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COMPARITIVE ANALYSIS OF MUTUAL FUNDS

For Partial Fulfillment of Degree

Masters of Business Administration (MBA)

Submitted By: Project Guide:

Deepak Sijwali Ms. HEENA TALWAR

M. B. A. 4th

SEM LECTURER

ROLL NO - DEPARTMENT OF

MANAGEMENT STUDIES

AMRAPALI INSTITUTE OF MANAGEMENT AND APPLIED

SCIENCES

SHIKSHA NAGAR, LAMACHAUR, HALDWANI(AFFILIATED TO UTTRAKHAND TECHNICAL UNIVERSITY, DEHRADUN)


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PREFACE

Mutual funds can be considered as financial intermediaries in the investment business that

collect funds from the public and invest on behalf of the investors. Mutual funds issue units to

the investors. The appreciation of the portfolio or securities in which the mutual fund has

invested the money leads to an appreciation in the value of the units held by investors.

By the vary nature of their activities, and by virtue of being knowledgeable and informed

investors, they influence the stock market and play an active role in promoting good corporate

governance, investors protection and the health of capital markets.

Investment decision is one of the most important decisions that one has to take. People often

commit mistake in selecting the avenues for investment. Mutual fund units are issued and

redeemed by the Fund Management Company based on the fund's net asset value (NAV).This

project was undertaken in order to make a comparative study of different Mutual Fund Schemes

by Reliance Mutual Funds, Birla Sun Life Mutual Funds, ICICI Prudential Mutual Funds and

SBI Mutual Funds. Management ideas without any action based on them mean nothing. That is

why practical experience is vital for any management students. So practical exposure are

indispensable to such courses. .

In the forthcoming pages, an attempt has been made to presently a comprehensive reportconcerning different aspects of my topic.


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DECLARTION

I Deepak Sijwali MBA (Final) of Amrapali Institute of Management And Computer Applications

undersigned here by declare that the report entitle as COMPARITIVE ANALYSIS OF

MUTUAL FUNDS for the partial fulfillment of the degree of Masters of Business

Administration submitted to Uttarakhand Technical University Dehradun is the original work of

mine and the data provided in the study to the best of my knowledge.

This study has not been submitted to any other institution or university for award of any

other degree.

DEEPAK SIJWALI


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ACKNOWLEDGEMENT

While completing this project I got an opportunity to understand about COMPARATIVEANALYSIS OF MUTUAL FUNDS. Now as I am submitting this project I feel that it would be

incomplete without mentioning the names of the people who were constant sources of help and

inspiration for me and providing a lot of help during the completion of this project and

contributed to my academic cause. I am thankful to Ms. Heena Talwar for her useful guidance

throughout this project. I am thankful to my friends to help me a lot. I am also thankful to my

parents for providing me the moral support and boost up. Hereby, I would thankful to my

institution for providing me all the necessary help needed for the completion of this project.

Thank you.


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Table of Content

Chapter 1.

1.1 Topic Introduction

1.2 Chapter Arrangement

1.3 Objectives of Study

1.4 Limitations of the study

Chapter 2.

2.1 Literature review

2.2 Companies considered

Chapter 3.

3.1 Research Methodology

3.2 SWOT Analysis

Chapter 4.

4.1 Data Analysis & Interpretation

4.2 findings

Chapter 5

5.1 Conclusion

5.2 Suggestions and Recommendations

5.3 Bibliography

5.4 Annexure


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CHAPTER 1

1.1 Topic Introduction

Mutual Funds are a collective investment process. An asset management company collects many

investors money. It invests this money in various securities to generate returns for the investors.

Investors get the net return after deducting the related expenses. If there is any loss, it would be

borne by the investors. An asset management company manages the pool of money; therefore it

is also an indirect form of investment for investors. It is necessary that every pool of investor

should have one common investment objective because the investment objectives decide where

the investment is made.

If the common objective is to take risk for higher returns in medium to long term then

investment will be made in equity.

If the objective is lower returns with safety of principal then investment is done in debt

instruments.

The most important feature of the mutual funds is that investors are the owners of the mutual

funds. They contribute to the funds and only they will share profits.

The pool of money which is contributed mutually by all investors and whose benefits will be

shared mutually by all investors is the mutual fund.


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1.2 Chapter Arrangement

CHAPTER-1

This chapter of the project report includes the introduction, objective, and sample size, period of

study, methodology, and limitation of the study.

CHAPTER-2

This part of project report states the literature review which includes theoretical background and

profile of the company.

CHAPTER-3

This part of project report contains data analysis on the basis of questionnaire and Findings.

CHAPTER-4

In this part of the project report I finally conclude the project with some recommendation.

1.3Objectives of the Study

To study about the mutual funds industry.

To study the approach of investors towards mutual funds.

To evaluate the performance of different type of mutual funds.


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To give the knowledge about comparative tools with the help of we can compare the

mutual funds.

Acceptance of mutual funds in India & its scope in future.

1.4 Limitations

TIME CONSTRAINTSShortage of time was a very big constraint due to which less no. of

mutual fund has been included in the study.

RESOURCE CONSTRAINTAvailability of the data was a constraint due to only those

mutual funds data is considered which is available.

PERIOD OF ANALYSISGenerally longer period gives us more accurate estimates of Mutual

Funds of different companies in detail. In this case study period of analysis is only 3 months.

COMPLEX CALCULATIONIf we want to make the analysis of different mutual funds than

there is a large data & complex calculations that make the more chances of errors, lack of

expertise, being a fresher.


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Chapter 2

Literature review

Theoretical Background

Overview of mutual fund

A mutual fund pools the money of people with similar investment goals. The money in turn is

invested in various securities depending on the objectives of the mutual fund scheme, and the

profits or losses are shared among investors in proportion to their investments. Mutual fund is an

instrument of investing money. Nowadays, bank rates have fallen down and are generally below

the inflation rate; therefore keeping large amount of money in bank is not a wise option, as in

real terms the value of money decreases over a period of time.

PROCESS OF MUTUAL FUND INVESTMENT

One of the options is to invest the money in stock market. But a common investor is not

informed and competent enough to understand the intricacies of stock market. This is where

mutual funds come to resource

A mutual fund is a group of investors operating through a fund manager to purchase a diverse

portfolio of stocks or bonds. Mutual funds are highly cost efficient and very easy to invest in .by


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pooling money together in a mutual fund, investors can purchase stocks or bonds with much

lower trading cost than if they tried to do it on their own. Also, one does not have to figure out

which stocks or bonds to buy. But the biggest advantage of mutual funds is diversification.

Diversification means spreading out money across many different types of investments when one

investment is down another might be up. Diversification of investment holdings reduces the risk

tremendously.


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TYPES OF MUTUAL FUNDS SCHEMES

There are varieties of mutual of mutual fund schemes that cater to the needs of the investor,

whatever your age, financial position, risk tolerance, and return expectations.

