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The Characteristics And Features Of Mutual Funds

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1.1 General Introduction
The term investment refers to the commitment of funds made with an expectation of some positive returns. Two essentials aspects of investment are that-firstly it involves waiting for returns, and secondly it involves an element of risk of not getting what is expected of the investment. Basically investment means purchase of financial asset that yield a return, which is proportionate to risk assumed over some future period of time.
In finance, investment means buying securities or other monetary or paper (financial) assets in the money markets or capital markets, or other in fairly liquid real assets, such as good as an investment, real estate or collectibles with a view to earn some gain over a period of time.
1.2 Features of Investment
All the investment have the following features:
• Return
• Risk
• Safety
• Liquidity
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Professional Management
Mutual Funds provide the services of experienced and skilled professionals, backed by a dedicated investment research team that analyses the performance and prospects of companies and selects suitable investments to achieve the objectives of the scheme.
2. Diversification
Mutual Funds invest in a number of companies across a broad cross-section of industries and sectors. This diversification reduces the risk because seldom do all stocks decline at the same time and in the same proportion. You achieve this diversification through a Mutual Fund with far less money than you can do on your own.

3. Convenient Administration
Investing in a Mutual Fund reduces paperwork and helps you avoid many problems such as bad deliveries, delayed payments and follow up with brokers and companies. Mutual Funds save your time and make investing easy and convenient.
4. Return Potential
Over a medium to long-term, Mutual Funds have the potential to provide a higher return as they invest in a diversified basket of selected securities.
5. Low

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