MUTUAL FUNDS

MUTUAL FUNDS


mutual funds denote (every single or interested person who have less knowledge of equity market or money market give his money to an institution(fund manager) to invest their money in equity  market on their behalf)

the institution or fund houses collect money in their fund collectively from many people and buy company shares in their fund & they take the net asset value(n.a.v) of their fund and allot it to their investor in form of units in the ratio how much money they have  invested.
in mutual fund the amount can be invested in lumpsum(whole amount )or sip(systematic investment  plan)

TYPES OF MUTUAL FUNDS

  • money market funds
  • fixed income or debt funds
  • balanced fund
  • gilt funds
  • index funds
  • diversified funds
when a person purchased fund they have to give a some percent of entry load and when they exit they have to give exit load normally when you sell fund after a year exit load won't get charged .

some funds are open ended and some are closed ended

open ended funds -you can withdraw or sell your units any time by signing a redemption form

with agency. money will be transferred with in two days.

closed ended fund -in this you cannot withdraw fund as there is  time barred in fund, its generally have three years locking period.

sip(systematic investment  plan)- it means person has to give certain amount of money as his choice scheme monthly, sip may be of any amount it will deduct regularly deduct from bank account of investor every month and with that amount investor adds unit every month of that fund at market price.





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