| You must have read this statement many a
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| | Having done that, he can invest in an
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| times in the TV commercials and also on
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| | appropriate combination of assured return
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| the form that you must have filled and
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| | schemes (National Savings Certificate,
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| wondered what does this line mean. Let me
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| | Public Provident Fund, post office
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| tell you this line means. I do agree that
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| | schemes, bonds from institutions) and
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| the mutual funds are subject to market
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| | mutual funds.
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| risk but that market risk if you go to
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| | Mutual Funds come under the regulation of
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| consider is very minimal. Thanks to the
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| | the Securities and Exchange Board of
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| stringent regulations employed by SEBI
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| | India and have to meet stringent
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| (Stock Exchange Board of India)..
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| | regulations. Therefore, they cannot just
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| Please note that mutual funds do not
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| | close shop and run away with investors'
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| provide any guarantee of returns or
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| | money.
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| capital (initial amount you invested).
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| | Mutual Funds comes under SEBI scanner and
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| Mutual funds are a good place to start
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| | so does all the other public offering and
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| because they offer you the opportunity to
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| | there is a security deposit that they
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| diversify quickly into a range of
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| | have to pay for getting listed. The
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| investments
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| | chance of being fraudulent is negligible.
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| Hence, nobody can assure you of returns,
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| | With the growing number of people
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| or even not suffering losses. Going
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| | investing in mutual funds they are making
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| strictly by the book, the possibility of
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| | it more reliable.
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| a fund performing exceptionally poorly
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| | In fact, India happens to have quite
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| and all your savings dwindling to nothing
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| | stringent rules and norms regarding the
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| is quite real.
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| | setting up of an AMC and making periodic
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| Having said that, please remember that
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| | portfolio disclosures (stating where
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| over the long term, the possibility of
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| | their have invested their money).
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| such an extreme event is quite
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| | Moreover, in the set-up of a mutual fund,
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| negligible. If the historical performance
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| | there is a body of trustees who are
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| is to go by, then there are hardly any
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| | supposed to look after the interest of
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| diversified equity funds which have
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| | investors whose money is being managed
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| delivered negative returns over the last
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| | under different schemes.
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| 10 years, if one would have invested
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| | The mutual fund itself is a trust
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| through the SIP.
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| | registered under the Indian Trust Act,
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| Therefore, there is no need to be overly
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| | and is initiated by a sponsor. The
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| concerned. Mutual funds are a very
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| | sponsor is the person who acts alone or
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| convenient vehicle for individual
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| | with another corporate to establish a
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| investors.
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| | mutual fund. The sponsor then appoints an
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| Moreover, returns tend to be commensurate
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| | AMC to manage the investment, marketing,
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| with the kind of risk you take. Mutual
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| | accounting and other functions pertaining
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| fund schemes are riskier than the assured
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| | to the fund.
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| return schemes like fixed deposits and
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| | Therefore, while it may be possible for a
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| bonds. But, they also have the potential
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| | mutual fund to inflict losses to the
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| to generate far superior returns.
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| | investors as a result of poor fund
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| It is upon the investor to strike a
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| | management, they just can't wind up their
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| balance between the return he wants to
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| | operations and run away with your money.
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| earn and the risk he wants to take.
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|
