Mutual Fund

Mutual funds are a type of certified managed combined investment schemes that gathers money from many investors to buy securities. There is no such accurate definition of mutual funds, however the term is most commonly used for collective investment schemes that are regulated and available to the general public and open-ended in nature. Hedge funds are not considered as any type of mutual funds.

Mutual funds are identified by their principal investments. They are the 4th largest category of funds that are also known as money market funds, bond or fixed income funds, stock or equity funds and hybrid funds. Funds are also categorized as index based or actively managed.

In a mutual fund, investors pay the funds expenditure. There is some element of doubt in these expenses. A single mutual fund may give investors a choice of various combinations of these expenses by offering various different types of share combinations.

The fund manager is also known as the fund sponsor or fund management company. The buying and selling of the funds investments in accordance with the funds investment is the objective. A fund manager has to be a registered investment advisor. The same fund manager manages the funds and has the same brand name which is also known as a fund family or fund complex.

As long as mutual comply with requirements that are established in the internal revenue code, they will not be taxed on their income. Clearly, they must expand their investments, limit the ownership of voting securities, disperse most of their income to their investors annually and earn most of their income by investing in securities and currencies.

Mutual funds can pass taxable income to their investors every year. The type of income that they earn remains unchanged as it gets transferred to the shareholders. For e.g., mutual fund distributors of dividend income are described as dividend income by the investor. There is an exception: net losses that are incurred by a mutual fund are not distributed or passed through fund investors.

Mutual funds invest in various kinds of securities. The various types of securities that a particular fund may invest in are mentioned in the funds prospectus, which explain the funds investments objective, its approach and the permitted investments. The objective of the investment describes the kind of income that the fund is looking for. For e.g., a "capital appreciation" fund generally looks to earn most of its returns from the increase in prices of the securities it holds rather than from a dividend or the interest income. The approach of the investment describes the criteria that the fund manager may have used to select the investments for the fund.

The investment portfolio of a mutual funds investment is continuously monitored by the funds portfolio manager or managers who are either employed by the funds manager or the sponsor.

Advantages of Mutual funds are:

1) Increase in diversification.
2) Liquidity on a daily basis.
3) Professional investment management.
4) Capacity to participate in investments that may be available only for larger investors.
5) Convenience as well as service.
6) Government oversight.
7) Easier comparison

like its advantages, the Mutual funds have disadvantages too. Here are some of them:

1) High fees.
2) Less control over timing of recognition of gains.
3) Much lesser predictable income.
4) No opportunity for customization.

There are different types of Mutual funds as well. Here are some of them.

Open-end funds
In open-end mutual funds, one must be willing to buy back their shares from investors at the end of every business day at the net asset value that is calculated for that day. Most of the open-end funds also sell shares to the public on every business day. These shares are also priced at a particular net asset value. A professional investment manager will oversee the portfolio, while buying or selling securities whichever is appropriate. The total investment in the funds will be variably based on share buying, share redemptions and fluctuation in the market variation. There are also no legal limits on the number of shares that can be issued.

Close-end funds
Close-end funds generally issue shares to the public just once, when they are created via an initial public offering. These shares are then listed for trading on a stock exchange. Investors, who dont wish any longer to invest in the funds, cannot sell their shares back to the funds. Instead, they must sell their shares to another investor in the market as the price they may receive may be hugely different from its net asset value. It may be at a premium to net asset value (higher than the net asset value) or more commonly at a lesser to net asset value (lower than the net asset value). A professional investment manager will oversee the portfolio, in buying or selling securities whichever is appropriate.

Unit Investment Trusts
UIT or Unit Investment Trusts issue shares to the public just once when they are created. The investors in turn can cash in on the shares directly with the fund or they may also sell their shares in the market. UITs do not have any professional investment managers. Their portfolio of securities is established by the creation of the UITs and does not undergo any changes. UITs in general have a limited life span, which is limited at their creation.