Mutual funds can be classified on the following basis:

a) ON THE BASIS OF STRUCTURE:

Open-end schemes


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Close-end schemes

Interval scheme

b) ON THE BASIS OF INVESTMENT OBJECTIVE:

Growth schemes

3Income schemes

Balanced scheme

Money market / liquid schemes

c) OTHER SCHEMES:

Special schemes

Tax saving scheme

Index schemes

Sectoral specific schemes

Diversified equity schemes

Primary market schemes

ON THE BASIS OF STRUCTURE

Open End Schemes:

An open-end mutual fund is a fund that does not have a set number of shares. It continues to sell

shares to investors and will buy back shares when investors wish to sell. Units are bought and

sold at their current net asset value.

Open-end funds keep some portion of their assets in short-term and money market securities to

provide available funds for redemptions.

A large portion of most open mutual funds is invested in highly liquid securities, which enablesthe fund to raise money by selling securities at prices very close to those used for valuations.

Such schemes do not have a fixed maturity period.

Close Ended Schemes:


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A closed-end mutual fund has a set number of shares issued to the public through an initial

public offering. These funds have a stipulated maturity period generally ranging from 3 to 15

years.

The fund is open for subscription only during a specified period. Investors can invest in the

scheme at the time of the initial public issue and thereafter they can buy or sell the units of the

scheme on the stock exchanges where they are listed. Once underwritten, closed-end funds trade

on stock exchanges like stocks or bonds.

The market price of closed-end funds is determined by supply and demand and not by net-asset

value (NAV), as is the case in open-end funds.

Interval Schemes:

These combine the features of open ended and close ended schemes. They may be traded on the

stock exchange or may be open for sale or redemption during predetermined intervals at NAV.

ON THE BASIS OF INVESTMENT OBJECTIVE:

Growth scheme:

Growth funds are those mutual funds that aim to achieve capital appreciation by investing in

growth stocks. They focus on those companies, which are experiencing significant earnings or

revenue growth, rather than companies that pay out dividends.

Growth funds tend to look for the fastest-growing companies in the market. Growth managers

are willing to take more risk and pay a premium for their stocks in an effort to build a portfolio

of companies with above-average earnings momentum or price appreciation.

Income schemes:

These schemes invest in fixed income instruments such as bonds issued by corporate and

financial institutions, and government securities.

It is to provide regular and steady income to investors. These schemes generally invest in fixed

income securities such as bonds and corporate debentures.


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This is ideal for retired people and others with a need for capital stability and regular income

Investors who need some income to supplement their earnings.

Balanced schemes:

Also known as hybrid scheme these funds invest in debt and security in comparable proportion.

The proportion need not be exactly same but comparable in India balanced funds are normally

invested 60% in debt and remaining in equity.

This scheme tends to provide investor exposure to both equity and debt markets in one product.

It is to provide both growth and income by periodically distributing a part of the income and

capital gains they earn. They invest in both shares and fixed income securities in the proportion

indicated in their offer documents. In a rising stock market, the NAV of these schemes may not

normally keep pace, or fall equally when the market falls.

This scheme is ideal for Investors looking for a combination of income and moderate growth.

Money market/ liquid schemes:

These schemes invest in short term instruments such as certificate of deposits, treasury bills and

short term bonds. Under this scheme risk is relatively low and recommended investment horizon

is up to 1 year. A money market fund is a mutual fund that invests solely in money market

instruments. Money market instruments are forms of debt that mature in less than one year and

are very liquid. Treasury bills make up the bulk of the money market instruments. Securities in

the money market are relatively risk-free.

Money market funds are generally the safest and most secure of mutual fund investments. The

goal of a money-market fund is to preserve principal while yielding a modest return. Money-

market mutual fund is akin to a high-yield bank account but is not entirely risk free. When

investing in a money-market fund, attention should be paid to the interest rate that is being

offered.

Aim: It is to provide easy liquidity, preservation of capital and moderate income. These schemes

generally invest in safer, short term instruments such as treasury bills, certificate of deposit,

commercial paper and interbank call money.


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Returns on these schemes may fluctuate, depending upon the interest rates prevailing in the

market.

This scheme is ideal for Corporate and individual investors as a means to park their surplus funds

for short periods or awaiting a more favorable investment alternative.

OTHER SCHEMES

Tax Savings Schemes:

These schemes offer tax rebates to the investors under tax laws as prescribed from time to time.

This is made possible because the government offers tax incentives for investment in specific

avenues. For e.g.: equity linked saving schemes and pension schemes. This is Ideal for Investors

seeking tax rebates

Special Schemes:

This category included index schemes that attempt to replicate the performance of a particular

index such as the BSE sensex or NSE 50, or industry specific (which invest in specific

industries) or sectoral schemes (which invest exclusively in segments such as A group shares or

initial public offerings)

Sector Equity Schemes:

The investment objective of a sectoral fund is to invest in securities of a specific sector. The

choice of the sector could vary depending upon the investor preference and the returnrisk

attributes of the sector.

For eg: banking stocks have shown quite decent growth in the last four years. Investors who

wanted to participate in this sector could do so, by investing in Sectoral funds.

Diversified Equity Schemes:

The fund invests in equity across all sectors and companies. These funds invest a pre-dominant

portion of the funds mobilized in equity shares. These funds have the freedom to invest both in

primary and secondary markets for equity.


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Primary Market Funds:

The primary funds invest in equity shares, but do so only when a primary market offerings is

available. The focus is on capturing the opportunity to buy those companies which issue their

equity in primary markets, either through a public offer or through a private placement.

.

Index Funds:

An index fund is a type of mutual fund that builds its portfolio by buying stock in all the

companies of a particular index and thereby reproducing the performance of an entire section of

the market.

These are funds operated by an investment company which raises money from the public and

invests in a group of assets (share, debenture etc.) in accordance with a stated set of objective.

Benefits of investing in mutual funds

As opposed to investing directly in the three asset classes, assessing through a mutual fund has

several advantages:

Professional management:

As the money is managed by the professionals who have the experience and recourses to

thoroughly analyze the economy and financial markets and spot good opportunities.

Diversification:

With the smaller amounts, you can achieve a higher degree of diversification and reduce your

risk

Liquidity and convenience:

Investing and getting back your money is easy. Also, there is very little paper work, and it is very

easy to track and monitor your investments.

Tax benefits:

Some mutual funds scheme offer you tax benefits under section 80 c .in addition, your returns

from mutual funds are eligible for favorable tax treatment.


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In short, the key to investment success is determining your needs and selecting and allocating

your savings across appropriate asset classes that can help you achieve them. Mutual fund offers

you a low cost, convenient and professional investments vehicle to access different asset classes.

DRAWBACK OF INVESTING IN MUTUAL FUNDS

Mutual funds have their drawbacks and may not be for everyone:

No Guarantees:

No investment is risk free. If the entire stock market declines in value, the value of mutual fund

shares will go down as well, no matter how balanced the portfolio. Investors encounter fewer

risks when they invest in mutual funds than when they buy and sell stocks on their own.

However, anyone who invests through a mutual fund runs the risk of losing money.

Fees and commissions:

All funds charge administrative fees to cover their day-to-day expenses. Some funds also charge

sales commissions or "loads" to compensate brokers, financial consultants, or financial planners.

