties and go off to a good

start due to the stock market boom prevailing then. These banks did not really

understand the mutual fund business and they just viewed it as another kind of

banking activity. Few hired specialized staff and generally choose to transfer staff


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from the parent organization. Some schemes had offered guaranteed returns and

their patent organization had to bail out these AMCs by paying large amount of

money the difference between the guaranteed and actual returns. The service level

was also bad. Most of these AMCs have not been able to retain staffs, float, and

new schemes etc. and it is doubtful whether barring a few expectations, they have

serious plans of continuing the activity in a major way.

The experience of some of the AMCs floated by private sector Indian companies

was also very similar. They quickly realized that the AMCs business is a business,

which makes money in the long term and requires deep pocketed support in the

intermediate years. Some have sold out to foreign owned companies, some have

merged with the others and there is general restructuring going on.

The foreign owned companies have deep pockets and have come in here with the

expectation of a long haul. They can be credited with introducing many new

practices such as new product innovation, sharp improvement in the service

standards and disclosure, usage of technology, broker education etc. In fact, they

have forced the industry to upgrade itself and service levels of the organization

like UTI have improved dramatically in the last few years in response to the

competition provided by these.


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TYPES OF MUTUAL FUND SCHEMES

Wide variety of Mutual Fund Schemes exist to cater to the needs such as financialposition, risk tolerance and return expectations etc. The table below gives an

overview into the existing types of schemes in the Industry.


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CATEGORIES OF MUTUAL FUND:


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Mutual funds can be classified as follow :

Based on their structure:y Open-ended funds: Investors can buy and sell the units from the fund, atany point of time.

y Close-ended funds: These funds raise money from investors only once.

Therefore, after the offer period, fresh investments can not be made into the

fund. If the fund is listed on a stocks exchange the units can be traded like

stocks (E.g., Morgan Stanley Growth Fund). Recently, most of the New Fund

Offers of close-ended funds provided liquidity window on a periodic basis such

as monthly or weekly. Redemption of units can be made during specified

intervals. Therefore, such funds have relatively low liquidity.


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Based on their investment objective:Equity funds: These funds invest in equities and equity related instruments.

With fluctuating share prices, such funds show volatile performance, even

losses. However, short term fluctuations in the market, generally smoothens out

in the long term, thereby offering higher returns at relatively lower volatility.

At the same time, such funds can yield great capital appreciation as, historically,

equities have outperformed all asset classes in the long term. Hence, investment

in equity funds should be considered for a period of at least 3-5 years. It can be

further classified as:

i) Index funds- In this case a key stock market index, like BSE Sensex or Nifty

is tracked. Their portfolio mirrors the benchmark index both in terms of

composition and individual stock weightages.

ii) Equity diversified funds- 100% of the capital is invested in equities

spreading across different sectors and stocks.

iii|) Dividend yield funds- it is similar to the equity diversified funds except

that they invest in companies offering high dividend yields.

iv) Thematic funds- Invest 100% of the assets in sectors which are related

through some theme.

e.g. -An infrastructure fund invests in power, construction, cements sectors etc.


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v) Sector funds- Invest 100% of the capital in a specific sector. e.g. - A banking

sector fund will invest in banking stocks.

vi) ELSS- Equity Linked Saving Scheme provides tax benefit to the investors.

Balanced fund:

Their investment portfolio includes both debt and equity. As a result, on the

risk-return ladder, they fall between equity and debt funds. Balanced funds are

the ideal mutual funds vehicle for investors who prefer spreading their risk

across various instruments. Following are balanced funds classes:

i) Debt-oriented funds -Investment below 65% in equities.

ii) Equity-oriented funds -Invest at least 65% in equities, remaining in debt.

Debt fund: They invest only in debt instruments, and are a good option for

investors averse to idea of taking risk associated with equities. Therefore, they

invest exclusively in fixed-income instruments like bonds, debentures,

Government of India securities; and money market instruments such as

certificates of deposit (CD), commercial paper (CP) and call money. Put your


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money into any of these debt funds depending on your investment horizon and

needs.

i) Liquid funds- These funds invest 100% in money market instruments, a

large portion being invested in call money market.

ii) Gilt funds ST- They invest 100% of their portfolio in government securities

of and T-bills.

iii) Floating rate funds - Invest in short-term debt papers. Floaters invest in

debt instruments which have variable coupon rate.

iv) Arbitrage fund- They generate income through arbitrage opportunities due

to mis-pricing between cash market and derivatives market. Funds are allocated

to equities, derivatives and money markets. Higher proportion (around 75%) is

put in money markets, in the absence of arbitrage opportunities.

v) Gilt funds LT- They invest 100% of their portfolio in long-term

government securities.

vi) Income funds LT- Typically, such funds invest a major portion of the

portfolio in long-term debt papers.

vii) MIPs- Monthly Income Plans have an exposure of 70%-90% to debt and an

exposure of 10%-30% to equities.


