NAV mean net asset value for mutual fund where an investor get value for his amount invested in scheme with holding unit currently .
It mean if you invested some amount in mutual fund scheme by 10000 rs in NFO and get 1000 unit mean currently NAV of this scheme stand at 10 rs. then after after six month if nav risen to 13.88 rs mean your investment grow up to 13880 at current date .
always catch your scheme redeemed time and switching time so if you see market is very high and you have right to switch your fund or withdrawn amount you can also book your profit and again reenter in same scheme when market go down so you also trade in some mutual fund scheme.
so first you have to learn and know about scheme before you going to invest for period ,maturity and entry load ,exit load.
always go for website AMFI before going to invest in mutual fund and get agent list registered in here for .
A mutual fund is a professionally managed firm of collective investments that collects money from many investors and puts it in stocks, bonds, short-term money market instruments, and/or other securities. The fund manager, also known as portfolio manager, invests and trades the fund's underlying securities, realizing capital gains or losses and passing any proceeds to the individual investors. Mutual Fund is a investment company that pools money from shareholders and invests in a variety of securities, such as stocks, bonds and money market instruments. Most open-end mutual funds stand ready to buy back (redeem) its shares at their current net asset value, which depends on the total market value of the fund's investment portfolio at the time of redemption. Most open-end mutual funds continuously offer new shares to investors.
Also known as an open-end investment company, to differentiate it from a closed-end investment company. Mutual funds invest pooled cash of many investors to meet the fund's stated investment objective. Mutual funds stand ready to sell and redeem their shares at any time at the fund's current net asset value: total fund assets divided by shares outstanding.
In Simple Words, Mutual fund is a mechanism for pooling the resources by issuing units to the investors and investing funds in securities in accordance with objectives as disclosed in offer document.
Investments in securities are spread across a wide cross-section of industries and sectors and thus the risk is reduced. Diversification reduces the risk because all stocks may not move in the same direction in the same proportion at the same time. Mutual fund issues units to the investors in accordance with quantum of money invested by them. Investors of mutual funds are known as unit holders.
The profits or losses are shared by the investors in proportion to their investments. The mutual funds normally come out with a number of schemes with different investment objectives which are launched from time to time. In India, A mutual fund is required to be registered with Securities and Exchange Board of India (SEBI) which regulates securities markets before it can collect funds from the public.
source:www.articlesbase.com/investing-articles
