5 Replies to “what is mutual fund and what are the steps tobe taken care of in investing in mutual fund?”

  1. mutual fund is an accumulated fund used for the purpose of investing in order to yield profits.

    check the mutual funds records, performance, market condition, terms, guarateed return, lock in period, insurance attachments, minimum amount of investments, minimum guranteed returns, liquidity option.

  2. There are many ways a person [an individual as well as a group of individuals], can put the presently available money to work in a way to give more better returns in the future. This activity is most commonly known as the investment.

    The idle money when invested can yield better returns than Savings. Investments in the Mutual Funds is also done with the same intention.

    The difference in investing in MF and other instruments of investment is that in the former the risk of losing money, and hence the benefits of profits are borne by ‘MANY’ and not ‘ONE’. Becasue there’s vested interests of many like minded persons which form a fund to invest in a vast number of differennt instruments, hence the name ‘MUTUAL FUND’.

    The funds bear the same risks and rewards principle as is prevalant in other instruments of investments like, gold, equities, business, property, etc. The best source of information about the risks / precatuions / steps need to be taken in investment in the MF can be obtained from the Key Information Memorandum and Scheme Information Document of the Fund.

    By the way, attested copies of the following documents are required to be deposited at the time of purchasing any scheme of the MF:
    1. Resolution /Authorisation to invest
    2. List of Authorised Signatories with Specimen Signature(s)
    3. Memorandum / Articles of Association
    4. Trust Deed
    5. Bye – Laws
    6. Partnership Deed
    7. Overseas Auditor’s Certificate
    8. Notarised Power of Attorney
    9. PAN Copy duly certified
    10. KYC Acknowledgement Letter [KYC=Know Your Customer]

    Take care. Hope this helps you. In case, some more information is required in the respect, do check the following websites:

    Enjoy investing 🙂

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