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AMFI Guidelines

DefinitionIntermediaries play a pivotal role in promoting sale of mutual fund schemes.

AMFI has therefore taken the initiative of developing a cadre of trainedprofessional intermediaries. As the first step AMFI launched the certificationprogramme in association with NSE's Certification in Financial Markets (NCFM)in July 2000 and SEBI has made AMFI Certification compulsory in a phasedmanner.

Intermediaries consisting of individual agents, brokers, distribution houses andbanks engaged in selling of mutual fund products as of now do not have anyguidelines or regulatory framework relating to the business of selling MutualFunds. It is important and necessary that these intermediaries follow professionaland healthy practices. AMFI has therefore taken the initiative of framing a broadset of guidelines along with a code of conduct.

It is our request that all the intermediaries make sincere efforts to adhere to theguidelines and the code of conduct so that all those engaged in the business of


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selling and marketing of mutual fund schemes follow professional, healthy andbest practices for the sustained benefit of all concerned - investors, intermediariesand the Mutual Fund Industry as a whole.


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Role of Intermediaries in the Indian Mutual Fund Industry

1. The mutual fund industry in India started in 1964 with the formationof the Unit Trust of India (UTI). In 1987, other public sectorinstitutions entered this business, and it was in 1993 that the first ofthe private sector participants commenced its operations

2. From the beginning, UTI and other mutual funds have reliedextensively on intermediaries to market their schemes to investors.It would be accurate to say that without intermediaries, the mutualfund industry would not have achieved the depth and breadth ofcoverage amongst investors that it enjoys today. Intermediaries haveplayed a pivotal and valuable role in popularizing the concept ofmutual funds across India. They make the forms available to clients,explain the schemes and provide administrative and paperworksupport to investors, making it easy and convenient for the clients toinvest

3. Intermediation itself has undergone a change over the past fewdecades. While individual agents provided the foundation for growthin the early years, institutional agents, distribution companies andnational brokers soon started to play an active role in promotingmutual funds. Recently, banks, finance companies, secondary marketbrokers and even post offices have also begun to market mutualfunds to their existing and potential client bases.

4. It is, thus clear that all types of intermediaries are required for thegrowth of the industry, and their wellbeing, quality orientation andways of doing business will have a significant impact on how themutual fund industry in India evolves in the future.


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Guidelines for Selling and Marketing Mutual Funds

Background

Investors can purchase and sell mutual fund units through various types of

intermediaries - individual agents, distribution companies, national/regionalbrokers, banks, post offices etc. as well as directly from Asset ManagementCompanies (AMCs), including the Unit Trust of India

Investors of Mutual Funds can be broadly classified into 3 categories:

i. Those who want product information, advice on financialplanning and investment strategies.

ii. Those who require only a basic level of service and executionsupport i.e. delivering and collecting application forms andcheques, and other basic paperwork and post sale activities

iii. Those that prefer to do it all themselves, including choice ofinvestments as well as the process/paperwork related toinvestments

Code of Conduct For Intermediaries

Take necessary steps to ensure that the clients' interest is protected.

Adhere to SEBI Mutual Fund Regulations and guidelines related toselling, distribution and advertising practices. Be fully conversantwith the key provisions of the offer document as well as theoperational requirements of various schemes.

Provide full and latest information of schemes to investors in theform of offer documents, performance reports, fact sheets, portfoliodisclosures and brochures, and recommend schemes appropriate forthe client's situation and needs.


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Disclose all material information related to the schemes/plans whilecanvassing for business.

Abstain from indicating or assuring returns in any type of scheme, unlessthe offer document is explicit in this regard.

Maintain necessary infrastructure to support the AMCs in maintaininghigh service standards to investors, and ensure that critical operations suchas forwarding forms and cheques to AMCs/registrars and dispatch ofstatement of account and redemption cheques to investors are done withinthe time frame prescribed in the offer document and SEBI Mutual FundRegulations.

