Mutual funds are professionally managed investment vehicles that pool money from various investors to purchase securities, offering diversification and liquidity. They are managed by fund managers, making them accessible to individuals who may lack market expertise. Notably, mutual funds often attract lower commissions and can be tax-efficient for long-term investments in domestic equity funds.

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What are Mutual Funds:
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A mutual fund is a professionally managed fund which pools money
from various investors to buy bonds, stocks and other securities.
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The funds collected are referred to as Assets Under Management or
AUM.

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What are Mutual Funds:
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The said funds are invested by fund managers appointed by a mutual
funds company or Asset Management Company.
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An investor holds a portion of the portfolio in the form of units.

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Features of Mutual Funds:
One of the main advantages of mutual funds is that it is handled by
professionals given that small investors do not have the required
expertise and time to analyze market movements and trends.

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Features of Mutual Funds:
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Mutual funds allow investors to invest their savings across a wide
spectrum of securities and thereby, diversify their assets as per their risk
tolerance.
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Given that mutual funds are usually large, they attract lower
commissions (brokerage) compared to smaller transactions of individual
investors.
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Mutual funds offer high liquidity. Some mutual funds are tax efficient as
well in that those who remain invested in domestic equity funds for
above one year do not have to shell out capital gains tax.

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