Q1. What is a Mutual Fund?
Ans. A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. Anybody with an investible surplus of as little as a few thousand rupees can invest in Mutual Funds. The money thus collected is then invested by the fund manager in different types of securities. These could range from shares to debentures to money market instruments, depending upon the scheme's stated objectives. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost.


Q2. What are the various types of mutual fund schemes available to an investor?
Ans. There are a wide variety of Mutual Fund schemes that cater to your needs, whatever your age, financial position, risk tolerance and return expectations.

By Structure:
Open-Ended Schemes These do not have a fixed maturity. You deal directly with the Mutual Fund for your investments and redemptions. The key feature is liquidity. You can conveniently buy and sell your units at net asset value ("NAV") related prices. Close-Ended Schemes Schemes that have a stipulated maturity period (ranging from 2 to 15 years) are called close-ended schemes. SEBI Regulations ensure that at least one of the two exit routes are provided to the investor.

By Investment Objective
Growth Schemes: Aim to provide capital appreciation over the medium to long term. These schemes normally invest a majority of their funds in equities and are willing to bear short- term decline in value for possible future appreciation. Ideal for:
* Investors in their prime earning years.
* Investors seeking growth over the long-term.
Income Schemes: Aim to provide regular and steady income to investors. These schemes generally invest in fixed income securities such as bonds and corporate debentures. Ideal for:
* Retired people and others with a need for capital stability and regular income.
* Investors who need some income to supplement their earnings.
Balanced Schemes: Aim to provide both growth and income by periodically distributing a part of the income and capital gains they earn. They invest in both shares and fixed income securities in the proportion indicated in their offer documents. Ideal for:
* Investors looking for a combination of income and moderate growth.
Money Market Schemes: Aim to provide easy liquidity, preservation of capital and moderate income. These schemes generally invest in safer, short-term instruments, such as treasury bills, certificates of deposit, commercial paper and inter- bank call money. Ideal for:
* Corporates and individual investors as a means to park their surplus funds for short periods or awaiting a more favourable investment alternative.
Tax Saving Schemes These schemes offer tax rebates to the investors under tax laws as prescribed from time to time. This is made possible because the Government offers tax incentives for investment in specified avenues. Recent amendments to the Income Tax Act provide further opportunities to investors to save capital gains by investing in Mutual Funds. Ideal for:
* Investors seeking tax rebates.

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Q3. What is Net Asset Value (NAV)?
Ans. Net Asset Value is equal to Market Value of the investments + current assets + receivable - current liabilities/ number of units outstanding.


Q4. Why should you invest in mutual funds?
Ans. The advantages of investing in a Mutual Fund are:

Professional Management:
You avail of the services of experienced and skilled professionals who are backed by a dedicated investment research team.

Convenient Administration:
Investing in a Mutual Fund reduces paperwork and helps you avoid many problems such as bad deliveries, delayed payments and unnecessary follow up.

Return Potential:
Over a medium to long-term, Mutual Funds have the potential to provide a higher return as they invest in a diversified basket of selected securities.

Low Costs:
Mutual Funds are a relatively less expensive way to invest compared to directly investing in the capital markets.

Liquidity
In open-ended schemes, you can get your money back promptly at net asset value related prices from the Mutual Fund itself. With close-ended schemes, you can sell your units on a stock exchange at the prevailing market price.

Flexibility
Through features such as regular investment plans, regular withdrawal plans and dividend reinvestment plans, you can systematically invest or withdraw funds according to your needs and convenience.

Choice of Schemes
Mutual Funds offer a family of schemes to suit your varying needs over a lifetime.


Q5. Is there any scheme available where I can invest for 10 days to 6 month & get better return compared to Bank F.D.?
Ans. Yes, You can invest in Liquid or GILT Fund for 10 days to 6 months and easily get return 8-90% (Tax free) with overnight liquidity.


Q6. Is there any scheme where I shall invest small amount on monthly basis for one year or more?
Ans. Yes, you can invest a small amount of Rs. 500/- on regular (Monthly) basis and get a good return on your investment under Systematic Investment Plan (SIP).


Q7. Why I should approach you for my Investment Consultancy?
Ans. Our investment division offers wide range of investment product. We can manage your portfolio according to your need. The professional advice provides you with the best return on investment. We also provide Investment Planning according to needs & requirements of an investor.

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