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    Question

    Which of the following Statements about the Asset

    Management Company is/are True? I- AMCs are firms pooling funds from various individual and institutional investors and investing in various securities. II- Portfolio Construction is also the task of AMCs. III- AMCs must comply with the set of risk management guidelines by SEBI and AMFI.
    A Only I Correct Answer Incorrect Answer
    B Only II Correct Answer Incorrect Answer
    C I & II Correct Answer Incorrect Answer
    D II & III Correct Answer Incorrect Answer
    E All of the above Correct Answer Incorrect Answer

    Solution

    Asset management companies (AMCs) are firms pooling funds from various individual and institutional investors and investing in various securities. The company invests the funds in capital assets such as stocks, real estate, bonds, and so on. The asset management companies have professionals called fund managers who manage the investment and the research team selects the right securities. An AMC works under the supervision of the board of trustees. But, they are answerable to India’s capital market regulator, the Securities and Exchange Board of India (SEBI). The Association of Mutual Funds in India (AMFI) is another statutory body that addresses investors’ grievances and looks after their interests. Every mutual fund house must comply with the set of risk management guidelines by SEBI and AMFI.

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