Explanation:

Retirement Phase – This is the stage when the investor needs the funds that have been accumulated over time. Hence, investors in this stage would move the funds to asset classes that meet their need for easy access to funds or regular periodic income as the case may be. So the investor will invest more in debt/liquid funds and very less in equity funds.

Explanation:

Thematic funds invest in line with an investment theme. For example, an infrastructure thematic fund might invest in shares of companies that are into infrastructure construction plus in toll-collection, cement, steel, telecom, power, etc. The investment is thus more broad-based than a sector fund. Sector funds invest in only a specific sector. For example, a banking sector fund will invest in only shares of banking companies.

Explanation:

The NAV that is applicable to a transaction depends, among other things, on the day and time at which the transaction request was received at the official point of acceptance. It is therefore very critical to record the time at which a transaction was received and use this information to determine the applicable NAV for a transaction. Time stamping is the process by which a stamp is put with details like date and exact time of receipt etc. on the transaction form.

Explanation:

The auditor appointed to audit the scheme accounts needs to be different from the auditor of the AMC. While the scheme auditor is appointed by the Trustees, the AMC auditor is appointed by the AMC.

Explanation:

Short-term debt funds help earn higher interest income in a rising interest rate scenario. (Bonds are essentially loans. If prevailing interest rates on loans, including bonds, are rising, bond investors tend to demand higher-yielding bonds to make more money on their bond investments). Long-term debt funds help investors earn higher returns from capital gains in falling interest rate scenarios.

Explanation:

The internet gave an opportunity to mutual funds to establish direct contact with investors. Investors can now access the website of the mutual fund and deal directly with the fund.

Explanation:

Most investors are either not organized, or lack the ability to make the calculations required for financial planning. A financial planner’s service is therefore invaluable in helping people realize their needs and aspirations.

Explanation:

Higher fund management does not mean better performance. Also some time passive funds like index funds can give better returns than active funds due to the fund managers’ wrong analysis.

Explanation:

In situations of ‘Sudden Wealth’, it is advisable to initially block the money by investing in a liquid scheme. An STP (Systematic Transfer Plan) from the liquid schemes into equity schemes will help the long-term wealth creation process. One should not invest 100% of the amount in equities in one go.

Explanation:

Scheme Information Document (SID), Statement of Additional Information (SAI) and Key Information Memorandum (KIM) are part of the Offer Documents. These give detailed information about the mutual fund scheme.