Mutual funds/ Unit Trusts are a way of investing pooled funds. A mutual fund consists of the owners who are the investors into the fund, the fund managers and the trustee who have title of the fund in trust on behalf of the investors. To invest, you buy a unit of the pooled fund. The price of a unit depends on the overall performance of the fund. This price is determined every day. You can find these daily prices for the various mutual funds from the daily newspaper (next to the NSE stock market report).

There are four main types of Unit Trusts

Fixed income – Fund managers invest this fund in opportunities with fixed income return such as real estate for rental

Equity Fund – All the funds are invested in the stock exchange

Money Market – The funds are invested in money market opportunities such as treasury bills, bank lending and bonds.

Balanced Fund – The funds are diversified to equities, fixed income and money market products.

There are 25 Capital Markets Authority (CMA) registered Mutual Fund managers each running their set of mutual funds. Most of the Fund Managers are banks and insurance companies.

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