Mutual Fund

Mutual Funds are meant for common investors who get the full time professional fund managers to manage their hard earned money across various asset classes like equities, bonds, money market instruments and/or other securities.

What is Mutual Fund?

A mutual fund is a professionally managed investment fund that pools money from many investors to purchase securities. These investors may be retail or institutional in nature.

It is a trust that collects money from a number of investors who share a common investment objective and invests the same in equities, bonds, money market instruments and/or other securities. And the income / gains generated from this collective investment is distributed proportionately amongst the investors after deducting applicable expenses and levies, by calculating a scheme’s “Net Asset Value” or NAV.

In day to day language buying a mutual fund is like buying a small slice of a big pizza. The owner of a mutual fund unit gets a proportional share of the fund’s gains, losses, income and expenses.

Mutual funds are ideal for investors who either lack large sums for investment, or for those who neither have the inclination nor the time to research the market , yet want to grow their wealth. The money collected in mutual funds is invested by professional fund managers in line with the scheme’s stated objective.

Why Mutual Funds:

Professional Money Management
Fund managers are responsible for implementing a consistent investment strategy that reflects the goals of the fund. Fund managers monitor market and economic trends and analyze securities in order to make informed investment decisions.

Diversification
Diversification is one of the best ways to reduce risk, Mutual funds offer investors an opportunity to diversify across assets depending on their investment needs.

Liquidity
Investors can sell their mutual fund units on any business day and receive the current market value on their investments within a short time period (normally three- to five-days).

Affordability
The minimum initial investment for a mutual fund is fairly low for most funds (as low as Rs500 for some schemes).

Convenience
Most private sector funds provide you the convenience of periodic purchase plans, automatic withdrawal plans and the automatic reinvestment of interest and dividends. Mutual funds also provide you with detailed reports and statements that make record-keeping simple.

Flexibility and variety
You can pick from conservative, blue-chip stock funds, sectoral funds, funds that aim to provide income with modest growth or those that take big risks in the search for returns. You can even buy balanced funds, or those that combine stocks and bonds in the same fund.

What is KYC?

KYC is an acronym for "Know Your Customer" and is a term used for Customer Identification Process as a part of Account Opening process with any financial entity. KYC establishes an investor’s identity & address through relevant supporting documents such as prescribed photo id (e.g., PAN card) and address proof and In-Person Verification (IPV). KYC compliance is mandatory under the Prevention of Money Laundering Act, 2002 and Rules framed there under, read with the SEBI Master Circular on Anti Money Laundering (AML) Standards/ Combating the Financing of Terrorism (CFT) /Obligations of Securities Market Intermediaries.

W.e.f January 1,2016 any subscription whether fresh, additional investment, or switch shall not be permitted by the AMCs if theKYC status of PAN for Mutual Funds is not updated as "KYC Registered-New KYC".

With effect from January 1, 2011, all categories of investors irrespective of amount of investment in Mutual Funds are required to comply withKYC norms under the Prevention ofMoney Laundering Act 2002 (PMLA) for carrying out the transactions such as new/ additional purchase, switch transactions, new SIP/ STP/ DTP registrations received from effective date i.e. January 1, 2011.

What is SIP?

Systematic Investment Plan (SIP) is an investment plan (methodology) offered by Mutual Funds wherein one could invest a fixed amount in a mutual fund scheme periodically, at fixed intervals – say once a month, instead of making a lump-sum investment.

The SIP instalment amount could be as little as Rs. 500 per month. SIP is similar to a recurring deposit where you deposit a small /fixed amount every month.

Common sense suggests that “Buying low and selling high” is perhaps the best way to get good returns on your investments. But this is easier said than done, even for the most experienced investors. There are many factors at play when it comes to any market - debt or equity, and all of them are inextricably linked.

SIP is a simpler approach to long term investing is disciplining and committing to a fixed sum for a fixed period and sticking to this schedule regardless of the conditions of the market.

 

STARTING EARLY PAYS WELL

To get the best out of your investments, it is very important to invest for the long-term, which means that you should start investing early, in order to maximize the end returns.

Let’s understand this better through an illustration –

Let's assume that two friends, both aged 25, decide to invest Rs. 2000 every month for a period of 5 years and earn 8% p.a. on a monthly compounding basis. The only difference is that while one starts investing promptly at the age of 25 itself, the other starts investing 10 years later at the age of 35 years. Both decide to hold on to their investments till they turn 60. So while both of them would accumulate principal investment of Rs.1.2 Lakh over a period of 5 years, the investment of the person who started early at the age of 25 appreciates to over Rs. 14 Lakh, the investment of the second person who started later grows to only about Rs. 6 Lakh.

Thus, you can clearly see the difference between the two and the clear advantage of investing early. So go ahead. Start investing through SIP today itself.

Mutual Funds offered through AU Small Finance Bank

At this point of time we offer the various schemes of the following fund houses :

Sr.No AMCs
1 AXIS ASSET MANAGEMENT COMPANY LIMITED
2

BIRLA SUN LIFE MUTUAL FUND

3

CANARA ROBECO ASSET MANAGEMENT COMPANY LTD.

4

DSP BLACKROCK INVESTMENT MANAGERS LTD.

5

EDELWEISS ASSET MANAGEMENT LIMITED

6

FRANKLIN TEMPLETON MUTUAL FUND.

7

HDFC AMC LTD.

8

ICICI PRUDENTIAL ASSET MANAGEMENT COMPANY LTD

9

IDFC ASSET MANAGEMENT CO.PVT. LTD.

10

KOTAK MAHINDRA AMC LTD.

11

L&T INVESTMENT MANAGEMENT LIMITED

12

MIRAE ASSET GLOBAL INVESTMENTS (INDIA) PVT. LTD.

13

MOTILAL OSWAL ASSET MANAGEMENT COMPANY LIMITED

14

PRINCIPAL PNB ASSET MANAGEMENT LTD.

15

RELIANCE CAPITAL ASSET MANAGEMENT LTD.

16

SBI FUNDS MANAGEMENT PVT.LTD

17

TATA ASSET MANAGEMENT LTD.

18

UTI ASSET MANAGEMENT COMPANY LTD.

Disclosure of Mutual Funds’ Commissions

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Customer Grievance Process:

Contact Helpline – 180012001200 or mail at customercare@aubank.in

Disclaimer : ​MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS, READ ALL SCHEME RELATED DOCUMENTS CAREFULLY.