Mutual fund is an investment scheme that accumulate funds from people and invests that money in financial securities such as shares and money market equipment. If you are also planning to invest money in mutual funds and are new, then you must know some special terms related to mutual funds before this.
Fund unit or share
Investors of mutual funds invest by purchasing units or shares of special funds in which they want to invest. The more units the investors buy, the higher the investment for them.
Net Asset Value (NAV)
The price/price of the price/price per share of the net asset value fund is. This is actually the main indicator of the performance of mutual funds. Depending on the performance of the fund, its NAV varies from time to time. During the purchase or sale of the fund unit, the existing NAV is considered and the unit is purchased/sold/redeemed at the current price per unit.
Entry load
This is the total amount that an investor has to pay while buying a unit of mutual fund scheme. This is basically the entry fee that is charged by the Fund Management Company when a person invests in mutual funds.
Exit load
When an investor redeems or redeems the mutual fund units, the exit load is charged by the fund house. Exit loads are not fixed and the scheme may vary. Generally, exit load ranges from 0.25% to 4%.
Property under Management (AUM)
Aum is the total market value of funds that are managed and handled by a particular mutual fund company.
Expenditure ratio
The spending ratio of mutual funds is made from the total assets acquired by it compared to the total expenditure incurred by the fund.
New Fund Off (NFO)
NFO is the latest fund offers and schemes, which are introduced in the market by asset management companies. According to Bankbazaar, since these new funds are launched at a special offer price, investors can buy these units at a relatively low price compared to the normal market price.
Redemption
When fund units are sold or transferred or canceled, it is known as redemption.
Sip investment
SIP or systematic investment planning is a way of investing small amount in kastos from time to time in mutual funds. By choosing this recurring investment instrument, people can invest small amount instead of a lump sum in mutual funds on weekly, quarterly and monthly basis.
Lump sum investment
Lump sum mutual fund investment is the way of contributing a fixed amount in a lump sum in mutual funds. This type of investment is particularly chosen by those who have a lot of money to invest. Retired individuals with large capital usually choose such investment.
Equity fund
Equity funds are growth funds that especially invest in shares and stocks of companies. The portfolio of these funds also known as stock funds contains stock and share mixtures of various companies.
Credit fund
These types of funds invest in combination with fixed income securities such as government securities, Treasury Bills, Money Market Instruments, Corporate Bonds and other types of loans. Such securities have a certain date of maturity and they pay a fixed interest rate. Most of them choose those investors who do not want to take much risk and are satisfied with a stable income.
Lock-in period
The lock-in period is the period during which the investor is not allowed to sell a particular investment. In other words, during the lock-in period, a person’s investment lock remains.
Floating rate date
The type of bond or date whose coupon rate varies depending on the change in market conditions. Holding period – This is the period or period for which an investor holds an asset. In other words, this is the time between the initial date of procurement of a securities and the date of its sale.
Long term capital gains
Benefits from the sale of assets such as shares and securities that are placed on hold for a period of more than 12 months.
Short -term capital gains
The benefits earned by the investor from the sale of assets such as shares, stocks and securities, which were owned by less than a year.
Portfolio turnover rate
This is the rate to be levied on the change of mutual fund portfolio.
Latest business news
