Mutual Funds are subject to market risk. Please read the offer document carefully before investing”. The very purpose of this disclaimer is to meet the statutory requirements. Only very few people would have heard it when it is mentioned in the radio or television as it flashes by at lightning speed. In print media (Newspaper, Magazines) it is published in extremely small font. Only investors who know the statutory requirements would even be aware of the statement because the advertisements, with ‘namesake’ disclaimers, are hardly educative.
So, what is the mystery behind the ‘flash’ statement? The statement means that mutual fund scheme invests the money collected from investors in instruments which are subject to market risk. Every investor of a MF should read the offer document carefully before they invest their money with the fund house. Continue reading “Mutual Funds – Reading between the lines”