Mutual Fund is a convenient medium through which
a common man can invest in the equity market. A Mutual Fund is actually a trust
that pools the savings of a number of investors who share a common financial
goal. The money so collected is invested in capital market instruments such as
shares, debentures and other securities. Professional Managers known as
investment bankers are employed by mutual fund houses to make investment
decisions on behalf of common investor. The income earned through these
investments and the capital appreciation realized are shared by its unit holders
in proportion to the number of units owned by them. Thus the Mutual Funds offer
the common man an opportunity to invest in a diversified professionally managed
basket of securities at a relatively low cost.
The mutual fund industry in India started in 1963 with the formation of Unit
Trust of India, at the initiative of the Government of India and Reserve Bank.
In the last few years Indian Mutual Fund industry has grown at a rapid pace.
Some of the top performing and best mutual funds in India are: SBI Mutual Funds,
UTI Mutual Funds, Prudential ICICI Mutual Funds and HDFC Mutual Funds. |
