Axis MoneyPlex Knowledge Nugget - 44
Axis Mutual Fund
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Difference Between Gold Fund of Fund & Gold ETF
Mutual funds are a pool of professionally managed funds. What fund houses do is that they pool funds from investors sharing a common investment and invest the capital raised with the intention of generating capital appreciation over the long term. Mutual funds are managed by a team of professional fund managers who buy and sell securities in quantum with an investment strategy that allows the fund to achieve its underlying index. Depending on the nature of the scheme and the investment objective of the fund, a mutual fund may invest across multiple asset classes like equity and debt. Apart from this it also invests in money market instruments like, government securities, etc. Mutual funds generally depend on the performance of their underlying assets to generate capital appreciation over time.
A mutual fund portfolio can also face losses during volatile market conditions. In order to stop this from happening, a mutual fund generally diversifies its investment portfolio among various money market instruments. So even if one asset class underperforms, investments in other sectors/industries may even out the losses. It is less likely for all the asset classes to underperform in tandem at the same time.
What are gold funds?
There are different mutual fund categories created by market regulator SEBI (Securities and Exchange Board of India) to help investors make an informed investment decision. It is also important for investors to determine their risk appetite before making an investment decision, especially when it comes to mutual fund investments.
So, depending on the investor’s financial goals, income needs and their risk appetite, they should make an investment decision. Some mutual funds even give investors an opportunity to seek capital appreciation from one single industry or asset like real-estate, banking, gold etc.
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Statutory Details: Axis Mutual Fund has been established as a Trust under the Indian Trust Act 1882, sponsored by Axis Bank Ltd. (liability restricted to ₹1 Lakh). Trustee: Axis Mutual Fund Trustee Ltd. Investment Manager: Axis Asset Management Co. Ltd. (the AMC) Risk Factors: Axis Bank Ltd. Is not liable or responsible for any loss or shortfall resulting from the operation of the scheme.
Mutual Fund Investments are subject to market risks, read all scheme related documents carefully.