Introduction to Mutual Fund

sunandaC

New member
Introduction to Mutual Fund


A mutual fund is a common pool of money in to which the investors place their contributions that are to be invested in accordance with a stated objective.

A mutual fund now represents perhaps the most appropriate investment opportunity for most investors.

As financial markets become more sophisticated and investors need a financial intermediary who provides the required knowledge and professional expertise on successful investing.


The Indian mutual fund industry has already started opening up many of the exciting investment opportunities to Indian investors.

We have started witnessing the phenomenon of more savings now being entrusted to the funds than to the banks.


Despite the expected continuing growth in the industry, mutual funds are still a new financial intermediary in India.


Hence it is important that mutual fund distributor acquire the knowledge of what mutual funds are, what they can do for the investors and what they cannot and how differently they work from other intermediaries such as banks.


Mutual funds serve as a link between the saving and the capital market, as they mobilize savings from investors and bring them to borrowers in the capital markets.


Mutual funds have imparted much needed liquidity to the financial system.


It is here the role of financial distributors come in to the picture where they also have to act like a financial planner to the investor than a mere distributor of the financial services.

Availing of the services of established distribution companies is a practiced accepted by mutual fund internationally.

This practice evolved with a view to circumvent the huge administrative mechanism required to support a large agent force.


Instead of having to deal with several agents a fund can interact with a distribution company which has several employees or sub brokers under it.

A distribution company usually manages distribution for several funds simultaneously and receives commission for its services.

Many private firms preferred to adopt this practice because of its sophisticated nature and because they benefit from the specialist knowledge and established client contacts of these marketing firms.


In India there are about ten major distribution companies in addition to a few hundred smaller ones.
 

rosemarry2

MP Guru
Introduction to Mutual Fund


A mutual fund is a common pool of money in to which the investors place their contributions that are to be invested in accordance with a stated objective.

A mutual fund now represents perhaps the most appropriate investment opportunity for most investors.

As financial markets become more sophisticated and investors need a financial intermediary who provides the required knowledge and professional expertise on successful investing.


The Indian mutual fund industry has already started opening up many of the exciting investment opportunities to Indian investors.

We have started witnessing the phenomenon of more savings now being entrusted to the funds than to the banks.


Despite the expected continuing growth in the industry, mutual funds are still a new financial intermediary in India.


Hence it is important that mutual fund distributor acquire the knowledge of what mutual funds are, what they can do for the investors and what they cannot and how differently they work from other intermediaries such as banks.


Mutual funds serve as a link between the saving and the capital market, as they mobilize savings from investors and bring them to borrowers in the capital markets.


Mutual funds have imparted much needed liquidity to the financial system.


It is here the role of financial distributors come in to the picture where they also have to act like a financial planner to the investor than a mere distributor of the financial services.

Availing of the services of established distribution companies is a practiced accepted by mutual fund internationally.

This practice evolved with a view to circumvent the huge administrative mechanism required to support a large agent force.


Instead of having to deal with several agents a fund can interact with a distribution company which has several employees or sub brokers under it.

A distribution company usually manages distribution for several funds simultaneously and receives commission for its services.

Many private firms preferred to adopt this practice because of its sophisticated nature and because they benefit from the specialist knowledge and established client contacts of these marketing firms.


In India there are about ten major distribution companies in addition to a few hundred smaller ones.

hey buddy,

Please check attachment for Overview of Mutual Fund Industry In India, so please download and check it.
 

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