Funds, ETFs & Index Investing

An arrangement to invest a fixed amount in a mutual fund at regular intervals, usually monthly.

Future Value = Instalment x [((1 + r) raised to n - 1) / r] x (1 + r), where r is the periodic return and n the number of instalments ₹

An arrangement to move a fixed amount at regular intervals from one scheme to another within the same fund house.

Test: units are redeemed from the source scheme and invested in the target scheme on a stated schedule ₹

Funds, ETFs & Index Investing

An arrangement to redeem a fixed amount from a mutual fund at regular intervals.

Units Redeemed each period = Withdrawal Amount / NAV on the withdrawal date ₹

Funds, ETFs & Index Investing

An equity fund investing at least 80% in companies linked by a theme that spans multiple sectors.

Test: minimum 80% allocation to stocks selected by a stated theme rather than by a single sector classification qualitative

Funds, ETFs & Index Investing

An index variant that assumes dividends are reinvested, so it measures the full return from holding the constituents.

Total Return = Price Return + Dividend Yield, compounded over the period index points

Funds, ETFs & Index Investing

The gap between a passive fund's return and its index's return over a period.

Tracking Difference = Fund Return - Index Return over the same period %

Funds, ETFs & Index Investing

The divisions of a mutual fund scheme that represent an investor's proportional ownership of the pool.

Units Allotted = Amount Invested / Applicable NAV shares