Mutual funds are investment vehicles that pool money from investors and invest in stocks, bonds, and other assets. A mutual fund is operated by a money manager who chooses the investments to match the fund's stated objective. The key players involved are the sponsor who establishes the fund, the asset management company that makes the investment decisions, trustees who oversee operations, a custodian that holds the fund's assets, and a registrar and transfer agent that manages investor transactions and records. A fund's value is determined by the net asset value which is calculated daily based on the total market value of assets minus liabilities divided by the number of outstanding units.

1. Rajesh Kumar SM

2. Meaning
A mutual fund is an investment vehicle that gathers
funds from liked mind investors and invests in equities,
bonds of your choice at the professional fee. Mutual funds
are operated by money manager, who invest the fund's
capital and attempt to produce capital gains and income for
the fund's investors. A mutual fund's portfolio is structured
and maintained to match the investment objective stated in
its prospectus.

3. Flow chart

4. Types of Mutual funds
Operational Return Investment
Open
Ended
Close
Ended
Interval Income Growth Conservative
(Schemes)
(Funds)

5. Cont…
Equity Indexed FundBalanced
Sectoral/Thematics
Fund of FundDebt
Large Cap
M & S Cap
Multi Cap
Gilt Funds
Bond-Long Term
Bond-Short Term
Equity +
Debt
Invest in
other
Mutual
Fund
Based on
Specific
Index
Tax Saving Funds
Investment
ELSS
Gold Fund
Gold ETF Gold Sector
(Gold , Gold Deposit,
Gold Receipts Schemes)
(Gold Processing
& Mining related comp)

7. Sponsor
Sponsor establishes the Mutual Fund, along
with any individual/body corporate. The Sponsor''s
liability is restricted to his contribution. Sponsor must
contribute a minimum 40% to the net worth of AMC.
Sponsor is a person who has a continuing
interest in the Mutual Fund and whose credibility is
significantly responsible for mobilizing the savings of
the public for the Mutual Fund

8. Asset Management Company (AMC)
A Company registered with SEBI, which takes
investment/divestment decisions for the mutual fund, and
manages the assets of the mutual fund.

9. Trustee - Role
 The Trustees shall ensure that the AMC has put in place adequate back office,
dealing and accounting systems.
 The Trustees shall ensure that the AMC has appointed all key personnel, including
fund manager(s) for the various schemes, auditors, compliance officers, registrars,
etc.
 The Trustee should also ensure preparation of the compliance manual and design
internal control mechanisms, including internal audit systems.
 Trustees should specify norms for empanelment of brokers and marketing agents.
 The trustees shall ensure that an AMC has been diligent in empanelling brokers, in
monitoring securities transactions with brokers and avoiding undue concentration
of business with any broker.
 The trustees shall ensure that the AMC has not given any undue or unfair
advantage to any associates or dealt with any of the associates of the AMC in any
manner detrimental to interest of unitholders.
 The trustees shall ensure that the transactions entered into by the Asset
Management Company are in accordance with regulations of SEBI and the
regulations of the scheme.

10. Custodian
The bank or trust company that maintains a
mutual fund's assets, including its portfolio of
securities or some record of them. The custodian
provides safekeeping of securities but has no role in
portfolio management.

11. RTA
Investors' transactions like buying, exchanges, processing of
mails and related information, changes in personal data, etc occur
frequently and have to be recorded. Registrar & transfer agents
have skilled expertise for maintenance of such data on a
professional basis, thereby contributing to saving costs and time
involved in keeping detailed accurate records of the investor
transactions.
Their role also extends to providing information to the
investors about new offers, maturity dates and all other investor-
friendly information at one place for their reference. Some of the
RTAs operating in India are Computer Age Management Services
(CAMS), Karvy, and Deutsche Investor Services, among others.

12. Key players in AMC
 Fund Accountants
 Lead Managers
 Investment Advisory
 Legal Advisory
 Auditor & Underwriters

13. Working Mechanism of AMC
 Creating Fund Manager
 Research and Planning
 Creating Dealers

14. Portfolio Management Process
 Setting investment Goals
 Nature of Scheme, Risk & Return, market conditions,
regulatory norms, size of issue and investors production
 Identifying specific securities
 Analyze and identify the right securities and risk & return
evaluated
 Portfolio designing
 Mixing of Equity and Debt, Time and quantum to buy
 Portfolio Revision
 Review must be done to keep in mind the dynamic
investment climate.

15. NAV Net Assets Value : per unit value of the particular mutual
fund which the investor approached and the amount
invested in that particular scheme.
NAV = Total Market Value – Funds Liabilities
No. of Outstanding Units
 Load : The initial expenses that incurred by mutual fund
related to scheme.

16. Evaluation of Mutual Fund
SPI – Sharpe Performance Index (Excess Retunrn)
SPI = Average portfolio return – Risk Free rate of return
Standard Deviation of Portfolio
Treynor’s Performance Index - Per unit of Risk
TPI = Average portfolio return – Risk Free rate of return
Market Risk Portfolio

17. Thank you