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30. '' These risks may depend on various factors,'' In this context, explain the various factors affecting the risk specified in the Offer Document.
The Indian Mutual Fund investors are very much aware of the aspects such as returns and benefits from the Mutual Fund investment but are not fully aware of the risk and problems involved in the Mutual Fund Investments. In the absence of this , the Mutual Fund investors are prone to all sorts of risk and will not be in a position to enjoy the returns and benefits they expect. These risks may depends on various factors. The first and foremost thing that an investors needs to do is to read the prospectus /offer document completely and carefully before deciding to make their investments in the Mutual Funds. Finally, investors should always be conscious of the fact that Mutual Funds invest their funds in capital market instruments such as shares ,debentures, bonds and money market instruments , and that all capital market instruments have risk. Therefore, an investors is supposed to have full knowledge and understanding that Mutual Fund investments are subject to market risk and should manage the risks carefully for a safe, profitable , and happy investment.
Ans: Every investment involves some level of risk. The Offer Document makes the investors aware of the risk factors inherent in the scheme. Investors will find descriptions of the risk associated with investments in the Fund. These help investors to refers to their own objectives and decide if the risk associated with the Fund's investments matches their own risk appetite and tolerance. Investors must be familiar with the factors that distinguish the different kinds of risk, and their association with particular Funds, and how they fit into the balance of risk in their overall portfolio. The Offer Document specifies about two risk factors:
i. Standard Risk Factors
ii. Specific Risk Factors