Essay on Hdfc

14553 Words May 28th, 2013 59 Pages

Genesis of Mutual Funds :

The goal of security industry is to a nation of shareholding capitalists to make every man and woman a participant in corporate activities. A small investor is unsophisticated as far as corporate investment is concerned, with the limited resources he/she cannot buy share of blue chip companies. He may not in most cases get allotment of the shares applied for in the primary market, on the other hand he will get full allotment of some dud shares. His investment would therefore not be balanced and diversified. He is not thereby able to minimize his risk by spreading his limited funds over different industries. He has limited access to price sensitive information on the stock exchange. He
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LIC established its mutual fund in June 1989 while GIC had set up its mutual fund in December 1990. At the end of 1993, the mutual fund industry had assets under management of Rs.47,004 crores.

Third Phase – 1993-2003 (Entry of Private Sector Funds) With the entry of private sector funds in 1993, a new era started in the Indian mutual fund industry, giving the Indian investors a wider choice of fund families. Also, 1993 was the year in which the first Mutual Fund Regulations came into being, under which all mutual funds, except UTI were to be registered and governed. The erstwhile Kothari Pioneer (now merged with Franklin Templeton) was the first private sector mutual fund registered in July 1993. The 1993 SEBI (Mutual Fund) Regulations were substituted by a more comprehensive and revised Mutual Fund Regulations in 1996. The industry now functions under the SEBI (Mutual Fund) Regulations 1996. The number of mutual fund houses went on increasing, with many foreign mutual funds setting up funds in India and also the industry has witnessed several mergers and acquisitions. As at the end of January 2003, there were 33 mutual funds with total assets of Rs. 1,21,805 crores. The Unit Trust of India with Rs.44,541 crores of assets under management was way ahead of other mutual funds.

Fourth Phase –

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