Mutual funds. What are Mutual Funds

Mutual funds are professionally managed collective investments that pools investments from various investors and invests in Stocks, bonds,money market and other securities. There are various types of mutual funds and each will have a fund manager and they invest according to their set priorities. The value of all mutual funds in the world are around $26 trillion.

Mutual funds and US

Massachusetts Investors Trust (now MFS Investment Management) was founded on March 21, 1924, and, after one year, it had 200 shareholders and $392,000 in assets. The entire industry, which included a few closed-end funds represented less than $10 million in 1924.

The Stock Market crash in the year 1929 hindered the growth of Mutual. US congress passed two Acts Securities Act of 1933 and Securities Exchange Act of 1934. The Law made it mandatory for all funds to be registered with Securities and Exchange Commission SEC. It also made mandatory that all investors are provided with Prospectus that will list the risk factor among all details. As of October 2007, there are 8,015 mutual funds that belong to the Investment Company Institute (ICI), a national trade association of investment companies in the United States, with combined assets of $12.356 trillion. 

Types of Mutual Funds in America
There are various types of mutual funds in America and Canada. They are Open end fund, Exchange traded funds, Equity Funds, Closed end funds etc
 
 Mutual Funds in India and world

Meaning and objective of the Mutual Funds in India and America are the same. In some countries they are called Mutual funds, Some other countries it is Funds, Investment funds and collective funds etc. 

History of Mutual Funds in India.  
Mutual funds came in to existence in India very late after the formation of UTI or Unit Trust of India by the Government of India and Reserve Bank of India at the year 1963. The first scheme of UTI was Unit scheme 1964. By the end of 1988 Unit Trust of India had nearly Rs6700 crores worth assets under its management.1987 marked a difference as the Government of India allowed SBI and other public sector institutions like LIC and GIC to issue Mutual funds. The year 1993 made it possible for private players to enter the Mutual Funds.The first Mutual Funds regulation comes in to existence this year. It was updated by Mutual Funds Regulations in 1996.

Money Market, money market investing

According to cambridge online dictionary Money market is the system in which banks and other similar organisations buy and sell money from each other. Money market is the global financial market for short term borrowing and lending.

Money market Funds.

Money market is the global financial market for short term borrowing and lending.It provides short term funding for global financial system.It is here the short term financial papers like commercial paper, treasury bills and bankers acceptance are being traded. It consists of financial institutions and agents who are interested in borrowing and lending.Most important feature of this market is its liquidity. You can buy and sell any time. The trading has an upward time limit of around 13 months.

The most important Money market funds are as follows.
Treasury bills
Commercial papers
Certificate of deposit
Inter corporate deposits 
Interbank participation certificate
Repo/reverse repo
Call notice/ term money
Money market in India is regulated by RBI and SEBI. 
 
Certificate of Deposit
CDs are similar to savings accounts in that they are insured and thus virtually risk-free; they are "money in the bank" . They are different from savings accounts in that the CD has a specific, fixed term (often three months, six months, or one to five years), and, usually, a fixed interest rate. It is intended that the CD be held until maturity, at which time the money may be withdrawn together with the accrued interest.

Treasury Bills
Treasury bills (or T-bills) mature in one year or less. Like zero-coupon bonds, they do not pay interest prior to maturity; instead they are sold at a discount of the par value to create a positive yield to maturity. Many regard Treasury bills as the least risky investment available to U.S. investors.

Advantages of Money Market Funds.
 There are many advantages of money market funds. It is considered as a low risk investment. People who invest here rarely make loss. All funds switch to money market funds at times to avoid making loss at times of volatility in the market. Money market funds offers more returns than the next alternative ie Bank savings.

Disadvantages money market Funds
There are some dis advantages associated with money market funds too. These funds are not considered as an investment worthy because the returns they promise on investments are very low. These works like bank savings and that makes it less exciting. With more and more new investment options coming people are getting more attracted towards investments other than money market funds.

Real estate , Real estate investing

Real estate is defined as a property in the form of Land or Building. Real estate investing means buying, selling and renting land or buildings with an aim to make profit. Real estate investment is one of the oldest method of investing in the world. A piece of land often considered as a status symbol in countries like India.

Why invest in property market.

World has come to recognize real estate or property investment as the safest investment on the earth. It has many benefits. People go for real estate when they want to invest their hard earned money safely. This is the first saving tips if you talk to any elders. Even though it comes with some dis advantages like the Liquidity problem you invest here because it is safe and highly rewarding. Real estate market is a developing country like India has gone up considerably. 
Real estate investment is capital intensive investment. You need money upfront to transfer the property. But more than 70 percent of the deals are happening with the help of mortgage. What is a mortgage? mortgage is an agreement which allows you to borrow money from a bank or similar organization, especially in order to buy a house or apartment, or the amount of money itself:  

We see a lot of investment strategies associated with Real estate these days. One of them is You enter in to a contract with the seller that you will purchase his property. You pay an advance of 20 or 25 percent and for the remaining amount you agree for a mutually agreed period of say 3 months. You try to find a person who is interested in the property within the agreed time and sell the property to him for a high value. Thus document charges and stamp duty are saved. You also make good profit.Another strategy is you buy a property with an intention to undertake the development of it and make profit. This is called real estate development

Real estate search or source.
Real estate is governed by different rules and traditions in different parts of the world. To find a property itself is a huge task. You can use different sources to find a worthy property.

