Mutual Funds

The Indian mutual fund industry started in 1963 with the formation of Unit Trust of India as an initiative of the government of India and Reserve Bank of India (RBI). Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It was set up by the Reserve Bank of India and functioned under the Regulatory and administrative control of the Reserve Bank of India. In 1978 UTI was de-linked from the RBI and the Industrial Development Bank of India (IDBI) took over the regulatory and administrative control in place of RBI. The first scheme launched by UTI was Unit Scheme 1964.

A Mutual Fund is a mechanism for pooling the savings of a number of investors who share a common financial goal.Anybody with an investible surplus of as little as a fewhundred rupees can invest in Mutual Funds. These investors buy units of a particular Mutual Fund scheme that has a defined investment objective and strategy.

Fidelity Fund Management has entered into an agreement with Federal Bank, one of India's premier private sector banks, for the distribution of its products.

Edelweiss Capital today announced that it has been granted the required registration by SEBI to start its mutual fund business. In a filing with the Bombay stock exchange, the company revealed that registration was granted to Edelweiss Mutual Fund with Edelweiss Asset Management acting as the investment manager .

UTI Dividend Yield Fund, with an NAV of 13.05 declared a dividend of 7% with a record date of May 9, 2008 clocking an annual divident of 24% for the fiscal year 2007-2008. All unit holders registered with the dividend option or investors making fresh investments before May 9th will be eligible for this dividend.

Kotak Mahindra Mutual Fund today announced tax-free dividend of Rs4.00 per unit (on a face value of Rs10/- per unit) in Kotak Balance. The dividend record date is March 25, 2008.

Sharekhan, a domestic brokerage reported today that Indian Mutual funds are sitting on 23,545 crores of cash to be deployed in the market. With uncertainty being the key characteristic of stock markets at present, mutual funds are playing it safe and have accumulated a cash pile of over Rs 20,000 crore, which is awaiting deployment after conditions become stable. Rs 19,214 crore lies with existing MFs, while the remaining Rs 4,331 crore has been mobilised through the NFOs.

Unit Trust of India, the country's largest mutual fund group, said today that it would partly lift the freeze on the sale and purchase of units of its flagship fund, US-64, on Aug. 1, permitting almost half of the plan's investors an exit.