what is mutual fund and NAV net assets value

                     UNDERSTANDING MUTUAL FUND

Mutual fund is the financial product of investment. A mutual fund is a professionally managed type of collective investment scheme that pools money from many invests and invests it in stock, bonds, short-term money market instruments and other securities.

Every mutual fund is managed by a fund manager. Fund manager using their management skills and research work to much better return then what an investor can manage on his own. Mutual fund investor is also known as a mutual fund shareholder or a unit holder. Investor receives a unit behalf of investment value.

If any changes in capital market instrument (shares, debenture, etc) its reflect in the NAV (Net Asset Value)

Example- 

·         Market value of a asset  Rs.500000

·         Total number of unit issued  25000

·         NAV of the scheme - 500000/25000 =20

·         If investor A invest Rs.1000 so allotted unit 50