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Wednesday, January 12, 2011

Advantages of Mutual Funds

Advantages of Mutual Funds

A Mutual Fund can be defined as a confidence wherein the savings of the investors with the same financial purpose are shared in. The unruffled money then goes for investment in capital market instruments. These can include shares, debentures and other such securities. These investments in turn succumb an income. The income and capital enjoyment are distributed amongst its unit holders. The return of mutual funds is many. Some of the rewards of mutual funds in India are listed as below:

Mutual Funds Advantages

There is numerous compensation of investing in a Mutual Fund and that is why more and more people are taking to it. Some of the major profits of mutual funds in India are as follows:-

Low cost: The operating expense of the Mutual fund seldom cross the 1.5 % mark of the asset you make. The Index Funds expenses are generally lesser. Instead, the company stocks are bought by them which are found on the explicit index.

Diversification: The top Indian mutual funds create their collection designs in such a manner that the attracted individuals who invest in mutual funds react in a different way even under similar economic circumstances.

Regulatory oversight: There are certain rules and convention framed by the government which each Mutual fund are required to follow. This is to guard the investors from any fraudulent actions.

Liquidity: Getting your money out from the mutual fund is not difficult task. All you have to do is just apply online, write a check, make a telephone call and you are done.
Convenience: Mutual fund shares can be bought via phone, mail, or even over Internet online also.

Ease to proceed: Investing in a mutual fund is easy if you are a bank account holder and you have a PAN card. All you will need to do is fill up the application form, attach the PAN card number proof (for transactions over Rs 50,000), sign the cheque and your Mutual Fund investment is complete.

Professional Management: A mass of the mutual funds in India employ the leading professionals in their investments management. These managers make decisions on what securities, the buying and selling of the funds will take place.

Well regulated: The SEBI (Securities Exchange Board of India) regulates the India mutual funds for the security and expediency of the investors. SEBI ensures that clearness is maintained by keeping a stern vigilance on the mutual funds. This keeps the investor informed and helps him/her to make his/her choice. To keep a track whether the investment in Mutual Fund is in line with the goal or not, SEBI demands the disclosure of portfolios once in every six months.


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