In training project report

on
“RISK & RETURN ANALYSIS
OF MUTUAL FUNDS”

Submitted in partial fulfilment of the

requirement of Bachelor of Business
Administration (BBA), Guru Jambheshwar
University of Science & Technlogy, Hisar.

Training Supervisor
Submitted by
Name & Designation
Virendra dhaka

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of the Supervisor
Enrolment No.
Mr.Abhinav sharma
07511001005

ACKNOWLEDGEMENT

I am very thankful to Reliance money Ltd. for having given me an

opportunity for training in the company.
I express my sincere thanks to Ms. Aarti Mittal HR of Reliance Money
Ltd., for involving me in day-to-day work at the office,which gave me an
insight to the actual environment in the industry.
I extend my thanks to my research guide Mr. Abhinav sharma (project
manager) for giving me his valuable time out of his busy schedule and
guidance in my project.
My sincere appreciation to Mr. Uma Shankar, their valuable suggestions
and critical comments surely would be of great help in the longer run. They
spread their valuable time to respond to my queries. Their valuable
suggestions about handling and analysis of data collected in my work are
also appreciable. Their constant moral support during my training is
appreciable.
Thanks are due to all other team members of the Human Resources
Department for their immense cooperation
Thank you all

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 (Virendra dhaka)
BBA FINAL YR.

Ref. No: Date………………………

CERTIFICATE

TO WHOM SO EVER IT MAY BE CONCERNED

This is to certify that Mr.VIRENDRA DHAKA a regular student

of B.B.A. Part-3rd has done project work on the topic:
“RISK&RETURN ANALYSIS OFMUTUAL FUNDS IN
RELIANCE” Under my guidance for the purpose of partial
fulfillment the requirement for the degree of B.B.A.

PLACE: JAIPUR PROJECT SUPERVISOR

DATE: (Mr. Abhinav sharma)
RELIANCE MONEY

Copyright© 2008. All rights Reserved. Reliance Money Limited Equities: Trading through Reliance Securities Limited | NSE SEBI
Registration Number Capital Market: - INB 231234833 | BSE SEBI Registration Number Capital Market: - INB 011234839 | NSE

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SEBI Registration Number Derivatives: - INF 231234833 Commodities: Trading through Reliance Commodities Limited | MCX
member code: 29030 | NCDEX member code: NCDEX-CO-05-00647| NMCE member code: CL0120 Mutual Funds: Reliance
Securities Limited | AMFI ARN No.29889

DECLARATION

I, VIRENDRA DHAKA, Student of BBA Session 2009-2010, declare that

the present work titled “RISK & RETURN ANALYSIS OF MUTUAL
FUNDS IN RELIANCE” is an original work. I anywhere else for the award
of any degree/ diploma/ certificate or for any prize have not submitted this
project report. All the data given in the report is to the best of my knowledge
and all references whether of any person or organization can be
crosschecked.

VIRENDRA DHAKA

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 PREFACE

This project has been prepared in the fulfillment of the degree of Bachelor of
Business Administration (GJU Hisar). I have tried my best to present the
best for my project title “RISK & RETURN ANALYSIS OF MUTUAL
FUNDS” under the able guidance of all staff and my faculties of PIMS.

Mutual funds are now the most appropriate investment option for the
investors. As financial markets become more sophisticated and complex,
investors need a financial intermediary who provides the required
knowledge and professional expertise on successful investing. It is no
wondering then that the birthplace of the mutual funds – the USA – the fund
industry has already overtaken the banking industry, more funds are being
under mutual fund management than deposit with banks.

The Indian Mutual Fund industry has already started opening up many of the
exciting investment opportunities to the Indian investors. We have started
witnessing the phenomenon of more savings now being entrusted to the
funds than to the banks. Despite the expected continuing growth in the
industry, Mutual Funds are still a new financial intermediary in India. Hence
it is important for the investors, the Mutual Fund agents, the Mutual Fund
distributors, then investment advisors and even the fund employees acquire
better knowledge of what Mutual Funds are, what they cannot, and how they
function differently from other intermediaries such as banks.

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 TABLE OF CONTENTS

TOPICS: PAGE NO.

ACKNOWLEDGEMENT
CERTIFICATE
DECLARATION
PREFACE
PART 1: INDUSTRY PROFILE
1.1 Concept of Mutual Fund 01-07

1.2 Types of Mutual Fund 08-11

1.3 Structure of Mutual Fund 12-13

1.4 Operation flow chart 14-14
1.5 Mutual Fund Management 15-16

1.6 Recent trends 17-18

1.7 History 19-21

1.8 Future scenario 22-23

PART 2: COMPANY PROFILE

2.1 Introduction of the company 24-25
2.2 Business Overview 25-26
2.3 Vision 26-26
2.4 Mission 27-27
2.5 Board of directors 28-28

2.6 Products & Services 29-29

PART 3: INTRODUCTION OF TOPIC

3.1 Mutual Fund 30-31

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3.2 Investment Objectives of Fund 32-33

3.3 How funds determine its share price or NAV? 34-34

3.4 Mutual fund markets 35-36
3.5 How to buy mutual fund? 37-38
3.6 Risk and Return 39-48
3.7 Investment strategies 49-49

RESEARCH METHODOLOGY 50-53

OBJECTIVE OF STUDY 54-54

FINDINGS AND ANALYSIS 55-66

CONCLUSION 67-67

LIMITATION OF STUDY 68-68

RECOMMANDATION 69-69
BIBLIOGRAPHY 70-70
ANNEXURE 71-73

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 PART-1

INDUSTRY PROFILE

1.1 CONCEPT OF MUTUAL FUND

A mutual fund is a company that pools the money of many people and
institutions and invests it in stocks, bonds, or other securities to pursue a
specific financial objective. Professional money managers make the day-to-
day decisions about which stocks, bonds, or other securities to buy and sell.
Each investor shares in the fund’s gains or losses according to how many
shares they own.

Mutual Funds are one of the prominent financial instruments. It is preferred

by any investors when compared with other financial instruments. There are
some who claim investing in mutual funds does not create the levels or
profit that other investments can earn.

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The diversified portfolios of investment companies mean that mutual funds
are a safe investment option. There are lots of mutual fund companies in the
market today. They are an attractive form of investment.

