Regional Mutual Funds

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The Regional Mutual Fund as the name suggests, is a special type of mutual fund, wherein the investment is made in such funds that are confined to the securities from a specified geographical region.

The development of a particular region for industrialization, especially for the setting up of Special Economic Zones or Export Oriented Units necessitated huge inflow of funds and subsequently structuring special funds to attract region specific investment.

Presently, the Indian Mutual fund market consists of a variety of funds.

The rise of the Indian mutual fund market was recorded after the economic reforms were undertaken by the government of India. The meteoritic rise of the Indian capital market after the 1990s was the effect of shift of Indian market from closed to open-market policy. The growth of the Indian Industry saw huge inflow of funds, both from domestic private and foreign sources. This further propelled the growth of the Indian infrastructure and real estate industry.

The development of particular region for industrialization, especially for the setting up of Special Economic Zones or Export Oriented Units necessitated huge inflow of funds and subsequently structuring special funds to attract region specific investment. The Association of the Mutual Funds of India (AMFI) came up with Regional Mutual Funds to fill the void of region specific funds. The Regional Mutual Funds grew very popular along with the other types of mutual funds in the recent years.

Definition and features of the Regional Mutual Funds:

The Regional Mutual Fund as the name suggests, is a special type of mutual fund, wherein the investment made in such funds are confined to the securities from a specified geography. In other words, the investments made in the Regional Mutual Fund are dependent on the geographical origin of the fund. The most important feature of this fund is that it invests in portfolio of companies operating in a particular geographical area. The main objective of investing in the Regional Mutual Funds is to take leverage of the geographical growth of that particular area. These funds are created on regions which are supposed to undergo tremendous modernization. The Regional Mutual Funds picks up securities that are not confined to geographical criteria.

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Last Updated 06/30/2011

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