Mutual Fund
A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. Mutual fund is a vehicle to mobilize moneys from investors, to invest in different markets and securities, in line with the investment objectives agreed upon, between the mutual fund and the investors. In other words, through investment in a mutual fund, a small investor can avail of professional fund management services offered by an asset management company. At present 45+ asset management companies and 2000+ mutual fund scheme available in india.
WHY SHOULD YOU INVEST IN MUTUAL FUNDS?
- Professional Management – You avail of the services of experienced and skilled professionals who are backed by a dedicated investment research team which analyses the performance and prospects of companies.
- Diversification – Units of a scheme give investors exposure to a range of securities held in the investment portfolio of the scheme. Thus, even a small investment of Rs. 500 in a mutual fund scheme can give investors a diversified investment portfolio.
- Convenient Administration – Investing in a Mutual Fund reduces paperwork and helps you avoid many problem. Mutual Funds save your time and make investing easy and convenient.
- Return Potential – Over a medium to long term, Mutual Funds have the potential to provide a higher return as they invest in a diversified basket of selected securities.
- Liquidity – In open-ended schemes, you can get your money back promptly at Net Asset Value (NAV) related prices from the Mutual Fund itself.
- Tax benefits- Specific schemes of mutual funds (Equity Linked Savings Schemes) give investors the benefit of deduction (U/C 80C).
- Transparency – You get regular information on the value of your investment in addition to disclosure on the specific investments made by your scheme.
- Flexibility – Through features such as Systematic Investment Plans (SIP), Systematic Withdrawal Plans (SWP) and dividend reinvestment plans, you can systematically invest or withdraw funds according to your needs and convenience.
- Well Regulated – All Mutual Funds are registered with SEBI and they function within the provisions of strict regulations designed to protect the interests of investors. The operations of Mutual Funds are regularly monitored by SEBI.