A Mutual Fund is a trust that pools the savings of a number of investors who
share a common financial goal. The money thus collected is invested by the
fund manager in different types of securities depending upon the objective of

the scheme. These could range from shares to debentures to money market
instruments. The income earned through these investments and the capital
appreciation realized by the scheme is shared by its unit holders in
proportion to the number of units owned by them (pro rata). Thus a Mutual
Fund is the most suitable investment for the common man as it offers an
opportunity to invest in a diversified, professionally managed portfolio at a
relatively low cost. Anybody with an investigable surplus of as little as a few
thousand rupees can invest in Mutual Funds. Each Mutual Fund scheme has
a defined investment objective and strategy.

A Mutual fund is the ideal investment vehicle for today's complex and
modern financial scenario. Markets for equity shares, bonds and other fixed
income instruments, real estate, derivatives and other assets have become
mature and information driven. Price changes in these assets are driven by
global events occurring in faraway places. A typical individual is unlikely to
have the. An individual also finds it difficult to keep track of ownership of
his assets, investments, brokerage dues and bank transactions etc.

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A mutual fund is the answer to all these situations. It appoints professionally
qualified and experienced staff that manages each of these functions on a
full time basis. The large pool of money collected in the fund allows it to
hire such staff at a very low cost to each investor.

OBJECTIVES OF MUTUAL FUND

 To define and maintain high professional and ethical standards in all

areas of operation of mutual fund industry.

 To interact with the Securities and Exchange Board of India (SEBI)

and to represent to SEBI on all matters concerning the mutual fund

industry.

 To represent to the Government, Reserve Bank of India and other

bodies on all matters relating to the Mutual Fund Industry.

 To develop a cadre of well-trained Agent distributors and to

implement a program of training and certification for all intermediaries
and others engaged in the industry.

 To undertake nation wide investor awareness program so as to

promote proper understanding of the concept and working of mutual
funds.

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  To recommend and promote best business practices and code of

conduct to be followed by members and other engaged in the activities of

mutual fund and asset management including agencies connected or
involved in the field of capital markets and financial services.

ADVANTAGES OF MUTUAL FUND

 Diversification
 Professional Management
 Convenience
 Liquidity
 Minimum initial investment
 Return Potential
 Low Costs
 Transparency

 Flexibility
 Well regulated
 Choice of schemes
 Tax Efficiency

Diversification:

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Using mutual funds can help an investor diversify their portfolio with a
minimum investment. When investing in a single fund, an investor is
actually investing in numerous securities. Spreading your investment across
a range of securities can help to reduce risk. A stock mutual fund, for
example, invests in many stocks - hundreds or even thousands. This
minimizes the risk attributed to a concentrated position. If a few securities in
the mutual fund lose value or become worthless, the loss maybe offset by
other securities that appreciate in value. Further diversification can be
achieved by investing in multiple funds which invest in different sectors.

Professional Management:
Mutual funds are managed and supervised by investment professionals. As
per the stated objectives set forth in the prospectus, along with prevailing
market conditions and other factors, the mutual fund manager will decide
when to buy or sell securities. This eliminates the investor of the difficult
task of trying to time the market. Furthermore, mutual funds can eliminate
the cost an investor would incur when proper due diligence is given to
researching securities. This cost of managing numerous securities is
dispersed among all the investors according to the amount of shares they
own with a fraction of each dollar invested used to cover the expenses of the
fund. What does this mean? Fund managers have more money to research
more securities more in depth than the average investor.

Convenience:

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With most mutual funds, buying and selling shares, changing distribution
options, and obtaining information can be accomplished conveniently by
telephone, by mail, or online.

Although a fund's shareholder is relieved of the day-to-day tasks involved in

researching, buying, and selling securities, an investor will still need to
evaluate a mutual fund based on investment goals and risk tolerance before
making a purchase decision. Investors should always read the prospectus
carefully before investing in any mutual fund.

Liquidity:
Mutual fund shares are liquid and orders to buy or sell are placed during
market hours. However, orders are not executed until the close of business
when the NAV (Net Average Value) of the fund can be determined. Fees or
commissions may or may not be applicable. Fees and commissions are
determined by the specific fund and the institution that executes the order.

Minimum Initial Investment:

Most funds have a minimum initial purchase of $2,500 but some are as low
as $1,000. If you purchase a mutual fund in an IRA, the minimum initial
purchase requirement tends to be lower. You can buy some funds for as
little as $50 per month if you agree to dollar-cost average, or invest a certain
dollar amount each month or quarter.

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Return Potential:
Over a medium to long-term, Mutual Funds have the potential to provide a
higher return as they invest in a diversified basket of selected securities.

Low Costs:
Mutual Funds are a relatively less expensive way to invest compared to
directly investing in the capital markets because the benefits of scale in
brokerage, custodial and other fees translate into lower costs for investors.

Transparency:
You get regular information on the value of your investment in addition to
disclosure on the specific investments made by your scheme, the proportion
invested in each class of assets and the fund manager's investment strategy
and outlook.

Flexibility:
Through features such as regular investment plans, regular withdrawal plans
and dividend reinvestment plans, you can systematically invest or withdraw
funds according to your needs and convenience.

Well Regulated:
All Mutual Funds are registered with SEBI and they function within the
provisions of strict regulations designed to protect the interests of investors.
The operations of Mutual Funds are regularly monitored by SEBI.

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Choice of Schemes:
Mutual Funds offer a family of schemes to suit your varying needs over a
lifetime

Tax efficiency:
Income tax benefits are granted to investors in mutual funds, making it more
tax efficient as compared to other comparable investment avenues.

1.2 TYPES OF MUTUAL FUND

The figure below gives an overview into the existing types of schemes …

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 MUTUAL
FUND TYPES

BY
BY OTHER
INVESTMENT
STRUCTURE SCHEMES
OBJECTIVE

OPEN ENDED GROWTH TAX SAVING

SCHEMES SCHEMES SCHEMES

INCOME SECTOR
CLOSE ENDED
SCHEMES SPECIFIC
SCHEMES
SCHEMES

BALANCED
INTERVAL INDEX
SCHEMES
SCHEMES SCHEMES

MONEY
MARKET
SCHEMES

BY STRUCTURE

OPEN ENDED – These do not have fixed maturity. The investors are free to
buy or sell any number of units at any point of time. We directly deal to

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mutual fund for our investment and redemption. The key feature is liquidity.
We can conveniently buy and sell of units at NAV related prices.

CLOSE ENDED – The scheme have stipulated maturity period. We can

invest in the scheme at the time of initial issue and there after we can buy
and sell the units under stock exchange where they are listed or these will be
repurchased by the mutual fund at their maturity. The market price at the
stock exchange could vary from the schemes NAV on account of demand
and supply situation.
One of the characteristics of close ended scheme is that they are generally
traded at discount to NAV but closer to maturity.

