Page 261 - DCOM304_INDIAN_FINANCIAL_SYSTEM

Indian Financial System Mahesh Kumar Sarva, Lovely Professional University

Notes Unit 13: Mutual Funds and Insurance Services

CONTENTS
Objectives
Introduction

13.1 Mutual Fund
13.2 Types of Mutual Funds
13.3 Significance of Mutual Funds

13.4 Performance Evaluation
13.4.1 Mutual Fund Companies in India
13.4.2 Major Mutual Fund Companies in India
13.5 Insurance Services
13.6 Public and Private Sector Insurance

13.7 Life Insurance
13.8 General Insurance
13.9 Summary

13.10 Keywords
13.11 Review Questions
13.12 Further Readings

Objectives

After studying this unit, you should be able to:

 Know introduction to unit trust of India;
 Know types and significance of mutual funds;
 Knowperformance evaluation;

 Know concept of insurance;
 Know types of insurance.

Introduction

Mutual fund concept, which has been in vogue in the Western world since long, is gaining
popularity in developing countries including India as an institutional device to bridge the gap
between supply and demand of capital in the market.
Mutual fund is an American concept and the terms 'Investment Trust', 'Investment Company',
'Mutual fund' etc., are used interchangeably in American literature. Mutual funds are corporations
which accept dollars to buy stock, long-term bonds, short-term debt instruments issued by
business or government units. These corporations pool funds and thus, reduce risk by
diversification. The term 'mutual' signifies that all gains or losses resulting from the investment
accrue to all the investors in proportion to their subscription. Mutual fund is, thus, a concept of

256 LOVELY PROFESSIONAL UNIVERSITY