NEWS
What are Mutual Funds?
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2024-05-24 05:12:02
A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. It is essentially a diversified portfolio of financial instruments – these could be equities, debentures / bonds or money market instruments. The corpus of the fund is then deployed in investment alternatives that help to meet predefined investment objectives. The income earned through these investments and the capital appreciation realized are shared by its shareholders in proportion to the number of shares (NAVPS) owned by them. Thus, a Mutual Fund is a suitable investment for the common person as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost. A mutual fund can make money in two ways: 1) the security can pay dividends and interest to the fund; or 2) A security can rise in value.