WHAT ARE MUTUAL FUNDS?

WHAT ARE MUTUAL FUNDS? A mutual fund is a pool of money managed by a professional Fund Manager.

It is a trust that collects money from a number of investors who share a common investment objective and invests the same in equities, bonds, money market instruments and/or other securities. And the income / gains generated from this collective investment is distributed proportionately amongst the investors after deducting applicable expenses and levies, by calculating a scheme’s “Net Asset Value” or NAV. Simply put, the money pooled in by a large number of investors is what makes up a Mutual Fund.

Portfolio is structured and maintained to match the investment objectives in its prospectus. Examples of Investment objectives are:

OverNight Funds: The Scheme intends to provide reasonable income along with high liquidity by investing in overnight securities having a maturity of one business day.

Equity Funds: To generate capital appreciation/income from a portfolio, predominantly invested in equity and equity related instruments.

Hybrid Funds: Objective of the scheme is to generate long term capital appreciation by investing in equity and equity related securities of companies across market capitalization spectrum. The fund also invests in debt and money market instruments with a view to generate regular income.

Long Duration Funds: Objective of the scheme is to generate long term capital appreciation by investing in equity and equity related securities of companies across market capitalization spectrum. The fund also invests in debt and money market instruments with a view to generate regular income.