types of mutual funds
TRANSCRIPT
SECURITY ANALYSIS &PORTFOLIO MANGEMENT
TYPES OF MUTUAL FUNDS
PRESENTED BYM INDRAJA 15331E0075
CONTENTS
• INTRODUTION TO MUTUAL FUNDS • TYPES OF MUTUAL FUNDS– On the basis of lock in period – On the basis of investment – Other funds
MUTUAL FUNDS: INTRODUTION
• Mutual Fund is an investment house where investor
pools in money for investment in a basket of diversified
assets, managed by professionals at relatively low cost.
• The funds collected are invested in various instruments such as
capital market, money market and debt market instruments.
• The investors get units in numbers on their investment
INTRODUTION
TYPES OF MUTUAL FUND
On the basis of lock in period • Open ended funds • Closed ended funds
On the basis of investment • EQUITY • ELSS• DEBT • BALANCED • SECTORAL
ON THE BASIS OF LOCK-IN PERIOD
MUTUAL FUND
OPEN-ENDED CLOSED-ENDED
OPEN ENDED MUTUAL FUNDS• Any time entry and exit• Liquidity can be maintained by investing in open
ended funds• Difficult to manage the funds, as the money flows in
and out, so the total funds get changed frequently• The units are brought and sold at NAV
CLOSED-ENDED MUTUAL FUNDS
• Minimum lock in period of 3 years• Short term returns are not possible• Number of units do not fluctuate on daily basis• Hence the number of units also remains same except
through bonus or right issue• A new investor can buy units of close ended funds
through secondary market
ON THE BASIS OF INVESTMENT
MUTUAL FUNDS
EQUITY
ELSS
DEBT
BALANCED
SECTORAL
EQUITY BASED MUTUAL FUND
• A mutual fund that invests principally in stocks• A minimum of 65% of total investment should be
in Indian equity• It includes various types such as
LARGE CAP: Investment in companies having market capitalization more than $10 billion. MID CAP: Investment in companies having market capitalization between $2 billion to $10 billion.
DEBT BASED MUTUAL FUNDS
It includes different types of schemes such as• Gilt Funds:
These funds invest exclusively in government securities.
Government securities have no default risk.• CORPORATE BONDS: For example ICICI prudential
corporate bond fund• COMBINED: This better than the above two
because investment only guilt securities may not even cover the inflation cost
Balanced Fund
• It is a balanced fund of Equity and Debt• The investment is done in both equity and
debt• For tax benefit investment in Indian equity
should account for 65%
ELSS FUND
• ELSS is a type of diversified equity mutual fund• Qualified for tax exemption under 80C• Investment up to 150000 are exempted under
this section• It is usually comes with a lock in period of 3
years
SECTORAL FUNDS
• Investments is done in stocks of a particular sector
• This funds have high risk but also give high returns
OTHER FUNDS
• International funds • Quant funds • Arbitrage funds
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