MUTUAL FUND INVESTMENT: AN OVERVIEW

A mutual fund is a trust with professionally managed investment support that collects and channelizes the savings of a number of investors who bear a common financial goal and invests in shares, debt securities, money-market securities or a combination of these. And these investors on investments in funds are known as unit holders. These securities are professionally managed on behalf of the unit holders and each investor holds a share/unit of the portfolio in ration of their investment and net fund value, which is, entitled to profits as well as losses.Income earned or loss through these investments and the capital appreciation realized is divided among its unit holders in proportion to the number of units owned by them after deducting applicable expenses, load and taxes. A mutual fund is the most suitable investment in the reach of common people as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost.