Midterm Exam (1St Sem)

Front 1

are experts in securities and do the trading in behalf of all the investors they will, in exchange, investors pay annual fees and other charges to cover for the operation of the fund.

Back 1

Fund Manager

Front 2

Fund Managers however cannot trade just any way they like. They are bound to follow the investment objective found in the prospectus.

Back 2

Investment Objective

Front 3

is an investment security type that enables investors to pool their money together into one professionally managed investment.

Back 3

Mutual Fund

Front 4

is a company that pools money from many investors and invests the money in securities such as stocks, bonds, and short-term debt.

Back 4

Mutual Fund

Front 5

The combined holdings of the mutual fund are known as its ______.

Back 5

Portfolio

Front 6

dividing the total net assets by the total number of units issued.

Back 6

Net Asset Value

Front 7

The total value of the assets a fund buys is called _________.

Back 7

Assets Under Management (AUM)

Front 8

Apart from dividends, mutual funds also distribute the profits it makes from selling some of the underlying assets at higher values.

Back 8

Capital Gains Distribution

Front 9

When you invest in a financial asset, you earn on the amount invested.

Over time, you can either reinvest this amount or put it in a bank account.

Back 9

Compounding

Front 10

This is the decline in your investment’s value in the mutual fund.

Back 10

Depreciation

Front 11

is one of the key benefits as well as characteristic of a mutual fund.

It is the practice of investing in different types of securities or asset classes. This is done to reduce risk.

Back 11

Diversification

Front 12

The average maturity of all the securities in a bond or money market fund’s portfolio.

Back 12

Average Portfolio Maturity

Front 13

Every day, values of financial assets change. So, when you buy at two different times, your purchase/market price will differ. For example, today you buy 10 units at Rs 100 each.

Back 13

Rupee-Cost Averaging

Front 14

This is the collection of assets owned by the mutual fund or even you as an individual.

It includes all the financial instruments invested in like stocks, bonds, and other securities.

Back 14

Portfolio

Front 15

Just like companies, mutual fund houses to announce the amount of dividend to be distributed a few days before the actual distribution.

Back 15

Ex-Dividend Date

Front 16

The amount paid to your fund manager for his expertise and portfolio management skills is called _______.

Back 16

Management Fees

Front 17

is the amount a mutual fund charges when units are purchased by investors. This is usually rare.

Back 17

Entry/Front-End Load

Front 18

is the amount a mutual fund charges you for selling or redeeming your shares.

Back 18

Exit Load

Front 19

There are funds which do not charge any fees or loads.

Back 19

No-Load Funds

Front 20

This is the total amount of profits an investor makes keeping in mind the dividends, capital gains from selling units, distribution of fund income as well as returns earned on reinvestments.

Back 20

Total Return

Front 21

Many fund houses group a set of mutual funds together based on their investment objectives, or other factors like management.

Back 21

Family of Funds

Front 22

Every investor puts his money in financial instruments for a particular reason.

This may be to increase wealth or accumulate money for buying something in the future, or simply to preserve your money from inflation.

Back 22

Investment Objective

Front 23

Every mutual fund is supposed to give details about its company, the investment objectives of the fund, the risks it perceives, services offered as well as fees.

Back 23

Prospectus

Front 24

This is the corporation or trust that invests the funds collected from investors on their behalf across securities.

Back 24

Investment Company

Front 25

is an investment vehicle much like a mutual fund, but which is traded on stock exchanges. It generally tracks an index, a basket of assets or a commodity.

Back 25

Exchange-Traded Fund

Front 26

Mutual funds invest in multiple types of assets like stocks and bonds. They can also invest across mutual funds.

Back 26

Funds of Funds

Front 27

When a stock gets listed on the exchange, it comes up with an _________.

Back 27

Initial Public Offering (IPO)

Front 28

when a mutual fund starts a new scheme and invites investors to put in money in exchange for units, it is called a ________.

Back 28

New Fund Offering (NFO)

Front 29

There are two ways to exit a mutual fund – sell it to another investor or back to the fund.

Back 29

Redeem

Front 30

is when the asset’s price changes a lot. It could be on the higher side or on the lower side.

Back 30

High Risk

Front 31

This is the organization that issues debt-market securities like bonds, commercial papers and certificate of deposits. It could be a company, a government organization or the government itself.

Back 31

Issuer

Front 32

These are again a debt-market instrument, issued by corporations to raise money for the short term.

They are usually unsecure as the company does not pledge any of its assets as collateral.

Back 32

Commercial Paper

Front 33

This is a kind of debt-market instrument issued by banks or financial organizations.

It acts as a proof of saving by the investor and promises interest payments.

Back 33

Certificate of Deposit (CD)

Front 34

Is a type of financial vehicle made up of a pool of money collected from many investors to invest in securities like stocks, bonds, money market instruments, and other asset.

Back 34

Mutual Fund

Front 35

are assets that have the potential to grow such as stocks or bonds.

Back 35

Securities

Front 36

A ______ represents part-ownership of companies such as PLDT, Ayala, SM, Jollibee, and etc. and it can be bought or sold in the Philippine Stock Exchange.

Back 36

Stock

Front 37

______ is a proof of debt.

Back 37

Bond

Front 38

They earn depending on securities that they have invested in.

Back 38

Earnings of Mutual Funds

Front 39

One of its owners and you obtain rights and privileges such as getting invited to the annual shareholders’ meeting, being entitled to vote, etc.

Back 39

Mutual Fund Shares

Front 40

Experts in securities and do the trading in behalf of all the investors.

Back 40

Fund Managers

Front 41

An investment security type that enables investors to pool their money together into one professionally managed investment. Can be invested in stocks, bonds, cash and/or other assets.

Back 41

Mutual Fund

Front 42

Combination of holdings that form one mutual fund; collection of assets owned by the mutual fund or an individual.

Back 42

Portfolio

Front 43

Portfolio of stocks, bonds or other securities that generate profits for the investor, or shareholder of the mutual fund.

Back 43

Mutual Fund

Front 44

Is the total worth of the entire mutual fund company divided by the number of shares it has distributed to all investor.

Back 44

Net Asset Value Per Share

Front 45

is an investment security type that enables investors to pool their money together into one professionally managed investment.

Back 45

Mutual Fund

Front 46

This is the amount a mutual fund charges investors for various reasons

Back 46

Load

Front 47

The amount paid to your fund manager for his expertise and portfolio management skills is called _______.

Back 47

Management Fees

Front 48

is the amount a mutual fund charges when units are purchased by investors. This is usually rare.

Back 48

Entry/Front-End Load

Front 49

is the amount a mutual fund charges you for selling or redeeming your shares.

Back 49

Exit Load

Front 50

There are funds which do not charge any fees or loads.

Back 50

No-load Funds

Front 51

This is the total amount of profits an investor makes keeping in mind the dividends, capital gains from selling units, distribution of fund income as well as returns earned on reinvestments.

Back 51

Total Return

Front 52

Many fund houses group a set of mutual funds together based on their investment objectives, or other factors like management.

Back 52

Family of Funds

Front 53

A mutual fund is registered with SEBI as an investment company. This is the corporation or trust that invests the funds collected from investors on their behalf across securities.

Back 53

Investment Company

Front 54

when a mutual fund starts a new scheme and invites investors to put in money in exchange for units, it is called a _________.

Back 54

New Fund Offering (NFO)

Front 55

When a stock gets listed on the exchange, it comes up with an _______.

Back 55

Initial Public Offering (IPO)

Front 56

There are two ways to exit a mutual fund – sell it to another investor or back to the fund.

Back 56

Redeem

Front 57

It is simply the degree of fluctuation in your asset’s price.

Back 57

Risk

Front 58

is when the asset’s price changes a lot. It could be on the higher side or on the lower side.

Back 58

High risk

Front 59

This is the organization that issues debt-market securities like bonds, commercial papers and certificate of deposits. It could be a company, a government organization or the government itself.

Back 59

Issuer

Front 60

In a bond market, there are two different interest rates prevalent:

Back 60

1. Fixed Rate

2. Yield to Maturity

Front 61

________ are governed by two different structures.

Back 61

Indian Mutual Funds

Front 62

The __________ follows one defined by the UTI Act, 1963, and its subsequent amendments.

Back 62

Unit Trust of India

Front 63

The legal structure of Indian mutual fund is unique and differs from that in the US and the UK.

Back 63

True

Front 64

The legal structure of Indian mutual fund is unique and differs from that in the US and the UK. In the US, funds are set up as investment must include the Phils.

Back 64

True

Front 65

In the _____ , funds are set up as investment companies which could be a corporation, partnership or unit investment trust

Back 65

US (United States)

Front 66

In the _____ , funds are set up in two alternative structures—open-ended funds are set up in the form of trusts while closed-ended .. are set up as corporate entities.

Back 66

UK ( United Kingdom)

Front 67

In ______ , all type of funds (whether open-ended or closed-ended) are set up as unit trusts.

Back 67

India

Front 68

The structure is defined by ______ (Mutual Fund) Regulations, 1996.

Back 68

SEBI (Securities and Exchange Board of India)

Front 69

The _____ is akin to a promoter of a company as he gets the mutual fund registered with Sebi.

Is defined under Sebi regulations as a person who, acting alone or in combination with .. another body corporate, establishes a mutual fund.

The _____ forms a trust, appoints the board of trustees, and has the right to appoint the asset management company (AMC) or fund manager.

Back 69

Sponsor

Front 70

The ______ act as a protector of unit holder .. interests.

______ play a critical role in ensuring full compliance with Sebi’s requirements.

Back 70

Trustees

Front 71

The _____ is appointed by trustees for managing fund schemes and corpus.

Back 71

Asset Management Company (AMC)

Front 72

The ________ is appointed by trustees for safekeeping of physical securities while dematerialised securities holdings are held in a ________ through a depository participant.

The _______ and _____ work under the instructions of the AMC, although under the overall direction of trustees.

Back 72

Custodian

depository

Custodian and depositories

Front 73

These are responsible for issuing and redeeming units of the mutual fund as well as providing other related services, such as preparation of transfer documents and updating investor records.

Back 73

Registrar and Transfer Agents

Front 74

The _________ is the first layer in the three-tier structure of Mutual Funds in India.

_______ is any person or any entity that can set up a Mutual Fund to earn money by fund management.

Back 74

Fund Sponsor

Front 75

The ______ must have experience in financial services for a minimum of __________ with a positive ________ for all the previous five years.

Back 75

sponsor

five years

net worth

Front 76

________and _______ form the second layer of the structure of Mutual Funds in India.

Back 76

Trust and Trustees

Front 77

A ______ is created by the _________ in favor of the trustees, through a document called a _________ .

The trust is managed by the ______ and they are answerable to ________.

Back 77

trust

fund sponsor

trust deed

trustees

investors

Front 78

A _________ is responsible for the safekeeping of the securities of the Mutual Fund.

They manage the investment account of the Mutual Fund, ensure the delivery and transfer of the securities.

Back 78

custodian

Front 79

These are the entities who provide services to Mutual Funds. ______ are more like the operational arm of Mutual Funds.

Back 79

Registrar and Transfer Agents (RTAs)

Front 80

_______ are the third layer in the structure of Mutual Funds.

The _____________ acts as the fund manager or as an investment manager for the trust.

A ________ is paid to the AMC for managing the fund.

Back 80

Asset Management Company

Asset Management Company (AMC)

small fee

Front 81

_______ audit and scrutinize record books of accounts and annual reports of various schemes.

Each AMC hires an independent auditor to analyse the books so as to keep their transparency and integrity intact.

Back 81

Auditors

Front 82

AMC uses the services of _______ to buy and sell securities on the stock market.

The AMCs uses research reports and recommendations from many ______ to plan their _________.

Back 82

brokers

brokers

market moves

Front 83

_______ depends on the market and your _________ amount keeps on changing accordingly.

Back 83

mutual fund

investment

Front 84

in case of _________, you get ______ returns.

Generally, if you put money in _________ for 5 or more years, you are more likely to get much better returns.

Back 84

bank deposits

fixed

mutual fund

Front 85

This is the organization that issues debt-market securities like bonds, commercial papers and certificate of deposits.

A.Issuer

B.commercial

C.certificate

D.interest

Back 85

A. Issuer

Front 86

There are two ways to exit a mutual fund – sell it to another investor or back to the fund.

A.Risk/Return

B.Redeem

C.Trade-Off

D.New Fund Offering

Back 86

B. Redeem

Front 87

Every mutual fund is supposed to give details about its company, the investment objectives of the fund, the risks it perceives, services offered as well as fees.

A.Exchange-Traded Off

B.Investment company

C.Prospectus

D.Inverstment Objectives

Back 87

C. Prospectus

Front 88

This is the decline in your investment’s value in the mutual fund.

A.Automatic Reinvestment

B.Capital Gains

C.Compounding

D.Depreciation

Back 88

D. Depreciation

Front 89

This is the collection of assets owned by the mutual fund or even you as an individual.

A.Diversification

B.Average Portfolio Maturity

C.Rupee-Cost Averaging

D.Portfolio

Back 89

D. Portfolio

Front 90

The fund management includes buying and selling of securities in large volumes.

Back 90

Custodian and depositories

Front 91

Are set up in the form of trusts structures.

Back 91

Open-ended funds

Front 92

Are set up as corporate entities.

Back 92

closed-ended funds

Front 93

are the third layer in the structure of Mutual Funds.

Back 93

Asset Management Company (AMC)

Front 94

Responsible for the safekeeping of the securities of the Mutual Fund.

Back 94

Custodian

Front 95

_________ underwrite new debt and equity securities, help with selling securities, and drive mergers and acquisitions, reorganizations, and broker trades.

_________ expedite the purchase and sales of bonds, stocks, and other investments, and aid companies in making initial public offerings (IPOs) when they first go public and sell shares.

Back 95

Investment Banks

Front 96

________ make loans to people and small businesses and offer checking and savings accounts and certificates of deposit.

________ act as managers for deposit accounts belonging to businesses and individuals, although they are primarily focused on business accounts, and they make public loans from the deposited money they hold.

Back 96

Commercial Banks

Front 97

________ are primarily financial middlemen, helping corporations set up IPOs, get debt financing, negotiate mergers and acquisitions, and facilitate corporate reorganization.

Investment banks also act as a ______ or ______ for institutional clients.

Back 97

Investment Banks

broker or advisor

Front 98

___________ take deposits, provide checking and debit account services, and provide business, personal, and mortgage loans. They also offer basic bank products such as certificates of deposit (CDs) and savings accounts to individuals and small businesses.

Back 98

Commercial Banks

Front 99

TRUE OR FALSE

Most types of bank deposits give you little or no interest, but will give you immediate access to your money.

Back 99

TRUE

Front 100

TRUE OR FALSE

If the bank goes broke, your money is insured by the government, and you will eventually get it back.

Back 100

TRUE

Front 101

Current returns for on-demand deposits range from _____ percent per year to ______.

Back 101

0.00% to 0.10%

Front 102

TRUE OR FALSE

The type of bank deposit called a Certificate of Deposit will give you a slightly higher interest rate, in return for you promising not to take it out for a specified time period, ranging from a month to 5 years.

Back 102

TRUE

Front 103

It is still government insured (up to USD 250,000). For binding periods from _______ years, returns are currently about ______ per year.

Back 103

1 to 3 years

1% to 2%

Front 104

TRUE OR FALSE

A mutual fund is essentially a stock brokerage.

Back 104

TRUE

Front 105

Is the total worth of the entire mutual fund company divided by the number of shares it has distributed to all investor.

Back 105

Net Asset Value Per Share

Front 106

Is a document that shares information about the investment, its objective, risks, costs, shares being offered, and other policies.

Back 106

Prospectus

Front 107

Balanced funds are the combined version of Open-ended as well as closed-ended funds.

Back 107

Interval Funds

Front 108

TRUE OR FALSE

Gilt funds are the government securities that carry no credit risk & are considered as the safest kind of funds

Back 108

True

Front 109

TRUE OR FALSE

Most types of bank deposits give you little or no interest, but will give you immediate access to your money.

Back 109

True

Front 110

TRUE OR FALSE

In UK all type of funds (whether open-ended or closed-ended) are set up as unit trusts.

