Mutual funds

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Mutual funds

  1. 1. Mutual Funds By: Prabhjot Singh Kamalpreet Kaur Priyanka Goyal Harsimram Singh
  2. 2. Definition and Its growth in India <ul><li>A mutual fund is nothing more than a collection of stocks and/or bonds. </li></ul><ul><li>Income is earned from dividends on stocks and interest on bonds. </li></ul><ul><li>The Indian mutual funds retail market, which at present is growing at a CAGR of around 30%, is estimated to reach US$ 300 Billion by 2015. </li></ul>
  3. 3. List of Top Mutaul Fund companies in India <ul><li>ABN-AMRO </li></ul><ul><li>Baroda Pioneer Mutual Fund </li></ul><ul><li>Benchmark </li></ul><ul><li>Birla Sunlife </li></ul><ul><li>Canbank </li></ul><ul><li>DBS Chola </li></ul><ul><li>Deutsche </li></ul><ul><li>DSP Merrill Lynch </li></ul><ul><li>Escorts </li></ul><ul><li>Fidelity </li></ul><ul><li>Franklin Templeton </li></ul><ul><li>HDFC </li></ul><ul><li>HSBC </li></ul><ul><li>ING Vysya </li></ul><ul><li>JM </li></ul><ul><li>Kotak Mahindra </li></ul><ul><li>LIC </li></ul><ul><li>Morgan Stanley </li></ul><ul><li>Principal </li></ul><ul><li>Prudential ICICI </li></ul><ul><li>Reliance </li></ul><ul><li>Sahara </li></ul><ul><li>SBI </li></ul><ul><li>Standard Chartered </li></ul><ul><li>Sundaram BNP Paribas </li></ul><ul><li>Tata </li></ul><ul><li>UTI </li></ul>
  4. 4. Objectives of Mutual Funds <ul><li>Diversification- Mutual funds hold a number of stocks, which protects them from a sharp decline in any one holding. </li></ul><ul><li>Growth- Rapid growth in the value of their funds. </li></ul><ul><li>Income- Receiving income from their investments. </li></ul><ul><li>International Exposure- It's important to have some exposure to overseas stocks. </li></ul><ul><li>Low Fees- Many &quot;no-load&quot; mutual funds are available that don't charge investors anything. </li></ul>
  5. 5. How do they Work? <ul><li>A Person buys shares in MF, either directly from company or from broker (indirectly). </li></ul><ul><li>That money, along with other people’s money is combined and invested in and array of different securities. </li></ul><ul><li>It's the fund manager's job to maximize the earnings of the fund's investors. </li></ul><ul><li>As the fund earns money, he is paid in periodic dividends. </li></ul><ul><li>The Net Asset Value (NAV) per share is calculated and posted once a day. </li></ul>
  6. 6. Types of Funds <ul><li>Closed-end Funds </li></ul><ul><li>Open-end Funds </li></ul><ul><li>Large cap Funds </li></ul><ul><li>Mid-cap Funds </li></ul><ul><li>Equity Funds </li></ul><ul><li>Balanced Funds </li></ul><ul><li>Growth Funds </li></ul><ul><li>No load Funds </li></ul><ul><li>Exchange Traded Funds </li></ul><ul><li>Value Funds </li></ul><ul><li>Money market Funds </li></ul><ul><li>International Mutual Funds </li></ul><ul><li>Regional Mutual Funds </li></ul><ul><li>Sector Funds </li></ul><ul><li>Index Funds </li></ul><ul><li>Funds of Funds </li></ul>
  7. 7. Expenses & Taxes involved in Mutual Funds <ul><li>Expense Ratio: Ongoing yearly fees to keep you invested in the fund. </li></ul><ul><li>Loads: Transaction fees paid when you buy or sell shares in a fund. </li></ul><ul><li>TAX: Each time a fund manager sells a particular asset, the fund owes a percentage of that sale to the government in capital gains tax. </li></ul>
  8. 8. Risks involved in Mutual Funds <ul><li>The Risk-return Trade-off </li></ul><ul><li>Market Risk </li></ul><ul><li>Credit Risk </li></ul><ul><li>Inflation Risk </li></ul><ul><li>Interest Rate Risk </li></ul><ul><li>Political/Government Policy Risk </li></ul><ul><li>Liquidity Risk </li></ul>
  9. 9. Advantages & Disadvantages of Mutual Funds <ul><li>Advantages </li></ul><ul><li>Professional Management </li></ul><ul><li>Diversification </li></ul><ul><li>Economies of Scale </li></ul><ul><li>Liquidity </li></ul><ul><li>Simplicity </li></ul><ul><li>Disadvantages </li></ul><ul><li>Professional Management </li></ul><ul><li>Costs </li></ul><ul><li>Dilution </li></ul><ul><li>Taxes </li></ul>
  10. 10. Thank You! Mutual Funds are subject to Market risk. Please read the Offer document carefully before Investing

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