A company registered with SEBI, which takes investment/divestments decisions for the mutual fund, and manages the assets of the mutual fund.

A plan offered by most of mutual funds where a small fixed amount is automatically deducted monthly from an investor’s bank account and invested in the mutual fund of their choice.

An investment option for mutual fund unit holders in which the proceeds from either the funds dividends or capital gains, or both are automatically used to buy more units of the funds.

An unmanaged group of securities whose performance is used as standard to measure investment performance. Commonly known as a market index. Some well-known benchmarks are the BSE Sensex and NSE Nifty.

A debt investment with which the investor loans money to an entity that borrows the funds for a defined, period of time at a specified interest rate.

Payments made usually at the end of the year to mutual fund. Share holders of gains realized on the sale of securities in the mutual fund portfolio.

A rise in market value of a mutual fund’s Securities, reflected in its net asset value per share. This is a specific long-term objective of many mutual funds.

A mutual fund scheme in which the investors commit their money for a particular period.

Credit quality is an indicator of credit risk. Credit quality is also one of the principal criteria used for judging the investment quality of a bond.

Debt funds are mutual funds that invest in fixed. There are preferred by individuals who are not willing to invest in a highly volatile equity market.

A mutual fund custodian is a trust, company, bank that is responsible for holding and safeguarding the securities owned within a mutual fund.

Conversion privilege is the right offered to a mutual fund investor, which allow them to move money, between different portfolios offered by the same mutual fund.

The actual percent charged, or amount you will pay during the corresponding time periods.

The fact is the dividend is a part of the investment made by the investor. Dividend options funds also offer users and option of dividend reinvestment plan. Where the dividend paid pout is used to purchase new units of the same mutual fund leading to an increase in the number of units of the fund overtime.

Entry load can be said to be the amount or fee charged from an investor while entering a scheme or joining the company as an investor.

An equity fund is a mutual fund that invests principally in stocks. Equity funds are also known as stock funds.

The ex-dividend date of a stock is the day on which the stock begins trading without the subsequent dividend value.

Exchange privilege is the opportunity given to mutual fund share holders to exchange their investment in a fund for another within the same fund family.

Exit load is a fee or an amount charged from an investor for exciting or leaving a scheme or the company as an investor.

A bond whose coupon rate changes with market conditions.

A front-end load is a commission or sales charge applied at the time of the initial purchase of an investment. The term most often applies to mutual fund investments, but may also apply to insurance policies.

A set of mutual funds managed by a single company. The funds within funds family have different investment goals. However, because the same company manages the whole family, individual’s investors may generally move money, from one fund to another without extra commissions or fees.

Gilt funds are debt funds that invest primarily in government securities. There funds have no risk of non-payment of interest but get affected by interest rate movements as the government borrowing happens to be for a longer duration.

A global mutual fund is an investment tool that allows you to invest in international markets. Simply put, a global mutual fund can be described as a mutual / exchange-traded fund, which invests primarily in companies/enterprises that are spread across the globe.

The interest rate is the amount charged, expressed as a percentage of principal, by a lender to a borrower for the use of assets.

Interest rate sensitivity is a measure of how much the price of a fixed-income asset will fluctuate as a result of changes in the interest rate environment. Securities that are more sensitive have greater price fluctuations than those with less sensitivity.

Income funds may invest in bonds or other fixed-income securities as well as preferred shares and dividend stocks.

Investors pool their money together in a bond fund, the same way they would in a stock mutual fund. Some bonds funds may focus solely on short-term investment.

It could include the long-term capital appreciation, regular monthly income. The funds invest according to the stated objective. The risk and return of the fund will depend on the investment objective since the portfolio of securities held and its management will be driven by the objective.

Jobbers also called stock jobber acted as market makers. They held shares on their own books and created market liquidity by buying and selling securities.

Junk bonds are issued by the company, which has a very low credit rating. With better credit and long track record, the company wants to sell shares to the investor so that their company can invest more and the company can earn profit but the risk in junk bonds is very high and sometimes it gives good returns, and sometimes it does not.

