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Glossary P

Pari Passu

Ranking equally. After conversion of debentures into shares, the new shares created carry the same rights as the existing shares of the company to receive dividends, rights and bonus shares, and to participate in the company's profit and loss.

Passive portfolio management

Exactly the reverse of active portfolio management. The portfolio manager assumes that markets are efficient and all information is already analyzed and reflected in the prices of shares. This strategy is based on the premise that it is impossible to consistently beat the market.


Pay-out day is the designated day on which securities and funds are paid out to the members by the clearing house of the Exchange.


Performance of an investment indicates the returns from an investment. The returns can come by way of income distributions as well as appreciation in the value of the investment.


It refers to the total investment holdings of the fund.

Portfolio Churning

It refers to the changes made to the portfolio keeping in view the market conditions. It includes both buying and selling of holdings and is aimed at giving a better yield to the investor.

Portfolio Turnover Cost

It refers to the costs associated with the churning (or changes made to the holdings) of the portfolio. Portfolio changes have associated costs of brokerage, custody fees, transaction fees and registration fees, which lower the returns. The quantum of turnover depends on the management style of the fund manager.


When the market price of a unit is more than the NAV, it is said to be trading at a premium.


An offer document by which a mutual fund invites the public for subscribing to the units of a scheme. This document contains information about the scheme and the AMC so as to enable a prospective investor to make an informed decision.

Public Sector Undertakings (PSU) Bonds

PSU Bonds are medium and long term obligations issued by public sector companies where the government share-holding is generally greater than 51% or more. Some of the PSU bonds carry tax exemptions also.

Purchase Price or Offering Price

The price at which a mutual fund's units can be purchased. The asked or offering price means the current net asset value per unit plus sales charge, if any.