Glossary

L

Level Load

Commission (load) that does not vary depending on the investment's length of time.

Liabilities

Any demand for cash against a company's assets, such as lenders ' bills, payable income tax, debenture redemption, interest on loans secured and unsecured, etc. While equity is shown under liability on the balance sheet investor, it has no claim on a company's assets unless it goes into liquidation.

Liquid Fund

Liquid fund invests in the instruments of the money market.Liquid funds invest only up to 91 days in equity and money market instruments. A liquid fund is similar to a money market fund, but removes a time of lock-in.

Liquidity

An asset is said to be liquid if it can be quickly sold for cash on the market. Investors are always advised to keep those properties they may sell in case of an emergency to get cash quickly.

Load

A distribution fee levied to cover selling costs by certain mutual funds (load funds). At the time of purchase, a front end load is paid. At the time of sale, a back-end charge is paid. Investor commissions pay to a mutual fund for entry and exit (buying units) (selling units), In order to meet the costs of maintaining the schemes, mutual funds charge their shareholders fees. This is known as a load. The load is usually charged when investors redeem their units before a given time is completed.

Lock-In Period

A time when the investor is not permitted to sell an investment. Lock-in period is the period in which the investor is not permitted to redeem the units purchased from the mutual fund. He can only sell them when the period of time expires. Period during which the selling of a particular investment is limited to a shareholder.

Long-Term Bond Fund

A mutual fund invests in more than 10 years maturing debt.

Long-Term Capital Gain

A benefit from the selling of a share of a mutual fund kept over a year.