Even if you don't use a broker or other financial adviser, you will pay a sales commission if you

buy shares in a Load Fund.

Taxes:

During a typical year, most actively managed mutual funds sell anywhere from 20 to 70 percent

of the securities in their portfolios. If your fund makes a profit on its sales, you will pay taxes on

the income you receive, even if you reinvest the money you made.

Management risk:

When you invest in a mutual fund, you depend on the fund's manager to make the right

decisions regarding the fund's portfolio. If the manager does not perform as well as you had

hoped, you might not make as much money on your investment as you expected. Of course, if

you invest in Index Funds, you forego management risk, because these funds do not employ

managers.


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FREQUENTLY USED TERMS

NET ASSET VALUE (NAV)

The net asset value of the fund is the cumulative market value of the assets fund net of its

liabilities. In other words, if the fund is dissolved or liquidated, by selling off all the assets in the

fund, this is the amount that the shareholders would collectively own. This

gives rise to the concept of net asset value per unit, which is the value, represented by the

ownership of one unit in the fund. It is calculated simply by dividing the net asset value of the

fund by the number of units. However, most people refer loosely to the NAV per unit as NAV,

ignoring the "per unit". We also abide by the same convention.

SALE PRICE

The price you pay when you invest in a scheme. Also called Offer Price. It may include a sales

load.

REPURCHASE/ REDEMPTION PRICE

The price at which a open-ended or close-ended scheme repurchases its units and it may include

a back-end load.

SALES LOAD

An AMC may decide that investors should pay more than NAV for their investment in each unit

of the scheme. This incremental amount is also called, Front-end load or Entry load.

Schemes that do not charge a load are called No Load schemes. Therefore, the amount that

needs to be paid is, Sale Price = NAV + Entry Load

REPURCHASE OR BACK-END LOAD

An AMC may decide that sellers would recover less than NAV for the units they sell in a

scheme. This shortfall, borne by existing investors, is called the Exit load or Back-end load.

Thus the amount will be, Sale Price = NAVExit Load


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SYSTEMATIC INVESTMENT PLAN (SIP)

SIP refers to the practice of investing a constant amount regularly, generally every month. When

the market goes up, then the money invested in that period gets translated into a fewer number of

units for the investor. If the market goes down, then the same money invested gets translated into

more units. This investment style is also called rupee cost averaging.

SYSTEMATIC WITHDRAWAL PLAN (SWP)

Under SWP, the investor would withdraw constant amount periodically. The investor can temper

gains and losses, though it does not prevent losses.

SYSTEMATIC TRANSFER PLAN (STP)

Investors exposure to different types of securities, whether debt or equity, should flow from

their risk profile or risk appetite which is a function of their financial position and personal

disposition. Through STP between plans, it is possible to maintain a target mix of debt and

equity in ones portfolio.

EQUITY LINKED SAVING SCHEMES (ELSS)

Equity-Linked Savings Schemes are by far the most exciting of all the tax-saving schemes.

Nomination facility is available with ELSS. The units can be easily transferred by filling out a

transfer form.

Equity fund or scheme:

A scheme, which invests predominant portion of its fund in equity and equity related

instruments, is known as equity schemes. This kind of scheme exhibits all the attributes of an

equity instrument viz., it has comparatively high risk, high return potential and highly volatile.

STRUCTURE OF THE INDIAN MUTUAL FUND INDUSTRY

The origin of mutual fund industry in India is with the introduction of the concept of mutual fund

by UTI in the year 1963. Though the growth was slow, but it accelerated from the year 1987

when non-UTI players entered the industry.


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In the past decade, Indian mutual fund industry had seen dramatic improvements, both quality

wise as well as quantity wise. Before, the monopoly of the market had seen an ending phase; the

Assets under Management (AUM) were Rs. 67bn. The private sector entry to the fund family

raised the AUM to Rs. 470 billion in March 1993 and till April 2004; it reached the height of

1,540 billion.

Putting the AUM of the Indian Mutual Funds Industry into comparison, the total of it is less than

the deposits of SBI alone, constitute less than 11% of the total deposits held by the Indian

banking industry.

The main reason of its poor growth is that the mutual fund industry in India is new in the

country. Large sections of Indian investors are yet to be intellectuated with the concept. Hence, it

is the prime responsibility of all mutual fund companies, to market the product correctly abreast

of selling.

The mutual fund industry can be broadly put into four phases according to the development of

the sector. Each phase is briefly described as under.

First Phase - 1964-87: Unit Trust of India (UTI) was established on 1963 by an Act of

Parliament. It was set up by the Reserve Bank of India and functioned under the Regulatory and

administrative control of the Reserve Bank of India. In 1978 UTI was de-linked from the RBI

and the Industrial Development Bank of India (IDBI) took over the regulatory and administrative

control in place of RBI. The first scheme launched by UTI was Unit Scheme 1964. At the end of

1988 UTI had Rs.6, 700 crores.

Second Phase - 1987-1993 (Entry of Public Sector Funds): Entry of non-UTI mutual funds.

SBI Mutual Fund was the first followed by Canbank Mutual Fund (Dec 87), Punjab National

Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund (Nov 89), Bank of India (Jun 90), Bank

of Baroda Mutual Fund (Oct 92). LIC in 1989 and GIC in 1990. The end of 1993 marked RS.

47, 004 as assets under management.

Third Phase - 1993-2003 (Entry of Private Sector Funds): With the entry of private sector


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funds in 1993, a new era started in the Indian mutual fund industry, giving the Indian investors a

wider choice of fund families. Also, 1993 was the year in which the first Mutual Fund

Regulations came into being, under which all mutual funds, except UTI were to be registered and

governed. The erstwhile Kothari Pioneer (now merged with Franklin Templeton) was the first

private sector mutual fund registered in July 1993.

The 1993 SEBI (Mutual Fund) Regulations were substituted by a more comprehensive and

revised Mutual Fund Regulations in 1996. The industry now functions under the SEBI (Mutual

Fund) Regulations 1996.

The number of mutual fund houses went on increasing, with many foreign mutual funds setting

up funds in India and also the industry has witnessed several mergers and acquisitions. As at the

end of January 2003, there were 33 mutual funds with total assets of Rs. 1, 21,805 crores. The

Unit Trust of India with Rs.44, 541 crores of assets under management was way ahead of other

mutual funds.

Fourth Phase - since February 2003: This phase had bitter experience for UTI. It was

bifurcated into two separate entities. One is the Specified Undertaking of the Unit Trust of India

with AUM of Rs.29, 835 crores (as on January 2003). The Specified Undertaking of Unit Trust

of India, functioning under an administrator and under the rules framed by Government of India

and does not come under the purview of the Mutual Fund Regulations.

The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and LIC. It is registered

with SEBI and functions under the Mutual Fund Regulations. With the bifurcation of the

erstwhile UTI which had in March 2000 more than Rs.76, 000 crores of AUM and with the

setting up of a UTI Mutual Fund, conforming to the SEBI Mutual Fund Regulations, and with

recent mergers taking place among different private sector funds, the mutual fund industry has

entered its current phase of consolidation and growth. As at the end of September, 2004, there

were 29 funds, which manage assets of Rs.153108 crores under 421 schemes.


