ABSTRACT

The position of Indian mutual fund enterprise as extensive economic carrier in

economic market has actually been noteworthy. In fact, the mutual fund enterprise has
emerged as an important segment of monetary market of India, mainly in
channelizing the financial savings of millions of individuals into the investment in
equity and debt devices. Mutual price range are apparently the very best and the least
traumatic way to invest in the stock marketplace. Quiet a massive sum of money has
been invested in mutual price range during the past few years. Any investor would
really like to spend money on a reputed Mutual Fund organization. Mutual budget are
financial intermediaries involved with mobilizing savings of those who have surplus
and the canalization of those savings in the ones avenues in which there may be a call
for funds. These intermediaries appoint their resources in any such way as to offer
combined blessings of low risk, constant return, high liquidity and capital
appreciation through diversification and expert management. Reforms in the Indian
economic gadget and the outlet up of the economy had been the motives for the
terrific boom within the Indian capital market. This examine analyzes the impact of
various demographic variables at the mindset of traders closer to mutual price range.
Aside from this, it additionally focuses on the blessings delivered by means of mutual
budget to investors. To this give up, two hundred respondents of Solapur city, having
Distinct demographic profiles were surveyed.The look at exhibits that most of the
people of traders have still not shaped any
Attitude toward mutual fund investments.

0
 TABLE OF CONTENT

S.No. TABLE OF CONTENT PAGE NO.

I CHAPTER-1

INTRODUCTION 5-8
OBJECTIVES 9
RESEARCH METHODOLOGY 10
LIMITATIONS 11

II CHAPTER-2

REVIEW OF LITERATURE 12-30

III CHAPTER-3

COMPANY PROFILE 31-38

39-46
CHAPTER-4
IV
DATA ANALYSIS & INTERPRETATION
47-70
CHAPTER-5 71

V FINDINGS
SUMMARY& CONCLUSIONS
SUGGESTIONS 72-74
75-76
CHAPTER- 6
VI
BIBLIOGRAPHY

1
CHAPTER 1
INTRODUCTION

Investment may be defined as an object of price bought for earnings or capital

appreciation. Investments are made to reap a particular objective and savings are
made to satisfy an unexpected event.

There are various avenues of investments according with individual alternatives.

Investments are made in special asset lessons depending on an man or woman’s
hazard and return traits investment choices are physical property and economic
property.

Gold and actual estates are examples of bodily property, that have a physical form to
them. There's a sturdy choice for these belongings, as those belongings may be bought
with coins and held for a long time. The apparent risks with physical assets are the
dangers of loss and theft, decrease stages of return; illiquid secondary markets; and
adhoc valuations and transactions.

Monetary belongings are securities, which can be certificates embodying a economic

settlement between parties. Bonds, fairness stocks, Deposits and insurance rules are a
number of the examples of financial belongings. In financial assets buyers handiest
hold the proof of their investments within the shape of a certificate or account. Those
products are generally liquid, transferable and in maximum cases, saved electronically
with high degree of protection.

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However a minimal amount of cash is constantly kept in hand for transactions and
contingencies. To face the contingencies and unexpected activities the coverage came
into existence. Some other street of funding is mutual budget. It is created while
buyers placed their cash collectively. It is therefore a pool of the investor’s budget.
The maximum vital characteristics of a mutual fund is that the individuals and the
beneficiaries of the fund are the identical class of humans, specifically the buyers. The
time period mutual manner that buyers contribute to the pool, and additionally enjoy
the pool. There are no other claimants to the finances. The pool of funds held
mutually via traders is the mutual fund.
A mutual fund swimming pools the money of human beings with similar investment
goals. The cash in turn is invested in various securities depending on the goals of the
mutual fund scheme, and the income (or loss) are shared amongst investors in share to
their investments.

Mutual fund schemes are normally open-ended (continually open for investments and
redemptions) or closed give up (with a fixed time period). A mutual fund scheme
troubles units that are usually priced at Rs.10 at some point of the preliminary offer.
For this reason, the quantity of units you own as in opposition to the overall quantity
of gadgets issued by using the mutual fund scheme determines your percentage within
the profits or lack of a scheme. In the case of open-stop schemes, gadgets may be
purchased from or offered back to the fund at a internet Asset price (NAV) based rate
on all enterprise days.

The NAV is the real price of a unit of the fund on a given day. Hence, whilst you
invest in a mutual fund scheme, you generally get an account announcement
mentioning the wide variety of devices which have been allocated to you and the
NAV based totally fee at which the units had been allotted. The account assertion is
just like your financial institution statement.

Mutual funds invest basically in three forms of asset classes:

Stocks: stocks represent ownership or equity in a organization, popularly known as
shares.
Bonds: those represent debt from businesses, monetary establishments or government
corporations.

3
Cash market units: those encompass brief-time period debt contraptions inclusive of
treasury payments, certificate of deposits and inter-bank call money.
A mutual fund’s business is to invest the price range for this reason accrued, in line
with the desires of the buyers who created the pool. In many markets these needs are
articulated as funding mandates. Evaluation of The belief closer to those mutual price
range is carried out here in this project. Even what factors the traders look before
making an investment can also be discovered.

OBJECTIVES

• To examine the extent of consciousness of mutual budget

• To examine the belief of investors towards mutual budget.

• To have a look at the factors taken into consideration with the aid of the
traders and people which ultimately have an effect on him while investing.

• To decide the form of mutual fund investor prefers the most.

RESEARCH METHODOLOGY

Primary records is statistics this is tailored to a employer’s wishes, by means of

customizing genuine method attention organizations, survey, area-exams, interviews
or statement.

Primary records offers more particular effects than secondary studies, which is an
particularly essential consideration when one launching a new product or service.
Similarly, number one studies is typically primarily based on statistical
methodologies. The tiny pattern can provide an accurate illustration of a selected
market.

4
Secondary data is based on records gleaned from research formerly finished by means
of authorities companies, chambers of trade, exchange institutions and different
businesses. This includes census bureau statistics. A whole lot kind of this data may
be observed in libraries or on the internet, however seems and business guides, as well
as magazines and newspapers.

Analysis of person investment styles can be achieved with the aid of this number one
facts analysis. On this assignment i've finished a survey with a questionnaire with a
pattern size of one hundred folks that are employees and tax payees. The
questionnaire consists of the financial reputation of the people, age group, marital
status, investments made and so forth.

As Karvy securities ltd. Distributes numerous investment merchandise like mutual

budget, insurance, shares, debentures and so on. This survey will help them in
growing advertising and marketing techniques for his or her funding products.

LIMITATIONS

Geographic Scope: The pattern used for the observe has been taken from the buyers of
the dual cities Hyderabad and Secunderabad.

Frame work: Sampling frame (i.E the listing of population individuals) from which
the pattern units are selected became incomplete because it takes into consideration
most effective the ones (goal buyers) who have made their investments at some point
of March and April 2006.

Even though adequate care become taken to elicit the correct records from the
respondents, some of them have felt difficulty in crystallizing their feelings into
phrases. Apart from the hassle confronted in articulating, it's miles the validity of the
comments can be speculated.

No matter the above boundaries the have a look at is useful in that it does factor out
the developments and allows to identify the dimensions for enhancing the scope of
mutual finances.

5
CHAPTER 2

REVIEW OF LITERATURE

MUTUAL FUNDS

THEORITICAL BACKGROUND

Mutual fund is a mechanism for pooling the sources with the aid of issuing devices to
the investors and investing price range in securities according with targets as
disclosed in provide record.

A mutual fund is an funding automobile for investors who pool their savings for
making an investment in assorted portfolio of securities with the goal of appealing
yields and appreciation in their price.

