My Cousin asked me whats a Mutual fund and he asked me to give him some advice on choosing advice on Mutual funds .Well I am not a Warren Buffet to give him advice nor am I a free consultant. So I thought I would give a small write up on Mutual Funds so that the adsense picks up proper ads and I advertise my blog.
Coming back on Mutual Funds, i would like to share the basics on Indian Mutual funds once in a while.
Basic : A Mutual Fund is a company which invests money in the stock market on behalf of investors. The money is pooled in by the investors and inturn they are issued units or shares.
NAV : The net asset value (NAV) of a mutual fund is simply its assets minus its liabilities.
In other words, NAV equals the fund's worth. If a fund has assets of 50,000 and liabilities of 10,000
it would have a Net asset of 40,000.
It is from NAV that the price per unit of a fund is calculated.
By dividing the NAV of a fund by the number of outstanding units, you are left with the price per unit.
In our example, if the fund had 4,000 units outstanding, the price-per-share value would be 40,000 divided by 4,000 which equals 10.
The NAVs of funds are constantly changing and, as such, so are their price per shares.
Funds usually wait until the end of each trading day to recalculate their NAV and individual share prices.
See You after some time on another round of Mutual Funds.
BTW, tip for my cousin :
Some good Mutual funds I am invested are HDFC Prudence, Reliance Growth Fund .
Coming back on Mutual Funds, i would like to share the basics on Indian Mutual funds once in a while.
Basic : A Mutual Fund is a company which invests money in the stock market on behalf of investors. The money is pooled in by the investors and inturn they are issued units or shares.
NAV : The net asset value (NAV) of a mutual fund is simply its assets minus its liabilities.
In other words, NAV equals the fund's worth. If a fund has assets of 50,000 and liabilities of 10,000
it would have a Net asset of 40,000.
It is from NAV that the price per unit of a fund is calculated.
By dividing the NAV of a fund by the number of outstanding units, you are left with the price per unit.
In our example, if the fund had 4,000 units outstanding, the price-per-share value would be 40,000 divided by 4,000 which equals 10.
The NAVs of funds are constantly changing and, as such, so are their price per shares.
Funds usually wait until the end of each trading day to recalculate their NAV and individual share prices.
See You after some time on another round of Mutual Funds.
BTW, tip for my cousin :
Some good Mutual funds I am invested are HDFC Prudence, Reliance Growth Fund .
4 comments:
ada paavi unna nambi advise ketta cisuin yaaru? banda paramasivana?
mmmm.....unakkum vena konjam tharean.free advice thana ?
etho solla varennu theriyuthu.
Evvalo naala edhula pozhudu ottikittu irrukee
@ramkumar
summa ipppo dhaan
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