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RECENT TRENDS IN MUTUAL FUND INDUSTRY

The most important trend in the mutual fund industry is the aggressive expansion of the foreign

owned mutual fund companies and the decline of the companies floated by nationalized banksand smaller private sector players.

Many nationalized banks got into the mutual fund business in the early nineties and got off to a

good start due to the stock market boom prevailing then. These banks did not really understand

the mutual fund business and they just viewed it as another kind of banking activity. Few hired

specialized staff and generally chose to transfer staff from the parent organizations.

The performance of most of the schemes floated by these funds was not good. Some schemes

had offered guaranteed returns and their parent organizations had to bail out these AMCs by

paying large amounts of money as the difference between the guaranteed and actual returns. The

service levels were also very bad. Most of these AMCs have not been able to retain staff, float

new schemes etc. and it is doubtful whether, barring a few exceptions, they have serious plans of

continuing the activity in a major way.

The experience of some of the AMCs floated by private sector Indian companies was also very

similar. They quickly realized that the AMC business is a business, which makes money in the

long term and requires deep-pocketed support in the intermediate years. Some have sold out to

foreign owned companies, some have merged with others and there is general restructuring going

on.

The foreign owned companies have deep pockets and have come in here with the expectation of

a long haul. They can be credited with introducing many new practices such as new product

innovation, sharp improvement in service standards and disclosure, usage of technology, broker

education and support etc. In fact, they have forced the industry to upgrade itself and service

levels of organizations like UTI have improved dramatically in the last few years in response to

the competition provided by these.


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Asset Management Company

An Asset Management Company (AMC) is a highly regulated organization that pools money

from investors and invests the same in a portfolio. They charge a small management fee, which

is normally 1.5 per cent of the total funds managed.


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Reliance Mutual Fund

Reliance Mutual Fund, a part of the Reliance - Anil Dhirubhai Ambani Group (R-ADAG) is one

of the fastest g9rowing mutual funds in the country. Reliance Mutual Fund offers investors a

well-rounded portfolio of products to meet varying investor requirements.

Reliance Mutual Fund constantly endeavors to launch innovative products and customer service

initiatives to increase value to investors. Reliance Mutual Fund schemes are managed by

Reliance Capital Asset Management Ltd., a wholly-owned subsidiary of Reliance Capital Ltd.

Reliance Capital Ltd. is one of Indias leading and amongst the fastest growing private sector

financial services companies, and ranks among the leading private sector financial services and

banking companies, in terms of net worth. Reliance Capital Ltd. has interests in asset

management and mutual funds, life and general insurance, private equity and proprietary

investments, stock broking and other financial services.

Reliance Capital has several undertaking viz. Reliance Mutual Funds, Reliance Life Insurance,

Reliance General Insurance, Reliance Consumer Finance and Reliance Money

Reliance Mutual Fund (RMF) is one of Indias leading Mutual Funds, with Assets Under

Management (AUM) of Rs. 77,765 crores (AUM as on Nov 30th 2007) and an investor base ofover 40.28 Lakhs Reliance Mutual Fund, a part of the Reliance - Anil Dhirubhai Ambani Group,

is one of the fastest growing mutual funds in the country.

RMF offers investors a well-rounded portfolio of products to meet varying investor requirements

and has presence in 115 cities across the country.

Reliance Mutual Fund constantly endeavors to launch innovative products and customer service

initiatives to increase value to investors.

Reliance Mutual Fund schemes are managed by Reliance Capital Asset Management Ltd., a

wholly owned subsidiary of Reliance Capital Ltd. Reliance Capital Ltd. is one of Indias leading

and fastest growing private sector financial services companies, and ranks among the top 3

private sector financial services and banking companies, in terms of net worth

Sponsor: Reliance Capital Limited.


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Trustee: Reliance Capital Trustee Co. Limited.

Investment Manager: Reliance Capital Asset Management Limited.

Statutory Details: The Sponsor, the Trustee and the Investment Manager are incorporated under

the Companies Act 1956.

General Risk Factors: Mutual Funds and securities investments are subject to market risks and

there is no assurance or guarantee that the objectives of the Scheme will be achieved. As with

any investment in securities, the NAV of the Units issued under the Scheme can go up or down

depending on the factors and forces affecting the capital markets. Past performance of the

Sponsor/AMC/Mutual Fund is not indicative of the future performance of the Scheme. The

Sponsor is not responsible or liable for any loss resulting from the operation of the Scheme

beyond their initial contribution of Rs.1 lakh towards the setting up of the Mutual Fund and such

other accretions and additions to the corpus. The Mutual Fund is not guaranteeing or assuring

any dividend/bonus. The Mutual Fund is also not assuring that it will make periodical

dividend/bonus distributions, though it has every intention of doing so. All dividend/bonus

distributions are subject to the availability of distributable surplus in the Scheme. For scheme

specific risk factors, please refer to the provisions of the Offer Document. Please read the Offer

Document carefully before investing.

Reliance mutual fund offers a unique feature of Indias first ATM cum Debit Card linked to

Mutual Fund investments.

This card enables the Reliance Mutual Fund investor to redeem the money anywhere anytime

(within the permissible withdrawal limit).

This card provides instant liquidity- 24x7 access to the clients investment at over a million

VISA enabled ATMs across the world.


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Mutual Fund Companies

Birla Sun Life Mutual Fund

A joint venture between Sun Life Assurance Company, the Canada-based financial service

organization and the Indian industrial house of Aditya Birla, this AMC was launched in the mid-

90 s.

Both the partners are well known in all areas that they operate in. While Aditya Birla is a

household name in India and has renowned brands in businesses spread across industries as wide

ranging as Aluminum (Hindalco), Textiles (Grasim), Fertilizers (Indo-Gulf), Finance (Birla

Global Finance Ltd.) and Rayon (India Rayon), Sun Life is a leading financial service

organization in North America. Sun Life provides services related to risk management, money

management and wealth management across globe. Having established itself at Toronto in 1871,

it has now spread its wings across Asia Pacific, U.S.A. and U.K. It also has a significant

presence through MFS Investment Management in U.S. and Spectrum United Mutual Funds in

Canada.

