Synopsis on Mutual Fund


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SYNOPSIS OF RESEARCH REPORT ON MUTUAL FUND INDUSTRY IN INDIA Submitted for the partial fulfillment towards the award of the degree in Master of Business Administration of U. P. Technical University, Lucknow SHASHISHEKHAR MAURYA Roll No. -10133DM031 Under the Supervision of Dr.Amit Agarwal Department of Management Studies Noida Institute of Engineering & Technology ABSTRACT Indian mutual fund industry now represents perhaps the most appropriate investment opportunity for most investors. As f
  SYNOPSIS OFRESEARCH REPORTON MUTUAL FUND INDUSTRY IN INDIA Submitted for the partial fulfillment towards the awardof the degree in Master of Business Administration of U. P. Technical University, LucknowSHASHISHEKHAR MAURYARoll No. -10133DM031Under the Supervision of Dr.Amit AgarwalDepartment of Management StudiesNoida Institute of Engineering & Technology  ABSTRACT Indian mutual fund industry now represents perhaps the mostappropriate investment opportunity for most investors. As financialmarkets become more sophisticated and complex, investors need afinancial intermediary who provides the required knowledge andprofessional expertise on successful investing. There are various choicesavailable to the investor of today. One however needs to invest carefully,and work out various investment options and decide on how to makebest of the investment in terms of monetary benefits.A mutual fund is a common pool of money into which investors placetheir contributions that are to be invested in accordance with a statedobjective. The ownership of the fund is thus join or mutual; the fundbelongs to all investors. A single investor’s ownership of the fund is inthe same proportion as the amount of the contribution made by him orher bears to the total amount of fund.A mutual fund uses the money collected from investors to buy thoseassets which are specifically permitted by its stated investmentobjective. Thus, an equity fund would buy mainly equity assets-ordinary shares, preference shares, warrants etc. It is these assets whichare owned by the investors in the same proportion as their contributionbears to the total contributions of all investors put together.  Since each owner is a part owner of a mutual fund, it is necessary toestablish the value of his part. In other words, each share or unit that aninvestor holds needs to be assigned a value. Since the units held by aninvestor evidence the ownership of the fund’s assets, the value of thetotal assets of the fund when divided by the total number of units issuedby the mutual fund gives us the value of one unit. This is generallycalled the Net Asset Value (NAV) of one unit or one share. The value of an investor’s part ownership is this determined by the NAV of thenumber of units held . WHAT IS A MUTUAL FUND? A Mutual Fund is a trust that pools the savings of a number of investors whoshare a common financial goal. The money thus collected is invested by thefund manager in different types of securities depending upon the objective of the scheme. These could range from shares to debentures to money marketinstruments. The income earned through these investments and the capitalappreciations realized by the scheme are shared by its unit holders in proportion to the number of units owned by them (pro rata). Thus a MutualFund is the most suitable investment for the common man as it offers anopportunity to invest in a diversified, professionally managed portfolio at arelatively low cost. Anybody with an inventible surplus of as little as a few  thousand rupees can invest in Mutual Funds. Each Mutual Fund scheme hasa defined investment objective and strategy. MUTUAL FUND OPERATION FLOW CHART A mutual fund is the ideal investment vehicle for today’s complex andmodern financial scenario. Markets for equity shares, bonds and other fixedincome instruments, real estate, derivatives and other assets have becomemature and information driven. Price changes in these assets are driven by
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