What is a mutual fund?
Mutual fund is a mechanism for pooling the resources by issuing units to the investors and investing funds in securities in accordance with objectives as disclosed in offer document. Investments in securities are spread across a wide cross-section of industries and sectors and thus the risk is reduced. Diversification reduces the risk because all stocks may not move in the same direction in the same proportion at the same time. Mutual fund issues units to the investors in accordance with quantum of money invested by them. Investors of mutual funds are known as unit holders. The profits or losses are shared by the investors in proportion to their investments. The mutual funds normally come out with a number of schemes with different investment objectives which are launched from time to time. A 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.
Mutual fund is a mechanism for pooling the resources by issuing units to the investors and investing funds in securities in accordance with objectives as disclosed in offer document. Investments in securities are spread across a wide cross-section of industries and sectors and thus the risk is reduced. Diversification reduces the risk because all stocks may not move in the same direction in the same proportion at the same time. Mutual fund issues units to the investors in accordance with quantum of money invested by them. Investors of mutual funds are known as unit holders.The profits or losses are shared by the investors in proportion to their investments. The mutual funds normally come out with a number of schemes with different investment objectives, which are launched from time to time. A 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.
A mutual fund is a pool of assets contributed to by investors who share similar investment objectives. The mutual fund is managed by professional portfolio managers and advisors in accordance with a disclosed investment strategy in order to achieve the mutual fund’s objective. Mutual funds provide a cost-effective way of owning diverse investments based on the knowledge and attention of professional money managers. There is a wide variety of mutual funds available in Canada (some 4000) to help investors achieve their personal financial goals. For example, the investment strategy of any given fund can be designed to provide lower or higher risk options. This in turn provides opportunities for investors who plan to invest their money for longer or shorter periods of time. Some funds are designed to provide investors with regular income; others may provide capital growth and income. There are also funds that can be turned into cash easily if the need arises. Funds can be invested entirely
A mutual fund is a financial intermediary that allows a group of investors to pool their money together with a predetermined investment objective. The mutual fund will have a fund manager who is responsible for investing the pooled money into specific securities (usually stocks or bonds). When you invest in a mutual fund, you are buying shares (or portions) of the mutual fund and become a shareholder of the fund.
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