The major strengths of the group are its expertise drawn from managing assets over the globe, a

big agent network and an ability to cater to the need of people. Drawing on the expertise of aworldwide staff of over 10,000 people and a network of more than 65,000 agents and

distributors, Sun Life is committed to providing not just products and services, but solutions for

clients financial and risk management needs.
http://www.mutualfundadvisorindia.in/amc_snapshot/formtoput_birla/BirlaCommonKIM.pdf


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HDFC Mutual Fund

HDFC Asset Management Company Limited (AMC) was incorporated under the Companies

Act, 1956, on December 10, 1999, and was approved to act as an Asset Management Company

for the Mutual Fund by SEBI on June 30, 2000. The sponsor HDFC was incorporated in 1977 as

first specialized housing finance institution in India. HDFC provides financial assistance to

individuals, corporate and developers for the purchase and construction of residential housing. It

also provides property-related services, training and consultancy. In the mutual fund venture,

HDFC has tied up with Standard Life, one of the leading Insurance companies in the United

Kingdom, having vast experience in management of funds. HDFC has developed a strong and

dedicated team of agents that market its fixed deposit products. These key partners would

constitute the backbone of the marketing and distribution network of Mutual Fund and will

remain a central theme of the organizational framework in times to come.
http://www.mutualfundadvisorindia.in/amc_snapshot/formtoput_hdfc/commanapp_debt.pdf


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Prudential ICICI Mutual Fund

ICICI Prudential Asset Management Company Ltd. is a joint venture between ICICI Bank,

Indias second largest commercial bank & a well-known and trusted name in the financial

services in India, & Prudential Plc, one of the United Kingdoms largest players in the financial

services sectors. In a span of over 18 years since inception and just over 13 years of the Joint

Venture, the company has forged a position of preeminence as one of the largest Asset

Management Companys in the country, contributing significantly towards the growth of the

Indian mutual fund industry.

The company manages significant Mutual Fund Assets under Management (AUM), in addition

to our Portfolio Management Services (PMS) and International Advisory Mandates for clients

across international markets in asset classes like Debt, Equity and Real Estate with primary focus

on risk adjusted returns. As an Asset Management Company, we have over 18 years of

experience and are currently managing a comprehensive range of schemes of more than 46

Mutual fund schemes and a wide range of PMS Products for our investors spread across the

country. We service this investor base with our own branch network of around 168 branches and

a distribution reach of over 42,000 channel partners.

Prudential ICICI Asset Management Company Limited is an investment management company

and a 55:45 joint venture between Prudential Corporation plc, UK, and ICICI Ltd., India. Both

companies are financial giants, and each is a major player in its field. Prudential Corporation plc,

UK was incorporated in 1848, as a provider of insurance products. Through its investments, it

controls approximately 4% of all the listed shares on the second largest stock exchange in the

world, the London Stock Exchange, making it one of the largest institutional investors in the UK.

ICICI Ltd. was established in 1955 by the World Bank, the Government of India and

representatives of Indian industry, to promote the industrial development of India by providing

project and corporate finance to Indian industry. Prudential ICICI Asset Management Company

Limited has been incorporated with a capital of Rs 65 crore. This investment - way above the

stipulated norm of Rs 10 crore, represents a strategic long-term commitment, on the part of both
http://www.mutualfundadvisorindia.in/amc_snapshot/formtoput_icici/Common%20Application%20Form.pdf


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partners, to the rapidly expanding financial services sector in India. In a short span of 14 months,

Prudential ICICIs product portfolio has grown from 2 closed ended funds to 8 open ended funds

and 2 closed ended funds.


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SBI Mutual Funds

SBI Funds Management Ltd. is the investment manager of SBI Mutual Fund. SBI Mutual Fund

has been constituted as a trust, sponsored by State Bank India. Today the Fund has an investor

base of over 2.8 million spread over 23 schemes. With a large network of collecting branches

and investor service centers, SBI Mutual Fund constantly endeavors to get closer to its growing

family of investors. SBI is the largest public sector Bank in India with 8,836 branches all over

India. SBI is the leader in providing loans to trade & industry. It also provides related services,

which generate significant fee-based income. It has also identified project finance and consumer

banking as key areas.

MARKETING STRATEGIES ADOPTED BY THE MUTUAL FUND

COMPANIES

The present marketing strategies of mutual funds can be divided into two main headings:

Direct Marketing

Selling through intermediaries

Joint Calls

Direct Marketing:

This constitutes 20% of the total sales of mutual funds. Some of the important tools used in this

type of selling are:

Personal Selling:

In this case the customer support officer of the fund at a particular branch takes appointment

from the potential prospect. Once the appointment is fixed, the branch officer also called

Business Development Associate (BDA) in some funds then meets the prospect and gives him all


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details about the various schemes being offered by his fund. The conversion rate in this mode of

selling is in between 30% - 40%.

Telemarketing

In this case the emphasis is to inform the people about the fund. The names and phone numbers

of the people are picked at random from telephone directory. Sometimes people belonging to a

particular profession are also contacted through phone and are then informed about the fund.

Generally the conversion rate in this form of marketing is 15% - 20%.

Direct Mail

This one of the most common method followed by all mutual funds. Addresses of people are

picked at random from telephone directory. The customer support officer (CSO) then mails the

literature of the schemes offered by the fund. The follow up starts after 34 days of mailing the

literature. The CSO calls on the people to whom the literature was mailed. Answer their queries

and is generally successful in taking appointments with those people. It is then the job of BDA to

try his best to convert that prospect into a customer.

Advertisements in newspapers and magazines

The funds regularly advertise in business newspapers and magazines besides in leading national

dailies. The purpose to keep investors aware about the schemes offered by the fund and their

performance in recent past.

Hoardings and Banners

In this case the hoardings and banners of the fund are put at locations of the city where the

movement of the people is very high. Generally such hoardings are put near UTI offices in order

to tap people who are at present investing in UTI schemes. The hoarding and banner generally

contains information either about one particular scheme or brief information about all schemes of

fund.


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Selling through intermediaries:

Intermediaries contribute towards 80% of the total sales of mutual funds. These are the people/

distributors who are in the direct touch with the investors. They perform an important role in

attracting new customers. Most of these intermediaries are also involved in selling shares and

other investment instruments. They do a commendable job in convincing investors to invest in

mutual funds. A lot depends on the after sales services offered by the intermediary to the

customer. Customers prefer to work with those intermediaries who give them right information

about the fund and keep them abreast with the latest changes taking place in the market

espec3ially if they have any bearing on the fund in which they have invested.

Regular meeting with distributors:

Most of the funds conduct monthly or bi-monthly meetings with their distributors. The objective

is to hear their complaints regarding service aspects from funds side and other queries related to

the market situation. Sometimes, special training programmes are also conducted for the new

agents or distributors. Training involves giving details about the products of the fund, their

present performance in the market, what the competitors are doing and what they can do to

increase the sales of the fund.

Joint calls:This is generally done when the prospect seems to be a high net worth investor. The BDA

(business development associate) and agent together visit the prospect and brief him about the

fund. The conversion rate is very high in this situation, generally, around 60%. Both the fund and

agent provide even after sale services in this particular case.

Marketing of Funds: Challenges and Opportunities:

Assessing of investors needs and market research

Responding to investors needs

Product designing

Studying the macro environment

Timing of the launch of the product


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Choosing the distribution network

Finalizing strategies for publicity and advertising

Preparing offer documents and other literature

Getting feedback about sales

Studying performance indicators about fund performance like NAV

Sending certificates in time and other sales activities

Honoring the commitments made for redemption and repurchase

Paying dividends and entitlements

Creating positive image about the funds and changing the nature of the market itself

Some facts for the growth of mutual funds in India

100% growth in the last 6 years.