Investments in securities are spread throughout a wide move-section of industries and

sectors and thus the threat is reduced .Mutual budget issues units to the traders
according with quantum of money invested by them. Buyers of mutual funds are
called unit-holders. The earnings or losses are shared by way of the buyers in
percentage to their investments. The mutual funds commonly pop out with a number
of schemes with exceptional investment goals, that are released now and again. A
mutual fund is required to be registered with securities and alternate board of India.

A mutual fund is setup within the shape of a agree with, which has

1. Sponsor

2. Trustees

3. Asset management agency and

4. Custodian.

The trust is installed by using a sponsor or more than one sponsor who's like promoter
of a business enterprise. The trustees of mutual fund maintain its property for the
advantage of the unit-holders. Asset management agency (AMC) authorized via SEBI
manages the funds by means of making investments in numerous kinds of securities.

6
Respective asset control agencies (AMC) management mutual fund schemes. Special
enterprise groups have subsidized those AMC s. Some worldwide finances also are
operation independently in India like extraterrestrial beings and Template.

A BRIEF HISTORY OF MUTUAL FUND

The idea of” mutual fund” is a brand new feather in Indian capital market however
now not to international capital markets. The formal foundation of mutual price range
may be traced to Belgium where society generated Belgium turned into established in
1822 as an investment agency to finance investments in countrywide Industries with
high related danger. The concept of mutual price range unfold to united states of
america inside the beginning of 20th century and three investment companies have
been started in 1924 seeing that then the concept of mutual funds has been growing all
over the world

In India, first mutual fund changed into started in 1964 whilst unit believe of India
(UTI) turned into established within the similar line of operation of the United
Kingdom.

The term ‘Mutual fund’ has now not been defined in British literature but it is
considered as synonym of investment believe of

DEFINITIONS

The concept of mutual fund has been defined in various ways.

“The mutual fund as an important vehicle for bringing wealth holders and deficit units
together indirectly”
...Mr. James pierce
“Mutual fund as financial intermediaries which being a wide variety of securities with
in the reach of the most modest of investors”.
…Frank Relicy

7
 According to SEBI mutual fund regulations 1993, “Mutual fund means a fund
established in the form of trust by sponsor to raise moneys by the trustees through the
sale of units to the public under one or more schemes for investing in securities in
accordance with these regulations.

CONCEPT OF MUTUAL FUNDS

A Mutual Fund is a believe that pools the financial savings of some of investors who
percentage a not unusual economic goal. The cash accordingly gathered is then
invested in capital market devices consisting of stocks, debentures and other
securities. The earnings earned via these investments and the capital appreciation
realized are shared by means of its unit holders in proportion to the quantity of
devices owned through them. For that reason a Mutual Fund is the maximum
appropriate funding for the common guy as it gives an opportunity to spend money on
a assorted, professionally controlled basket of securities at a surprisingly low price.

The flow chart below describes broadly the working of a mutual fund:

8
VALUE CHAIN OF MUTUAL FUND

SPONSOR:

Any person who, acting on my own or in mixture with any other body company,
establishes a mutual fund.

Asset Management Company

A firm that invests the pooled funds of retail investors in securities in step with the
said investment objectives. For a price, the funding organization presents more than
diversification, liquidity, and professional control carrier than is commonly available
to man or woman buyers.

Trustee

The Board of Trustees or the Trustee enterprise who hold the assets of the Mutual
Fund in believe for the benefit of the unit holders.

Mutual Fund

A fund mounted in the form of a trust to raise cash via the sale of devices to the public
or a phase of the public beneath one or greater schemes for investing in securities,
inclusive of cash market devices.

Transfer Agent

9
A switch agent is hired by way of a mutual fund to preserve information of
shareholder bills calculate and disburse dividends and put together and mail
shareholder account statements, federal earnings tax facts and other shareholder
notices.

Custodian

Mutual funds are required by means of law to guard their portfolio securities through
putting them with a custodian. Nearly all mutual funds use qualified bank custodians.

Unit Holder

Someone who's preserving devices in a scheme of a mutual fund.

CLASSIFICATION OF SCHEMES

 By Structure

Open-ended

A scheme in which traders can purchase and redeem their devices on any enterprise
day. Its gadgets aren't listed on any inventory trade however are offered from and sold
to the mutual fund.

Close-ended

A mutual fund scheme that gives a restrained range of devices, which have a lock-in
duration, typically of three to 5 years. The gadgets of closed-quit finances are
frequently indexed on one of the essential inventory exchanges and traded like
securities at prices, which may be higher or lower than its NAV.

In India 90% of the schemes is open-ended fund and the rest 10% is close-ended price
range. There are 1062 open-ended price range and 119 near-ended price range.

10
.

By Objective

A scheme also can be classified as increase scheme, income scheme, or balanced

scheme considering its funding objective. Such schemes can be open-ended or close-
ended schemes as defined in advance. Such schemes may be labeled in particular as
follows:

Growth / Equity Oriented Scheme

The aim of growth funds is to provide capital appreciation over the medium to long-
term. Such schemes normally invest a major part of their corpus in equities. Such
funds have comparatively high risks. These schemes provide different options to the
investors like dividend option, capital appreciation, etc. and the investors may choose
an option depending on their preferences. The investors must indicate the option in
the application form. The mutual funds also allow the investors to change the options
at a later date. Growth schemes are good for investors having a long-term outlook
seeking appreciation over a period of time.

Income / Debt Oriented Scheme

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The aim of growth funds is to offer capital appreciation over the medium to long-
time period. Such schemes generally invest a prime part of their corpus in equities.
Such budget have comparatively excessive dangers. These schemes offer distinct
alternatives to the investors like dividend alternative, capital appreciation, etc. And
the investors can also pick an option relying on their alternatives. The traders must
imply the choice within the software form. The mutual finances additionally allow the
buyers to exchange the options at a later date. Growth schemes are true for investors
having a long-time period outlook in search of appreciation over a time frame.

Balanced Fund

The aim of balanced funds is to provide both growth and regular income as such
schemes invest both in equities and fixed income securities in the proportion indicated
in their offer documents. These are appropriate for investors looking for moderate
growth. They generally invest 40-60% in equity and debt instruments. These funds are
also affected because of fluctuations in share prices in the stock markets. However,
NAVs of such funds are likely to be less volatile compared to pure equity funds.

Money Market or Liquid Fund

Those price range also are income price range and their goal is to offer clean liquidity,
preservation of capital and slight income. These schemes make investments
completely in more secure short-time period instruments which include treasury bills,
certificate of deposit, business paper and inter-financial institution name money,
government securities, and so on. Returns on those schemes differ much much less
compared to other price range. Those price range are suitable for company and person
traders as a method to park their surplus budget for brief periods.

Gilt Fund

Those price range make investments exclusively in government securities. Authorities

securities don't have any default danger. NAVs of these schemes additionally
fluctuate because of alternate in hobby rates and different financial elements as, is the
case with earnings or debt orientated schemes.

Index Funds

12
Index finances mirror the portfolio of a particular index inclusive of the BSE touchy
index, S&P NSE 50 index (Nifty), and many others these schemes invest within the
securities in the equal weightage comprising of an index. NAVs of such schemes
could upward thrust or fall in accordance with the upward thrust or fall within the
index, although not exactly with the aid of the same percent due to a few factors
referred to as "monitoring blunders" in technical phrases. Essential disclosures on this
regard are made in the provide report of the mutual fund scheme.

There are also trade traded index budget launched by way of the mutual budget that
are traded at the stock exchanges.

AVENUES OF INVESTMENTS

Savings shape an vital part of the economy of any kingdom. With the financial
savings invested in numerous alternatives to be had to the humans, the cash acts as the
motive force for boom of the u . S .. Indian economic scene too gives a plethora of
avenues to the investors.