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Mutual Fund industry adds 5.6 lakh folios in July, debt funds gain traction  According to data from Association of Mutual Funds in India, the number of folios with 45 fund houses rose to 9,21,05,737 at the end of last month, from 9,15,42,092 at June-end, registering a gain of 5.63 lakh folios.
Fri, 14 Aug 2020 15:07:08 +0530


Gaurav Ratnaparkhi The Nifty is in a triangular pattern on the hourly chart, which is nearing its maturity. Once the swing high of 12,025 is crossed, the pattern will be considered to have broken out on the upside.
Sat, 24 Oct 2020 12:08:52 +0530


Amit Jain Market is closely watching these numbers to expand multiple of earnings for 2nd half of the financial year.
Fri, 23 Oct 2020 12:30:40 +0530


DAILY VOICE | Market can correct 10% at any moment of time: Satish Kumar of Equirus Securities The market can correct 10% at any moment of time, more so when the market is pricing in a recovery. So, if it falls go and buy the stocks you found attractive on fundamentals
Fri, 23 Oct 2020 08:50:05 +0530


After The Bell: Nifty breaks 4-day winning streak; here’s what should investors do on Friday? Shrikant Chouhan of Kotak Securities said the strategy should be to buy Nifty if it crosses 11,950 levels
Thu, 22 Oct 2020 20:48:35 +0530


Deepak Jasani Going by the current momentum, Nifty could keep inching upwards. New high for the Nifty is barely 5 percent away.
Thu, 22 Oct 2020 14:44:35 +0530


These 21 stocks turned multibaggers in just 6 months; time to book profit or stay put? Booking profit could be a trading call, but if investors want to remain invested then some of these stocks could give higher returns in the next 2-3 years
Thu, 22 Oct 2020 09:58:50 +0530


Ashish Chaturmohta ACC which hit a fresh 52-week high closed with gains of over 2 percent, Newgen Software rallied more than 9 percent to a new 52-week high of Rs 269 and Ester Industries was locked in upper circuit of 20 percent on Wednesday.
Thu, 22 Oct 2020 08:14:10 +0530


Harish Krishnan Overall, we think earnings of listed companies may show an improvement over the June quarter.
Wed, 21 Oct 2020 13:50:55 +0530


Interview | If you are positive on India, you have to be positive on the markets, says Sunil Singhania of Abakkus Month-on-month economic data has been positive and most companies have seen an uptick in sales. The economy is keeping pace with the stock market and Nifty earnings will see a growth this quarter, says Sunil Singhania, founder, Abakkus Asset Manager
Wed, 21 Oct 2020 10:36:49 +0530


Mazhar Mohammad Stocks like Britannia Industries which fell nearly 6 percent, Oberoi Realty was up nearly 20 percent, and HCL Technologies closed with gains of more than 4 percent on Tuesday were some of the stocks in focus.
Wed, 21 Oct 2020 08:55:11 +0530


After The Bell: Profit-booking on D-St; here’s what investors should do on Wednesday The Nifty is moving in a narrow range of 11,800-11,950 levels. Above 12,050, the Nifty can move to 12,200 in a short period of time, say analysts.
Tue, 20 Oct 2020 18:12:07 +0530


Pritam Deuskar One-sided growth makes people overestimate their ability to predict market or stocks and misconstrue luck with analysis or understanding, says Wealthyvia.com founder Pritam Deuskar.
Tue, 20 Oct 2020 13:25:08 +0530


Consistent performers: These 11 stocks rallied 20-140% in December quarter of last 3 years Stocks that gave double-digit returns consistently in the last quarter of the previous three calendar years include names like DB Realty, GMM Pfaudler, Dolat Investments, Alkyl Amines, Manappuram Finance etc.
Tue, 20 Oct 2020 10:00:44 +0530


Trade Spotlight: Amber Enterprises, Federal Bank and Spencer Retail in focus Stocks like Amber Enterprises which rose nearly 13 percent, Federal Bank gained more than 7 percent, and Spencer Retail closed with gains of over 3 percent were some of the stocks in focus on Monday.
Tue, 20 Oct 2020 08:43:45 +0530