Numbers of foreign AMCs are in the queue to enter the Indian markets like Fidelity

Investments, US based, with over US$1trillion assets under management worldwide.

Saving rate is over 23%, highest in the world. Only channelizing these savings in mutual

funds sector is required.

'B' and 'C' class cities are growing rapidly. Today most of the mutual funds are concentrating

on the 'A' class cities. Soon they will find scope in the growing cities.

Mutual fund can penetrate rural like the Indian insurance industry with simple and limited

products.

SEBI allowing the MF's to launch commodity mutual funds.

Emphasis on better corporate governance.

Trying to curb the late trading practices.

Introduction of Financial Planners who can provide need based advice.

Performance of mutual funds in India


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For 30 years it goaled without a single second player. Though the 1988 year saw some new

mutual fund companies, but UTI remained in a monopoly position.

The performance of mutual funds in India in the initial phase was not even closer to satisfactory

level. People rarely understood, and of course investing was out of question. But yes, some 24

million shareholders were accustomed with guaranteed high returns by the beginning of

liberalization of the industry in 1992. This good record of UTI became marketing tool for new

entrants. The expectations of investors touched the sky in profitability factor. However, people

were miles away from the preparedness of risks factor after the liberalization.

The Assets under Management of UTI was Rs. 67bn. by the end of 1987. Let me concentrate

about the performance of mutual funds in India through figures. From Rs. 67bn. the Assets under

Management rose to Rs. 470 bn. in March 1993 and the figure had a three times higher

performance by April 2004. It rose as high as Rs. 1,540bn.

The net asset value (NAV) of mutual funds in India declined when stock prices started falling in

the year 1992. Those days, the market regulations did not allow portfolio shifts into alternative

investments. There were rather no choices apart from holding the cash or to further continue

investing in shares. One more thing to be noted, since only closed-end funds were floated in the

market, the investors disinvested by selling at a loss in the secondary market.

The performance of mutual funds in India suffered qualitatively. The 1992 stock market

scandals, the losses by disinvestments and of course the lack of transparent rules in the where

about rocked confidence among the investors. Partly owing to a relatively weak stock market

performance, mutual funds have not yet recovered, with funds trading at an average discount of

1020 percent of their net asset value.

The supervisory authority adopted a set of measures to create a transparent and competitive

environment in mutual funds. Some of them were like relaxing investment restrictions into the

market, introduction of open-ended funds, and paving the gateway for mutual funds to launch

pension schemes.

The measure was taken to make mutual funds the key instrument for long-term saving. The more


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the variety offered, the quantitative will be investors.

At last to mention, as long as mutual fund companies are performing with lower risks and higher

profitability within a short span of time, more and more people will be inclined to invest until

and unless they are fully educated with the dos and dont of mutual funds.


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CHAPTER 3

3.1 RESEARCH METHODOLOGY

MEANING OF RESEARCH:

Research in common parlance refers to a search for knowledge. And according to Redman and

Moore Systematized effortto gain new knowledge. And some people consider research as

movement, a movement from known to the unknown.

Thus Research is an original contribution to the existing stock of knowledge making for its

advancement. It is the pursuit of truth with the help of study, Observation, comparison and

experiment. In short, the search for knowledge through objective and systematic method of

finding solution to a problem is research.

Data Collection Method

Data for the present study is collected from two sources:

Primary sources:

The data are collected directly from the universe by conducting interviews, etc. these are the

original sources from which the researcher directly gathers data which are not previously

referred.

Secondary sources:

The data are collected from the secondary sources such as magazines, journals, etc. These

sources consist of already variable data in the form of statements, and reports, which may

include sensory reports, financial statements of the company, reports of governments

departments, etc.

I used Secondary sources of data collection.

1. For secondary source I have used

Internet, Magazines, and Newspaper etc.


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2. Data Approach- There are several Approach of data collection. The primary sources of data

collection are done through

Observation

Interviewing

Stimulation

Mail survey

Projective techniques

Questionnaire

Observation:

Observation is a mode of primary data collection through which we directly get the data from a

universe and based on that data one can carry on the research.

Interviewing:

Interviewing is another mode of direct data collection, which provides complete information

about the universe.

Stimulation:

Stimulation is a technique of performing experiments on the model of a particular system. The

experiment is done on the model and not on the real system because the latter will be

inconvenience and expansive.

Mail survey:

Through Mail survey, we can get direct data from the universe, the responds and the feedback

based on which the research can be carried out.

Projective techniques:

Projective techniques are based on the theory that the description is the vague objects and

requires interpretation, and this interpretation can be based on the individual own background,

attitudes, and values.


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Questionnaire:

Questionnaire is the method of data collection, which is very much popular, particularly in big

cities. Different modes of questions are put up on the paper and the particular universe, on which

the research is conducted, are asked to fill their responses.

3.2 SWOT ANALYSIS

SWOT analysis (alternately SLOT analysis) is a strategic planning method used to evaluate

the Strengths, Weaknesses/Limitations, Opportunities, and Threats involved in a project or in

a business venture. It involves specifying the objective of the business venture or project and

identifying the internal and external factors that are favorable and unfavorable to achieve that

objective. The technique is credited to Albert Humphrey, who led a convention at Stanford

University in the 1960s and 1970s using data from Fortune 500 companies.

Setting the objective should be done after the SWOT analysis has been performed. This would

allow achievable goals or objectives to be set for the organization.

Strengths: characteristics of the business, or project team that give it an advantage over

others

Weaknesses (or Limitations): are characteristics that place the team at a disadvantage relative

to others

Opportunities: external chances to improve performance (e.g. make greater profits) in the

environment

Threats: external elements in the environment that could cause trouble for the business or

project


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In this case study, SWOT analysis is related with the Mutual Funds study

STRENGTHS:

1. Diversification:

A large no. of investors have small savings with them. They can at the most buy shares of

one or two companies.

2. Liquidity:

Investment made in its schemes can be easily convertible into cash anytime.

3. Higher Returns:

Mutual Funds are expected to provide higher returns to the investors as compare to direct

investment.

4. Expert Supervision and Management:

A small investor cannot be an expert in portfolio management. When he invest in mutual

funds, he gets the benefit of experts.


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WEAKNESSES:

1. Inadequate Research:

Most of mutual fund in India is suffering because of inadequate research facility.

2. Trading Limitations:

Although mutual funds are highly liquid in general, most mutual funds cannot be bought or

sold in the middle of the trading day.

OPPORTUNITIES:

Rapid Growth:

In India, area of investment is very wide. There are lots of investors who usually invest in

different ways, so there is a scope of rapid growth.

THREATS:

In India, there are so many investment tools like L.I.C., G.I.C., Securities, Bonds, and

Debentures etc. All are competing Mutual Funds in every segment.

STRENGTH-Dont be modest; be realistic.

Think about your strengths in relation to other

nonprofit organizations in your service area

and those that are your competitors.

WEAKNESS-Take a hard look at your past

results in all areas of resource generation and

determine which activities are performing well,

marginal, or poor.

OPPORTUNITY- Opportunities are

everywhere, especially during seasons of

organizational and societal change. Be open to

revisiting old opportunities that have

reappeared.

