Asset management is the business of investing other people's money for them, together with the software that a fund company uses to do it. The company that runs a mutual fund is called an asset manager, or an asset management company (AMC). Pension funds and the investment teams of insurance companies do the same work.
Say you put ₹5,000 into a mutual fund every month through a SIP, a systematic investment plan. The fund pools your ₹5,000 with the money of lakhs of other investors. A fund manager decides which shares and bonds to buy with it. Each evening, the fund works out what everything it holds is worth. From that figure, it calculates the NAV, the net asset value, which is the price of one unit of the fund. Your statement shows the number of units you own, multiplied by that day's NAV.
You never see the software that does this work. It falls into two groups.
The first group is the investment management software that the fund runs on. Its centre is the investment management system. It holds every position, which means each share and bond the fund owns and how much of it. It records every trade, values the portfolio each day and checks it against the rules that SEBI sets for funds. Investment accounting and reporting software produces the accounts. Funds that invest in companies not listed on a stock exchange, such as private-equity and venture capital funds, use other tools as well. These include fund administration software and cap table management.
The second group is the financial market data that the fund manager reads before deciding. It includes share and bond prices on a financial data terminal, the grades that a credit rating agency gives to bonds, and the index that the fund follows, which an index provider calculates. More and more, an AI model drafts the research that analysts read. An analyst still checks each draft before anyone acts on it. This way of working is called human in the loop.
India has a large part in both groups. Several of the world's biggest investment software and financial data companies run large engineering and research centres in Delhi NCR, Hyderabad, Bengaluru, Mumbai and Pune. Much of the world's financial data is collected, checked and built into products there.
A fund buys its shares through the same stock exchanges as everyone else. The page on stock trading and settlement explains how a trade is matched and settled.