Prasanna Pathak We are very close to the all-time highs and new high is a possibility driven by liquidity. However, the risk-reward is not favourable at this juncture and one should be cautious.
Tue, 20 Oct 2020 08:37:42 +0530


Subscribe to Equitas Small Finance Bank: Anand Rathi Anand Rathi has come out with its report on Equitas Small Finance Bank. The research firm has recommended to #39;#39;Subscribe#39;#39; the ipo in its research report as on October 20, 2020
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Subscribe to Equitas Small Finance Bank: Hem Securities Hem Securities has come out with its report on Equitas Small Finance Bank. The research firm has recommended to #39;#39;Subscribe#39;#39; the ipo in its research report as on October 19, 2020
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Subscribe to Equitas Small Finance Bank: KR Choksey KR Choksey has come out with its report on Equitas Small Finance Bank. The research firm has recommended to #39;#39;Subscribe#39;#39; the ipo in its research report as on October 19, 2020
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Subscribe to Equitas Small Finance Bank: Arihant Capital Arihant Capital has come out with its report on Equitas Small Finance Bank. The research firm has recommended to #39;#39;Subscribe#39;#39; the ipo in its research report as on October 19, 2020
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Subscribe to Equitas Small Finance Bank: ICICI Direct ICICI Direct has come out with its report on Equitas Small Finance Bank. The research firm has recommended to #39;#39;Subscribe#39;#39; the ipo in its research report as on October 19, 2020
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Likhitha Infrastructure shares locked in upper circuit on listing day: Should investors hold or book profit? The current market capitalisation of the company stood at Rs 269.44 crore, with promoters#39; shareholding in the company at 74 percent post issue.
Fri, 16 Oct 2020 12:23:28 +0530


Equitas Small Finance Bank may launch IPO on October 20, to raise Rs 532 crore At the time of filing DRHP in December 2019, promoter Equitas Holdings held 95.49 percent stake in Equitas Small Finance Bank.
Mon, 12 Oct 2020 13:01:55 +0530


Stellar Listing: Mazagon Dock Shipbuilders debuts at Rs 216, a 49% premium The bumper listing was in line with analysts#39; expectations given company#39;s strong orderbook position, attractive valuations and hefty IPO subscription.
Mon, 12 Oct 2020 10:00:35 +0530


Tepid Listing: UTI AMC opens first day trade at Rs 490, a 12% discount Given the tepid response to IPO and consistent redemption pressure from investors in the mutual fund industry for last three months, the listing was on expected lines.
Mon, 12 Oct 2020 10:00:30 +0530


Angel Broking off to a poor start, closes at 10% discount on debut day Angel Broking has the second weakest listing of 2020. It traded with volumes of 8,94,431 equity shares on the BSE and 85,46,238 shares on the NSE.
Mon, 05 Oct 2020 17:05:58 +0530


Angel Broking lists at discount, what should investors do? If someone wants to buy Angel Broking, they should wait for a decent correction before adding this counter, Gaurav Garg of CapitalVia Global Research said.
Mon, 05 Oct 2020 13:57:55 +0530


Weak Listing: Angel Broking debuts at Rs 275, a 10% discount The listing was in line with analysts#39; expectations citing valuations concerns, muted revenue growth despite robust client additions and rising competition in the broking industry.
Mon, 05 Oct 2020 09:59:37 +0530


CAMS IPO | Stock settles at Rs 1,401.60, a 14% premium over its issue price Hemang Jani of Motilal Oswal Financial Services advised investors to hold the company for the long term given its business model and healthy financials
Thu, 01 Oct 2020 18:26:20 +0530


Chemcon Speciality Chemicals ends 72% higher from its issue price of Rs 340 per share The listing premium was definitely higher than Happiest Minds Technologies (111 percent premium)
Thu, 01 Oct 2020 17:58:19 +0530


Subscribe to UTI Asset Management Company: Ajcon Global Ajcon Global has come out with its report on UTI Asset Management Company. The research firm has recommended to #39;#39;Subscribe#39;#39; the ipo in its research report as on September 29, 2020
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