Banks:

Taken into consideration as the most secure of all alternatives, banks were the roots of
the monetary system in India. For an regular person though, they have got acted
because the most secure investment avenue in which someone deposits money and
earns hobby on it. Every body have correctly used the two foremost modes of funding
in banks, savings bills and fixed deposits. However, today the interest charge shape
within the usa is headed southwards, keeping in line with worldwide tendencies. With
the banks supplying little above 7% of their constant deposits for twelve months, the
yields have come down appreciably in recent times. Add to this, the inflationary
pressures in economy and you've a role where the savings aren't earning. The inflation
is creeping up, to nearly eight% at times, and which means the value of money saved
is going down in place of going up. This successfully mars any exchange f gaining
from the investments in banks.

Post office Schemes

13
Among all saving options, post workplace schemes were offering the very best rates.
Brought to it is that the investments are safe with the department being a central
authority of India entity. So the 2 fundamental and most searched for features, the
ones of go back safety and quantum of returns were being handsomely looked after
Public Provident finances act as alternatives to keep for the publish retirement
duration for most of the people and were considered properly option largely due to the
truth that returns had been better than most different alternatives and additionally
helped people gain from tax advantages underneath numerous sections. The
subsequent are the post workplace savings schemes to be had for the investors:

Monthly Income scheme:

This scheme offers an hobby of 8p.Cp.A, payable monthly and a bonus of 10%
payable at maturity after 6 years. There may be no tax deductible at supply (TDS)
applicable on investments made in this scheme.

National Savings Scheme:

This scheme offers an hobby of eight% p.A; compounded half of every year and
payable at adulthood in 6 years.

Post Office Time Deposits:

There are four options to be had to traders depending on the time period of investment
desired by means of the investor. They're:

1 year) this offers an hobby of 6.25% p.A

2 year) This offers an interest of 6.Five% p.A

3 year) This gives an interest of 7.25% p.A

4 12 months) This gives an hobby of 7.5% p.A

Kisan Vikas Patra:

14
An critical feature of this scheme is that it assures that the cash invested doubles in
eight years and 7 months.

Public Provident Fund:

This scheme gives a return of 8% in line with annum, compounded yearly for
adulthood of 15 years.

Government of India Bonds:

The GOI Bonds have the subsequent investment options:

6.5% Tax free bonds

There may be no ceiling on the amount of investment in these bonds. The effective
yields of those bonds are 9.28% p.A during five years and premature encashment
choice to be had to investors only after the of completion of 3 years.

8% Taxable Bonds:

Those bonds do not have any TDS charged on them. There's no most restriction of
investment in these bonds but there should be a minimum investment of Rs.1, 000.
The maturity period is 6 years. The investor has the option of hobby payable half
every year or cumulative. The traders can also avail tax advantage under segment 80L
of profits Tax Act, up to Rs. 15,000.

Company Fixed Deposits:

Corporations have used constant deposit schemes as a method of mobilizing funds for
their operations and have paid interest on them. The more secure a company is rated,
the lesser the go back supplied has been the thumb rule. But, there are numerous
capacity roadblocks in those.

The threat of economic position of the organisation no longer being understood with
the aid of the investor lurks.

15
 1. Liquidity is a major problem with the quantity being acquired monthly
after the due dates.

2. The protection of important quantity has been observed lacking.

Stock markets:

Inventory markets provide an option to put money into a high chance, high go back
game. Even as the ability go back is a good deal greater than 10-11% any of the
alternatives discussed above can commonly generate, the hazard is undoubtedly of the
very best order. However, as it'd appear, human beings generally are clueless as to
how the inventory marketplace features and inside the method can endanger the
difficult-earned cash.

For people who aren't adept at expertise the stock market, the venture of producing
superior returns at comparable ranges of hazard is laborious to say the least. This is in
which mutual funds come into picture.

COMPARISION OF OTHER AVENUES WITH MUTUAL FUNDS

The mutual fund zone operates below stricter guidelines in comparison to maximum
other investment avenues. Other than supplying buyers tax efficiency and criminal
comfort, how do mutual funds evaluate with other merchandise?

Company Fixed Deposits versus Mutual Funds

Constant deposits are unsecured borrowings by using the agency accepting the
deposit. Credit score of the fixed deposit program is an indication of the inherent
default hazard in t he funding. The cash of buyers in a mutual fund scheme are
invested through the AMC in designated investments below that scheme. Those
investments are held and managed in-trust for the advantage of the scheme’s buyers.
On the other hand, there may be no such direct correlation between a company’s fixed
deposit mobilization, and the avenues in which it deploys these assets.

There can be no actuality of yield, until a named guarantor assures a go back or to a

lesser quantity, if the funding is in a serial gilt scheme. O the other hand, the go back

16
below a hard and fast deposit is positive, situation handiest to the default chance of
the borrower.

The primary value at which constant deposits are encashable isn't problem to
marketplace chance. However, the cost at which devices of a scheme are redeemed
entirely relies upon in the marketplace. If securities have gained value at some point
of the duration, then the investor can even earn this is better than what she expected
whilst she invested. Conversely, she could also come to be with a loss.

Early encashment of fixed deposits is continually issue to a penalty charged by way of

the enterprise that time-honored the fixed deposit. Mutual fund schemes also have the
choice of charging a penalty on ”early” redemption of gadgets (with the aid of way of
an “go out load”).

Bank Fixed Deposits versus Mutual Funds

Constant deposits are unsecured borrowings by using the agency accepting the
deposit. Credit score of the fixed deposit program is an indication of the inherent
default hazard in t he funding. The cash of buyers in a mutual fund scheme are
invested through the AMC in designated investments below that scheme. Those
investments are held and managed in-trust for the advantage of the scheme’s buyers.
On the other hand, there may be no such direct correlation between a company’s fixed
deposit mobilization, and the avenues in which it deploys these assets.

There can be no actuality of yield, until a named guarantor assures a go back or to a

lesser quantity, if the funding is in a serial gilt scheme. O the other hand, the go back
below a hard and fast deposit is positive, situation handiest to the default chance of
the borrower.

The primary value at which constant deposits are encashable isn't problem to
marketplace chance. However, the cost at which devices of a scheme are redeemed
entirely relies upon in the marketplace. If securities have gained value at some point
of the duration, then the investor can even earn this is better than what she expected
whilst she invested. Conversely, she could also come to be with a loss.

17
Early encashment of fixed deposits is continually issue to a penalty charged by way of
the enterprise that time-honored the fixed deposit. Mutual fund schemes also have the
choice of charging a penalty on ”early” redemption of gadgets (with the aid of way of
an “go out load”).

Bonds and Debentures versus Mutual funds

As within the case of constant deposits, credit score of a bond or debenture is a sign
of the inherent default threat within the funding. However, unlike constant deposits,
bonds and debentures are transferable securities.

At the same time as an investor can also have an early encashment alternative from
the issuer ( as an example via a “placed” alternative), liquidity is usually thru a listing
in the marketplace, implications of this are:

The fee that the investor would recognize in an early exit is problem to marketplace
danger. The investor may want to have a capital benefit or a loss. This factor is similar
to a mutual fund scheme.

A hypothecation or loan of identified constant and / or modern-day assets ought to

back debt securities, e.G secured bonds or debentures. In any such case, if there may
be a default, the recognized belongings emerge as to be had for meeting redemption
necessities.

An unsecured bond or debenture is for all practical functions like a set deposit, as far
as get admission to to property is concerned.

A custodian for the benefit of traders inside the scheme holds the investment of a
mutual fund scheme.

