1- What is Mutual Fund Participation Certificate?
It is a document which shows the investor's rights against the founder and the company, and shows the investor's amount of investment in the mutual fund.

2- Who can establish Mutual Fund?
According to the rules set by the Capital Markets Board, banks, brokerage houses, insurance companies, pension and provident funds are permitted to establish mutual funds.

3- Who have the right to manage the Fund Porfolio?
According to the portfolio management contract articles signed with the founder of the Fund, portfolio management companies, and if an authorization certificate is taken from the Capital Markets Board, brokerage houses have the right to manage the Fund's portfolio.

4- How is the Fund Portfolio kept?
The securities of the Fund are kept within Takasbank A.Ş. and international clearance houses. Stocks, repos, bills and bonds are kept within Taksabank A.Ş, and foreign securities, if any, are kept within the international clearance houses.

5- What is "Benchmark" ?
This criteria sets the performance of the Fund according to its risk level. It determines at what percentage the cash of the Fund will be allocated to the investment instruments.

6- What are the Income of Mutual Funds?
There are three major revenue items of the mutual funds. The first item is the increase in the portfolio value due to increase in securities invested in the Fund portfolio. This naturally leads to an increase in the share value. The second item is interest and dividend revenue gained from the securities invested in the Fund portfolio. The last revenue item occurs when the Fund sells the security with profit and adds the capital gain to portfolio value.

7- What are the Expenses of Mutual Funds?
There are two major expense items of the mutual funds. The first item is the management fee paid by the founder of the Fund to the portfolio management company. The other expense item is official publication costs, buying and selling, safe-guarding wages and commissions.

8- Where can invest Mutual Funds?
Mutual funds can invest in stocks, treasury bills, government bonds, repos, private sector bonds, investment funds, precious metals, futures, forwards, options and foreign securities.

9- What are the advantages of Mutual Funds?
The most important advantage of a Mutual Fund is that they are managed by professional managers. The funds are managed with the principle of minimum risk and maximum return. Another advantage is that the mutual funds minimize the investors' risk. In other words, mutual funds diversify the risk by investing in various investment instruments, to minimize the probability of loss. Another important advantage is that a mutual fund can easily be converted into cash with its returns.
By investing into a mutual fund, a small investor will have the chance to gain as much as a big investor. Last but not the least advantage is that the returns from A and B type mutual funds are tax exempt. Although the legal entities are subject to institutional tax because of their A and B type mutual fund returns, there is an advantage of tax delay if invested in a mutual fund which invests 51% of its portfolio permanently in stocks.

10- What are the points to take into account when investing in Mutual Funds
The first point that should be taken into account is to determine whether the mutual fund's risk-return level fulfills the investor's expectations. For example, a risk-averse investor who buys liquid fund should keep in mind that this choice will lead to low but safe returns. On the other hand, a risk-lover investor aiming higher returns may choose stock funds, but should be aware of the fact that higher return is not guaranteed. Another point that should be taken into account is to have detailed information about the founders of the Fund, Fund portfolio managers and the management strategy of the Fund.
Also the investor should search the fund from various sources, such as newspapers, magazines, internet, fund bulletins. The daily, monthly, yearly returns of the Fund should be examined carefully before giving the investment decision. When to buy, where to buy are important information for mutual fund participation certificates.

11- What are the types of the mutual funds?

A Type Variable Fund: The fund that consists of at least 25% stock exchange and no other restriction for the type of the invested securities of the remaining part.
B Type Variable Fund: These kind of funds consists of 25% stock exchange at most. Remain is invested in short or long-term government bonds or repurchasing.
Liquid Fund: 100% of the securities are invested in capital market instruments which have 180 days or less to maturity date.
Bond Fund: These kinds of funds are required to invest at least 51% of their assets in foreign or domestic, private or public bonds.
Mixed Funds: These kinds of funds must be consisted by at least two different capital markets instruments, such as, stock exchange, private or government bonds and bills, precious metals market instruments... Additionally, each instrument has to have 20% share of all assets.
Equity funds: These kinds of funds are required to invest at least 51% of their assets in ISE equities.
Affiliates Fund: These kinds of funds are required to invest at least 51% of their assets in equities that belongs to affiliates of the certain company.
Group Funds: These kinds of funds are required to invest at least 51% of their assets in equities that belongs companies of certain groups.
Sector Funds: These kinds of funds are required to invest at least 51% of their assets in equities that operate in certain sector.
Foreign Securities Funds: These kinds of funds are required to invest at least 51% of their assets in private or public foreign securities.
Gold and other Precious Metals Funds: These kinds of funds are required to invest at least 51% of their assets in gold or other precious metals or the securities that issued based on these metals and trading at national or international markets.
Private Funds: Shares of the funds are allocated to certain real or legal persons who are determined before issuing.
Index Funds: Returns of these kinds of funds have to have 90% correlation between certain index that is accepted by the Capital Market