December 19, 2014

Introduction and Background

I love mutual funds.  In fact, I love the whole concept of collective investment schemes. From the point of view of ordinary investors, I regard these as probably the single most important investment innovation in the history of capitalism. These have given the less-wealthy the power, in a way that nothing else has, to somewhat level the playing field that capitalism tends to bend in favour of the wealthy.

I have spent most of my working life using mutual funds to my advantage and to the advantage of anyone who trusted my understanding and my intentions. This is one of two blogs that I have put together in an attempt to document some of that understanding. Through these, I hope to share my observations, experiences and inferences. I hope to shed light on conceptual issues, and on best practices and questionable practices. Over time, I hope to create a resource that will benefit investors, advisors and representatives of mutual funds.

I have opted to set this blog in the context of India and Indian readers. However, if one can sidestep the India-specific references, and consider my use of the term ‘mutual funds’ as a substitute for collective investment schemes, by whatever name offered, then this blog should be of some relevance to readers elsewhere as well.

It would help to be familiar with the basics of what a mutual fund is. For someone unfamiliar, I have a primer here. Additionally, for someone seeking clarity on specific terms, I have a glossary here.

The blog will be closed to comments but I welcome feedback, thoughts and questions via email:

A final thought: mutual funds are a complex investment option, and acquiring a good understanding will likely take some time. If you don’t want complex investment options, stick to PSU bank deposits, savings accounts, Post Office Schemes and the PPF. Do bear in mind, though, that there are some compelling reasons to consider investing in mutual funds. I hope that whatever investment decisions you make, are for the right reasons.