The Top Mutual Fund Company,About Mutual Fund,The Complete guide to Mutual Fund

Mutual Funds

These are a prevalent investment tool for investors because it offers a convenient and lucrative way to invest in the financial markets. Mutual fund industry in India came with the concept of Mutual Fund in the year 1963 at the initiative of the Government of India and Reserve Bank of India.

Mutual Funds (MF): For investment in stock (equity) market one has to bee vigilant of his portfolio and watch ups and down of market, keep a tab of financial and commercial information of the company for getting good return. A person engaged in service or occupation may not find time and expertise to undertake this activity on ongoing basis. For such investors the via media in invest in Mutual Funds till LPG era there was only one company UTI Unit Trust of India operating handful of products like Units -64, ULIP etc. Today there are more than 200 companies offering about 5000 products of MFs. Many a times investor gets confused in selecting product and option. The person needs to understand gimmicks of NAV, Growth Scheme, Income Scheme, Industry oriented product ( like petroleum, banks, FMCG etc. limiting of that investment of there MF to that industry), Index liked product (linked to index like SENSEX, NIFTY, MIDCAP etc.), Entry load, Exit Load, Administrative charges etc. There is marked related risk to MF. However specific scrip (company) related risk can be eliminated and advantage of investment in stock market can be taken. People interested in investing retrial benefits and interested in getting stock market related returns can Prefer MFs. However lack of experience and expertise of in this area may invest only small part say 10 to 20% of there corpus in such funds. They younger generation should start there savings with SIP Systematic Investment Plan offered by these funds where monthly subscription is accepted for purchasing MF on regular basis, The online services offered by the MF houses are good.

Mutual fund is required to be registered with Securities and Exchange Board of India (SEBI), which regulates securities markets, before it can collect funds from the public. It acts like a company that pools money from investors and invests the same in stocks, bonds, short-term money-market instruments, other securities or assets and some combination of these investments. It offers a prospect to invest in a diversified, professionally managed basket of securities. These securities are often referred to as holdings and all of the fund's holdings make up the portfolio. When one invest in a mutual fund, the investor is actually buying shares in the fund, which means investors own a percentage of the fund's entire portfolio in ratio of its holding.

Managed funds are an ideal option for people who are:

New to investing.
Happy to outsource the selection of investments to professional managers.
Have a small initial amount to invest (with the option to make regular additional contributions).
Looking for investment diversification to minimise risk.

Lastly, after understanding the basics of mutual fund and its various schemes, an individual as per his investment objective needs to know the various criteria to choose the fund, which are as follows:

Performance analysis of the scheme for a considerable long period taking into account historical returns and portfolio.
Analysis of the Fund House and the experience of the Fund Manger.
Analysis of the fund amount and how the changes across the time period.
Comparison of charges deducted by Asset Management Companies across the category where an investor wishes to make investment.
The price at which one can exit (i.e. exit load) the scheme and its impact on overall return.
Comparison of scheme with its benchmark and how has the scheme performed especially in an unstable environment.
Last but not the least an investor can refer to certain investment ratios such as Sharpe, Sortino, Treynor, Alpha etc. to judge the risk-return analysis of the scheme.