Bachchan & Parker to re-unite

By Pulkit Gupta

New Delhi:  Luxor Writing Instruments said it has signed Bollywood star Amitabh Bachchan as the brand ambassador for 'Parker' pens in India for two years.
Earlier, Mr. Bachchan was associated with the brand from 2001 till 2008 and did enormous ads to promote the brand.
 "With the re-signing, Luxor looks at creating a new high for brand Parker in India...Both Parker and Mr. Bachchan stand for knowledge, heritage, lineage and value. So the fit is perfect," the company said in a statement.
Bachchan will soon be seen with Parker in an extensive all India multimedia campaign, it added.
Parker was launched in India in 1996 by Luxor Writing Instruments Pvt Ltd and is currently available in more than 50000 outlets in India.
The company produces over 300 million pens every year under Luxor, Pilot, Parker and Waterman brand.

Businessdiction: MUTUAL FUNDS

By Pulkit Gupta


Atleast 20 times a day through tv, newspapers, internet, people, hoardings we all hear this term 'mutual funds' but what is this Mutual Fund???
A 'mutual fund' can be described as a fund that is pooled by a large group of investors who give their money to a fund manager (or group of fund managers) of an investment company to invest in equities, debentures, bonds, etc. depending upon the various schemes floated by asset management firms and charge a very small fee for their services.

History of Mutual funds

• Mutual funds evolved from unregulated investment pools put together by individuals in Europe during the 19th century. The first legitimate U.S. based mutual fund began operations in 1924. After the Wall Street crash of 1929, the federal government began to regulate the fledgling industry. The 1934 Securities Exchange Act required mutual fund companies to register with the Securities and Exchange Commission. The 1940 Investment Company Act provided the structural framework for modern-day mutual funds.
• So how these funds work!!
• Firstly, a mutual fund scheme is floated in the market by the asset management firms and they give all the details through a prospectus, that how and where the fund would be invested, including all the fees and terms & conditions. The fund is divided into 'units', which an investor can purchase in accordance to his pocket. Though such funds generally come with a minimum investment clause, in which an investor has to invest a minimum amount declared in the prospectus of the fund. The current value of these funds are calculated on a daily basis (generally the working days of stock markets), on the basis of which the Net Asset Value (NAV) of a fund is declared, which is the market value of a fund minus its liabilities. NAV's keep on changing according to the condition of the stock markets and other instruments in which the money is invested. Investors can exit from these funds according to the type of fund or the conditions mentioned in the prospectus while entering the fund.
• One must be aware of the fact that while buying or selling the units of a mutual fund, asset management firms levy charges on their investors. The fees levied while buying is called 'entry load' and while selling its called 'exit load'.

What are different types of Mutual funds?

A very important question which pops up is what are these different kinds of mutual funds because while investing in a mutual fund all an investor gets to know is all those fancy names like magna fund, aggressive growth fund, emerging markets fund, etc. Mutual funds can be categorised as follows:

a) In accordance to type of investments :
Whenever a mutual fund scheme is introduced in the market, its prospectus will always give you details about where all the money of the fund would be invested. This can be further categorised as follows:

1) Equity funds: Funds that invest only in equities or stocks of various listed companies, these can be further divided to small-cap, mid-cap, large-cap.

2) Balanced or Diversified funds: Funds that invest in equities as well as debt instruments to avoid excessive risk.

3) Gilt funds: Funds which invests in several different types of medium and long term government securities in addition to high quality corporate debt.

4) Money Market funds: These are the funds which invests in the money markets instruments and are short term investments.

5) Sector Specific funds: These are the ones which only invests in a particular sector like banking, real estate, services, etc.

6) Index funds: Its a kind of a fund which invest in the equities which are a part of  index of a particular stock market.

7) Income funds: The objective of these funds is to invest in debt papers. Government authorities, private companies, banks and financial institutions are some of the major issuers of debt papers. By investing in debt instruments, these funds ensure low risk and provide stable income to the investors. These are some what similar to Gilt Funds.

b) In accordance to time of closure of the fund:
A fund is also classified on the basis of its closure date. Some funds have a fixed date of closure and some don't have a definite closure date.

1) Open Ended funds: Funds which do not have a specific date of closure are known as open ended funds.

2) Close Ended funds: These are the funds which have a specific date of closure.

c) Tax Incentive funds:
There are certain funds which offer tax saving benefits to its investors on long term basis.

d) On the basis of payouts by the fund:
Mutual funds can also be classified on the basis of periodicity of its payout to its investors. At time of investment, investors are given the options for payout on their investment.On this basis it can be divided in two types:

1) Dividend Paying funds: Under this option an investor is paid a dividend from time to time as per the profits earned by the fund. But this dividend is given on the discretion of the asset management company as it may require funds to increase the fund's NAV or for expansion of the fund.

2) Reinvestment Schemes: As per this option, the investor's dividend would be re-invested in the fund. He would be allotted additional units of the same fund in the ratio of dividend earned and current market price per unit.

A mutual fund scheme may come under combinations of various categories mentioned above. An investor should enquire about all the possible details before entering into any such fund. Investors can exit the fund anytime as per their requirement by paying exit load and the earning would be calculated according to the current market value of the unit of a fund which entirely depends upon the NAV of the mutual fund.

Investment in mutual funds is beneficiary as it gives you a regular or high return on your investments as compared to what you get via fixed deposits or any other investment scheme.
A mutual fund can not be described as risk free investment but can be a wise way of investing for a layman as their money is looked after by a team of professionals but its advisable that investors should check the previous performance of the asset management company offering the mutual fund scheme.