Index

S No. 1 2

Topic Introduction Why Invest In Mutual Funds Types Of Mutual Funds Indian Mutual Funds References

Page No 02-03 04-05 07-10 11-13 14

3 4 5

Mutual Fund Definition

A mutual fund is a common pool of money into which investors with common investment objectives place their contributions that are to be invested, in accordance with the stated objective of the scheme. The investment manager invests the money collected into assets that are defined by the stated objective of the scheme. For example, an Equity fund would invest in Equity and Equity related instruments and a Debt fund would invest in Bonds, Debentures, Gilts etc.

Mutual Funds in India-Growing from very Modest Beginnings A: The Indian Mutual fund industry has started opening up many exciting investment opportunities for Indian investors. We have started witnessing the phenomenon of savings now being entrusted to the funds rather than in banks alone. Mutual Funds now represent perhaps one of the most appropriate investment opportunities for most investors. As financial markets become more sophisticated and complex, investors need a financial intermediary who can provide the required knowledge and professional expertise on taking informed decisions. The Indian Mutual fund industry has passed through three phases: The first phase was between 1964 and 1987 when Unit Trust of India was the only player. By the end of 1988, UTI had total assets worth Rs.6,700 crores. The second phase was between 1987 and 1993, during which period, 8 *funds were established (6 by banks and one each by LIC and GIC). The total number of schemes went up to 167 and Assets Under Management saw the figures improving to over 61,000 crores. The third phase was marked by the entry of private and foreign sectors in the Mutual fund industry in 1993. The first entrant was Kothari Pioneer Mutual fund, launched in association with a foreign fund. The Securities and Exchange Board of India (SEBI) formulated the Mutual Fund Regulation in 1996, which for the first time established a comprehensive regulatory framework for the mutual fund industry. Since then several mutual funds have been set up by the private and joint sectors. Currently there are 34 Mutual Fund organizations in India.
2

Today the AUM of the Mutual Fund Industry stands at over Rs.2 lakh crores, a growth of over 1 lakh crores since the last 5 years. Also the percentage of Equity assets in the overall AUM has increased from a shade under 5% to over 30% in the same period.

Why Invest in Mutual Funds

A: Investing in Mutual Funds through Kotaksecurities.com offers a multitude of benefits, these have been listed below

1. Professional Investment Management One of the primary benefits of investing in Mutual Funds is that an investor gets the advantage of professional management of his finances. Being fulltime, high-level investment professionals, a good investment manager is more resourceful and more capable of monitoring the companies the Mutual Fund have chosen to invest in, rather than individual investors. The managers have real-time access to crucial market information and are able to execute trades on the largest and most cost-effective scale.