Equity versus Mutual fund

Investment in each equity and mutual price range are difficulty to marketplace threat.
Investment in an open-quit mutual fund removes this direct risk of no longer being
capable of dell the funding within the marketplace. An indirect chance stays, due to
the fact the scheme has to realise its investments to pay traders. The AMC is but in a

18
 better role to address the situation. In addition, as a consequence of numerous SEBI
rules, consisting of illiquid securities are in all likelihood to be best part of the
scheme’s portfolio.

Another benefit of fairness mutual fund scheme is they give buyers the gain of
portfolio diversification through a small funding.

RISK AND RETURN GRID:

An investor has specifically 3 investment goals.

1. Safety of principal

2. Return

3. Liquidity

BANKS FIXED BONDS AND EQUITY MUTUAL

DEPOSIT DEBENTURES MARKET FUND
Returns Low Low to Low to Moderate to high Better
Moderate moderate
Administrative High Moderate Moderate to Low to Moderate Low
expenses to High high
Risk Low Low to Low to High Moderate
Moderate moderate
Investment Less Few Few Many More
options
Network High Low Low penetration Low but Low but
penetration penetration improving fast improving
Liquidity At a cost Low Low to Moderate to High Better
moderate
Quality of Not Not Not transparent Transparent Transparent
Assets transparent transparent
Guarantee Maximum None
Rs 1 lakh

Pricing

The internet asset price of the fund is the cumulative marketplace cost of the asset
fund internet of its liabilities. In other words, if the fund is dissolved or liquidated, by

19
way of promoting off all the property inside the fund, this is the amount that the
shareholders might together very own. This gives rise to the idea of the internet asset
value in line with unit, that's the value, represented by means of the possession of 1
unit in the fund. It's far calculated without a doubt via dividing the net asset fee of the
fund by way of the number of devices. But, the majority refer loosely to the NAV
consistent with unit as NAV, ignoring the “consistent with unit”. We also abide by the
equal conference.

Calculation of NAV

The maximum critical part of the calculation is the valuation of the belongings owned
by the fund. As soon as it's far calculated, the NAV is actually the internet cost of
assets divided via the number of devices exquisite. The specified method for the
calculation of the asset fee is given beneath.

Asset value = (Value of investments+ receivables+ accrued income+ other

current assets- liabilities- accrued expenses) /Number of units outstanding.

ADVANTAGES OF INVESTING IN MUTUAL FUND:

Number of options available

Mutual finances invest in step with the underlying funding goal as special on the time
of launching a scheme. Mutual fund have equity finances, debt finances, gilt finances
and lots of others that cater to the special desires of the investor. Whilst fairness
finances may be as risky as the stock markets themselves, debt finances provide the
sort of protection this is aimed for on the time making investments. The only pertinent
thing right here is that the fund needs to be decided on keeping the risk profile of the
investor in mind because the goods listed above have unique risks associated with
them.

Diversification

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Diversification reduces the danger due to the fact all shares don’t move within the
same direction on the equal time. You'll achieve this diversification thru a Mutual
Fund with some distance less money that it is easy to on his personal.

Professional Management

Mutual funds employ the offerings of the professional specialists who've years of
revel in to returned them up. They use extensive research techniques to research every
funding choice for the capability of returns in conjunction with their danger tiers to
give you the figures for the performance that determine the suitability of any
capability funding.

Potential of returns

Returns within the mutual are commonly better than any option in any other avenue
over an affordable time period. Human beings can choose their funding horizon and
stay positioned inside the chosen fund for the length.

Liquidity

The traders can withdraw or redeem cash on the net Asset price related charges in the
open-end schemes. Inside the Closed-cease Schemes, the units may be transacted at
the prevailing marketplace fee on a stock exchange. Mutual funds additionally offer
the facility of direct repurchase at NAV related fees.

Well Regulated

The Mutual Fund industry may be very well regulated. All funding needs to be
accounted for, selections judiciously taken. SEBI acts as a real watch canine in this
situation and might impose penalties at the AMC’s at fault. The rules designed to
shield the buyers pursuits are carried out effectively.

Transparency

Being under a regulatory body paintings, Mutual budget have to disclose their
holdings, investment pattern and all of the information that can be considered as
fabric, earlier than all traders. Which means investment method, outlooks of the

21
markets and scheme related info are disclosed with reasonable frequency to ensure
that transparency exists in the device.Flexible, affordable and occasional cost

Mutual funds offer a enormously less expensive manner to invest whilst as compared
to different avenues which include capital market operations. The charge in phrases of
brokerages, custodial costs and other management fees are substantially decrease than
other alternatives and are without delay related to the overall performance of the
scheme. Funding in Mutual budget additionally offer loads of flexibility with features
including ordinary funding plans, ordinary withdrawal plans and dividend funding
plans enabling systematic investment or withdrawal of budget.

Convenient Administration

Funding inside the mutual fund reduces paper paintings and facilitates you avoid
many issues which include terrible deliveries, not on time bills and observe up with
agents and groups. Mutual funds save a while and make making an investment
smooth and convenient.

TAXATION ON MUTUAL FUNDS

An Indian mutual fund registered with the SEBI, or schemes sponsored by using
specific public quarter banks/economic establishments and authorised via the critical
government or authorized through the RBI are tax exempt as in step with the
provisions of segment 10(23D) of the profits tax act. The mutual fund will receive all
profits without any deduction of tax at supply underneath the provisions of segment
196(iv), of the income tax act

22
CHAPTER 4

DATA ANALYSIS & INTERPRETATION

DATA ANALYSYS

SOME OF THE SCHEMES OF MUTUAL FUNDS:

Standard Chartered Mutual Fund

Schemes:

Grindlays cash fund: it's far an Open-ended profits scheme with excessive liquidity. A
scheme that invests in money marketplace units like Treasury payments, call money,
Repos , brief-time period corporate Debentures, commercial Papers, certificates of
Deposits, etc that offer a high level of balance and smooth liquidity

Tax:

The GCF is also very taxed green. It comes with a daily (compulsory reinvestment),
Weekly (obligatory reinvestment), month-to-month and Bi-monthly dividend
alternatives. Each day gains are declared inside the shape of dividends after which
reinvested after netting it off against Dividend Distribution Tax (presently
20.91%).This dividend is absolutely tax unfastened. So the net tax prevalence is just
20.Ninety one% as compared to 36.5925% for similar non mutual fund option.

Grindlays Floating rate Fund: It seeks to generate solid returns with a low hazard
method via creating a portfolio that is extensively invested in good nice floating
charge debt or cash market units, fixed price debt and cash marketplace gadgets.

GFRF normally invests in Floating charge debentures and bonds, quick tenor constant
rate devices and long tenor constant price devices swapped to floating fee.

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Plans: The fund is available in two plans

 Short term plan for buyers with a time horizon of 1-6 months.
 Long time plan for buyers with a time horizon of past 6 months.

Grindlays Debt funds: Debt finances are price range that invest simplest in debt
securities and are designed to in the main protect your capital and provide higher
returns through making an investment in excessive quality debt securities.Operations
of Debt budget: There are important assets of sales that a debt fund earns:

A) Hobby income

Whilst you spend money on a financial institution / agency deposit, it gives you a hard
and fast price of hobby with the important being lower back on adulthood. Further
when a debt fund invests in diverse debt securities the issuers of these securities
provide a fee of interest and the important on maturity. The issuers of those securities
should both could either be numerous corporates like Reliance, Hindalco, ICICI,
Bharat Petroleum or the government of India.

B) Mark to marketplace benefit/loss

As hobby charges on financial institution fixed deposits exchange often so do interest

charges on debt securities. Interest fees and debt protection prices are in truth the 2
sides in seesaw. In widespread, fees fall while interest quotes upward thrust and rise
while hobby quotes fall. If the interest rates were to decline then more moderen bonds
might be issued at lower interest fees than current bonds. Therefore old bonds might
be costlier and as a result fees of these older bonds would upward thrust.

