Mutual Funds
Mutual Funds are investment products that operate on the principle of collective investment. They collect money from a large group of investors, pool it together, and invest it in various securities like stocks, bonds etc. in line with their objective. They are an alternative to investing directly in stocks and other securities – a more convenient alternative, yet no less rewarding.
A Mutual Fund that invests in a number stocks in each scheme with great analysis of each individual stock and the overall market conditions remarkably relieves you of all such hassles. Personal finances can be well-managed through Mutual Funds. Mutual Funds assure neither returns ( benefits ) nor the value of your original investment. There are inherent risks, but they can be managed by diversifying the investment. Mutual Funds offer several features that make them a powerful and convenient wealth creators !
Regulated industry: Mutual Funds are tightly regulated by the securities market regulator SEBI ( Securities and Exchange Board of India ), which regularly comes up with rules to protect investor interests. Mutual Funds publish NAV ( Net Asset Value ) or price per Unit of each scheme at the end of each day and also release the fund portfolio every month.
Companies ranked 1 to 100 on the basis of market capitalization
Companies ranked 101 to 250 by market capitalization.
Companies ranked 251 and onwards by market capitalization.
A minimum of 80% of investment is made in Large-cap companies’ equities (shares).
A minimum of 65% of the investment is made in Mid-cap companies’ equities (shares)
A minimum of 65% of the investment is made in Small-Cap companies’ equities (shares).
A minimum of 25% each is made in Large, Mid and Small-Cap companies’ equities.
The combination of Large, Mid and Small-Cap stock depends upon prevailing market conditions.
NRIs are eligible to invest in Mutual Funds through NRE/NRO a/c. If invested through NRE a/c, the principal amt. and the entire gain (subject to applicable tax) can be repatriated without any formalities. If the investment had been made through NRO a/c, such repatriation will be permitted by banks if certain formalities are complied with.
NRIs can take advantage of India’s economic growth by investing in Equity/Hybrid/Multi-asset Mutual Fund schemes in India and enjoy concessional tax rules as applicable to Resident Indians!
