Sep 21, 2019

Mutual fund

Mutual Fund

Mutual fund is a financial institution which is operated under supervision of Securities and Exchange Org., and being administered by specialists and by using the funds made available to it by the investors, it makes investment in varying portfolio of shares and other securities for the purpose of protecting against investment risk, benefiting from savings due to scaling and securing the investors’ interests. As a result, one who has invested in a mutual fund, he has, indeed, indirectly invested in the shares of several companies, purchased by the mutual fund from his own assets.

Features and Privileges of Investment in Funds

1) Professional Management: Funds are administered by specialists and skilled managers, and therefore, investors, who have no adequate experience, time and/or appropriate facilities for an independent investment may make investment in the capital market via such funds.

2) Total Transparency and Supervision: Due to supervision on the legal structure by institutions such as the fund’s administrator, the fund’s auditor, Securities and Exchange Org., investors can be sure of preservation of their rights.

3) Diversification and Risk Reduction: According to financial theories diversification in investment can reduce investment risk and decrease in the price of a share may be compensated by appreciation in the value of other securities.

4) Easiness and Simplicity: Investment in the investment funds is simple and there is no need of complicated analyses.

5) Liquidity (Accessibility): Such funds are highly liquid, and investors may get access to cash funds any time by retirement of their investment units. In such case, investment will not encounter restrictions such as sales queuing and/or symbol stop which may exist in direct investment in shares.

6) Economies of Scale: A retail investor is not able to make payment of consultation costs and/or to make use of varying information and analysis software, but when little capitals of retail investors make available such privileges.

7) Mutual Fund Managers’ Motivation: With regard to the designed structure of a mutual fund, its managers’ motivation concerning shares and direct relationship between the growth of the fund’s assets and profits taken by the managers and other associates is predictable, and managers have sufficient motivation for building up the best possible investment portfolio.

8) Availability of Earnings for Re-Investment: Whereas the basis of valuation of a mutual fund is the intraday net value of assets, increase in such value leads to availability of re-investment for the managers of the fund.

9) Flexibility and Diversity: Existence of remarkable number and diversity of mutual funds, with a wide range of objectives of investment from conservative to aggressive, gives investor many options and a high flexibility.

Types of Mutual Funds

A) Types of Mutual Funds based on their Sizes

They may be categorized into small-size and large-size funds.

B) Types of funds based on their asset composition

-  Stock fund

-  Fixed-income securities investment fund

-   Mixed investment fund

 Mutual Fund

Mutual fund is a financial institution which is operated under supervision of Securities and Exchange Org., and being administered by specialists and by using the funds made available to it by the investors, it makes investment in varying portfolio of shares and other securities for the purpose of protecting against investment risk, benefiting from savings due to scaling and securing the investors’ interests. As a result, one who has invested in a mutual fund, he has, indeed, indirectly invested in the shares of several companies, purchased by the mutual fund from his own assets.

Features and Privileges of Investment in Funds

1) Professional Management: Funds are administered by specialists and skilled managers, and therefore, investors, who have no adequate experience, time and/or appropriate facilities for an independent investment may make investment in the capital market via such funds.

2) Total Transparency and Supervision: Due to supervision on the legal structure by institutions such as the fund’s administrator, the fund’s auditor, Securities and Exchange Org., investors can be sure of preservation of their rights.

3) Diversification and Risk Reduction: According to financial theories diversification in investment can reduce investment risk and decrease in the price of a share may be compensated by appreciation in the value of other securities.

4) Easiness and Simplicity: Investment in the investment funds is simple and there is no need of complicated analyses.

5) Liquidity (Accessibility): Such funds are highly liquid, and investors may get access to cash funds any time by retirement of their investment units. In such case, investment will not encounter restrictions such as sales queuing and/or symbol stop which may exist in direct investment in shares.

6) Economies of Scale: A retail investor is not able to make payment of consultation costs and/or to make use of varying information and analysis software, but when little capitals of retail investors make available such privileges.

7) Mutual Fund Managers’ Motivation: With regard to the designed structure of a mutual fund, its managers’ motivation concerning shares and direct relationship between the growth of the fund’s assets and profits taken by the managers and other associates is predictable, and managers have sufficient motivation for building up the best possible investment portfolio.

8) Availability of Earnings for Re-Investment: Whereas the basis of valuation of a mutual fund is the intraday net value of assets, increase in such value leads to availability of re-investment for the managers of the fund.

9) Flexibility and Diversity: Existence of remarkable number and diversity of mutual funds, with a wide range of objectives of investment from conservative to aggressive, gives investor many options and a high flexibility.

Types of Mutual Funds

A) Types of Mutual Funds based on their Sizes

They may be categorized into small-size and large-size funds.

B) Types of funds based on their asset composition

-  Stock fund

-  Fixed-income securities investment fund

-   Mixed investment fund

C) From a Narrower View

1) Stock fund (without periodic payment in small or large size)

2) Stock fund (with periodic payment in small or large size)

3) Fixed-income securities investment fund (with guaranteeing Min. profit in large size)

4) Fixed-income securities investment fund (with predicting Min. profit in large size)

5)  Index fund (in large size)

6)  Foreign investment fund

7)  Charity investment fund (in large size)

8)  Fund without liquidity provider

9)  Exchange traded fund (ETF)

Services

Being supported by the scientific and operational capabilities of our experienced specialists, and in consideration of all aspects of investment and risk management, we offer aggregate of services concerning setting up and management of (foreign currency) mutual funds.

C) From a Narrower View

1) Stock fund (without periodic payment in small or large size)

2) Stock fund (with periodic payment in small or large size)

3)  Fixed-income securities investment fund (with guaranteeing Min. profit in large size)

4) Fixed-income securities investment fund (with predicting Min. profit in large size)

5) Index fund (in large size)

6) Foreign investment fund

7) Charity investment fund (in large size)

8) Fund without liquidity provider

9) Exchange traded fund (ETF)

Services

Being supported by the scientific and operational capabilities of our experienced specialists, and in consideration of all aspects of investment and risk management, we offer aggregate of services concerning setting up and management of (foreign currency) mutual funds.