INTERVAL – This scheme have combine the features of open ended and
close ended schemes and may be traded on stock exchange any time or well
be open for sale or redemption during predetermined intervals at NAV
related prices.

BY INVESTMENT OBJECTIVE
GROWTH SCHEMES - The aim of growth funds is to provide capital
appreciation over the medium to long-term. These schemes invest majority

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of their funds in equities and are willing to bear short term decline in value
for possible future appreciation. These may be of diversified nature or may
be sector oriented.

INCOME SCHEME – Debt schemes typically invest a major part, if not all
their funds in debt, in many market investment like bonds, debentures,
government securities, in the inter banks call money market or commercial
paper. These instruments provide a fixed interest which is generally paid out
at various intervals access to such investment. The aim of income funds is to
provide regular and steady income to investors.

BALANCED SCHEME – These invest both in shares and fixed income

securities in the proper way indicated in the offer document. These provide
moderate risk and moderate return to the investors. As the NAV of these
schemes may not keep pace or face equity when the equity market rises or
falls respectively.

MONEY MARKET SCHEME – The aim of money market funds is to

provide easy liquidity, preservation of capital and moderate income. These
schemes generally invest in safer short-term instruments such a treasury
bills, certificates of deposit commercial paper and inter-bank call money.

OTHER SCHEMES

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TAX SAVING SCHEME – These schemes aims to offer tax benefits to the
investors and it invests accordingly in schemes of government etc. These
schemes involve less risk and slow growth.

SECTOR SPECIFIC SCHEME – These are the funds/schemes which

invest in the securities of only those sectors or industries as specified in the
offer documents. E.g. Pharmaceuticals, Software, Fast Moving Consumer
Goods (FMCG), Petroleum stocks, etc. The returns in these funds are
dependent on the performance of the respective sectors/industries. While
these funds may give higher returns, they are more risky compared to
diversified funds. Investors need to keep a watch on the performance of
those sectors/industries and must exit at an appropriate time.

INDEX SCHEME – These schemes are those where the portfolio are
designed in such a way that they reflect composition of some broad base
market index. This is done by holding securities in the same prop

1.3 STRUCTURE OF THE MUTUAL FUND INDUSTRY

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The Indian mutual fund industry is dominated by the Unit Trust of India
which has a total corpus of Rs 700bn collected from more than 20 million
investors. The UTI has many funds/schemes in all categories i.e. equity,
balanced income etc with some being open-ended and some being closed-
ended. The Unit Scheme 1964 commonly referred to as US 64, which is a
balanced fund, is the biggest scheme with a corpus of about Rs 200 bn. UTI
was floated by financial institutions and is governed by a special act of
Parliament. Most of its investors believe that the UTI is government owned
and controlled, which, while legally incorrect, is true for all practical
purposes.

The second largest categories of mutual funds are the ones floated by
nationalized banks. Canbank Asset Management floated by Canara Bank
and SBI Funds Management floated by the State Bank of India are the
largest of these. GIC AMC floated by General Insurance Corporation and
Jeevan Bima Sahayog AMC floated by the LIC are some of the other
prominent ones. The aggregate corpus of funds managed by this category of
AMCs is about Rs 150 bn.

the third largest category of mutual funds is the ones floated by the private
sector and by foreign asset management companies. The largest of these are
Prudential ICICI AMC and Birla Sun Life AMC>the aggregate corpus of
assets managed by this category of AMCs is in excess of Rs 250 bn.

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1.4 OPERATION FLOW CHART

Pool their
Passed money
back to with

Generates Invest in

1.5 FUND MANAGEMENT

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Actively managed funds: Mutual Fund managers are professionals. They
are considered professionals because of their knowledge and experience.
Managers are hired to actively manage mutual fund portfolios. Instead of
seeking to track market performance, active fund management tries to beat
it. To do this, fund managers "actively" buy and sell individual securities.
For an actively managed fund, the corresponding index can be used as a
performance benchmark.

Is an active fund a better investment because it is trying to outperform the

market? Not necessarily. While there is the potential for higher returns with
active funds, they are more unpredictable and more risky. From 1990
through 1999, on average, 76% of large cap actively managed stock funds
actually under performed the S&P 500. (Source - Schwab Center for
Investment Research)

Actively managed fund styles: Some active fund managers follow an

investing "style" to try and maximize fund performance while meeting the
investment objectives of the fund. Fund styles usually fall with in the
following three categories.

Fund Styles:

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 • Value: The manager invests in stocks believed to be currently
undervalued by the market.
• Growth: The manager selects stocks they believe have a strong
potential for beating the market.
• Blend: The manager looks for a combination of both growth and
value stocks.

To determine the style of a mutual fund, consult the prospectus as well as

other sources that review mutual funds. Don't be surprised if the
information conflicts. Although a prospectus may state a specific fund style,
the style may change. Value stocks held in the portfolio over a period of
time may become growth stocks and vice versa. Other research may give a
more current and accurate account of the style of the fund.

1.6 RECENT TRENDS IN MUTUAL FUND INDUSTRY

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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 banks and 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 has 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.

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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.

1.7 HISTORY OF MUTUAL FUND INDUSTRY

The mutual fund industry in India started in 1963 with the formation of Unit
Trust of India, at the initiative of the Government of India and Reserve Bank

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the. The history of mutual funds in India can be broadly divided into four
distinct phases

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 of assets under management.

Second Phase – 1987-1993 (Entry of Public Sector Funds)

1987 marked the entry of non- UTI, public sector mutual funds set up by
public sector banks and Life Insurance Corporation of India (LIC) and
General Insurance Corporation of India (GIC). SBI Mutual Fund was the
first non- UTI Mutual Fund established in June 1987 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 established its mutual fund in June 1989 while

GIC had set up its mutual fund in December 1990. At the end of 1993, the
mutual fund industry had assets under management of Rs.47, 004 crores.

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

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In February 2003, following the repeal of the Unit Trust of India Act 1963
UTI was bifurcated into two separate entities. One is the Specified
Undertaking of the Unit Trust of India with assets under management of
Rs.29, 835 crores as at the end of January 2003, representing broadly, the
assets of US 64 scheme, assured return and certain other schemes. 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 assets under management 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.

