Abstract

A mutual fund is a pool of money managed by a professional Fund Manager. It is a trust that collects money from a number of investors who share a common investment objective and invests the same in equities, bonds, money market instruments and/or other securities. It is more reachable to the investors as the funds do not get invested in one sector but get diversified to many sectors. Investors today have access to a wide variety of investment opportunities thanks to the increasing competitive nature of the market. Mutual funds, out of the many other investment options available, are the one that are best suited for the average person since they provide the ability to invest in a portfolio that is both diversified and managed by professionals at a fee that is relatively modest. This paper primarily focuses in understanding the concept of mutual funds, its process, history, structure, types, categories, benefits and limitations.

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