Real estate agents                                                                                                                   Advertisements (online, News papers and Magazines)
Banks and other financial institutions that sell or auction mortgaged properties.
By search personally.
These are the ways people employ generally to search properties.

Real estate law.
Real estate is governed by different laws and rules by different people. In places like India where people live as a family there are changes of dragging litigation. You have to seek legal advice once you located a property. You must also make proper enquiries about the ownership, market price, and resale option of the property. You must use your intelligence in over coming this major short comings. Frauds and fraudulent activities do happen here.

Arrange Finance.
Arranging Finance is another big concern here. You need money to settle dues and there will be problems related to money at the time of purchase. Most people do mortgage their properties to finance their purchase. Mortgaging is a difficult exercise. There are people who have paid more interest per month for the property than the amount of rent they received. Mortgaging your property also means you are not the original owner unless you clear your dues.

There are huge amounts of risks involved here. A careful Investor must verify the document well before he settles his dues.Also obtaining a certificate about the boundary of your property is another safe tips.Make your enquiries about the market price and quality of your investment. 
Foreclosure Investments.

This is one investment professional real estate investors are all after. This investment is conducted by investors to make good deal. Banks and financial institutions do foreclose the mortgaged properties because of default etc. Banks are not keen to make profit as they are only looking towards realizing their investment. You can make real profit with this investment.

Gold Bullion, Invest in Gold, Futures Trading

Gold is the most trusted investment option for millions. Gold stock is the most important credibility factor for countries and Financial institutions like Banks. People love to invest in gold simply because of its liquidity factor. Deep inside the rural India, Investment means only gold for people. Of all precious metals Gold is the most important and famous investment option.

Gold bullion means simply gold in the form of bars. But in practice we refer gold bullion for trading of gold. People often invest in gold to hedge against loss. When stock market experiences bearish trend, we find people return to gold. Investors generally buy gold as a hedge or safe haven against any economic, political, social, or currency-based crises. These crises include investment market declines, inflation, war, and social unrest. Investors also buy gold during times of a bull market to financially gain.

Invest in Gold It is one investment option you could never ignore. People at different times go for bullion market because of different reasons. You love or hate it but never ignore it. The purpose of this website is to inform our viewers about a great genuine opportunity to make money on investment in gold.

Futures Trading is a contract which is entered between a buyer and a seller at a futures exchange to buy or sell a commodity or currency. The commodity may be foreign exchange, market indexe, gold, silver and other commodities. Gold is one of the preferred commodities when it comes to futures trading. When stock market goes down rapidly we generally see a positive movement of investors towards gold. 

Commodity trading, Commodity futures, Futures trading

Commodity tradings happens in commodity markets. Commodity market is a place where commodities are traded or exchanged under standardized contracts. In a commodity market tradings follow different methods like forward trading, futures trading and spot trading.Commodities trading or Futures trading is considered to be a great way to invest and make money. This is one investment option particularly when the stock markets are volatile

Commodity Trading, Futures trading  
Commodities are traded under different methods. Usually in a commodity market there are spot trading, forward trading and futures trading. 

Spot trading Spot trading means that the trading and delivery takes place immediately or there many be a small delay in the delivery due to technical constraints.
Forward contracts is a trading that takes place between a buyer and a seller. It is a contract whereby seller agrees to sell the commodity to the buyer at the present rate on a future date. The trading will be completed on the day specified. 

Futures contract Futures contract or trading follows the same routine like the forward contract. The actual transaction of selling or buying will happen at a later date. But the contract here is regulated through an exchange. Futures exchange of the respected countries will execute the contract there by eliminating the fear of non execution of the contract.

 
Hedging Hedging is another practice that insures against poor harvests. This practice is carried on by cooperatives mainly. They try to reduce the risk of poor harvest by actively participating in the futures market. They take futures contracts and offset the loss they may incur on account of poor harvest.

Commodity Futures trading takes place in commodity exchanges and it has some great advantages. Due to Commodity futures trading poor farmers can afford to make profit and insure themselves against low prices by entering in to a contract to sell at the time the product prices are high. Buyers also benefit from the fluctuating prices at the time of the harvest. Futures also are regulated very well by futures exchanges of the respective countries. 

Commodity futures thrive particularly when the stock markets are volatile. That is the co relation between stock markets and gold futures. When stock markets are falling FIIs or Foreign Institutional Investors withdrew their stock market investments and invest is gold and commodities that push the commodity market. It is another advantages of commodity trading. When the stock markets are volatile or crashing you can invest in commodities as you can speculate better in commodities than stock markets. 

