The document provides an overview of mutual funds including: 1. It defines a mutual fund as a professionally managed collective investment vehicle that pools money from investors to purchase securities. 2. It lists some key advantages of mutual funds such as diversification, daily liquidity, professional investment management, and government oversight. 3. It outlines some types of mutual fund schemes including growth funds, income funds, balanced funds, and money market funds.

1. Presented By :-
Sandeep Pramanik
Abrar Khan

2. 1. Human life cycle
2. Individual investor
3. Value of money over time
4. Graph of sensex from globlization
5. Sensex of last two year
6. Option for investing
7. What is mutual fund
8. Advantages & disadvantages
9. Types of mutual funds

3. 1. History of mutual funds
2. Regulation
3. Taxation
4. Risk
5. Investment strategies
6. Investment check list

6. Impact of inflation on monthly Value of Rs. 100,000 over time
expenses of Rs. 30,000 today
100,000
79,599
78,353
62,368
48,102
38,288 37,689
30,000
Today 5 years 15 years 20 years Today 5 years 15 years 20 years
At inflation of 5%
Investors need to beat inflation

9.  Deposit in Bank – FD’s, Locker ;)
 Loan a Friend/Relative on Interest
 Property Investments
 Invest in liquid assets - Gold, Silver..
 Investment in Capital Markets -
- Direct - Equity Share Markets
- Debt & Bonds Market
- Indirect - Mutual Funds

10.  Direct Equity
 High risk, high return category.
 Needs a lot of time & expertise.
 Substantial initial capital required.
 Mutual Funds
 One-Time Investment
 Systematic Investment Plan (SIP)

11. A mutual fund is a type of professionally-
managed collective investment vehicle that pools
money from many investors to purchase securities.
While there is no legal definition of mutual fund, the
term is most commonly applied only to those
collective investment vehicles that are regulated.
Hedge funds are not considered a type of mutual fund

12.  The term mutual fund is less widely used
outside of the United States and Canada.
For collective investment vehicles….
 It available to the general public and
open-ended in nature….
 Mutual funds must be registered with the
Securities and Exchange Commission….
 They are not taxed on their income if
they comply with certain requirements….

14. ADVANTAGES OF MUTUAL FUNDS
 Increased diversification
 Daily liquidity
 Professional investment management
 Service and convenience
 Government oversight
 Ease of comparison
 Ability to participate in investments that
may be available only to larger investors

15.  Fees
 Less predictable income
 No opportunity to customize
 Less control over timing of recognition of
gains

16. Type of
Mutual Fund
Schemes
Special
Investment
Structure Schemes
Objective
Open Ended Industry Specific
Growth Funds
Funds Schemes
Close Ended Index
Income Funds
Funds Schemes
Sectoral
Interval Funds Balanced Funds
Schemes
Money Market
Funds

17.  The first mutual funds were established in
Europe IN 1774.
 Mutual funds were introduced into the
United States in the 1890s
 The first open-end mutual fund with
redeemable shares was established on March
21, 1924.

19.  Governed by SEBI (Mutual Fund) Regulation 1996
 All MFs registered with it, constituted as trusts ( under Indian Trusts Act,
1882)
 Bank operated MFs supervised by RBI too
 AMC registered as Companies registered under Companies Act, 1956
 SEBI- Very detailed guidelines for disclosures in offer document, offer
period, investment guidelines etc.
 NAV to be declared everyday for open-ended, every week for closed
ended
 Disclose on website, AMFI, newspapers
 Half-yearly results, annual reports
 Select Benchmark depending on scheme and compare

20. TAXATION
• All dividends declared by debt / equity oriented schemes are tax
free in the hands of the investor
• Dividend distribution tax @ 14.1625% for individuals and 22.66%
for corporates under debt oriented schemes
• No DDT under equity schemes
• Long term capital gain in equity schemes – exempt from tax
• Indexation benefit available for long term non equity schemes
• Equity short term capital gain @10%
• STCG in Debt funds – Rates applicable for the investor
• Deduction of Rs. 1 lac under section 80C

22.  Historical analysis
 Return is remembered, Risk forgotten
 Risk = Potential for Harm
 Market Risk
 Non-Market Risk
 Credit Rate Risk
 MF Risk = Volatility (fluctuation of NAV)
 Standard Deviation
 Websites give star rating ( basis = risk-adjusted return)

23.  Systematic Investment Plan (SIP)
 Invest a fixed sum every month. (6 months to 10 years-
through post-dated cheques or Direct Debit facilities)
 Fewer units when the share prices are high, and more units
when the share prices are low. Average cost price tends to
fall below the average NAV.
 Systematic Transfer Plan (STP)
 Invest in debt oriented fund and give instructions to transfer
a fixed sum, at a fixed interval, to an equity scheme of the
same mutual fund.
 Systematic Withdrawal Plan (SWP)

24. An investment plan to invest a
fixed amount regularly at a
specified frequency say,
monthly or quarterly.
SIP is a simple method of investing used
across the world as a means to creating wealth

26.  Draw up your asset allocation
 Financial goals & Time frame (Are you investing for retirement? A
child’s education? Or for current income? )
 Risk Taking Capacity
 Identify funds that fall into your Buy List
 Obtain and read the offer documents
 Match your objectives
 In terms of equity share and bond weightings, downside risk protection,
tax benefits offered, dividend payout policy, sector focus
 Check out past performance
 Performance of various funds with similar objectives for at least 3-5
years (managed well and provides consistent returns)

27.  Think hard about investing in sector funds
 For relatively aggressive investors
 Close touch with developments in sector, review portfolio regularly
 Look for `load' costs
 Management fees, annual expenses of the fund and sales loads
 Does the fund change fund managers often?
 Look for size and credentials
 Asset size less than Rs. 25 Crores
 Diversify, but not too much
 Invest regularly, choose the S-I-P
 MF- an integral part of your savings and wealth-building plan.

28.  Contacting the Asset Management Company directly
 Web Site
 Request for agent
 Agents/Brokers
 Locate one on AMFI site
 Financial planners
 Bajaj Capital etc.
 Insurance agents
 Banks
 Net-Banking
 Phone-Banking
 ATMs
 Online Trading Account
 ICICI Direct
 Motilal Oswal, Indiabulls- Send agents