Similarly if hobby quotes were to raise then cost of old bonds might fall, as more
recent bonds could undergo better interest costs. The traded charge of a bond might
also as a result vary from its face price. The longer a bonds length to adulthood, the
extra its price have a tendency to differ as marketplace hobby charges alternate.

DSP Merrill lynch Mutual Fund:

Schemes

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Liquidity Fund:

It is an open-ended fund liquid scheme seeking to generate a reasonable return

commensurate with low risk and high degree of liquidity from a portfolio constituted
of money market securities and high quality debt securities.

Floating rate Fund:

It's miles an open-ended profits scheme seeking to generate income commensurate

with prudent hazard from a portfolio appreciably constituted of floating rate debt
securities and fixed rate debt securities swapped for floating fee returns. The scheme
may put money into fixed price debt securities and cash market securities.

Brief time period Fund:

It's miles an open-ended earnings scheme looking for to generate earnings

commensurate with prudent danger, from a portfolio constituting of cash market
securities, floating price debt securities and debt securities.

Bond fund:

It is an open-ended earnings scheme in search of to generate an appealing return,

consistent with prudent hazard from a portfolio, which is extensively produced from
excessive first-class debt securities of issuers predominantly domiciled in India.

Equity Fund:

It is an open ended increase scheme seeking to generate long time capital

appreciation, from a portfolio which is extensively constituted of equity and equity
related securities of issuers domiciled in India. The scheme may invest a sure portion
of its corpus in debt and cash market securities, so one can meet liquidity necessities
occasionally.

T.I.G.E.R Fund:

It is an open ended increase scheme whose number one funding goal is to are trying to
find to generate capital appreciation, from a portfolio this is appreciably created from

25
fairness securities of corporates, which could advantages from structural changes
brought approximately by persevering with liberalization in monetary regulations by
way of the government and / or from persevering with investments in infrastructure,
each by public and personal zone.

HDFC MUTUAL FUND

Schemes

HDFC Growth Fund:

It's far a open ended scheme in search of to generate long term capital appreciation
from a portfolio this is invested predominantly in fairness and fairness associated
units

HDFC fairness Fund:

It is an open-ended increase scheme to obtain capital appreciation.

HDFC pinnacle 2 hundred Fund:

It's miles an open-ended growth scheme looking for to generate long-time period
capital appreciation from a portfolio of equity and fairness-related gadgets in the main
drawn from the businesses in BSC two hundred index.

HDFC Balanced Fund:

It is an open ended balanced scheme looking for to generate capital appreciation along
side contemporary earnings from a blended portfolio of equity and fairness associated
and debt & cash marketplace instruments.

HDFC Tax Savers Fund:

It's miles an open-ended equity related saving scheme with a lock-in length of three
yrs searching for to generate long time growth of capital.

HDFC Gilt Fund:

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It is an open-ended income scheme looking for to generate credit score risk-loose
returns through investments in sovereign securities issued by using primary
government or state government.

Birla Sun Life Mutual Fund:

Schemes

Birla Advantage Fund:

It's far an open-ended diverse equity fund and portfolio stays over wait throughout
banks MNC pharma, IT and Telecom.

Birla Dividend Yield Plus:

It's miles an open-ended increase scheme investing in high dividend yield groups and
continuously having a fantastic outlook on banking area.

Birla Mid cap Fund:

It is an open ended increase scheme investing by and large in mid cap stocks and the
portfolio stays well diverse throughout pharmaceutical, banking, customer non
durable, IT, hotels.

Birla MNC Fund:

It's miles an open-ended boom scheme making an investment in multi countrywide

agencies and the portfolio stays over weight across consumer non-durable, IT, Agro
chemical compounds.

Birla Gilt Plus:

It's far an open-ended authorities safety scheme.

Birla equity Plan:

It's miles an open-ended equity related financial savings scheme with a lock-in for
three years.

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Kotak Mutual Fund

Schemes:

Kotak 30:

It's miles an open-ended fairness growth scheme seeking to generate capital

appreciation from a portfolio of predominantly and fairness related securities with
funding in, generally, not more than 30 stocks.

Kotak opportunities:

It's far an open-ended equity increase scheme in search of to generate capital

appreciation from a diverse portfolio of fairness and fairness associated securities.

Kotak Global India:

It is an open-ended boom scheme searching for to generate capital appreciation from a

varied portfolio of fairness and fairness related securities issued by way of globally
competitive Indian corporations.

Kotak Liquid:

It's miles an open-ended debt scheme to offer reasonable returns and high stage of
liquidity by way of investing in debt and money marketplace contraptions of different
maturities in an effort to unfold the threat throughout unique varieties of issuers in
debt markets.

Chola mutual fund:

Schemes:

Cholamandalam growth fund:

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It is an open ended scheme searching for to generate long time capital appreciation,
earnings through investments in equity & equity related contraptions; the secondary
goal is to generate a few contemporary earnings and distributive dividend.

Chola midcap fund:

It's miles an open ended scheme in search of to generate capital appreciation with the
aid of investing primarily in mid cap shares. The scheme will make investments
generally that have a marketplace capitalization among Rs.300 crores to Rs. 3000
crore.

Chola opportunities fund:

It's far an open ended scheme so that you can make investments in particular to
generate long term capital appreciation from a assorted portfolio of equity and
fairness associated securities.

Chola Multi-cap fund:

It is an open-ended growth scheme so that you can offer long term capital
appreciation by making an investment in a nicely different portfolio of fairness and
fairness associated units throughout all levels of market capitalization.

Chola Gilt investment plan:

It is an open-ended growth scheme searching for to generate returns from a portfolio

via investing in government securities.

Chola monthly income plan:

It is an open-ended increase scheme in search of to generate monthly earnings via

funding in variety of debt, equity and cash market instruments.

CHOOSING FUNDS

While it comes down to it, the decision to invest in a mutual fund is one you need to
make to your personal. Whilst you try to select an investment, however, it is a superb

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idea to are seeking the steerage of a monetary consultant who will review its objective
to make sure it helps your financialgoal.

As an investor, your dreams are unique, and a financial marketing consultant can help
fit you with the exceptional budget. Bear in mind, but, while you are choosing price
range, to recall how a whole lot chance you're comfy with and when you'll need the
money. When you have the time to climate the marketplace's u.S.And downs, you can
want to don't forget equity investments.

Earlier than you pick a mutual fund, it is important to study the prospectus carefully
to study all you could about the fund's performance, investment desires, dangers, fees
and prices.

DECISION MAKING FACTORS WHILE INVESTING IN MUTUAL FUNDS

Earlier than looking at the mutual budget to be had to you, it can be nice to determine

The combination of inventory, bond, and money marketplace budget you pick. Some
experts believe that is the maximum crucial selection in investing. Right here are
some widespread factors to keep in thoughts whilst determining what your investment
strategy need to be.

Diversify.

It is a good idea to spread your investment among mutual price range that spend
money on exclusive styles of securities. Shares, bonds, and money marketplace
securities work otherwise. Every offers exceptional blessings and drawbacks. You
could additionally want to diversify within the equal elegance of securities.
Diversifying can preserve you from setting all your eggs in one basket and therefore,
can also growth your returns over along length of time.

Consider the effects of inflation.

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For the reason that cash you set apart today may be supposed to be used several years
down the road, you need to have a look at inflation. Inflation measures the boom of
popular charges through the years.

Conservative investments like money marketplace budget frequently may be popular

due to the fact they are controlled to hold a regular value. But their go back after
accounting for the inflation rate can be very low, perhaps even bad.