1.8 GLOBAL SCENARIO

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Some basic facts—
• The money market mutual fund segment has a total corpus of $ 1.48
trillion in the U.S. against a corpus of $ 100 million in India.
• Out of the top 10 mutual funds worldwide, eight are bank-sponsored.
Only Fidelity and Capital are non-bank mutual funds in this group.
• In the U.S. the total number of schemes is higher than that of the listed
companies while in India we have just 277 schemes.
• Internationally, mutual funds are allowed to go short. In India fund
managers do not have such leeway.
• In the U.S. about 9.7 million households will manage their assets on-
line by the year 2003, such a facility is not yet of avail in India.
• On-line trading is a great idea to reduce management expenses from
the current 2% of total assets to about 0.75% of the total assets.
• 72% of the core customer base of mutual funds in the top 50-broking
firms in the U.S. is expected to trade on-line by 2003.

Internationally, on-line investing continues its meteoric rise. Many have

debated about the success of e-commerce and its breakthroughs, but it is true
that this aspect of technology could and will change the way financial

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sectors function. However, mutual funds cannot be left far behind. They
have realized the potential of the Internet and are equipping themselves to
perform better.
In fact in advanced countries like the U.S.A. mutual funds buy-sell
transactions have already begun on the Net, while in India the Net is
used as a source of Information.
Such changes could facilitate easy access, lower intermediation costs
and better services for all. A research agency that specializes in internet
technology estimates that over the next four years Mutual Fund Assets
traded on-line will grow ten folds from $ 128 billion to $ 1,227 billion;
whereas equity assets traded on-line will increase during the period from $
246 billion to $ 1,561 billion. This will increase the share of mutual funds
from 34% to 40% during the period. Such increases in volumes are expected
to bring about large changes in the way Mutual Funds conduct their
business.

PART-2

COMPANY PROFILE

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2.1 INTRODUCTION OF THE COMPANY
Reliance Money is a group company of Reliance Capital; one of India's
leading and fastest growing private sector financial services companies,
ranking among the top 3 private sector financial services and banking
companies, in terms of net worth. Reliance Capital is a part of the Reliance
Anil Dhirubhai Ambani Group.

Reliance Money is a comprehensive electronic transaction platform offering

a wide range of asset classes. Its endeavor is to change the way India
transacts in financial markets and avails financial services. Reliance Money
is a single window, enabling you to access, amongst others in Equities,
Equity & Commodities Derivatives, Mutual Funds, IPOs, Life & General
Insurance products, Offshore Investments, Money Transfer, Money
Changing and Credit Cards.

Reliance Capital has interests in asset management and mutual funds, life
and general insurance, private equity and proprietary investments, stock
broking and other activities in financial services.

2.2 BUSINESS OVERVIEW

RCL is registered as a depository participant with National Securities
Depository Ltd (NSDL) and Central Depository Services Ltd (CDSL) under

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the Securities and Exchange Board of India (Depositories and Participants)
Regulations, 1996. RCL has sponsored the Reliance Mutual Fund within the
framework of the Securities and Exchange Board of India (Mutual Fund)
Regulations, 1996.RCL primarily focuses on funding projects in the
infrastructure sector and supports the growth of its subsidiary companies,
Reliance Capital Asset Management Limited, Reliance Capital Trustee Co.
Limited, Reliance General Insurance Company Limited and Reliance Life
Insurance Company Limited. As of March 31, 2005, the company’s
investment in infrastructure projects stood at Rs. 1071 Crores. The
investment portfolio of RCL is structured in a way that realizes the highest
post-tax return on its investments.

2.3 VISION OF THE COMPANY

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 “Growth has no limit at Reliance. I
keep revising my vision. Only when you
can dream it, you can do it.”
MR.ANIL AMBANI
CHAIRMAN

“To be a globally respected wealth creator with

an emphasis on customer care and a culture of
good corporate governance.”

"We will leverage our strengths in executing complex global-scale projects

to make leading edge information and financial services affordable by all
individual consumers and businesses in India. We will offer unparalleled
value to create customer delight and enhance business productivity. We will
also generate value for our capabilities beyond Indian boarders while
enabling millions of knowledge workers to deliver their service globally."

2.3 MISSION OF THE COMPANY

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“To create and nurture a world-class, high
performance environment aimed at delighting
our customers.”

“To offer unparalleled value by providing the

customer transparent, convenient and cost–
effective, anytime-anywhere financial
transaction capability”

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2.4 BOARD OF DIRECTORS

Amitabh Jhunjhunwala, Vice-Chairman

He is 51, a Fellow Chartered Accountant.

Rajendra Chitale, Independent Director

He is 46, an eminent Chartered Accountant, is the

Managing Partner of M/s M. P. Chitale & Associates.

Shri C. P. Jain

He is 61, is the former Chairman and Managing

Director of NTPC Ltd. (National Thermal Power
Corporation).

2.5 PRODUCTS & SERVICES

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 EQUITY

MONEY DERIVAT
CHANGING -IVES

MONEY
COMMO
TRANSFE RELIANCE
R MONEY DITIES

MUTUAL
IPO’S FUND

INSURANC
E

PART-3

INTRODUCTION OF THE TOPIC

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3.1 MUTUAL FUND
A mutual fund is a company that pools the money of many people and
institutions and invests it in stocks, bonds, or other securities to pursue a
specific financial objective. Professional money managers make the day-to-
day decisions about which stocks, bonds, or other securities to buy and sell.
Each investor shares in the fund’s gains or losses according to how many
shares they own.

Mutual funds can be categorized as money market funds, stock funds,

corporate and government bond funds, municipal or tax-free bond funds, and
balanced funds (which own both stocks and bonds). Within these categories
there are specific types of funds. For example, stock or equity funds range
from the conservative growth and income funds to the more aggressive small
company and international funds.

Reliance Mutual Fund (RMF)

Reliance Mutual Fund, a part of the Reliance - Anil Dhirubhai Ambani

Group (R- ADAG) is one of the fastest growing mutual funds in the country.

Reliance Mutual Fund offers investors a well rounded portfolio of products

to meet varying investor requirements.

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Reliance Mutual Fund (RMF) is one of India’s leading Mutual Funds, with
Assets Under Management (AUM) of Rs.59,857 crore (AUM as on 30th
June 2007) and an investor base of over 3.4million.Reliance Mutual Fund
constantly endeavor’s 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 is one of India's 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.
Reliance Capital has interests in asset management and mutual funds, life
and general insurance, private equity and proprietary investments, stock
broking and other financial services.