THREATS- Identify the social, political, or

economic changes outside your organization to

see how they could adversely affect your

sustainability.
http://www.investorwords.com/2832/liquid.htmlhttp://www.businessdictionary.com/definition/day.htmlhttp://www.businessdictionary.com/definition/day.htmlhttp://www.investorwords.com/2832/liquid.html


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77

23

0 50 100 150No

ofrespondents

Yes No

Chapter 4

FINDING AND ANALYSIS

Q1. Are you aware of Mutual Funds?

Yes ( ) No ( )

ANALYSIS

The purpose of this question is to know the number of people who are aware of the mutual funds.

The findings show that 77% of the people aware about the mutual funds and only 23% are not

aware about the mutual funds.

YES 77%

NO 23%


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Q2. Are you aware of the followings in relation to mutual funds?

Different types of schemes ( )

Net Asset Value (NAV) ( )

Sponsor ( )

Association of Mutual Funds of India (AMFI) ( )

s

The purpose of this question is to know that whether investors are aware about various relations

in mutual funds. The findings show that 35% of people are aware about different types of

schemes and about 35% for NAV. 20% people are aware about AMFI and only 10% are aware

about the sponsors.

Different

types of

schemes 35%

Sponsor 10%

NAV 35%

AMFI 20%

Awareness in relation to mutual funds

35%

10%

35%

20%

0 10 20 0 40

Different types ofschemes

Sponsor

NAV

AMFI

Awareness in relation to mutual funds

0

10

20

30

40

50

60

70

80

90

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

East

West

North


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Q3.How did you come to know about Mutual fund investment schemes?

Reference groups ( ) Internet/Mail ( )

Financial Magazine/Newspaper ( ) Television ( )

Broker / Agent ( )

The purpose of this question is to know how people know about mutual fund schemes.

The findings show that majority i.e. 40% of people come to know through brokers & agents.

Second best is newspaper & financial magazine having a stake of 25%.

Influencial factor Referencegroups 12%

Intenet/Mail15%

FinancialMagazine/N ewspape

25%

Televisio8%

Broker&Age

nts 40%

Reference groupsIntenet/MailFinancial Magazine/NewspaperTelevisionBroker&Agents

Reference groups 12%

Internet/Mail 15%

Financial

Magazine/Newspaper 25%

Television 8%

Broker Agents 40%


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0%

20%

40%

60%

preferred mutual fund company

Series1 55% 23% 12% 10%

Reliance ICICI S.B.I. Any

Q4. Which all mutual fund you have invested in?

Reliance Mutual Fund ( ), ICICI Prudential Mutual Fund (

S.B.I. Mutual Fund ( ), any other specify

The purpose of this question is to know that in what all mutual funds investment is being made

by investors. The findings show that 55% of people invest in reliance mutual fund and about

23% invest in ICICI.

Reliance Mutual Fund 55%

ICICI Mutual Fund 23%

S.B.I. Mutual Fund 12%

Any other specify 10%


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It means Reliance Mutual Fund has the more brand equity as compare to the other Mutual Fund

available in the market.

Q5. Do you view following factors/ source of information important while investing in mutual

fund?

Safety ( ) Liquidity ( )

Return earned ( ) Tax saving ( )

All of the above ( )

The purpose of this question is to know what factors are important while investing in mutual

fund. The findings show that nearly all the factors i.e. safety, liquidity, returned earned and tax

Factor affecting investment in mutual funds

Tax saving

5%

All the above

75%

Liquidity6%Return earned

6%

Safety

8%

Safety

Liquidity

Return earned

Tax saving

All the above

Safety 8%

Liquidity 6%

Return earned 6%

Tax saving 5%

All the above 75%


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saving are important and considered while making investment in mutual funds. However, 75%

investors consider nearly all the factors.

Q6. Do you find following source of information relevant to analyze the performance of your

investment?

Monthly updates ( ), Quarterly Results ( )

Half yearly Reports ( ), Annual Reports ( )

Newspapers ( ), Websites of respective mutual funds ( )

AMFI website ( )

The purpose of this question is to know various sources of information important to analyze the

performance of investment made in mutual funds. The result shows that majority is occupied by

newspaper having 30%.20% by annual reports, 10% each for monthly and half yearly updateswhile 9% each by websites of respective mutual funds and AMFI website.

0%

5%

10%

15%

20%

25%

30%

Information relevant to analyseperformance of investment

Series1 10% 12% 10% 20% 30% 9% 9%

Monthly

updates

Quarterl

y

Half

yearly

Annual

Reports

Newspa

pers

Websit

es of

AMFI

website

Monthly updates 10%

Quarterly Results 12%

Half yearlyReports 10%

Annual Reports 20%

Newspapers 30%

Websites of

respective

mutual funds 9%

AMFI website 9%


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Q7.Do you seriously go through the Annual report of your scheme to evaluate the performance

of your scheme?

Yes No (If no, skip to Q No. 8)

Yes 60%

No 40%

From the above it can be easily depicted that 60% of people seriously go through Annual reports

of the scheme while 40% does not.

Considertion of Annual Reports

Yes

60%

No

40% Yes

No


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Q8. Do you find following contents of the annual report of scheme relevant?

Growth in NAV ( ) Management fee ( )

Total expenses ( ) Balance sheet ( )

The purpose of this question is to know what all contents of annual report are relevant. The

findings show that Growth in NAV is most relevant and occupies 30% in all.25% each of Totalexpenses & balanced sheet. While just 20%for management fees. This shows that NAV is

important and relevant.

30%

20%

25% 25%

0%

5%

10%15%

20%

25%

30%

Growth in

NAV

Management

fee

Total

expenses

Balance

sheet

Contents of Annual Report

Series1

Growth in NAV 30%

Management fee 20%

Total expenses 25%

Balance sheet 25%


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Q9. How much % of risk is bearable?

0-5% ( ) 5-10% ( ) 10-15% ( ) above 15% ( )

From the findings it can be said that majority of the investors like to bear 5-10% risk in a year.

Risk Bearable by investors

20%

55%

15%10%

0%

20%

40%

60%

Series1

Series1 20% 55% 15% 10%

0-5% 5-10% 10-15% above 15%

0-5% 20%

5-10% 55%

10-15% 15%

above 15% 10%


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Q10. How much do you save annually (in Rs. Approx?)

Less than Rs 50,000 ( ) , Rs 50,001 to Rs 1, 00,000 ( )

Above Rs 1, 00,000 ( )

The purpose of this question is to know how much savings are done annually by investor in

mutual funds. The result shows that 55% of people save about Rs. 50,001to Rs. 1, 00,000

Annual Savings

25%

55%

20%

0%

20%

40%

60%

Series1

Series1 25% 55% 20%

Less than Rs Rs 50,001 to Rs Above Rs 1,00,000

Less than Rs 50,000 25%

Rs 50,001 to Rs 1,00,000 55%

Above Rs 1,00,000 20%


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Q11.Do you prefer investment in Mutual funds to other savings avenue in future?

