We’ve got FOMO if we think there are parts of the money world that we don’t know about! We realized that GMTA, and thought you might experience this fear too! TBH, there is a lot of ground to cover, and the journey to financial literacy is perennial. But, being the GOAT means never giving up. You see what we’re trying to do here right? Oh well! IYKYK.

Today, we’re rounding up some of the most common abbreviations associated with investing, to help further your financial education! Let’s dive right into it –

1. AMFI – Association of Mutual Funds in India – The AMFI is a non-profit organization that plays the role of a regulatory authority for all mutual fund investing in the country. It was incorporated in August 1995, and as things stand today, 42 Asset Management Companies (AMCs) that are registered with SEBI are also members of AMFI. The AMFI operates under the guidelines of SEBI (decoded here). There are a number of functions that fall under the purview of the AMFI. These include maintaining ethical standards in investing, protecting the interests of investors, sharing pertinent information with investors, and regulating the conduct of investment providers.
   
   
2. AMC – Asset Management Company – An AMC is a company that uses pooled funds from its clients, to invest across asset classes including stocks, bonds, real estate, and more. AMCs are more popularly known as money management companies. For certain individuals with high net worth, AMCs also create centralized portfolios, encapsulating the details and growth rates of their pensions, hedge funds, mutual funds, and ETFs (decoded here). From the investor POV, AMCs can be useful as they eliminate the need for minimum investment requirements since your money is going to be pooled with several other investors’ capital to buy financial assets. 
   
   
3. AUM – Assets Under Management – AUM refers to the total market value of the assets that are managed by an individual or a company on behalf of clients (investors). So, for instance, an AMC with a higher AUM might indicate more experience and a higher net worth, than one with a lower AUM. The AUM can be an important performance metric for you to keep in mind when deciding who, or which money management company to approach for your personal finance management. 
   
   
4. NAV – Net Asset Value – If you log onto any mutual fund trading website or platform, you will see that with each fund, there is an NAV mentioned alongside that fund. The NAV of a mutual fund represents the price of one unit. So, if you want to invest ₹5,000 today, and your selected mutual fund has an NAV of ₹50 today, then you will be able to buy a total of 100 units of said fund. Easy peasy!
   
   
5. NFO – New Fund Offer – An NFO is a first-time subscription that offers a mutual fund scheme to the public (investors). Launched at a fixed price (usually of ₹10), an NFO is usually up for grabs for a limited time period of 15 days. It offers investors a fresh new fund to invest in; one that hasn’t yet been affected by any market fluctuations. NFOs can offer investors an avenue for diversification and can even offer tax considerations in some cases (yay!). 

Whether you’re a newbie investor or an investing vet, these 5 terms will keep cropping up in your investment journey. Understanding these terms will bring you a step closer to financial literacy – so keep them in mind!