3.2 INVESTMENT OBJECTIVES OF MUTUAL FUND

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The following table shows five mutual fund categories, listed by 33 different
investment objectives:

Investment
Fund Category Subcategory
Objective
Equity Capital appreciation Aggressive growth

-- -- Growth

-- -- Sector

-- Total return Growth-and-income

-- -- Income-equity

-- World equity Emerging market

-- -- Global equity

-- -- International equity

-- -- Regional equity

Hybrid Hybrid Asset allocation

-- -- Balanced

-- -- Flexible portfolio
-- -- Income-mixed

Taxable bond Corporate General

-- -- Intermediate-term

-- -- Short-term

-- High yield High yield

-- World Global bond, general

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 Global bond, short-
-- --
term
-- -- Other world bond

-- Government General

-- -- Intermediate-term

-- -- Short-term

-- -- Mortgage-backed

-- Strategic income Strategic income

Tax-free bond State municipal General

-- -- Short-term

-- National municipal General

-- -- Short-term

Money market Taxable Government

-- -- Non-government

-- Tax-exempt National

-- -- State

3.3 HOW FUND DETERMINE ITS SHARE PRICE OR NAV

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3.4 MUTUAL FUND MARKETS
Rapid growth of the mutual fund market is a challenge to both management
companies and supervision. Similarly to the assets in mutual funds, the
number of Finnish mutual funds has experienced strong growth. At the
moment, there are already 508 mutual funds, while the figure stood at 469 at
the end of 2005 and 403 at the end of 2004. The number of unit holders has
also increased steadily. In particular, mutual fund ownership of individuals
has increased strongly.

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Rapid growth requires expertise and moderation in order to control the
operational risks related to growth, so that eg the processes of NAV
calculation and mutual fund unit register function without errors as the
number of transactions increases. Similarly the sufficiency and expertise of
personnel is put to the test amid rapid growth. From a supervision point of
view it is important to pay attention to the capability of management
companies to review their operating modes in line with their growth.

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Increase in the number of unit holders increases the number of those
investors in the markets with little knowledge about mutual funds as
investments or even about the securities markets. Supervision must now
focus on the supervision of the disclosure obligation, since the key processes
and risk management in the industry have been inspected extensively in
2003 - 2006.

3.5 HOW TO BUY MUTUAL FUND?

Buying mutual funds have never been difficult even considering the
complexities involved in it. You can buy mutual funds as easily as 1-2-3.
Here are the typical steps involved when you want to buy mutual funds

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• You can buy mutual funds when mutual fund companies make initial
public offerings. At this time you will usually have to pay the basic
face value and not the market dictated price that includes a premium
as in many cases. Filling out an application form with a payment of
some initial deposit is all it takes.
• Buying mutual funds called closed end funds is from stock exchanges.
Closed end funds are initially sold by fund companies in limited
numbers and they are listed in a stock exchange to facilitate trading by
investors. These will be usually at premium prices or as dictated by
demands in the market (higher demands for various reasons attract
higher premiums).

• Buying mutual funds called closed end funds is from stock exchanges.
Closed end funds are initially sold by fund companies in limited
numbers and they are listed in a stock exchange to facilitate trading by
investors. These will be usually at premium prices or as dictated by
demands in the market (higher demands for various reasons attract
higher premiums).
• You can also buy mutual funds (open end funds - funds purchasable
perpetually from the company). Here the price at which you buy will
be a figure called as NAV in the industry circles. This term stands for
net asset value, a figure that denotes the current value of a share of the

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 company after adding the earnings and deducting the expenses and
taxes equally amongst all the number of shares.
• Most companies and banks that are in the mutual funds business
facilitate online buying of mutual funds to their customers. They need
you to have a trading as well as a demat account and connect your
bank account to this. You can log on to a broker's or the company's
own trading internet portal to be able to buy online. Once online you
can choose from the array of exchange traded mutual funds (ETF) and
open end funds too. Your trades will be either credited or debited to
your demat account (an account to hold dematerialized shares -
electronic form of shares) instantaneously. This is some what like you
can transfer funds from your bank account.

3.6 RISK AND RETURN

RISK
Risk can be defined as the potential for harm.

But when anyone analyzing mutual funds uses this term, what is actually
being talked about is volatility.

Volatility is nothing but the fluctuation of the Net Asset Value (price of a
unit of a fund). The higher the volatility, the greater the fluctuations of the
NAV.

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Generally, past volatility is taken as an indicator of future risk and for the
task of evaluating a mutual fund; this is an adequate (even if not ideal)
approximation.

What is risk?
Every type of investment, including mutual funds, involves risk. Risk refers
to the possibility that you will lose money (both principal and any earnings)
or fail to make money on an investment. A fund's investment objective and
its holdings are influential factors in determining how risky a fund is.
Reading the prospectus will help you to understand the risk associated with
that particular fund.

Generally speaking, risk and potential return are related. This is the
risk/return trade-off. Higher risks are usually taken with the expectation of

higher returns at the cost of increased volatility. While a fund with higher
risk has the potential for higher return, it also has the greater potential for
losses or negative returns. The school of thought when investing in mutual
funds suggests that the longer your investment time horizon is the less
affected you should be by short-term volatility. Therefore, the shorter your
investment time horizon, the more concerned you should be with short-term
volatility and higher risk.

Defining Mutual fund risk

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Different mutual fund categories as previously defined have inherently
different risk characteristics and should not be compared side by side. A
bond fund with below-average risk, for example, should not be compared to
a stock fund with below average risk. Even though both funds have low risk
for their respective categories, stock funds overall have a higher risk/return
potential than bond funds.

Of all the asset classes, cash investments (i.e. money markets) offer the
greatest price stability but have yielded the lowest long-term returns. Bonds
typically experience more short-term price swings, and in turn have
generated higher long-term returns. However, stocks historically have been
subject to the greatest short-term price fluctuations—and have provided the
highest long-term returns. Investors looking for a fund which incorporates
all asset classes may consider a balanced or hybrid mutual fund. These

funds can be very conservative or very aggressive. Asset allocation

portfolios are mutual funds that invest in other mutual funds with different
asset classes. At the discretion of the manager(s), securities are bought,
sold, and shifted between funds with different asset classes according to
market conditions.

Mutual funds face risks based on the investments they hold. For example, a
bond fund faces interest rate risk and income risk. Bond values are inversely
related to interest rates. If interest rates go up, bond values will go down
and vice versa. Bond income is also affected by the change in interest rates.