Back 110

False - India

Front 111

TRUE OR FALSE

Net Assets Value is calculated by dividing the total net assets by the total number of units issued.

Back 111

True

Front 112

The asset management company acts as the fund manager or as an investment manager for the trust.

A. Asset Management companies

B. Auditor

C. Custodian

D. Trust & Trustees

Back 112

A. Asset Management Companies

Front 113

It operates as a combination of open and closed-ended schemes, it allows investors to trade units at predefined intervals.

A. Equity Schemes

B. Interval

C. Money Market or Liquid funds

D. Balanced funds

Back 113

B. Interval

Front 114

All type of funds (whether open-ended or closed-ended) are set up as unit trusts.

A. EuropeB. UKC. USD. India

Back 114

D. India

Front 115

(Identify the missing words) You will typically get much better returns. Mine have averaged __________ over the last _______.

Back 115

5% to 8%

20 years

Front 116

Three distinct types of investors.

Back 116

1. Pre-Investor2. Passive Investor3. Active Investor

Front 117

_________ are the funds in which the maturity date is not fixed.

The investors have the opportunity to buy &sell units at any time at NAV.

These are the liquid funds & investors can invest at any time during the year & redemption can also be done continuously.

Back 117

Open-ended funds

Front 118

________ are the funds where the maturity period is fixed.

These funds are not available for subscription all the time like open-ended funds rather they are available for investment during a specified time i.e. when they are launched initially.

Back 118

Close-ended funds

Front 119

_________ are the combined version of Open-ended as well as closed-ended funds. These funds are available for trading in the stock exchange at predetermined intervals.

Back 119

Interval funds

Front 120

_________ are the funds in which the majority of the investment is made in the equity shares.

Therefore it carries a high risk but also the potential of high returns.

The investment goal under such kind of funds is to achieve long term growth.

There may be funds that focus mainly on a single market sector for eg Banking sector equity fund.

Back 120

Equity/ Growth Funds

Front 121

The investment under such kind of funds is made in securities such as bonds, debentures, government securities, etc.

Since investment is made in debt instruments, the risk factor is low & income is stable & regular.

_________ are less volatile as compared to equity funds. The investment goal under such type of funds is safety and to achieve moderate growth of funds.

Back 121

Debt or Income Funds

Front 122

Underbalanced funds, the money is invested in both equity & debt instruments. The investment goal is to achieve both profits & moderate growth. They ensure stable returns & appreciation in capital to the individuals who have invested money in balanced funds.

Back 122

Balanced Funds

Front 123

Such kind of funds goes for short term investments such as Treasury bills, commercial papers, etc. under which period is less than 91 days.

The investment objective under liquid funds is to attain liquidity, increase in capital & moderate return on funds.

Back 123

Money Market or Liquid Funds

Front 124

These are the government securities that carry no credit risk & are considered as the safest kind of funds.

Back 124

Gilt Funds

Front 125

This scheme allows investors to buy or sell units at any point in time.

It does not have a fixed maturity date either. You deal directly with the Mutual Fund for your investment and redemption.

Back 125

Open-Ended Scheme

Front 126

This type of scheme has a stipulated maturity period and investors can invest only during the initial launch period known as the New Fund Offer (NFO).

Back 126

Close Ended Scheme

Front 127

It operates as a combination of open and closed-ended schemes, it allows investors to trade units at predefined intervals.

They may be traded on the stock exchange or they may even be open for sale or redemption during pre-determined intervals at NAV related prices.

Back 127

Interval

Front 128

Equity Schemes

SEBI has decided a total of ________ under Equity Schemes but a mutual fund company can only have _________ and it has to choose between Value or Contra.

Back 128

11 categories

10 categories

Front 129

The minimum investment in equity & equity related instruments–65% of total assets.

An equity mutual fund investing across Large Cap, Mid Cap, Small Cap stocks

Back 129

Multi-Cap Funds

Front 130

The minimum investment in equity & equity related instruments of large-cap companies – 80% of total assets.

An equity the mutual fund predominantly investing in Large Cap stocks.