Yes ( ) , No ( ) , Not sure ( )

The purpose of this question is to know the investor preference in mutual funds

to other saving avenue in future. The findings show that 60% prefer investing in mutual

funds.15% says no while 25% are not sure about this. This means that mutual funds are mostly

preferred.

Future investment in mutual funds

60%

15%25%

0%

20%

40%

60%

80%

Series2

Series2 60% 15% 25%

Yes No Not sure

Yes 60%No 15%

Not sure 25%


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FINDING

1-The purpose of this question is to know the number of people who are aware of the mutualfunds. The findings show that the maximum no. of people aware about mutual fund.

2-The purpose of this question is to know that whether investors are aware about variousrelations in mutual funds. The findings show that the maximum no. of people aware about by thesechemes.

3- The purpose of this question is to know how people know about mutual fund schemes. The

findings show that majority thorough broker and agent.

4- The purpose of this question is to know that in what all mutual funds investment is being

made by investors. The findings show that maximum of people invest in reliance mutual fund.

5- The purpose of this question is to know what factors are important while investing in mutual

fund. The findings show that nearly all the factors i.e. safety, liquidity, returned earned and tax

saving are important and considered while making investment in mutual funds. However

maximum investors consider nearly all the factors.

6-The purpose of this question is to know various sources of information important to analyze

the performance of investment made in mutual funds. The result shows that majority is occupied

by newspaper having maximum annual reports.

7- From the above it can be easily depicted that maximum people seriously go through Annual

reports of the scheme.

8- The purpose of this question is to know what all contents of annual report are relevant. The

findings show that Growth in NAV is most relevant and occupies.

9- From the findings it can be said that majority of the investors like to bear.

10- The purpose of this question is to know how much savings are done annually by investor in

mutual funds. The result shows that maximum of people save about Rs. 50,001to Rs. 1, 00,000.


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11- The purpose of this question is to know the investor preference in mutual funds to other

saving avenue in future. The findings show that maximum prefer investing in mutual funds.


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CHAPTER 5

5.1 Suggestions & Recommendations

For the Investors

1. The investor should read offer document before investing.

2. Every Investor should read all the instruction carefully related to the fund in which he/she

wants to invest.

3. Investor should check the status of his investment time to time.

4. If the investors expect high return on their investments then it is better to invest in the Equity

Fund, but it also includes high risk

5. If the investor do not want high risk then it is better to invest in the Debt Fund.

For the AMCs

1. Mutual Fund industries try to make aware the people towards the mutual fund.

2. Mutual Fund industries should launch some fixed return plans.

3. Mutual Fund industries also should launch some pension plan with guaranteed return for the

senior citizens.

4. Mutual fund industries should conduct some awareness program for the investors.

5. Mutual Fund industry should provide better after sales services to the investors


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5.2 CONCLUSION

The project is to define customers perception towards mutual Funds. The study was very

fruitful, it yielded the desired results, helped me understand the process of Mutual Funds better.

The study also yielded what are the factors that people are looking forward to in the case of

Mutual Funds.

The study also shows that a large number of investors prefer mutual funds to other avenues in

future.

This project also shows comparative study of Mutual Fund schemes ofRELIANCE MONEY

LTD., BIRLA SUN LIFE MUTUAL FUND, HDFC MUTUAL FUNDS, ICICI

PRUDENTIAL MUTUAL FUNDS AND SBI MUTUAL FUNDS.

On the basis of research I can say that most of the investors expect good return 15% to 25% from

the equity scheme. As far as risk bearing ability is concerned out of the study it was found that

most of the investors are comfortable with the risk of 5% to 10%, being the investors of Equity

schemes. Very few investors prefer the above 15%. Their expected return is also exceptionally

high.


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BIBLIOGRAPHY

www.fundsindia.com/Best-Mutual-Funds

www.fundsupermart.co.in/

.wikipedia.org/wiki/Mutual_fund

www.mutualfundindia.com

www.reliance fund.com
http://www.fundsindia.com/Best-Mutual-Fundshttp://www.fundsindia.com/Best-Mutual-Fundshttp://www.fundsindia.com/Best-Mutual-Fundshttp://www.fundsindia.com/Best-Mutual-Fundshttp://www.fundsindia.com/Best-Mutual-Fundshttp://www.fundsindia.com/Best-Mutual-Fundshttp://www.fundsindia.com/Best-Mutual-Fundshttp://www.fundsupermart.co.in/http://www.fundsupermart.co.in/http://www.fundsupermart.co.in/http://www.fundsupermart.co.in/http://www.mutualfundindia.com/http://www.mutualfundindia.com/http://www.mutualfundindia.com/http://www.mutualfundindia.com/http://www.mutualfundindia.com/http://www.fundsupermart.co.in/http://www.fundsindia.com/Best-Mutual-Funds


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ANNEXURE

INVESTORS PROFILE

Name

Age..

Occupation...

Address

Contact No. ...

Q1. Are you aware of Mutual Funds?

Yes ( ) No ( )

Q2. Are you aware of the followings in relation to mutual funds?

Different types of schemes ( )

Net Asset Value (NAV) ( )

Sponsor ( )

Association of Mutual Funds of India (AMFI) ( )

Q3.How did you come to know about Mutual fund investment schemes?

Reference groups ( ) Internet/Mail ( )

Financial Magazine/Newspaper ( ) Television ( )

Broker / Agent ( )

Q4. Which all mutual fund you have invested in?

Reliance Mutual Fund ( ), ICICI Prudential Mutual Fund ( )

S.B.I. Mutual Fund ( ), any other specify


58/59

Q5.Do you view following factors/ source of information important while investing in mutual

fund?

Safety ( ) Liquidity ( )

Return earned ( ) Tax saving ( )

All of the above ( )

Q6.Do you find following source of information relevant to analyze the performance of your

investment?

Monthly updates ( ), Quarterly Results ( )

Half yearly Reports ( ), Annual Reports ( )

Newspapers ( ), Websites of respective mutual funds ( )

AMFI website ( )

Q7.Do you seriously go through the Annual report of your scheme to evaluate the performance

of your scheme?

Yes No (If no, skip to Q No. 8)

Q8.Do you find following contents of the annual report of scheme relevant?

Growth in NAV ( ) Management fee ( )

Total expenses ( ) Balance sheet ( )

Q9. How much % of risk is bearable?

0-5% ( ) 5-10% ( ) 10-15% ( ) above 15% ( )

Q10. How much do you save annually (in Rs. Approx?)

Less than Rs 50,000 ( ) , Rs 50,001 to Rs 1, 00,000 ( )

Above Rs 1, 00,000 ( )


59/59

Q11.Do you prefer investment in Mutual funds to other savings avenue in future?

Yes ( ), No ( ), Not sure ( )

Q12. Indicate your perception on the given scale with regard to the following. (Tick the relevant

column).

a).Investors receives good quality advice from distributor ( )

b).Advertising and performance portrayal is often misleading ( )

c).There is need to simplify the information provided to unit holders ( )

d).Attending investor educational programme is beneficial ( )

Documents

Copy of Mutual_fund