Mutual Fund Based Questions

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Explain the structure of a mutual fund? Concept of Entry load and Exit Load? How is entry load and exit load calculated? Various kind of funds? a. Index Funds b. MIPs c. Liquid Funds d. FMPs e. ETFs f. Equity Funds g. Balanced Funds h. Floating Rate Mutual Funds i. Tax Saving Mutual Funds These are the Debt mutual funds which invests about 75% to 100% in securities which pay a floating rate interest (bank loans, bonds and other debt securities) while the rest is in fixed income securities. Coupon rate: The stated interest rate on a bond or other debt security when its issued. Benchmark rate: A rate used as a yardstick for measuring or setting other interest rates. Expense ratio: A measure of what it costs an investment company to operate a mutual fund. There are two kinds of floating rate funds long term and short term. o The portfolio of the short-term fund plan is normally skewed towards short-term maturities with higher liquidity and the portfolio of the long-term plan is skewed towards longer-term maturities. However, even the longer-term funds are positioned more on the lines of shortterm funds and are not very aggressive in nature. o The MIBOR rate is the weighted average of call money business transactions done by 29 institutions, including banks, primary dealers and financial institutions.

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What is Systematic Withdrawal plan? What is a growth plan? What is a dividend plan? What is a SIP and how does it work? What is Systematic transfer plan? a. Debt to Equity b. Equity to Debt 10. What are some of the transparent processes adopted by the mutual funds to prove that the investors money has been mobilized? 11. Do investors know that distributors are paid? 12. What is the advantage of FMP? 13. Index Funds are passive investments, Why? 14. What kind of risks are mutual funds exposed to? a. Equity Risks : Volatility b. Debt Fund : Credit Risk and Interest Rate Risk 15. Check List for a mutual fund ? a. Investment objective, b. Asset allocation, c. Investment pattern, d. Features of the scheme, e. Risk factors associated with the scheme, f. Initial issue expenses and recurring expenses to be charged to the scheme, g. Entry or exit loads, h. Sponsors track record, i. Educational qualification and work experience of key personnel including fund managers, j. Performance of other schemes launched by the mutual fund house in the past. 16. Regulatory bodies of mutual funds in India? a. SEBI

17. Role of AMFI a. Committee on Valuation b. Committee on best practice c. Committee on Operations and Compliance d. Committee on Registration of AMFI Certified Distributors e. Committee on Investment Awareness Program f. Committee of Customer Engagement