Back 130

Large-Cap Funds

Front 131

The minimum investment in equity & equity related instruments of large-cap companies – 35% of total assets

The minimum investment in equity & equity related instruments of mid-cap stocks – 35% of total assets

An open-ended equity mutualfund investing in both large-cap and mid-cap stocks

Back 131

Large & Mid Cap Funds

Front 132

The minimum investment in equity & equity related instruments of mid-cap companies – 65% of total assets

An equity the mutual fund predominantly investing in Mid Cap stocks

Back 132

Mid-Cap Funds

Front 133

The minimum investment in equity & equity related instruments of small-cap companies – 65% of total assets

An equity the mutual fund predominantly investing in Small Cap stocks

Back 133

Small-Cap Funds

Front 134

The scheme should predominantly invest in dividend-yielding stocks. The minimum investment in equity – 65% of total assets

An equity the mutual fund predominantly investing in dividend-yielding stocks

Back 134

Dividend Yield Funds

Front 135

The scheme should follow a value investment strategy. The minimum investment in equity & equity related instruments – 65% of total assets

An equity mutual fund following a value investment strategy

Back 135

Value Funds

Front 136

The scheme should follow a contrarian investment strategy. The minimum investment in equity & equity related instruments – 65% of total assets

An equity mutual fund following contrarian investment strategy

Back 136

Contra Funds

Front 137

A scheme focused on the number of stocks (maximum 30) Minimum investment in equity & equity related instruments – 65% of total assets

An equity scheme investing in maximum 30 stocks (mention where the scheme intends to focus, viz., multi-cap, large-cap, mid-cap, small-cap)

Back 137

Focused Funds

Front 138

The minimum investment in equity & equity related instruments of a particular sector/particular theme – 80% of total assets

An open-ended equity scheme following the theme as mentioned

Back 138

Sectoral Funds or Thematic

Front 139

The minimum investment in equity & equity related instruments – 80% of total assets (following Equity Linked Saving Scheme, 2005 notified by Ministry of Finance)

An open ended equity linked saving scheme with a statutory lock in of 3 years and tax benefit

Back 139

ELSS (Equity Linked Saving Scheme) Funds

Front 140

Debt Schemes

SEBI has decided a total of __________ under Debit Schemes.

16 categories are very high for debt funds considering their similarity in risk and returns from a retail investor perspective. Some categories like Overnight Fund and Liquid Fund are similar. The same is the case with money market funds and ultra-short-term debt fund categories.

Back 140

16 Categories

Front 141

Investment in overnight securities having the maturity of 1 day

A debt scheme investing in overnight securities

Back 141

Overnight Funds

Front 142

Investment in Debt and money market securities with maturity of upto 91 days only

A liquid scheme

Back 142

Liquid Funds

Front 143

Investment in Debt & Money Market instruments such that the Macaulay duration of the portfolio is between 3 months – 6 months

Back 143

Low Duration Funds

Front 144

Investment in Money Market instruments having maturity up to 1 year

A debt scheme investing in money market instruments

Back 144

Money Market Funds

Front 145

Investment in Debt & Money Market instruments such that the Macaulay duration of the portfolio is between 1 year – 3 years

A short term debt scheme investing in instruments with Macaulay duration between 1 year and 3 years

Back 145

Short Duration Fund

Front 146

Investment in Debt & Money Market instruments such that the Macaulay duration of the portfolio is between 3 years – 4 years

Back 146

Medium Duration Funds

Front 147

A medium-term debt scheme investing in instruments with Macaulay duration between 4 years and 7 years

Back 147

Medium to Long Duration Fund

Front 148

A debt scheme investing in instruments with Macaulay duration greater than 7 years

Back 148

Long Duration Fund

Front 149

A dynamic debt scheme investing across duration

Back 149

Dynamic Bond Funds

Front 150

A debt scheme predominantly investing in the highest-rated corporate bonds

Back 150

Corporate Bond Funds

Front 151

A debt scheme investing in below highest-rated corporate bonds

Back 151

Credit Risk Funds

Front 152

A debt scheme predominantly investing in Debt instruments of banks, Public Sector Undertakings, Public Financial Institutions

Back 152

Banking and PSU (Public Sector Undertakings) Fund

Front 153

A debt scheme investing in government securities across the maturity

Back 153

Gilt Fund

Front 154

A debt scheme investing in government securities having a constant maturity of 10 years

