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8. Explain capital protection oriented scheme with an example.
Ans: The term , 'Capital protection oriented scheme' means a Mutual Fund scheme, which is designated as such and which protects the capital invested therein through suitable orientation of its portfolio structure . Capital guarantee means the capital sum invested by an investors is intact at the end of a specific time period . For example , if a person invests Rs.10,000 in a capital protection oriented scheme, then at the end of a certain time period , say five years , he will get back a sum of at least Rs.10,000. There can be a higher payout depending on the earning of the scheme, but this will be additional earning . So , an investor can be sure that he will not lose his capital . Hence, there is a guatantee of protection of capital , but no gurantee of return.