The mutual fund industry in India started in 1963 with the
formation of Unit Trust of India, at the initiative of the
Government of India and Reserve Bank. The history of mutual
funds in India can be broadly divided into four distinct phases.
First Phase – 1964-87 Established Unit Trust of India (UTI) .
Second Phase – 1987-1993 Entry of Public Sector Funds
Third Phase – 1993-2003 Entry of Private Sector Funds)
Fourth Phase – since February 2003 consolidation and growth.
A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. The money thus collected is then invested in capital market instruments such as shares, debentures and other securities. The income earned through these investments and the capital appreciation realised are shared by its unit holders in proportion to the number of units owned by them.
Association of Mutual Funds ( Established in 1995) in India is an important organ of all Asset Management Companies that are registered with Securities and Exchange Board of India. Till today, all the Asset Management Companies with Mutual Fund schemes are the members of Association of Mutual Funds in India.
Association of Mutual Funds India, also referred to as AMFI, has helped the Indian Mutual Fund Industry to enter into a healthy and professional market, maintaining the market ethics and standards. It attempts to promote the interests of both Mutual Funds and unit holders
A money market fund is a mutual fund that invests solely in cash/cash equivalent securities, which are also often referred to as money market instruments. These investments are short-term, very liquid investments with high credit quality. They generally include:
This was attributed to the fact that many of Fixed Maturity Plans (FMPs) of mutual funds had invested significantly in commercial papers (CPs) , bonds of real estate companies and non-banking financial institutions (NBFCs), pass through certificates (PTCs) and only a small portion in bank CDs
The mutual fund industry has witnessed a value erosion of Rs 75,966 crore in equity-related schemes in the first seven months of the current financial year. This is primarily because of the slide in the equity market on account of the global financial turmoil.
Funds book Rs 3,858-cr loss in FY09 first half (19 NOV.)
29 fund houses, which published their unaudited financial results for the first half ended September 30, 2008, 22 mutual funds have posted a combined net loss of Rs 4,466 crore, while the remaining seven fund houses have reported an aggregate net profit of Rs 608 crore in the first six months of 2008-09. The fund houses had made a profit of Rs 18,528 crore in the second half of 2007-08.