What Does Mutual Fund Marketing Consist of?
Bangalore:Making money these days has become way too easier with the introduction of mutual funds. It makes it easier for individual investors to satisy their investment needs. Money from various investors is collected and invested into different securities by the shareholders.
Mutual funds are designed in order to meet the needs of target customers. Marketing involves sellers, buyers and a prodcut to sell. Mutual fund too is a product; every wondered what goes into its marketing?
The marketing of mutual funds consists of the following elements
Product design: Designing a scheme involves all those steps that are required to product in a manufacturing scheme. The task of designing the schemes of mutual funds is performed by the Asset Management Company (AMC). A team consisting of fund managers and researchers is formed by the AMC. The researchers carry out survey studies in the financial market to find out the expectation of the investors. Based on this collected data, a mutual fund product is developed, containing basic features by the fund manager. Some additional small features are added to the scheme to attract investors.
The scheme, before getting marketed has to be accepted by the trustees. The Asset Management Company is required to provide all necessary information to the investors in the specific form prescribed by the SEBI.
Product Promotion: Publicity of the scheme is also carried out by the AMC. Unless approved by the trustees, no scheme can be launched. Also, a copy of the offer document, the form prescribed by SEBI, has to be filed along with a fess of 
25,000 with the board. The document must contain sufficient information that would affect the investor's decision including the disclosure on maximum investments proposed to be made by the scheme in the listed securities of the group companies of the sponsor.
Product Pricing: Regulation 49 of Mutual Funds Regulations provides parameters for determining the sale price and repurchase price of mutual funds applicable for investors. Earlier, mutual funds used two different ways to calculate the sale and repurchase price. There was a slight variation found in the amount payable to the investors due to the different practices followed. Now there is a uniform method used by all mutual funds to calculate the same.
Product Distribution: Decision relating to distribution depends on the agents appointed at the branch levels. Agents/distributors carry out a definite function in the entire marketing set-up of mutual funds. It is they who make the target customers aware about the features of mutual funds products in detail. They are provided training before being appointed and are also entitled to a certain amount of commission related to the amount of products sold by them.
25,000 with the board. The document must contain sufficient information that would affect the investor's decision including the disclosure on maximum investments proposed to be made by the scheme in the listed securities of the group companies of the sponsor.
Product Pricing: Regulation 49 of Mutual Funds Regulations provides parameters for determining the sale price and repurchase price of mutual funds applicable for investors. Earlier, mutual funds used two different ways to calculate the sale and repurchase price. There was a slight variation found in the amount payable to the investors due to the different practices followed. Now there is a uniform method used by all mutual funds to calculate the same.
Product Distribution: Decision relating to distribution depends on the agents appointed at the branch levels. Agents/distributors carry out a definite function in the entire marketing set-up of mutual funds. It is they who make the target customers aware about the features of mutual funds products in detail. They are provided training before being appointed and are also entitled to a certain amount of commission related to the amount of products sold by them.