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Bond yields are directly related to interest rates falling as interest rates fall
and rising as interest rise. Income risk is greater for a short-term bond fund
than for a long-term bond fund.

Similarly, a sector stock fund (which invests in a single industry, such as

telecommunications) is at risk that its price will decline due to developments
in its industry. A stock fund that invests across many industries is more
sheltered from this risk defined as industry risk.

Risk factors
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

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doing so. All dividend/bonus distributions are subject to the availability of
the distributable surplus in the Scheme.

Types of risk
Following is a glossary of some risks to consider when investing in mutual
funds.

• Call Risk. The possibility that falling interest rates will cause a bond
issuer to redeem—or call—its high-yielding bond before the bond's
maturity date.
• Country Risk. The possibility that political events (a war, national
elections), financial problems (rising inflation, government default),
or natural disasters (an earthquake, a poor harvest) will weaken a
country's economy and cause investments in that country to decline.

• Credit Risk. The possibility that a bond issuer will fail to repay
interest and principal in a timely manner. Also called default risk.
• Currency Risk. The possibility that returns could be reduced for
Americans investing in foreign securities because of a rise in the value
of the U.S. dollar against foreign currencies. Also called exchange-
rate risk.
• Income Risk. The possibility that a fixed-income fund's dividends
will decline as a result of falling overall interest rates.

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 • Industry Risk. The possibility that a group of stocks in a single
industry will decline in price due to developments in that industry.
• Inflation Risk. The possibility that increases in the cost of living will
reduce or eliminate a fund's real inflation-adjusted returns.
• Interest Rate Risk. The possibility that a bond fund will decline in
value because of an increase in interest rates.
• Manager Risk. The possibility that an actively managed mutual
fund's investment adviser will fail to execute the fund's investment
strategy effectively resulting in the failure of stated objectives.
• Market Risk. The possibility that stock fund or bond fund prices
overall will decline over short or even extended periods. Stock and
bond markets tend to move in cycles, with periods when prices rise
and other periods when prices fall.
• Principal Risk. The possibility that an investment will go down in
value, or "lose money," from the original or invested amount.

How Mutual Funds Manage To Reduce Their Risk?

Fund managers allocate available funds in a specified proportion among
various instruments of investments. Consider a fund being well diversified
across the spectrum of exchange listed stocks and bonds which yield a
guaranteed return in addition to being invested in money markets and real
estates. While bonds and money market investments provide a low but
steady return, other instruments are of high yielding character in a short
period. The higher risk of high yielding portfolio is compensated for by the

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investments in bonds in events of adverse market behavior. The portfolio
will be constantly reviewed and adjusted to variations in order to maximize
returns and minimize risks. This means, fund managers buy or sell stocks or
bonds as per the dictates of the fund and market pulls. For example an
investment in a perceived risky instrument will be sold immediately and
reinvested in a prospective media of the time.

RETURN
As an investor, you want to know the fund's return-its track record over a
specified period of time. So what exactly is "return?"

A mutual fund's return is the rate of increase or decrease in its value over a
specific period of time usually expressed in the following increments: one,
three, five, and ten year, year to date, and since the inception of the
fund. Since return is a common measure of performance, you can use it to

evaluate and compare mutual funds within the same fund category.
Generally expressed as an annualized percentage rate, return is calculated
assuming that all distributions from the fund are reinvested.

Since average returns can sometimes "hide" short-term highs and lows, you
should evaluate returns for a time period of several years-not just one year or
less. A fund that has a high return in one year may have experienced losses
in other years-these fluctuations may not be apparent in its average return.

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While a fund's return shows its track record, keep in mind that past
performance is no guarantee of future results.

When using returns to compare funds, always use net returns. Net returns
are the true returns of both load and no-load funds after deducting all costs
and expenses.

Types of return
There are three ways, where the total returns provided by mutual funds can
be enjoyed by investors:

• Income is earned from dividends on stocks and interest on bonds. A

fund pays out nearly all income it receives over the year to fund
owners in the form of a distribution.

• If the fund sells securities that have increased in price, the fund has a
capital gain. Most funds also pass on these gains to investors in a
distribution.
• If fund holdings increase in price but are not sold by the fund
manager, the fund's shares increase in price. You can then sell your
mutual fund shares for a profit. Funds will also usually give you a
choice either to receive a check for distributions or to reinvest the
earnings and get more shares.

Mutual fund returns

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Fund Category Rating 3Yr
Return
UTI Infrastructure Equity: Diversified 66.62
Magnum Contra Equity: Diversified 66.14
DSPML T.I.G.E.R. Reg Equity: Diversified 64.56
Magnum Global Equity: Diversified 63.32
Reliance Growth Equity: Diversified 60.93
Sundaram BNP Paribas Equity: Diversified 60.50
Select Midcap
Kotak Opportunities Equity: Diversified 60.05
HDFC Equity Equity: Diversified 51.13

HDFC Top 200 Equity: Diversified 50.88

Magnum Balanced Hybrid: Equity-oriented 46.69
Canara Robeco Balance II Hybrid: Equity-oriented 42.82
HDFC Prudence Hybrid: Equity-oriented 40.78
ICICI Prudential Long-... Debt: Medium-term 9.07
Birla Sun Life Income Debt: Medium-term 7.57
Canara Robeco Income Debt: Medium-term 6.72
ICICI Prudential Flexible Debt: Medium-term 6.51
Income
ICICI Prudential Advis... Debt: Medium-term 6.34
Magnum Multiplier Plus Equity: Diversified 67.04
Birla Sun Life Equity Equity: Diversified 60.02
DSPML Equity Fund Equity: Diversified 57.78
Sundaram BNP Paribas Equity: Diversified 56.67
S...
ICICI Prudential Dynamic Equity: Diversified 56.19
Sundaram BNP Paribas I... Equity: Diversified 55.05
Kotak 30 Equity: Diversified 54.91
Birla Mid Cap Equity: Diversified 54.87

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Risk return trade off
The table below shows the different types of funds and the potential
risk/return trade off.

Higher risk and

Lower risk and return Moderate risk and return
return

Short- and Long- Growth

Money Aggressive
intermediate- term Balanced and Growth
market growth
term bond bond funds income funds
funds funds
funds funds funds

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3.7 Investment strategies
Knowing your tolerance for risk is one of the important issues you must
consider when you are making an investment decision. You must have a
strong understanding of your personal situation and investment goals.
Consider the following criteria when developing your investment strategy.

