What is a Mutual Fund?
Mutual Fund (MF) is a trust comprising like-minded investors who pool in their money into a corpus that is invested by the MF’s Asset Management Company (AMC) in different types of investments such as stocks, government and corporate bonds, and more. All MFs have a specified investment objective. Investors are allocated units under their respective folios wherein the unit value depends on the MF’s Net Asset Value. The MF grows its investment in two ways: income earned and any capital appreciation realized through sale. This is shared by individual unitholders in proportion to the number of units they own.