A „Mutual Fund‟ is an investment vehicle for investors who pool their savings for investment in diversified portfolio of securities with the aim of attractive yields and appreciation in their value. The investment managers of the funds manage these savings in such a way that the risk is minimized and steady return is ensured.
As per Mutual Fund Book, published by Investment Company Institute of the U.S., “A Mutual Fund is a financial service organization that receives money from shareholders, invests it, earns returns on it, attempts to make it grow and agrees to pay the shareholder cash on demand for the current value of his investment.”
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Securities and Exchange Board of India (Mutual Funds) Regulations, 1996 define „Mutual funds‟
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To provide good returns on investment. To assure safety, security and liquidity of capital To provide insurance protection
Other institutions under mutual funds offer some combination of liquidity, return and safety. But LIC Mutual Fund will offer investment option with a fourth dimension, i.e. insurance
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protection. Many of the specific schemes that will be offered by LIC Mutual Fund will offer some life cover. LIC Mutual Fund (LICMF) has, therefore, been established as a catalytic agent between investors and capital markets. Funds collected under LICMF are invested in the light of general guidelines of Government and SEBI and the pre-determine objectives of the scheme.
The main types of schemes started by LIC under LICMF are as follows:
Dhanvriddhi - 1989: It was launched in June 1989. It is an income cum growth scheme. The assured return is 12%. The corpus of the scheme is Rs. 2.43 crore. The redemption duration is 7 to 8 years.
Dhan 80 CC (1): It was launched in March 1990. It is a growth cum tax savings scheme. The corpus was Rs. 23.16 crores. The redemption duration is 5
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It is a tax cum growth scheme. The duration of the scheme is 5 years. Dhanvarsha (8) (9): These scheme were launched in 1996-97. These are close ended schemes.
LIC MF Bond Fund: During the year 1998-99, LIC Mutual Fund launched LIC MF Bond Fund, an open ended debit scheme. This scheme has started a new trend by introducing the concept of single window service. Arrangements have been made to provide single window investor service at each of seven area offices where collection is received.
LIC NOMURA MF Equity Fund: It was launched on 11th January, 1993, named Dhanvikas. It is an open ended pure growth scheme seeking to provide capital growth by investing mainly in mix of equity instruments. The investment portfolio of the scheme will be constantly monitored and reviewed to optimize capital growth.
LIC NOMURA MF Tax Plan: It was launched on 1st January, 1997 named Dhan Tax Saver 1997. This scheme was made open – ended w.e.f 17th April, 2000 under a new name LIC NOMURA MF Tax Plan. The investment objective of the scheme is to provide capital growth along with tax rebate and tax relief to investors through prudent investments in the stock
Student Answer: Professional management and diversification are the major reasons investors purchase mutual funds, as well as they are easy to invest in for beginning investors or those who lack large amount of money as required by other types of investments. Investment companies are employed with experienced and profession fund managers who research and devote a lot of time to finding the perfect securities for their investment portfolios. The diversification allows for gains, even in a loss, because one investment in a mutual fund can offset the loss of another by it’s gains. Basically, your investments are scattered around and offer somewhat of a safety net for your
The tax-exempt status creates a high level of demand particularly from investors who seek tax exempt cash flow as a source of annual income and revenue. The buyers of TOBs are for the most part money market mutual funds. Money market mutual funds are guided by certain regulations as to what type of bonds they can have in their portfolio. Specifically, the underlying municipal bonds must be rated at least AA-. The maximum maturity of the municipal bonds is thirteen months and the average weighted maturity of a money market fund’s tax exempt bond portfolio must be no longer than 50 days. This compares to typical maturities of municipal bonds of five to fifteen years. The money fund maturity guidelines combined with a strong demand for tax exempt instruments creates a very active and deep market for these synthetically created short-term tax-exempt securities. The approximate size of the TOB market is $70Bn.
...are accountable to a board of directors and shareholders and publish annual reports that are public record so to make sure there financial standards are on the up and up.
receive bank financing for this new entity of HKD 2.3bn as a Delay Draw Term Loan (“DDTL”) plus HKD
Ross, S.A., Westerfield, R.W., Jaffe, J. and Jordan, B.D., 2008. Modern Financial Management: International Student Edition. 8th Edition. New York: McGraw-Hill Companies.
As an investor with several types of securities, I am looking for long-term stability towards a retirement fund. The combination of several different stocks and mutual funds allows for the safety of the investments. By investing long-term in different accounts, I have the ability to gain more in the long-run with less risk of not lose all my savings on one investment.
When a plant still have a good shape, the management team has to create a policy that request every employees contribute a small amount in every month to save a company and their jobs. When AT&D had trouble financial, the AT & D leaders can use the fund to pay employees, the result, the company did not have to lay-off or move to another states.
According to Investopedia (Asset Allocation Definition, 2013), asset allocation is an investment strategy that aims to balance risk and reward by distributing a portfolio’s assets according to an individual’s goals, risk tolerance and investment horizon. There are three main asset classes: equities, fixed-income, cash and cash equivalents; but they all have different levels of risk and return. A prudent investor should be careful in allocating each asset class to his portfolio. Proper asset allocation is a highly debatable subject and is not designed equally for everybody, but is rather based on the desires and needs of the individual investor. This paper discusses the importance of asset allocation, the differences and the proper diversification within the portfolio.
Devang Mody is the Business Head of Sales Finance in Bajaj Finserv Lending. He is a chartered accountant by profession and brings in a rich experience of 15 years of experience in consulting and financial services. He has joined Bajaj Finserv Lending from AIG, where he worked as Vice President – Business Development and CRM for the consumer finance business. He has worked with GE money for around 8 years before
For an organisation to rise fund, they usually tend to look at the stock market and capital market to do it so. This is two markets are usually seemed similar by the investors as they both contributes to the development of an economy. But there are significant difference between them. The capital market is a market that consist of stock market as well as the bond market. As a result, the capital market provides a long-standing finance using the debt capital and the equity capital. Capital markets divided into two sectors known as primary markets and secondary markets. The primary market is where securities are issued for the first time whereas the secondary market is where securities that have been already issued are traded among investors (Difference...
standards, catch up with the trends and produce tax revenues. The importance of equity investors
period of time and, in return, may receive a "bond". The bond issuer agrees to a fixed rate of
Machiraju, H. R. , 2002. International Financial Markets And India. 1st ed. New Delhi: New Age International.
Loyal investors act as partnership; provide sustainable power of financial support, continuous development in new market, more benefit into the company, strong cash
The second purpose is to disclose risk faced by the company to public including stakeholders and shareholders. Companies are obliged to disclose all the necessary information that is related to the performance of the company to stakeholders and shareholders. This is probably preventing shareholders to make wrong decisions in their investments due to insufficient information provided by the company.