Mutual Funds
Mutual fund is a kind of collective investment that is managed professionally. In Mutual funds, the money is collected from a large number of investors and then it is invested in bonds, stocks, and various other securities. The fund manager of Mutual fund collects the interest income which is then distributed among the individual investors on the basis of the number of units that they hold. Mutual fund's value of a share is calculated on a daily basis and is known as per share Net Asset Value (NAV).
Mutual Funds in Pakistan
“Mutual fund is a pool of money invested according to a common investment objective by an asset management company (AMC) on behalf of the fund’s investors”. A mutual fund can generate profits from three different sources, which are: Dividend, Capital Gains and Appreciation of Share Price. The figure below shows that mutual fund deals with the following entities; trustee, auditor, SECP, AMC and investor. A mutual fund provides liquidity, portfolio management expertise, risk diversification, and stability to stock market and it also mobilizes savings by attracting funds from small investors.
Classification of Mutual Funds
Classification of Mutual Funds has been done on the basis of their investment objective and structure. Classification of Mutual Funds has been done into main types such as Income Funds, Sector- Specific Funds, Large Cap Funds, Fixed- Income Funds, Interval Funds, Closed- End Funds, and Tax Saving Funds. Income Funds are a kind of mutual fund whose aim is to provide to the investors with steady and regular income. They usually invest their principal in securities such as corporate debentures, bonds, and government securities.
Sector- Specific Funds are funds that make investments in specified sectors only. They give importance to one sector only such as pharmaceuticals, software, infrastructure, and health care. Large Cap Funds are a kind of mutual fund that makes investment in the shares of large blue chip companies. Fixed- Income Funds makes investment in debt securities that have been issued either by the banks, government, or companies. They are also known as income funds and debt funds. Interval Funds are a
Mutual Funds Corrine Rogers Zane Rampulla Austin Keller Chaz Vanderwall Jon Coppess What is a mutual fund ? • You can purchase shares in a mutual fund if you do no choose to buy individual stocks. A mutual fund is an investment company that pools the money of investors and buys a collection of investments. The Advantage of Expert Management • Many investors lack the financial know-how to manage their own portfolio so professionals manage non-index. These professionals have dedicated careers to…
One of the best definitions to mutual fund that I found is: an investment vehicle that is made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets. Mutual funds are operated by money managers, who invest the fund's capital and attempt to produce capital gains and income for the fund's investors. A mutual fund's portfolio is structured and maintained to match the investment objectives stated…
growth – growth will slow down 2. CEO is a marketing guy, maybe poor at cost control Positive ones 1. It is now audited Peat Marwick, the Big-8 firm!! Woow 2. CEO: we diversify our product lines 3. Value Line (a prestigious stock/mutual fund research company: project that in FY 1989, Kando’s profit will increase by another 30% 4. Barron’s and BW: favorable reviews 5. Even Warren Buffet is said to be interested *If you get this audit client, you will be rich!! | 1988 |…
ANALYSIS OF MUTUAL FUND PERFORMANCE MEASURES Many mutual funds operate in public sector as well as private sector as a investment companies. Mutual fund performance can be evaluated through performance measurement ratios which are use in portfolio analysis. I here used Trey nor, Sharpe, and Jensen ratio to evaluate mutual funds and rank accordingly…
The fund is essentially a corporation whose sole business is to collect and invest money. You join the pool by buying shares in the fund. Your money is then invested by a team of professionals, who research stocks, bonds or other assets and then place the money as wisely as they can. There are several flavors of mutual funds. Funds that impose a sales charge taking a cut of any new money that comes into the fund, or a cut of withdrawals are called load funds; those that do not have…
ADVANTAGES OF MUTUAL FUND An investors can invest directly in individual securities or indirectly through a financial intermediary. Globally, mutual have established them self as the means of investment for the retail investor advantages are as followes Transparency Mutual funds transparently declare their portfolio every month. Thus an investor knows where his or her money is being deployed an in case they are not happen wit the portfolio they can withdraw at short notice Diversification An…
bonds, mutual funds and etc.., there are so many options and each has its advantages and disadvantages. Keep in mind that your current circumstances and personal financial goals play a huge role in deciding which feature will be more advantage towards you and your family. I believe that mutual fund is a smart way to start your investment journey. Unlike bonds or stock, mutual funds offer features such as professional management and diversification. Investment companies will have professional fund managers…
Introduction: Mutual funds combine the savings of a large number of investors and manage them as a single pool of money. Instead of investors worrying about what stock or bond or commodity to invest in, professional fund managers do the job. Mutual funds are run by mutual fund companies, also as Asset Management Companies (AMCs). Each AMC operates a number of fund schemes that suit different type of investment needs. For individual investors who don’t have time to study and research investments, mutual funds…
Full Length Research Paper Validity of efficient market hypothesis: Evidence from UK mutual funds M. Jibran Sheikh and Umara Noreen* COMSATS Institute of Information Technology, Islamabad, Pakistan . Accepted 8 September, 2011 This research is geared towards analysing performance of the fund managers an d their market timing abilities. For the purpose of this study, sample of 50 U.K. mutual funds were selected in random. Their returns from the beginning of 1990 to the end of 2008 were…
later introduced to their students are not traceable. Apart from these, Clayton also illustrated the principle agent theory in managing free capitalism. He argued that about 40% of the stock in the free market is executed by hedge fund, and 55% by mutual fund or pension fund, which means 95% of the stock is hold by people who are expected to keep these stock in less than one year. In my opinion, I agree with Clayton’s opinion. If we always following the right rule to do things, we will naturally form…