As an instance, a 4% inflation price over a length of many years may want to erase a
money marketplace fund's three% yield over the identical time period. So even though
such an funding may additionally supply some safety of main, it is able to no longer
be capable of grow enough in price over time or even maintain up with the price of
inflation.

Persistence is a distinctive feature. It's no mystery—the prices of commonplace shares

can exchange pretty a bit from day to day. Consequently, the part of your account
invested in inventory funds would possibly range in fee much the identical way.

If you don't need your cash proper away (for as a minimum 5 years), you probably
don't want to panic if the stock marketplace declines or you discover that your
quarterly declaration indicates the value of your funding has fallen. Inside the beyond,
the inventory market has regained misplaced cost over the years. Despite the fact that
you are not assured it'll accomplish that within the destiny, try to be affected person
and allow your stock budget time to recover.

Take into account the saying, "purchase low, and promote high." Switching out of a
stock mutual fund whilst costs are low is normally not the manner to make the most of
your investment. Of course, if a fund continues to underneath-carry out over time as

31
well as your different fund alternatives, you can need to remember changing
finances.

Have a look at your age. More youthful traders may be extra comfortable with stock
finances, because they've time to attend out the fast-time period u.S.And downs of
stock costs. By way of investing in a stock fund, they is probably able to receive
excessive returns over the long-term.

Then again, folks who are in the direction of retirement can be more interested in
defensive their cash from possible drops in fees, considering they'll need to apply it
quickly. In this example, it could be wise to vicinity a more percent of cash in bond
and/ or cash market finances, which won't have such big modifications in value.

How are you going to determine an investment blend appropriate in your age? One
way is to subtract your age from 100. The solution you come up with may be an
excellent quantity to start with in determining what part of your overall investments to
put into inventory mutual budget.

Threat. When you are choosing price range, make certain to don't forget how a whole
lot chance you're cozy with and how near you are to retirement. If retirement is
around the corner, you can want a portfolio with little or no chance. However, if you
are more youthful, and feature the time to weather the market's united statesand
downs, you could want to choose a more competitive investment approach.

Study FUND documents

Your primary supply of statistics regarding the mutual fund may be the prospectus.
It's far a criminal file illustrating the rules and policies that a mutual fund must
observe and incorporates information on the fund's intention and strategy, risks,
performance, economic highlights prices and expenses, and a wide variety of facts
that you should realize before investing.

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What are the fund' s aim and approach?

Dreams vary from fund to fund, and they are critical to recognize so that you can
decide in the event that they fit your non-public goals. A few funds generate income
for their shareholders, even as others deal with capital appreciation. Some cognizance
on a combination of the 2, and others are orientated towards tax blessings or
preservation of capital.

Funds also put in force differing strategies to help accomplish their goals. The goals
and strategies phase of a prospectus information the sorts of securities wherein fund
managers can make investments and how managers analyze them

Finances can be limited to domestic investments, consciousness on a sure country or

region, or invest everywhere in the world. In addition, some funds invest handiest in
specific industries or specifically sorts of corporations. Others invest in large-,
medium- or small-capitalization agencies.

What are the risks?

As with all investments, each fund, whether home, worldwide or sector precise,
incorporates exclusive risks. The main dangers phase of a prospectus explains which
ones are associated with the securities in that unique fund, which can also assist you
decide what stage of hazard you are relaxed having in your funding portfolio.

How has a fund carried out?

While historic overall performance would not predict how a fund will do inside the
destiny, you'll be interested by the way it carried out in beyond marketplace
environments. Depending on the age of the fund, a prospectus will offer its 1- five-
and 10-year average annual returns, consisting of a comparison to its benchmark
index over the identical period.

33
What are economic highlights?

In this phase a prospectus lists 5 years of annual financial information, if a fund is less
than five years antique, gives records on the grounds that inception. Statistics consists
of net asset values at the start and give up of each yr, and details the gains or losses,
dividends and distributions that account for any adjustments.

Monetary Highlights also display fund asset records which include internet assets
ratios to average net assets for expenses and internet investment earnings, and
portfolio turnover quotes.

What are the charges of a fund?

Operating a fund entails a few charges you have to be privy to. The costs and fees
phase breaks out those expenses and who will pay them. In addition, an example of
fund expenses is supplied that will help you examine the value of making an
investment in a single fund as opposed to some other.

Who's coping with the fund?

Within the management segment, a prospectus offers a short biography of a fund' s

managers, together with how lengthy they have got labored on the fund and their
normal industry revel in.

MARKET SEGMENTATION

Marketplace segmentation is the department of market into homogeneous

organizations, with a purpose to respond differently to promotions, communications,
advertising and different advertising mix variables. A exceptional advertising blend
can goal every institution, or “segment”, due to the fact the segments are created to
minimize inherent differences among respondents inside each phase and maximize
differences between each phase.

Marketplace segmentation changed into first described within the 1950’s, whilst
product differentiation turned into the primary marketing method used. In the 1970’s

34
and 1980’s, marketplace segmentation started to take off as a method of increasing
income and acquiring competitive benefits.

Makes use of of market Segmentation

There are many appropriate reasons for dividing a market into smaller segments. The
number one reasons:

Less difficult advertising and marketing

It's far less difficult to deal with the desires of smaller corporations of customers, in
particular if they have many traits in not unusual (e.G. Are seeking for the equal
advantages, same age, gender, etc.).

Locate niches

Discover beneath-served or un-served markets. The usage of “area of interest

advertising”, segmentation can allow a brand new corporation or new product to goal
much less contested buyers and facilitates a mature product are seeking new
customers.

Green

More efficient use of advertising and marketing assets is by way of focusing at the
fine segments for the investor supplying—product, rate, merchandising, and vicinity
(distribution). Segmentation can help keep away from sending the incorrect message
or sending message to the wrong people.
Class variables

Classification variables are used to categorise survey respondents into market

segments. Almost any demographic, geographic, Psychographic or behavioral
variable may be used to classify human beings into segments.
Demographic variables — Age, gender, profits, ethnicity, martial repute, training,
occupation, household size, period of house, form of residence, and so on.

35
Geographic variables – city, kingdom, zip code, census tract, u . S . A ., place,
metropolitan or rural region, populace density, weather, etc.

Psychographic variables – Attitudes, lifestyle, pastimes, hazard aversion, personality

trends, management trends, magazines read, television applications watched, PRIZM
clusters, and so forth.Behavioral variables – emblem loyalty, usage level, advantages
sought, distribution channels used, response to advertising factors, etc.

Precis

Target advertising and marketing or market segmentation based on client wants and
needs can growth income. Goal marketplace identifies purchaser corporations and the
motives they buy. Marketplace segmentation facilitates a commercial enterprise be
extra attentive to converting purchaser needs. An standard advertising plan or
approach visually indicates how all aspects of a marketing attempt paintings together.
The last purpose of any enterprise is to promote the service or product.

Primary records FOR THE challenge:

For the custom designed needs o the challenge, primary information become accrued
via a survey inside the dual towns of Hyderabad & Secunderabad. A Random pattern
of one hundred buyers were surveyed. They were all asked to reply a questionnaire
genuine to their knowledge. The comments obtained from the patron became
instrumental, gauging the perception of the investors in the direction of mutual funds.
It also throws light at the elements, which have an impact on them to make choices at
the same time as investing. Further the interaction with few of the buyers is going an
extended way in information the inlaid motives for their choices.

SECONDARY DATA:

36
The primary resources of secondary records are the net web sites of numerous mutual
fund houses like cholamandalam mutual fund, Franklintempletonindia, ICICI, BIRLA
SUNLIFE, KOTAK and more such houses. Many references have been amassed from
one of a kind libraries to benefit an perception on mutual price range. Previous
studies carried out in this subject furnished precious help. Similarly to the above
assets, running with Karvy pals and interplay with their personnel supplied a realistic
edge to my theoretical ideas.

