Mutual Fund

MUTUAL FUND.

WHAT IS MUTUAL FUND?

A Mutual Fund is a body corporate registered with the Securities and Exchange Board of India (SEBI), that pools up the money from individual / corporate investors and invests the same on behalf of the investors /unit holders, in equity shares, Government securities, Bonds, Call money markets etc., and distributes the profits.

MAIN FUNCTION TO MOBILIZE THE SAVING OF THE GENERAL PUBLIC AND INVEST THEM IN STOCK MARKET SECURITIES

REGULATION 0F MUTUAL FUNDS SEBI HAS THE AUTHORITY TO LAY GUIDELINES , SUPERVISE AND REGULATE THE WORKING OFMUTUAL .

HISTORY OF INDIAN MUTUAL FUND INDUSTRY  THE

MF INDUSTRY IN INDIA WAS STARTED IN 1963.  UTI WAS ESTABLISHED IN 1963 BY AN ACT OF PARLIAMENT & US-64 WAS THE 1st SCHEME LAUNCHED BY UTI IN 1964.  IN 1987 PUBLIC SECTOR ENTERED IN MUTUAL FUND INDUSTRY.  IN 1993 WITH THE ENTRY OF PVT. SECTOR NEW ERA STARTED IN THE INDIAN MUTUAL FUND INDUSTRY.

The Mutual Fund Operation cycle

NAV

=

TOTAL ASSET – TOTAL LIABILITIES NO. OF UNITS OUTSTANDING

Type of Mutual Fund Schemes By Structure

OPEN ENDED SCHEMES CLOSE ENDED SCHEMES

GROWTH SCHEMES

By Investment Objectives

INCOME SCHEMES BALANCED SCHEMES MONEY MARKET SCHEMES

Other Schemes

TAX SAVING SCHEMES SPECIAL SCHEMES SECTOR SCHEMES

Do notprovide issue Aims to Offer Aims tax at Investors Aims This atare Units for capital providing Aims rebates toeasy free to join providing category Repurchase, appreciation Sectoral provide to the liquidity, the fund includes both redemption Over the investors regular funds under & preservation orgrowth withdraw Index & On a periodic medium to steady the are tax ideal income laws for of capital & from the Schemes income. that Basis. Units can long term. investors to prescribed. moderate investors. who fund Ideal attempt for Be redeemed Ideal Eg., income. have for Equity retired at any Investors to time Only on Linked people Ideal already Savings for & after an looking replicate for Termination investors in& Corporates Others, decided Schemes with to Initial lock-in the a Of the their prime the Individual invest (ELSS). need in for period. You performance combination scheme, or earning years, investors Ideal acan particular capital scheme as buy & a of Of a Through who are means stability Sector for to & sell atpark particular Income & Dealings in the seeking Investors regular orgrowth their surplus units at Index moderate such Secondary over the Segment seeking income funds for short NAV related growth as the market long term tax rebates periods BSE or NSE 50

Advantages of Investing in Mutual Funds

Plus

Tax Most benefits Funds Disclosure Most open allowing Mutual offunds ended Easy to Diversified switching Portfolio Funds redeem invest and portfolio between Capital areto within easy funds. Gains leads NAV 3regulated working redeem to risk by SEBI. declared days. From Tax-free debt control daily Dividends to equity etc.

The present Indian Mutual Fund Industry looks different

Pvt Sector 28%

UTI 65%

Rs. 90,587 crores AUM as on March 2001

Public Sector 7%

Pvt Sector 8% Public Sector 10%

UTI 82%

Rs. 65,828 crores AUM as on Dec 1998