Date post: | 14-Jan-2015 |
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YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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BONDS
It is a fixed income (debt) instrument issued for a period of more than one year with the purpose of raising capital.
The central or state government, corporations and similar institutions sell bonds.
A bond is generally a promise to repay the principal along with a fixed rate of interest on a specified date, called the Maturity Date
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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In the Indian securities markets, the term ‘debenture’ is used for debt instruments issued by the Central and State governments and public sector organizations and the term ‘bond’ is used for instruments issued by private corporate sector.
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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TYPES OF BONDS
Zero Coupon Bond Bond issued at a discount and repaid at a
face value. No periodic interest is paid. The buyer of these bonds receives only
one payment, at the maturity of the bond.
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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CONVERTIBLE BOND
A bond giving the investor the option to convert the bond into equity at a fixed conversion price.
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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TREASURY BILLS
Short-term (up to one year) bearer discount security issued by government as a means of financing their cash requirements.
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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MUTUAL FUNDS IN INDIA
The first introduction of a mutual fund in India occurred in 1963, when the Government of India launched Unit Trust of India (UTI).
Market was made open to private players in 1993.
The first private sector fund to operate in India was Kothari Pioneer, which later merged with Franklin Templeton
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
7
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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MUTUAL FUNDS
Collective investment Pools money from many investors Invests it in stocks, bonds, short-term
money market instruments and other securities.
Fund manager
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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MUTUAL FUNDS : STRUCTURE IN INDIA
3-tier structure First tier- Sponsor, who thinks of
starting a mutual fund. The Sponsor approaches the Securities
& Exchange Board of India (SEBI), which is the market regulator and also the regulator for mutual funds.
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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Second tier- Once SEBI is convinced, the sponsor creates a Public Trust as per the Indian Trusts Act, 1882.
Once the Trust is created, it is registered with SEBI after which this trust is known as the mutual fund.
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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Third tier-Trustees appoint the Asset Management Company (AMC), to manage investor’s money.
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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The AMC’s Board of Directors must have at least 50% of Directors who are independent directors.
It is the AMC, which in the name of the Trust, floats new schemes and manage these schemes by buying and selling securities.
Whenever the fund intends to launch a new scheme, the AMC has to submit a Draft Offer Document to SEBI.
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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After getting SEBI approval it becomes the offer document of the scheme.
This certificate says that all the information Provided inside the OD is true and correct.
A compliance Officer is one of the most important persons in the AMC.
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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CUSTODIAN
A custodian’s role is safe keeping of physical securities and also keeping a tab on the corporate actions like rights, bonus and dividends declared by the companies in which the fund has invested.
Custodian is appointed by the Board of Trustees.
Only the physical securities are held by the Custodian.
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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AMC
Manage investor’s money on a day to day basis.
All activities by the AMC are done under the name of the Trust, i.e. the mutual fund.
The AMC charges a fee for providing its services.
The fee is charged as a percentage of the scheme’s net assets.
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
20
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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HELP YOURSELF
MF
BOND
YOGESH NAMDEO INGLE. MBA (FINANCE), NET (MANAGEMENT), Ph.D (WIP), G.D.C &A, NCMP.
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BOND