Survey Details

Total Sample Size 100

Economic Status Criterion Tax payees & Non tax payees

Age groups 23 years and above

Martial Status Criterion Married, Married with children & Unmarried

FACTORS CONSIDERED BY INVESTORS

WHILE INVESTING

Every investor considers several factors whilst investing in any of the products as it
offers with the maximum vital need of lifestyles “cash”.

The five principal elements that had been taken into consideration are:
1. Safety & security
2. Tax exemption
3. Liquidity
4. Profitability

37
 Factors considered by investors
While investing
17%
31%
14%

12% 26%
Safety & security Tax exemption
Liquidity Profitability
Return pattern

SAMPLE SIZE 100

ECONOMIC STATUS TAX PAYEES AND NON-TAX PAYEES

The above graph shows that 31% people remember safety & safety as the primary
element even as making an investment, 26% is going for Tax exemption, 17%
considered go back pattern within the funding, 14% went with profitability and 12%
confirmed interest in liquidity.

ANALYSIS OF THE ABOVE GRAPH:

In a growing united states of america like India most people fall within the lower
center elegance and center elegance sectors. The mindset of the investors is of number
one problem. As increasingly more alternatives that warrant high returns are available
inside the market, investor tends to be greater skeptical. So, even as making an
investment in any road, their first priority is safety and protection. Even the age of the
investor performs a major role inside the choice-making. As an example, if the
investor is within the age of fifty and above, he generally seems for low or no risks
even as investing. Therefore, 31% of buyers surveyed preferred safety & protection.

Next is the “tax exemption”; as there is tremendous increase within the corporate zone
and the remuneration gadget for a particular region has changed. This created a
change in income degrees and thereby affected the expenditure patterns. Inside the
beyond, it took worker years of time to attain a 5-figured salary. But, steadily the

38
system has modified. Even the worker in the lower stage or the middle stage of the
corporate ladder is receiving a handsome emolument. So, they're choosing the
exemption of tax. Consequently, the subsequent choice is for tax exemption this is
26% of the entire.

Except buyers going for safety & safety, there are traders who choose go back on
investments they made. They are specifically within the age group of 23 and 35.
Because these investors are probable to think that, at this age they may be mentally
greater strong and feel that they can cope with financial risks. Any earnings made
might similarly bolster their monetary balance. And so, 17% went with return pattern
of their funding. Within the same manner, 14% of the buyers look for profitability,
especially folks that are already doing commercial enterprise, i.E. Individuals who are
already acquainted with taking dangers.Out of the overall, 12% of investors desired
liquidity. The primary motive for this can be that, that making the invested cash
liquefied as and while required is essential, and this is not feasible if the investments
are made in any coverage, bank deposits, and so on.

Although there are various factors that may be attributed to an investor’s psyche,
through big, we will finish that most variety of buyers is making an investment in
those sectors in which there is protection & safety for his or her most important. The
alternative factors antecede protection.

INVESTMENT PATTERN:

Investment pattern

7% 5% 4%
2%
9% 42%

31%

Bank deposits insurance mutual fund

bonds shares Equity
none

39
Sample size a hundred

Monetary reputation Tax payees & non-tax payees

From the above graph, it's miles clean that forty two% opted for an investment in
financial institution deposits, 31% for coverage, 7% for stocks, nine% for mutual
fund, 2% for bonds, 5% for fairness and ultimate four% have invested in a few
different investments inclusive of actual estates etc.

ANALYSIS OF THE ABOVE GRAPH:

The investment sample of an investor is likewise very crucial because this indicates
the avenues in which the people are really involved. Here, forty two% have invested
in bank deposits as it is very secure and danger free. Out of the sample of a
hundred,it's far located that those who opted for an funding in banks in the form of
deposits are found to be inside the age institution of forty and above and are in
authorities services.

The subsequent preference, as located within the pie chart for investment sample is
“insurance”. People typically opt for life coverage as it promotes a experience of
safety & security for the dependents at the person and even his property. So, the
following precedence is coverage. 7% of the traders went for an investment in stocks
because it brings quick returns, even though stocks are liable to excessive risks.

As shown nine% of the traders opted for an funding in mutual budget. From this we
are able to infer that the marketplace of mutual fund is choosing up slowly. In keeping
with the survey, the humans who've invested within the mutual funds belong to
excessive-income range and that they want an exemption from tax and a mere 2%
opted for bonds, 5% for funding in fairness and four% have invested in different
investments which includes actual property to make quick returns on their
investments.

40
AWARENESS TOWARDS MUTUAL FUNDS:

Awareness towards mutual

funds

13%

87%

Aware of mutual fund Not aware of mutual fund

In the above pie chart, we are able to study that almost 90% of traders are privy to
mutual funds and simplest thirteen% humans aren't aware about it. This shows that
maximum of the investors recognize approximately mutual finances in a single or the
opposite way.

Evaluation OF THE ABOVE GRAPH:

Of the pattern surveyed, nearly all the people are privy to mutual finances. They are
privy to the term “mutual fund”. Though the questionnaire can not pick out the
volume of the attention. Thru the interaction it's miles found that they may be no
longer honestly privy to the blessings in investing mutual budget, numerous sorts of
mutual finances and distinctive schemes provided in it. It's miles determined that
human beings frequently have an inhibition that investments in mutual finances can
be accomplished only via the ones who have surplus amount of money with them and
want to avail tax redemption.

41
 MUTUAL FUND INVESTMENTS:

Mutual finances are medium threat investments. Even though investing in mutual
fund doesn’t guarantee a hard and fast amount of returns, nevertheless, they may be
no longer low. The awareness approximately mutual funds is the primary criterion.

Mutual fund investments

19%
6%

75%

Equity funds Debt funds Liquid funds

Sample length 16

Criterion Mutual fund investors in the survey

From the graph, it is clean that best sixteen out of a hundred invested in mutual
budget. From the ones 16, 12 have invested in equity funds, three in liquid funds and
the remaining 1 in debt funds.

ANALYSIS OF THE ABOVE GRAPH:

42
Simplest 16 out of 100 invested in mutual budget this could be especially attributed to
the low level of awareness, numerous inhibitions and a now not so clean concept
about the mutual budget. It's miles very important to have a clear perception of mutual
price range, how they paintings and how the money is invested in one-of-a-kind
portfolios in step with the traders’ desire.

Traders who opted for fairness budget are 12 of 16 percentage. Fairness budget being
the general public preference may be reasoned as they want their investments to be
put in numerous sectors i.E. Varied budget so that they can make earnings out of it
without problems. Even a few went for INDEX price range because the investments
are made in Bench Nark Index inventory like BSE, NSE.

A few (3percentof 16%) traders made investments in liquid price range as they want a
quick term investments where the investor need not look forward to lots time for the
go back. Those are also referred to as as cash Markets for brief time period.

Handiest a single investor went for debt price range where investments are in diverse
debt merchandise like certificates of Deposits (CD’s), industrial papers and phone
money because the investor want a secured investment, which he can avail in Debt
budget.

43
FINDINGS

• A few of the investors are privy to mutual budget however maximum in their
perception closer to them isn't always fantastic.

• Investors are particularly involved with the hazard factors of mutual finances
and are not directing closer to them.

• The traders who have invested in mutual price range in particular move for it
because of the Liquidity count and Tax exemption.

• The majority don’t recognize the blessings of mutual finances and the
numerous kinds of mutual finances.

• There are almost 1173 schemes of mutual funds provided by way of diverse
mutual fund houses, which an everyday individual isn't always aware.