Back 154

Gilt Fund with 10-year constant duration

Front 155

A debt scheme predominantly investing in floating rate instruments

Back 155

Floater Fund

Front 156

A hybrid mutual fund investing predominantly in debt instruments

Back 156

Conservative Hybrid Funds

Front 157

50-50 balanced scheme investing in equity and debt instruments

Back 157

Balanced Hybrid Funds

Front 158

A hybrid scheme investing predominantly in equity and equity-related instruments

Back 158

Aggressive Hybrid Funds

Front 159

A hybrid mutual fund which will change its equity exposure based on market conditions

Back 159

Dynamic Asset Allocation Funds or Balanced Advantage

Front 160

A scheme investing in 3 different assetclasses.

Back 160

Multi-Asset Allocation Funds

Front 161

A scheme investing in arbitrage opportunities

Back 161

Arbitrage Funds

Front 162

A scheme investing in equity, arbitrage, and debt

Back 162

Equity Savings

Front 163

SEBI has decided a total of 7 categories under Hybrid Schemes but a mutual fund company can only have 6 categories and they have to choose between Balanced Hybrid Fund or Aggressive Hybrid Fund.

Also, Finally, SEBI has made Arbitrage Fund under the Hybrid Fund category.

Back 163

Hybrid Schemes

Front 164

A retirement solution-oriented scheme having a lock-in of 5 years or till retirement age (whichever is earlier)

Back 164

Retirement Fund

Front 165

A fund for investment for children having a lock-in for at least 5 years or till the child attains the age of majority (whichever is earlier)

Back 165

Children's Fund

Front 166

A mutual fund replicating/ tracking any index

Back 166

Index Fund/ETFs

Front 167

A fund of fund is a mutual fund that invests in other mutual funds

Back 167

Fund of Funds (FoF's) (Overseas/Domestic)

Front 168

__________ means that the portfolio manager buys and sells investments, attempting to outperform the return of the overall market or another identified benchmark.

__________ involves buying a portfolio of securities designed to track the performance of a benchmark index.

Back 168

Active management

Passive management

Front 169

These funds invest in short-term fixed-income securities such as government bonds, treasury bills, bankers’ acceptances, commercial paper, and certificates of deposit.

Back 169

Money market funds

Front 170

These funds buy investments that pay a fixed rate of return like government bonds, investment-grade corporate bonds, and high-yield corporate bonds.

Back 170

Fixed income funds

Front 171

These funds invest in stocks. These funds aim to grow faster than the money market or fixed-income funds, so there is usually a higher risk that you could lose money.

Back 171

Equity funds

Front 172

These funds invest in a mix of equities and fixed-income securities. They try to balance the aim of achieving higher returns against the risk of losing money.

Back 172

Balanced funds

Front 173

These funds aim to track the performance of a specific index such as the S&P/TSX Composite Index

Back 173

Index funds

Front 174

These funds focus on specialized mandates such as real estate, commodities, or socially responsible investing.

Back 174

Specialty funds

Front 175

These funds invest in other funds. Similar to balanced funds, they try to make asset allocation and diversification easier for the investor.

Back 175

Fund-of-funds

Front 176

Portfolio managers may have different investment philosophies or use different styles of investing to meet the investment objectives of a fund.

Back 176

Diversify by investment style

Front 177

4 common approaches to investing

Back 177

1. Top-down approach

2. The bottom-up approach

3. A combination of top-down and bottom-up approaches

4. Technical analysis

Front 178

looks at the big economic picture, and then finds industries or countries that look like they are going to do well. Then invest in specific companies within the chosen industry or country.

Back 178

Top-down approach

Front 179

focuses on selecting specific companies that are doing well, no matter what the prospects are for their industry or the economy.

Back 179

The bottom-up approach

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A portfolio manager managing a global portfolio can decide which countries to favor based on a top-down analysis but build the portfolio of stocks within each country based on the bottom-up analysis.

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A combination of top-down and bottom-up approaches

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attempts to forecast the direction of investment prices by studying past market data.Mutual fund companies often build relationships with advisors and encourage them to sell their funds. When you’re choosing an advisor

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Technical analysis