Presented by Group E
Mutual funds
Table of contents
Mutual
Various
Net
fund: size, asset
structure types Prospect
and of and value
compositio and
mutual objective mutual
n of the fund
industry cost
Introduction:
Mutual fund
A mutual fund is a pooled investment vehicle
that collects money from multiple investors to
invest in a diversified portfolio of assets, such as
stocks, bonds, money market instruments, or
other securities.
• Market Capitalization :
Sizes of mutual Mutual funds may be classifi ed
fund:
based on the market cap of the
companies they invest in, such as
large-cap, mid-cap, or small-cap
funds.
• Total asset under management: • Investment Strategy:
This is a total market value of The size can vary depending
assets managed by a mutual fund it on the fund's investment focus,
in the case the font size and such as equity, fi xed income, or
fl uctuate with market condition balanced funds.
• Number of Investors: • Performance Metrics:
The total number of The fund's performance
shareholders or investors in the relative to its peers can also be an
mutual fund can also refl ect its indicator of its size and
attractiveness to investors.
size and popularity.
Structure of mutual fund:
1. Trustee: The trustee oversees the mutual fund and ensures
compliance with regulations and the interests of the investors.
2. Asset Management Company (AMC): The AMC is responsible
for managing the fund's investments and operations, making
decisions on buying and selling securities.
3. Board of Directors: The board governs the AMC and is
responsible for strategic decisions and oversight.
4. Investment Manager: This team makes investment decisions
based on the fund's objectives and strategies.
Structure
. of mutual fund:
5. Research Team: Analysts and researchers evaluate
investment opportunities and provide insights to the
investment manager.
6. Compliance Officer: Ensures that the fund adheres to
regulatory requirements and internal policies.
7. Custodian: A financial institution that holds the fund's
securities and ensures their safekeeping.
8. Distributors: They market and sell mutual fund units to
investors, often playing a role in investor education.
Components
Asset Management Company
(AMC): The AMC manages the
Fund sponsor : mutual fund's portfolio by making
The fund sponsor is typically a investment decisions in line with the
fi nancial services company or fund's objectives. It employs
investment fi rm that creates and professional fund managers and
markets the mutual fund. It provides analysts to oversee the investments.
the initial capital and infrastructure
required to set up the fund.
Fund Manager:
The fund manager is a fi nancial
expert responsible for managing the
fund's portfolio. They make decisions
on buying, selling, or holding
securities based on market research
and analysis.
Components
Trustees:
Entities that oversee the fund's
Custodian:
operations, ensuring compliance with
Institutions that hold and regulations and protecting investors'
safeguard the fund's interests.
assets, ensuring their
Regulatory authority :
security and proper Bodies such as the Securities
management. Board of Nepal (SEBON) that
regulate and supervise the
mutual fund industry to maintain
transparency and protect
investors.
Types of mutual fund
Closed ended
Open ended mutual fund :
mutual fund : • FIX maturity date
• Listed on NEPES guided
• Not like on short
by SEBON with fi nd
market number of universe
• No fi x maturity date • Capital 15% on 85%
• Unit issued can be public
increase as per • Every month publishes
demand NAV value
• Are managed by
AMC
01
Increasing awareness:
Mutual funds :
Growing fi nancial literacy
in courage more investors
Prospect and
.
02
Market growths:
objectives Expanding economics
.
can enhance return
Retail participation:
03 More individual are
through technology
investing
.
pen ended
Mutual funds :
Prospect and
objectives 04 SIPs Popularity :
Systematic investment
.
plan promote consistent
investing
05
Diverse option:
Various font cater to
.
diff erent risk diff erence
Wealth creation : Diversification :
Minimise risk by
To provide opportunities investing in a
for investors to grow diversifi ed
their wealth over time
Objectives protofolio of
asset
of
Professional management : mutual funds Liquidity :
To ensure To off er easy
investments are
entry and exist
managed by fi nancial
experts options for
investors.
Tax Benefits :
To provide tax
advantages as per
applicable laws
Objectives Capital appreciation :
of To achieve long
term growth by
Income generation : mutual funds investing in
high-growth.
To generate regular
income through
dividends and
interest.
Net Asset value NAV =
Total asset at period - Total liabilities
Net Asset Value (NAV) . No. of share outstanding
represents the per-share value where,
of a mutual fund's assets NAV = Net Asset Value at
minus its liabilities. It is a period 't'
critical metric used to assess
the value of a mutual fund and
determine the price at which
investors can buy or sell fund
shares.
Mutual Fund
Cost 3. Exist load :
1.Expense Ratio : A fee charged when you sell your
Yearly fee to cover the fonts mutual fund units , especially if
management and operational sold with specific period
expenses. For example the expense
ratio is 1%, Rs.1 is charged for every
Rs. 100 invested annually 4. Transaction fee:
One time charge for processing
investment or withdrawals
2. Entry load :
A one-time fee for buying units of 5. Other costs:
the mutual fund. (not common in Distribution commission (if investing in
many for now) . regular plans).
Presented by Sandra Haro
Thank you
very much!