• A common investor basically appears for the Tax exemption and protection &
protection at the same time as investing.

• Traders often sense that the ones human beings, who have surplus amount
with them and invest to avail Tax exemption, can do making an investment in mutual
budget

44
SUMMARY

This file is an try to provide an analysis of the belief of an investor closer to mutual
budget. However, what has been stated is handiest the tip of iceberg in terms of
information that are to be had.

But, my examinations indicates that employees are involved to put money into mutual
budget provided sufficiently knowledgeable and a knowledge is supplied on its
running. Even though the self-hired are investing in mutual funds and coverage, they
may be making an investment small quantities in them because they do now not need
to take high risks.

Karvy inventory dealer ltd ought to educate the human beings approximately the
numerous blessings of making an investment in mutual finances and create an
consciousness regarding diverse investment options.

In conclusion, it's far critical to remember that the main motive for initiating the task
is to research the belief of an everyday investor toward the mutual budget and the
factors that guide him to make funding decisions. The examine does no longer
purpose to propose investments in mutual budget.

CONCLUSION

Mutual funds are still and would continue to be the unique financial tool in the
country. One has to appreciate the fact that every aspect of life as its periods of high
and lows. This has been the case with the stock markets. Why not apply the same
logic to mutual funds? Mutual funds have not failed in any country where they
worked with regulatory frame work. Their future is bright. The poor performance of
many mutual funds schemes may be mostly attributed to the quality of personal
involved and their matter of fund management.

45
SUGGESTIONS

Make people aware of mutual funds by:

Arranging unfastened seminars in specific corporations approximately mutual fund

investments.

Arranging stalls in Public locations is a superb publicity.

Extra commercials need to return to give an explanation for the diverse benefits of
mutual funds or even the various schemes provided by way of them.

What to anticipate from a monetary advisor the important thing for mutual fund
traders is to outline and recognize the price of expert economic offerings, after which
insist on getting that price. Whilst you pay a sales charge or a fee, what are you able
to count on a professional to do for you? Your advisor should at the least:

Apprehend investor wishes and help him formulate long-term funding

goalsandobjectives.

Before making specific tips, marketing consultant ought to attempt to benefit an entire
photograph of traders beyond enjoy, life-style and desires, in addition to his different
investments and modern-day financial situation. Whilst the investor planning to retire,
for example? Does the investor have existence insurance? Does he own actual estate?
How secured is his process?

Assist the investor expand realistic expectations via discussing the risks and
rewardsofeachinvestment.Every investment desire has its strengths and weaknesses,
and investor should in no way experience much less than fully knowledgeable. While
investor ask questions, or have doubts,

46
Investor need to count on your monetary consultant to answer genuinely, and help
him increase a approach this is both practical and cozy for him.

In shape investor’s goals and objectives with appropriate mutual budget.

Investor need to anticipate your advisor to make clear and unique recommendations,
and give an explanation for the motives in the back of them in terms he can
understand. Of course, the advisor must be confident and nicely knowledgeable
approximately the control and portfolio strategies of any mutual funds
recommended.

Always display investor portfolio and assist you interpret performance.

Your guide can not have an impact on or expect a fund's consequences.

However, he or she ought to speak consequences with you and help you choose your
development. You ought to experience that you can always askyour advisor,"How
am I doing?"

Behavior ordinary evaluations to make sure that your approach keeps to provide most
excellent effects for you.

One of the maximum precious offerings your marketing consultant can provide is to
help you "live on route" with your funding application. However "staying on
direction" long term does no longer necessarily suggest staying placed.

Assume your monetary advisor to work with you to regulate your portfolio in reaction
to any giant trade on your lifestyle, priorities, property or responsibilities.

These are the simple offerings that investors should count on from their financial
advisors. Past the fundamentals, many investors ought to use even extra specialized
help, like recommendation on retirement plan distribution options, setting up and
servicing retirement plans for small corporations and self-hired people,

Developing tax-advantaged strategies for children's college training, insurance, estate,

and consider making plans; and year-cease mutual fund tax recommendation. In case
you need specialized offerings, there are many monetary advisors who allow you to
obtain the help you n

47
BIBLIOGRAPHY

S.No. Name of the Author Publisher Page Nos.

1 Punithavathi Securities Analysis and Portfolio 29,30,411&412

Pandyan Management
2 V.A.Avadhani Investment and Securities Markets in 427,428
India

MAGAZINES:
1. Business standard
2. Economic times

48
Marketing dictionary A. IVONAVIC

S.NO WEBSITE’S MONTH OF SEARCH

1 http:// www.karvy.com May 2007

2 http:// www.amfiindia.com May 2007

3 http:// www.ici.org May2007

4 http:// www.google.com May 2007

5 http:// www.moneycontrol.com June 2007

6 http:// www.franklintempletonindia.com June 2007

49
Investor’s perception towards Mutual Funds

PERSONAL INFORMATION

A) Name:
B) Type of Business:
C) Address:
D) Telephone: Mobile:
E) Fax: Email:
F) Annual Income:

ANNEXURE

1.In which part of these modes have you made your major part of investment?
[] Shares [] Equity [] Mutual Fund [] Insurance
[] Bank Deposit [] Bonds
[] Others Specify---------------------------------
2.Why do you prefer the above option?
[] Return Pattern [] Tax Exemption
[] Liquidity [] Safety & Security
[] Profitability [] Guaranteed Return
[] Others Specify-----------------------------------
3.How long would you like to invest?
[] Short term (below 1yr) [] Medium term (up to 2yrs)
[] Long term (above 3yrs)

4.Have you seen any advertisements for Mutual Funds?

[] Yes [] No

5.If yes, what are the advertisement have you seen for?
[] Birla sunlife mutual funds [] Reliance mutual fund
[] Chola mutual funds [] Standard charted mutual funds
[] Franklin Templeton mutual fund [] Sundaram mutual fund
[] HDFC mutual fund [] UTI mutual fund

50
 [] ING VYSA mutual fund [] Any other specify--------------------
[] Prudential ICICI mutual fund
6. Rank the following services preferred by you from a financial Advisory
Institution?
Services Rank
1. Telephone services
2. Online services
3. Mobile services
4. Personal services
7. Mention the names of mutual funds you have invested?
---------------------------------------------------------------------
8. In which scheme of mutual funds have you invested?
[] Debt [] Equity
[] Liquidity [] Mixed (Debt & Equity)
[] Others specify---------------------------
9. What was the approximate return you got on your investment?
[] Debt [] Equity
[] Liquidity [] Mixed
[] Others specify---------------------------
10. Which factors you consider the most while, investing in mutual funds?
[] Return patterns [] Performance
[] Services [] Risk factors
[] Quality of portfolio [] Professional management
[] Wealth creation

11. Which period of dividend income you prefer the most?

[] Monthly [] Quarterly
[] Half yearly [] Annual
12. How often you need reminders (recall) about mutual fund?
[] Monthly [] Quarterly
[] Half yearly [] Annual
13. If you need so, which mode you would prefer?
[] Account statements [] Remainder letters

51
 [] Television & Internet [] News papers & Magazines
14. Please rank your expectations from a mutual funds Advisory concern
Expectations Rank
1. Right Advice
2. Speed of transaction
3. Research inputs
4. Reputations
5. Reliability
6. Investor facilitation
7. Advertisements
8. Easy procedure
15. Are you willing to invest in mutual funds?
[] Yes [] No
If no, specify the reason------------------------------------------
If yes, do you need further assistance from Wealth Management Executives
from
Karvy Consultants Ltd?
[] Yes [] No
16. As investors please specify your needs, expectations and recommendations to
Develop the mutual funds.

52