1. Current income needs: Do you need income from your investment to

meet current living expenses? Will you reinvest any dividends or

interest paid that exceeds your current income needs?
2. Capital risk tolerance: Will you be seriously concerned over a

temporary drop in market value or your investment?

3. Time horizon: How long can you invest before withdrawing

substantial funds? Will you need to withdraw money for a new car,
tuition, or a vacation home?
4. Tax liability: Are you in a high tax bracket? Are you subject to a state

capital gains and dividend tax?

5. Legal considerations: Are there investment restrictions due to the

nature or source of your funds? Are the funds part of an organization

or other entity on which investment restrictions have been imposed by
law or other regulations?
6. Liquidity requirements: Is there a foreseeable need for large

amounts of cash for which provisions should be made?

7. Unique requirements: Is there anything unique or special that must

be considered in your financial planning?

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 RESEARCH METHODOLOGY
DEFINATION

Research methodology is a way to systematically solve the research

problem. It may be understood as science of studying how research is done
scientifically.
According to Clifford woody “Research Comprises defining and redefining
problem formulating hypothesis or suggested solution Collecting,
Organizing and evaluating data making deductions and reaching Conclusion
at Carefully testing the Conclusion to determine whether they fit the
formulating hypothesis”.

TYPES OF RESEARCH
Descriptive research is also called Statistical Research. The main goal of
this type of research is to describe the data and characteristics about what is
being studied. The idea behind this type of research is to study frequencies,
averages, and other statistical calculations. Although this research is highly
accurate, it does not gather the causes behind a situation.

Exploratory research is a type of research conducted because a problem

has not been clearly defined. Exploratory research helps determine the best
research design, data collection method and selection of subjects. Given its
fundamental nature, exploratory research often concludes that a perceived
problem does not actually exist.

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Quantitative research is based on the measurement of quantity or amount.
It is applicable to phenomena that can be expressed in term of quantity. We
have also found requirement in quantity so it’s the quantitative research.

POPULATION
• Specific Area :- Durgapura colony, JAIPUR
• population :- 2 lack

SAMPLE DESIGN
Sample design refers to the technique or the procedure the researcher would
adopt in selecting item for the Sample. Sample design may be well lay down
the number of items to be included in the sample that is the size of the
sample design is determined before data are collected. There are many
Sample designs from which a researcher can choose some designs are
relatively more precise and easier to apply than other researcher must select
a sample design which should be reliable and appropriate for his research
study.
Here we have used random sampling and the sample size was 300.
We have made a questionnaire through personal interview filled the
questionnaire.

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Data Collection
Data collection is a very important step in any research. It’s the pivot along
which the whole research revolves. If the data collected is not appropriate
then the whole research will be of no use.
Data Collection basically involves collecting the relevant data from various
sources may be primary or secondary and then sorting the information so
that meaningful information can be gathered from the sorted data.
Data can be collected from two sources:

Sources of Data Collection

Primary sources Secondary Sources

Primary Sources: Primary sources include the data, which are first handed.
They are collected directly from the respondents using the data collection
methods like the questionnaires, survey interviews, direct observation, or
tabulation.

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Secondary Sources: Secondary sources are the sources in which data has
already been collected by some other person or organization for their use
and is used by the researcher for his purpose. These include websites, trade
associations, journals, books etc.

My research is based on the mixture of both primary and secondary sources.

I have collected the information with the help of Questionnaire, journals and
websites. Questionnaires have helped me to know about the needs of the
individual investors. Journals and websites have provided me the
information about the MF industry, its past and future performance.

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 OBJECTIVE OF THE STUDY

The Purpose of research is to discover answer to question through the

Application of scientific procedure. The main aim of research is to find out
the truth which is hidden and which has not been discovered as yet.

 To highlight the satisfaction level regarding fund.

 To know buying behavior of people.

 To make familiar with mutual fund.
 To know the perception regarding mutual fund schemes and prospectus.

 To gain familiarity with a phenomenon or to achieve new insights into it

(Studies with this object in view are termed as exploratory or formulate
research studies)

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 FINDINGS AND ANALYSIS

As part of the project we had make a survey with the help of questionnaire
that has to taken to different people to get perception towards mutual fund
the questionnaire is passed on the general public and requested to give their
opinion toward mutual fund the questionnaire Consists of both open and
close ended question the main motto behind the Study is to find out how
people react against the mutual fund and aware about the benefits of mutual
fund.
In research methodology we have used random sampling and sample
size was 300. Simple random sampling method is followed where every
member of population have equal chance of been selected. The questionnaire
is administrated on sample to find out their perception towards mutual fund.
After analysis of questionnaire conclusions were made based on finding
from pie charts.

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Q.1.Are you aware of the mutual fund?

(a) YES [ ]

(b) NO [ ]

(c) NO IDEA [ ]

MUTUAL FUND AWARENESS

10%
NO IDEA
20%
NO

70% YES

INTERPRETATION
From the survey it was find out that 70% of customers know about mutual
fund. While 20% Customer are not aware with mutual fund and rest of the
customers they have no idea about the mutual fund.

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Q.2. Have you ever invested in any mutual fund?

(a) YES [ ]

(b) NO [ ]

MUTUAL FUND INVESTMENT

45% NO
55%
YES

INTERPRETATION
Out of total respondents 55% have at least some amount in mutual fund, the
fact that some how majority for investment in mutual fund.

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Q.2 (a) If YES,

Then how much return you are earning?

Ans. As per the survey 55% people invested in mutual fund. Most of them
say that it is the most appropriate amount of return that a person should
demand, a number of factors have to be considered such as his current
situation, future business plans etc. It is an investment avenue that has the
potential for safety as well as growth

They are earning near about 32% annual return from their investment which
is quite good as per the investment purpose.

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Q.3.Which of the following investment instruments as your 1st preference?

(a) Gold & Silver (b) Fixed Deposits (c) Stock Market

(d) Life Insurance (e) Mutual Fund (f) Real Estate

(g) Post Office, PPF, NSC etc.

INVESTMENT PREFERENCE

REAL EST.
10
STOCK MKT
20 REAL EST.
MUTUAL FUNDS STOCK MKT
30 MUTUAL FUNDS
FD'S FD'S
40
LIFE INS.
LIFE INS.
GOLD&SILVER
50
PO,PPF,NSC
GOLD&SILVER
60
PO,PPF,NSC
70

INTERPRETATION
The above chart depicts that people mainly give their 1st preference to PO,
PPF, NSC etc and only 30% people give their 1st preference to mutual fund
as because the reason behind is this that people are not so much aware of it.

