In most countries marketing of mutual funds to the general public is permitted, but only of funds that have been authorised or recognised by the jurisdiction, or by a federated or affiliated jurisdiction. Even so, it may be possible to promote unauthorised funds to professional and institutional investors, or to people no longer living in the country /expatriates/.
CROSS-BORDER/ INTERNATIONAL MARKETING
The advent of the Internet has posed as much of a challenge to regulators as it has provided opportunities to fund management companies and their selling agents; but restraints on international marketing include: Read the rest of this entry »
Once a mutual fund is authorized, it is launched to potential investors by way of an initial offer of shares or units at a fixed price. The terms of the offer are restricted by regulations, which cover matters such as how long the initial offer period may last and the circumstances that require it to close.
The fund or its management company may set a minimum and a maximum target of capital to be raised, and the prospectus must explain what will happen if those targets are not reached or are exceeded.
The launch is usually accomplished by making announcements in the press, mailings to prospective investors, launch briefings for advisers and agents, and advertisements. Although not permitted in the US, some countries allow advertisements to solicit money ‘off the page’ by inclusion of an application form. Nowadays, this extends to advertising and making investment via the Internet. Read the rest of this entry »
Mutual funds are run by professional fund managers, who may choose to appoint other professional bodies to undertake, under contract, one or more aspects of running their funds, such as:
- investment managers – to manage the portfolio of investments;
- marketing companies – to advertise and promote the funds;
- selling agents – to actively sell the funds‘ shares or units;
- administrators – to perform accounting and servicing functions;
- registrars or transfer agents – to maintain the registers of share- or unit holders. Read the rest of this entry »
