A mutual fund is a common pool of money into which investors place their contributions that are to be invested in different types of securities in accordance with the stated objective. Mutual funds are corporation that accept money from investors and use this money to buy stocks, long term bonds, short term debt instruments issued by businesses or Government.

It is apparent that there is ample opportunity for growth of our nascent mutual fund industry. The individual investors will have to go under the umbrella of professional fund managers like those in any other emerging market. In course of time mutual funds will play a vital role in our capital market because of its inherent strength as a professionally managed investment vehicle.