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Q.4.Why should you choose to invest in mutual fund?

(a) Maximum Return [ ]

(b) Tax Benefit [ ]

(c) Easy to Invest [ ]

INVESTMENT PURPOSE

10%
EASY TO INVEST
50% TAX BENEFIT
40%
MAXIMUM RETURN

INTERPRETATION
From the survey it was find out that 50% people invest for the higher return
and 40% invest for the tax benefit and the rest are invest as it is easy to
invest.

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Q.5.How can you select your mutual fund?

(a) Fund Performance [ ]

(b) Fund NAV [ ]

(c) Brand Image [ ]

FUND SELECTION CRITERIA

20%
BRAND IMAGE
45%
FUND PERFORMANCE
FUND NAV
35%

INTERPRETATION
From the survey it was found that 45% people select their mutual fund
according to the fund brand image, 35% people select their fund according
to its performance and the rest were select on the basis of its NAV. It reflects
that fund brand image should be very important in selection of any mutual
fund.

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Q.6.What rate of return did you expect annually from mutual fund under
today’s capital market scenario?

(a) 6%-10% [ ]

(b) 11%-15% [ ]

(c) 16%-20% [ ]

(d) Above 20% [ ]

MUTUAL FUND RETURNS

10%
16%-20%
20% 40%
ABOVE 20%
11%-15%
30%
6%-10%

INTERPRETATION
As per the above diagram it represents that only 10% people thought that they could earn
6%-10%, 20% thought they could earn 11%-15%, 40% thought they could earn 16%-
20% and 30% thought that they could earn above 20% from the mutual fund.

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Q.7 Are mutual fund risky?

(a) YES [ ]

(b) NO [ ]

30%
NO
YES
70%

INTERPRETATION
Out of total respondents 30% answered that mutual fund are not risky but
70% answered that yes mutual fund are risky because it overall depends on
the stock market which is not clearly predictable every time.

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Q.8.For how many years do you like to invest in mutual fund?
(a) 1 year [ ]

(b) 2-4 years [ ]

(c) 4-6 years [ ]
(d) Above 6 years [ ]

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Q.9. Have you ever heard about Reliance mutual fund?
(a) YES [ ]
(b) NO [ ]

RELIANCE MUTUAL FUND AWARENESS

30%

NO

70% YES

INTERPRETATION
Out of total respondents 60% answered YES that they know about Reliance
Mutual Fund and 40% answered NO.

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Q.10.What type of return you are earning from your mutual fund?
(a) High [ ]
(b) Low [ ]
(c) Average [ ]

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 CONCLUSION

Mutual Funds Should Creative Value

Mutual funds can create value in several ways,

such as by

(1) Adopting a research-driven investment strategy aimed at discovering

value and identifying the best performing companies and stocks, thereby

also putting pressure on company management’s to improve their

performance.

(2) Designing investment products based on a better understanding of the

investor’s needs.

(3) Providing liquidity (through open-ended schemes which are akin to

market-making service) to securities, like bonds or infrequently traded

shares, which may otherwise be liquid.

(4) Providing an easy way to investors to diversity risk.

(5) Improving the reach of investment products to small investors through

widest possible distribution networks.

(6) We should give the first priority promotional activities for awareness
of customers and it is less expensive than others.

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In order to facilitate a steady growth of the mutual fund industry, there
is also a clear responsibility on the Government, viz. to provide a
rational and stable tax environment relating to mutual funds.

LIMITATIONS

 Due to the financial & time constraints the study was limited to our place

thus the conclusion arrived in the end rely in short term experience.

 Being an opinion survey the personal bases of he respondents might have

entered into their responses.

 Time constraints resource constraints were some of the limitations

 The selected sample might have affected the results of the study therefore

the findings & conclusions of the study are only suggestive & not

conclusive.

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 RECOMMENDATION

 Company should have extensive advertising to attract potential

Customers.

 Adequate training improves the skill of employee.

 Company should put stress on market Capture

 Adequate transparency in product plan and policies

 Maintain proper Customer relationship

 Company should publish its weekly review of internal or external

Competitive business.

 There must be proper management information system in Company.

 Monthly NAV statement to provide to the customer

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 BIBLIOGRAPHY

BOOKS

 Kothari C.R.: Research Methodology, New Delhi, new age

international (p) Ltd. 1985

 Phillip Kotler: Marketing Management New Delhi Tata

Dorling Kindersley Publishing Inc.2006

 Rajan Sexena : Marketing Management New Delhi Tata Mc

Graw Hill publishing company limited.1997

WEBSITES

 www.amfindia.com
 www.reliancemoney.com
 www.reliancecapital.com
 www.uti.com
 www.mutualfundhelper.com

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 ANNEXURE
NAME: AGE:

OCCUPATION: GENDER: M/F

Q.1.Are you aware of the mutual fund?

(a) YES [ ]

(b) NO [ ]

(c) NO IDEA [ ]

Q.2. Have you ever invested in any mutual fund?

(a) YES [ ]

(b) NO [ ]

Q.2 (a) If YES,

Then how much return you are earning?

ANS……

Q.3.Which of the following investment instruments as your 1st preference?

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(a) Gold & Silver (b) Fixed Deposits (c) Stock Market

(d) Life Insurance (e) Mutual Fund (f) Real Estate

(g) Post Office, PPF, NSC etc.

Q.4.Why should you choose to invest in mutual fund?

(a) Maximum Return [ ]

(b) Tax Benefit [ ]

(c) Easy to Invest [ ]

Q.5.How can you select your mutual fund?

(a) Fund Performance [ ]

(b) Fund NAV [ ]

(c) Brand Image [ ]

Q.6.What rate of return did you expect annually from mutual fund under
today’s capital market scenario?

(a) 6%-10% []

(b) 11%-15% [ ]

(c) 16%-20% [ ]

(d) Above 20% [ ]

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Q.7 Are mutual fund risky?

(a) YES [ ]

(b) NO [ ]

Q.8.For how many years do you like to invest in mutual fund?

(a) 1 year [ ]

(b) 2-4 years [ ]

(c) 4-6 years [ ]

(d) Above 6 years [ ]

Q.9. Have you ever heard about Reliance mutual fund?

(a) YES [ ]
(b) NO [ ]

Q.10.What type of return you are earning from your mutual fund?
(a) High [ ]
(b) Low [ ]
(c) Average [ ]

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