What is a Mutual Fund?

A mutual term refers to a group of two or more persons and the amount of money stored, collected or provided for a specific purpose by the fund. A mutual fund is a type of joint investment scheme.

It is a fund that creates a large fund by mixing money with other investors, and that fund invests in various shares, bonds or other securities. Mutual funds are generally overseen by a portfolio manager, which is not possible for a typical investor at the individual level.

This mutual fund is circulated in many countries of the world including our country. The first mutual fund started circulating around 12-5. Mutual funds were launched in the United States in the 1970s. In this country, prior approval of the BSEC is required to release these funds. Moreover, mutual funds require an entrepreneur, a trustee, a fund manager and custodian.

All of them are instructed to comply with the Mutual Fund Rules. Investing in a mutual fund is good for a new investor, as it has a relatively low risk.

Before you invest in a mutual fund you need to know your personal goals. How much risk can you take and how many days you can invest. The mutual fund’s shares are generally called units.

Suppose the face value of a unit is Tk 5 and if the size of the fund is Tk 20 crore, the number of units will be 2 crore. Related articles: Why New Investors Lose In Stock Market

Through the legal process, various individuals, through the IPO from the institution, withdraw money through the condition and invest in the stock market and financial sector. Mutual fund investment risk is lower than ordinary company shares because mutual fund portfolio holds shares of 5 to 20 or more companies.

Although those who manage mutual funds are generally efficient, many mutual funds are currently living below the face value. There is a lot of speculation that mutual funds will shoot in the days ahead.

Needless to mention, the dividend is always paid on the face value. You can gain experience about the stock market by investing in professional investment management, government supervision, risk reduction and new investment mutual funds.

According to the Investment Company Institute, the global mutual fund assets at the end of 20 were $ 3 trillion. Which now exceeds $ 1 trillion.

by Abdullah Sam
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