Avoid colluding with clients in faulty business practices such as bouncingcheques, wrong claiming of dividend/redemption cheques, etc.

Avoid commission driven malpractices

Avoid making negative statements about any AMC or scheme and ensurethat comparisons if any, are made with similar and comparable products.3.11 Ensure that all investor related statutory communications (such aschanges in fundamental attributes, exit/entry load, exit options, and othermaterial aspects) are sent to investors reliably and on time.

Maintain confidentiality of all investor deals and transactions. All employees engaged in sales and marketing should obtain AMFIcertification. Employees in other functional areas should also be

encouraged to obtain the same certification.


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6. A special class selected from out of unit holders

2. Due DiligenceMembers in the conduct of their Asset Management business shall at alltimes

a. Render high standards of service.b. Exercise due diligence.c. Exercise independent professional judgment.

Members shall have and employ effectively adequate resources andprocedures which are needed for the conduct of Asset Managementactivities.

3. Disclosuresa. Members shall ensure timely dissemination to all unit holders of

adequate, accurate, and explicit information presented in a simplelanguage about the investment objectives, investment policies,financial position and general affairs of the scheme.

b. Members shall disclose to unit holders investment pattern, portfoliodetails, ratios of expenses to net assets and total income and portfolioturnover wherever applicable in respect of schemes on annual basis.

c. Members shall in respect of transactions of purchase and sale ofsecurities entered into with any of their associates or any significantunit holder.

1. Submit to the Board of Trustees details of such transactions,justifying its fairness to the scheme.

2. Disclose to the unit holders details of the transaction in briefthrough annual and half yearly reports.

d. All transactions of purchase and sale of securities by key personnelwho are directly involved in investment operations shall be disclosedto the compliance officer of the member at least on half yearly basis


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and subsequently reported to the Board of Trustees if found havingconflict of interest with the transactions of the fund.

4. PROFESSIONAL SELLING PRACTICESa. Members shall not use any unethical means to sell market or induce

any investor to buy their products and schemes.b. Members shall not make any exaggerated statement regarding

performance of any product or scheme.c. Members shall endeavor to ensure that at all times

1. Investors are provided with true and adequate informationwithout any misleading or exaggerated claims to investorsabout their capability to render certain services or theirachievements in regard to services rendered to other clients,

2. Investors are made aware of attendant risks in members'schemes before any investment decision is made by theinvestors,

3. Copies of prospectus, memoranda and related literature ismade available to investors on request,

4. Adequate steps are taken for fair allotment of mutual fundunits and refund of application moneys without delay andwithin the prescribed time limits and,

5. Complaints from investors are fairly and expeditiously dealtwith.

d. Members in all their communications to investors and selling agentsshall

1. not present a mutual fund scheme as if it were a new shareissue

2. not create unrealistic expectations3. not guarantee returns except as stated in the Offer Document

of the scheme approved by SEBI, and in such case, theMembers shall ensure that adequate resources will be madeavailable and maintained to meet the guaranteed returns.

4.

convey in clear terms the market risk and the investment risksof any scheme being offered by the Members.5. not induce investors by offering benefits which are extraneous

to the scheme.6. not misrepresent either by stating information in a manner

calculated to mislead or


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7. by omitting to state information which is material to makingan informed investment decision

5. Investment Practicesa. Members shall manage all the schemes in accordance with the

fundamental investment objectives and investment policies stated inthe offer documents and take investment decisions solely in theinterest of the unit holders.

b. Members shall not knowingly buy or sell securities for any of theirschemes from or to

1. any director, officer, or employee of the member2. any trustee or any director, officer, or employee of the Trustee

Company

6. Operationsa. Members shall avoid conflicts of interest in managing the affairs of

the schemes and shall keep the interest of all unit holders paramountin all matters relating to the scheme.

b. Members or any of their directors, officers or employees shall notindulge in front running (buying or selling of any securities ahead oftransaction of the fund, with access to information regarding thetransaction which is not public and which is material to making aninvestment decision, so as to derive unfair advantage).

c. Members or any of their directors, officers or employees shall notindulge in self dealing (using their position to engage in transactionswith the fund by which they benefit unfairly at the expense of thefund and the unit holders).

d. Members shall not engage in any act, practice or course of businessin connection with the purchase or sale, directly or indirectly, of anysecurity held or to be acquired by any scheme managed by theMembers, and in purchase, sale and redemption of units of schemesmanaged by the Members, which is fraudulent, deceptive ormanipulative.