How to Join Commodity Futures trading
You can join with limited formalities in a futures trading. Formalities to join are similar to Stock market. You are required to open a Dmat account with a Commodity broker or a bank that offers commodity option. You are required to possess a Pan card or Income tax payment no in India before joining Commodities trading. You the Broker charges are very less considering equities market. You have the benefit of Margins here. You can learn more about margins in the next chapter. 

Commodities market in India, Futures trading in India
Opening up of commodity market to futures trading in India opened up a great possibility to make money for Indians. India now has three commodity exchanges namely, the National commodity and derivatives exchange, the Multi Commodity Exchange of India Ltd and the National Multi Commodity Exchange of India Ltd. Many brokers have registered under these exchanges and most important among them are Sharekhan and ICICI direct.
One of the greatest benefit of Commodity futures is that you do not require lot of money to start trading. Even 125 USD or 5000 rupees would be enough to start trading here. But to make an impact you need to invest more. You have to create a portfolio of commodities that could help you to manage and control risk factor.

You have to inform at the time of contract whether you would like to take delivery in case of maturity of the contract. An ideal futures trading could be to buy and sell or sell and buy before the maturity of the contract so that you could avoid sales tax and other taxation. You can inform the brokers at the time of contract that you would like to settle in cash.

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Forex Trading, Learn Forex

Forex trading refers to the trading between currencies. Forex is the most important Economic Indicator. It is also one of the Greatest investment Opportunity. The important advantage of this business is that it allows us to begin with a small investment and make a good return from the business.

Forex Market Never sleeps. You have to be on your toes if you choose this trade.Slight variations in the value of the currencies mean great profit or loss for the traders. You must be well informed and educated before you enter this trading.

Why Forex? Because it allows us to begin this trading with a small investment. There are forex brokers offering to help you begin trading with investment as low as 25 USD. Second benefit is its high leverage margin. You can trade up to 100 times the amount you invest in this trading because of the high leverage margin benefit. Third benefit is that it allows us to make phenomenal returns on our investments because of the volume of trade.

There are certain disadvantages too. You have to be prepared for a loss also. The chances are that one day you may wake up to see that all your investment is wiped out because of the variations which are measured as pips. But, the risk factor is what make this exciting. The risk factor can be overcome by proper education and intuition.

Forex trading is a business which is affected or controlled by various factors. Regional, Economical and political factors are some important variants here. You must also learn to track the performance of a particular currency over a period of time. You must base your intuitions based on the knowledge you acquire over a period of time from the knowledge.

This is one business option you must consider . Learn the various options and ideas to make money from forex trading 

Stock market, Stock market History, Basics

Stock market, Stock market History, Basics< 

A stock market, or (equity market), is a private or public market < 
for the 
trading of company stock and derivatives of company stock at an agreed price; these are securities listed on a stock exchange as well as those only traded privately.The size of the world stock market is estimated at about $36.6 trillion USD at the beginning of October 2008 . The world derivatives market has been estimated at about $480 trillion face or nominal value, 12 times the size of the entire world economy. Learn more about the stockmarket and its functions by clicking here stock market for beginners

+ Stock Market History

Stock market has a rich history and it dates back to 11th century AD. According Wikipedia an 

online encyclopedia Stockmarket history dates back to Jewish and Muslim Merchants who by then have set up every forms of Trade Associations and were in knowledge of many credit and payment methods. In the Year 1602 the Dutch East India Company issued first shares on Amsterdam Stock Exchange.It was the first company to issue stocks and Bonds. Amsterdam Stock Exchange also was the first to introduce many innovative services in the stock market like Short selling,options trading, speculative Instruments,Merchant Banking etc. 
Stock markets have a very rich history. It dates back to 11th century. People love stock market because it opens a very good and unique opportunity for them to make money. Stock market is fast displacing real estate from the most favorable investment option. Though it sees a slide or a crash people find it unique and love to make most of it. 
Learn more about 
 New york Stock Exchange NYSE and its history
 NASDAQ and its history
 BSE and its history
 NSE and its history
 Euronext and its history

Factors that decide Investment.

Liquidity factor 
Liquidity is the most important variable in our Investments. We invest for future. For example we have a surplus of 1million dollar and we invested this money in stock market. We required the money after 3 months and the very next day we sell our stocks and we have our money with us. This is what we call as Liquidity.Liquidity risk Liquidity risk' arises from situations in which a party interested in trading an asset cannot do it because nobody in the market wants to trade that asset. Liquidity risk becomes particularly important to parties who are about to hold or currently hold an asset, since it affects their ability to trade.

 The Rate of return on Investment
The investment decisions are taken on the basis of how much returns we stand to gain from our investments. We love to choose a savings option that gives us more returns.

Risk Factor.
We all love our investments give us more returns while, our principals are safe. Risk taking itself is an art that differs with the character of persons. Some can take more risks while others can't. Risk taking excites some persons more and some run away from risk.

How to Invest, Investment research

Why we invest? We invest because We want to secure our future. We save our surplus income for our future. We save for our kids. Investment requires a lot of research because without proper research we stand to lose all our hard earned money overnight. We have to learn how to invest before we start investing. Let us discuss certain factors decide our investment.All these investment strategies are common to people all over India and world.