Mutual Funds

Direct vs Regular Mfs

https://scripbox.com/blog/difference-between-a-direct-plan-and-regular-plan-in-
mutual-fund-investment
http://www.moneycontrol.com/news/business/mutual-funds-business/direct-mutual-fund-
schemes-fare-better-than-regular-plans-here-is-why-2249999.html

http://www.investopedia.com/ask/answers/04/032604.asp
http://www.moneycontrol.com/news/business/mutual-funds-business/5-
parametersselecting-best-mutual-fund-scheme-1268369.html
https://www.valueresearchonline.com/story/h2_storyview.asp?str=4151
http://economictimes.indiatimes.com/wealth/invest/what-is-a-benchmark-in-a-mutual-
fund/articleshow/56100970.cms

Growth vs Dividend Option MF

The difference
The growth option simply implies that the profits you make stay reinvested. In
other words, the profits, along with your capital, are invested in stocks/debt to
earn you more money.

Dividend payout implies that a part of such profits (an amount that the fund
decides to give out) is stripped from your NAV and given to you. That means, a part
of the funds profits are given in cash. Hence, your NAV falls to the extent of
dividends. This is why the NAV of growth and dividend option are not the same.Div
distrn reduces NAV of MF Schemes.NAV is calculated by dividing the value of the
funds assets by the no of the funds outstanding shares/units.When the fund
distributes dividend payments the NAV declines

In finance, assets under management (AUM), sometimes called funds under management
(FUM), measures the total market value of all the financial assets which a
financial institution such as a mutual fund, venture capital firm, or brokerage
house manages on behalf of its clients and themselves

AUM or Assets Under Management is the total market value of investments managed by
an asset management company (AMCs).

This parameter is different for debt and equity schemes. In equity the comfortable
asset size in hundreds of crores, in debt it should be in thousands of crores as
the investment value per investor is higher in debt funds.

Less AUM in any scheme is very risky as you dont know who the investors are and
what quantum of investments they have in this particular scheme.Exit of any big
investor out of any mutual fund may impact its overall performance very badly and
the remaining investors in a scheme will have to bear the impact. In schemes with
larger AUMs this risk gets minimised.

High scheme assets will help in reducing the total expense ratio of the scheme.

Expense Ration

Expense ratio is very important parameter to be looked at while selecting any

mutual fund scheme. All fund management and distribution related expenses are borne
by the scheme. This means high expense ratio will affect the funds returns.

Though mutual funds total expense ratio has been capped by SEBI, still lower the
better unless we get some extraordinary return by paying higher expenses for fund
management.
A benchmark is a standard against which the performance of a security, mutual fund
or investment manager can be measured

mutual fund returns should not be looked at in isolation. It must be judged in

comparison to the broader markets to understand the real performance. This is where
a mutual fund benchmark is useful.

What is a benchmark?
A benchmark is a standard against which the performance of a mutual fund can be
measured. Since 2012, SEBI made it mandatory for fund houses to declare a benchmark
index. This benchmark is independent and is based on the objectives of your ..

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