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Mutual Funds Growth in India

In: Business and Management

Submitted By peyush
Words 2161
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Managerial Economics - Trends & growth of Mutual fund in India.
Mutual Fund:
Mutual Fund is an institutional arrangement wherein savings of millions of investors are pooled together for investment in a diversified portfolio of securities to spread risk and to ensure steady returns. These funds bring a wide variety of securities within the reach of the most modest of investors. It is essentially a mechanism of pooling together savings of large number of investors for collective investment with an approved objective of attractive yield and appreciation in value. The Mutual Funds offers different investment objectives such as growth, income and Tax planning.
Mutual Funds play vital role in resource mobilization and its efficient allocation to the productive sources of the economic system. Throughout the world, these funds have worked as a reliable instrument of change in financial intermediation, development of capital markets and growth of the
Corporate sector. The process of Liberalization, deregulation and reconstruction of the Indian economy has created necessity for efficient allocation of scarce financial resources. In this process of development, Mutual Funds have emerged as strong financial intermediaries and are playing an important role in bringing stability to the financial system and efficiency to the resource allocation process.
History
Mutual Fund investment traces its origin to the investments of Scottish and English investors in the American West in the 1800s and later of the early global portfolio investors in Japan in the 1960s.
The “investment trust” concept spread rapidly through Europe, and the first American fund was created in 1893. The idea spread quickly around the world, but it came to India only in the 1960s.
The Mutual Fund Industry in India started in 1963 with the formation of Unit Trust of India (UTI), at the initiative of the

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