Level loads are fees paid for the sale of mutual fund shares by investors. As a fixed percentage throughout the year. Shares with level loads are designated as class c shares.

A lock- in period is specified as the time period wherein you cannot withdraw the money invested in that particular fund.

A money market fund is a kind of mutual fund that invest only in highly liquid near term instruments such as cash equivalent securities, and high credit rating debt based securities with a short term.

Mutual fund companies raise money from investors. She invests this money in shares. Mutual funds also charge investors in return. For those who do not know much about investing in the stock market, Mutual Fund is a good option for investment.

Net Asset Value means the value of total assets. Just as a stock is prized in the context of stock, in the context of a mutual fund, the price of a unit of the fund is measured in its NAV. The expenditure of 1 day of running the Mutual Fund through the expense ratio is taken out, and then the NAV of that day is calculated.

Net asset value represents a fund's per share market value. ... By dividing the total value of a fund by the number of outstanding units, you are left with the price per unit—the form of measurement in which net asset value is usually quoted.

The number of net assets can be tallied out with the shareholder's equity of a business. One of the easiest ways to calculate net assets is by using the below formula. Net Assets = Assets – Liabilities.

Open-Ended mutual fund as the name suggests, there is no definite time for an investor to buy entry (buy) and exit (sell) in such a mutual fund, and it is open at all, the investor never takes entry. And can do exit anytime, when a mutual fund, thus entry and exit have no time limit, such a mutual fund is called open-ended mutual fund.

he payable date refers to the date that any declared stock dividends are due to be paid out. Investors who purchased their stock before the ex-dividend date are eligible to receive dividends on the payable date.

If you invest in a mutual fund scheme then it is important to understand some technical things and ratios related to it. The portfolio turnover ratio shows that share of holdings in the portfolio of mutual funds.

Prime-rate funds are closed-end mutual funds that seek to provide yields that match the prime rate.

This fee will be charged by the fund company and then added back to the fund. This fee may also be known as an exit fee, market timing fee, or short-term trading fee.

The date on which a share's dividend and/or capital gains will be reinvested in additional fund shares.

The price at which a mutual fund's shares are redeemed by the fund. The redemption price is usually equal to the current net asset value per share.

It is a mutual fund scheme, which covers the entire corpus or a large part of it in a single sector. Some investors choose sector funds when they believe that sector will outperform the entire market. Other investors place bets on sector funds to hedge other holdings in the portfolio. For example, if you believe that there may be many rate cuts in the coming days, which can benefit banks, the biggest benefit will be to the banking sector funds.

Mutual funds are categorized into different series funds which are designed to provide different benefits for investors and different compensation arrangements for the advisors that sell the fund these funds invest. Often involves risk.

The Systematic Investment Plan gives you an opportunity to put a certain amount every month in your preferred Mutual Fund scheme. It is usually started in Equity Mutual Fund.

Standard deviation is a measure of the mutual fund that shows how the mutual fund has performed in the market.

Systematic withdrawal plans are one type of facility. Through this, investors get a fixed amount back from the mutual fund scheme, if the investor wants to withdraw only a certain amount or if they want, they can withdraw the capital gains on the investment.

Treasury bills are short-term financial instruments issued by the country's central bank. It is one of the safest money market instruments as it is devoid of market risks.

A unit holder is an investor who owns the security of a trust. For example, a mutual fund company issues funds and the owner of one of its units is called a unit holder.

These are the investment funds that manage the money of investors who seek private equity stakes in start-up and small- to medium-sized enterprises with strong growth potential.

Investors get a fixed amount back from the mutual fund scheme. In how much time, how much money to withdraw, the investors themselves choose this option. If the investors want to withdraw only a certain amount or if they want, they can withdraw the capital gains on the investment.

Under this bond, you pay face value on maturity. There is no interest between investment and maturity. Bond is issued at deep discount and the issue price is less than the face value