Worldwide, the Mutual Fund, or Unit Trust as it is called in some parts of the world, has a long and successful history. The popularity of the Mutual Fund has increased manifold. In developed financial markets, like the United States, Mutual Funds have almost overtaken bank deposits and total assets of insurance funds. As at the end of December 1999, in the US alone there were 7,791 Mutual Funds with total assets of over US$6.8 trillion
In India, the Mutual Fund industry started with the setting up of Unit Trust of India in 1964. Public sector banks and financial institutions began to establish Mutual Funds in 1987. The private sector and foreign institutions were allowed to set up Mutual Funds since 1993. As on March 2000, there were 33 Mutual Funds and 337 schemes with total assets of RS. 1,13,005/- crores. This fast growing industry is regulated by the Securities and Exchange Board of India (SEBI).