e. Members shall not, in respect of any securities, be party to-1. creating a false market,2. price rigging or manipulation


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3. Passing of price sensitive information to brokers, Members ofstock exchanges and other players in the capital markets ortake action which is unethical or unfair to investors.

f. Employees, officers and directors of the Members shall not work asagents/ brokers for selling of the schemes of the Members, except intheir capacity as employees of the Member or the Trustee Company.

g. Members shall not make any change in the fundamental attributes ofa scheme, without the prior approval of unit holders except whensuch change is consequent on changes in the regulations.

h. Members shall avoid excessive concentration of business with anybroking firm, and excessive holding of units in a scheme by fewpersons or entities.

7. Reporting Practices1. Members shall follow comparable and standardized valuation policies

in accordance with the SEBI Mutual Fund Regulations.2. Members shall follow uniform performance reporting on the basis of

total return.3. Members shall ensure scheme wise segregation of cash and securities

accounts.

8. Unfair Competition

Members shall not make any statement or become privy to any act, practice orcompetition, which is likely to be harmful to the interests of other Members or islikely to place other Members in a disadvantageous position in relation to amarket player or investors, while competing for investible funds.

9.Observance of Statutes, Rules and Regulations

Members shall abide by the letter and spirit of the provisions of the Statutes,

Rules and Regulations which may be applicable and relevant to the activitiescarried on by the Members.


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10.Enforcement

Members shall:

d. widely disseminate the AMFI Code to all persons and entitiescovered by it

e. make observance of the Code a condition of employmentf. make violation of the provisions of the code, a ground for revocation

ofg. contractual arrangement without redress and a cause for disciplinary

actionh. require that each officer and employee of the Member sign a

statement that he/ she has received and read a copy of the Codei. establish internal controls and compliance mechanisms, including

assigning supervisory responsibilityj. designate one person with primary responsibility for excercising

compliance with power to fully investigate all possible violations andreport to competent authority

k. file regular reports to the Trustees on a half yearly and annual basisregarding observance of the Code and special reports ascircumstances require.


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SEBI Role in Mutul Fund..

Definition

SEBI (Mutual Fund) Regulations 1993 defines Mutual Fund as a fund

established in the form of a trust by a sponsor to raise money by the trustees

through the sale of units to the public under one or more schemes for investing

securities in accordance with these regulations

ESTABLISHMENT OF SEBI

The Securities and Exchange Board of India was established on April 12, 1992 inaccordance with the provisions of the Securities and Exchange Board of India Act,1992.


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PREAMBLE

The Preamble of the Securities and Exchange Board of India describes the basicfunctions of the Securities and Exchange Board of India as

..to protect the interests of investors in securities and topromote the development of, and to regulate the securities marketand for matters connected therewith or incidental thereto

THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT,1992

No.15 of 1992

[4th April ,1992.]

An Act to provide for the establishment of a Board to protect the interests ofinvestors in securities and to promote the development of, and to regulate,the securities market and for matters connected therewith or incidentalthereto.

In the year 1992 SEBI act was passed. The objectives of SEBI are to protect

the interest of investors in securities, to promote the development of, and to

regulate the securities market. As far as mutual are concerned, SEBI formulates

policies and regulation the mutual fund to protect the interest of the investors.

SEBI notified regulation for mutual funds in 1993. Thereafter mutual fund

sponsored by private sector entities were allowed to enter the capital market.

The regulations were fully revised in 1996 and been amended. Therefore, from


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time to time SEBI has also issued guidelines to the mutual fund from time to

time to protect the interest of the investors.

All mutual funds whether promoted by public sector or private sector entities

including those promoted by foreign entities are governed by the same set of

regulation. There is no distinction in regulatory requirement of the mutual fund

and all are subject to monitoring and inspecting by SEBI. The risks associated

with the scheme launched by mutual funds sponsored by these entities are of

similar type.


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BIBLIOGRAPHY

y WWW.SBIMF.COM

y WWW.MONEYCONTROL.COM

y WWW.AMFIINDIA.COM

y WWW.ONLINERESEARCHONLINE.COM

y WWW. MUTUALFUNDSINDIA.COM

y WWW.SEBI.COM


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MUTUAL FUND INVESTMENT IS SUBJECT TO MARKET RISKS.

PLEASE READ THE OFFER DOCUMENT CAREFULLY BEFORE

INVESTING

revised mutul fund project

Documents

Transcript of revised mutul fund project