ASTUDYONCOMPARSTI

VESTUDYONTODAY’
SYOUTHWITHREGARDS
TOMUTUALFUNDANDSHAREMARKETI
NVESTMENTAPROJECT

SUBMI
TTED

TO

UNI
VERSI
TYOFMUMBAIFORPARTI
ALCOMPLETI
ONOFTHE

DEGREEOF

BACHELOR’
SINCOMMERCE(
ACCOUNTI
NG&FI
NANCE)

UNDERTHEFACULTYOFCOMMERCE

BY

AJAYMATHURBHAIVADHER

UNDERTHEGUI
DANCEOF

PROF.NI
COLEPEREI
RA

KESSHROFFCOLLEGEOFARTSANDCOMMERCE

Bhul
abhai
Desai
Road,
Kandi
val
i(West
),Mumbai
-400067

NAACRe-
accr
edi
ted‘
A’Gr
adeandI
SO9001:
2008Cer
ti
fi
ed

Apr
il2020

CERTI
FICATE
Thisistocert
ifythatMR.AJAYMATHURBHAIVADHERhaswor kedand
dulycomplet
edhi sproj
ectworkf orthedegreeofBachel
orinCommer ce
(Account
ingFinance)undertheFacul t
yofCommer ceinthesubjectof
Commer ceandhisprojecti
senti
tled,ASTUDYONCOMPARSTI VESTUDY
ON TODAY’ SYOUTH WI TH REGARDSTO MUTUALFUND AND SHARE
MARKET I NVESTMENT undert he super
visi
on ofguide MRS.NI COLE
PEREIRA.

Ifurt
hercer
tif
ythattheent
ir
ewor khasbeendonebythel
earnerundermy
guidanceandt hatnopartofi thasbeensubmitt
edprevi
ouslyforany
DegreeorDipl
omaofanyUni ver
sit
y.

I
tishisownwor kandf
act
srepor
tedbyher
/hi
sper
sonalf
indi
ngsand
i
nvest
igat
ions.

PROF.NI
COLEPEREI
RA

Dat
eofSubmi
ssi
on:

DECLARATI
ONBYLEARNER
ItheundersignedMrs.AJAYMATHURBHAIVADHERher eby,declarethat
thewor kint hi
sprojectt i
tl
edA STUDY ON COMPARSTI VESTUDY ON
TODAY’ S YOUTH WI TH REGARDS TO MUTUAL FUND AND SHARE
MARKETI NVESTMENT,f ormsmyowncont ri
buti
ontother esearchwor k
carr
iedoutunderthegui danceofMRS.NICOLEPEREIRAi sar esultofmy
ownr esearchworkandhasnotbeenpr evi
ousl
ysubmittedtoanyot her
Univer
sit
yforanyotherDegr ee/
Dipl
omatothi
soranyotherUniversit
y.

Wher
everref
erencehasbeenmadetopr
evi
ousworkofother
s,i
thasbeen
cl
ear
lyi
n-di
catedassuchandi
ncl
udedi
nthebi
bli
ogr
aphy.

I,her
ebyfur
therdecl
aret
hatallinf
ormat
ionofthisdocumenthasbeen
obtai
nedandpresent
edinaccordancewithacademicrul
esandethical
conduct
.

AJAYMATHURBHAIVADHER

Cer
ti
fi
edBy

PROF.NI
COLEPEREI
RA
 ACKNOWLEDGEMENT

Toli
stwhoallhavehel
pedmeisdi
ff
icul
tbecauset
heyar
esonumer
ous
andt
hedept
hi ssoenor
mous.

Iwoul
dliket
oacknowl
edgethefol
lowi
ngasbeingideal
i
sti
cchannel
sand
fr
eshdi
-mensi
onsi
nthecomplet
ionoft
hispr
oject
.

Itakethi
sopport
unit
ytothankt
heUni
ver
sit
yofMumbaif
orgi
vi
ngme
chancetodot
hisproj
ect
.

Iwoul dli
ketot hankmyPr inci
pal
,Dr.L.BHUSHAN f orpr
ovi
ding t
he
necessar
yfaci
l
iti
esrequi
redf
orcomplet
ionoft
hispr
oject
.

It
aket
hisopport
uni
tyt
othankourCoor
dinat
or,
Dr.VAI
BHAV.R.ASHARf
or
hi
smoralsuppor
tandgui
dance.

Iwouldalsoli
ket
oexpr
essmysincer
egrat
it
udetowardsmyproj
ectgui
de,
MRS.NI COLE PEREI
RA whose gui
dance and car
e made t
he proj
ect
successf
ul.

Iwouldli
ke tothankmyCol l
ege Libr
ary
,forhavi
ng pr
ovi
ded v
ari
ous
r
efer
encebooksandmagazi
nesrel
atedtomyproj
ect
.

Last
ly,
Iwoul
dli
ketot
hankeachandev
erypersonwhodirect
lyorindi
rect
ly
hel
pedmei nthecomplet
ionoftheproj
ectespeci
all
ymyPar entsand
Peer
swhosupport
ed.
 TABLEOFCONTENT

CHAPTER. SR.
NO. CONTENT PAGENO.

I I
ntr
oduct
ion 1-
29

1.
1 Whati
sinv
est
ment 1

1.
2 Whyi
nvest
menti
simpor
tant 1-
2

1.
3 Mut
ual
Fund 2-
3

1.
4 Mut
ual
FundCont
ent 3

1.
5 Hi
stor
yofMut
ual
Fundi
nIndi
a 4-
5

1.
6 Shar
eMar
ket 6

1.
7 Hi
stor
yofI
ndi
anShar
eMar
ket 6-
29

I
I Rev
iewofLi
ter
atur
e 30-
44

I
II Resear
chandMet
hodol
ogy 45-
46

3.
1 Obj
ect
iveoft
hest
udy 45

3.
2 Scopeoft
hest
udy 45

3.
3 Dat
aCol
l
ect
ion 45-
46

3.
4 Sampl
eSi
ze 46

3.
5 Sel
ect
ionoft
het
opi
c 46

3.
6 Li
mit
ati
onoft
hest
udy 46

I
V Dat
aAnal
ysi
sandI
nter
pret
ati
on 47-
58

V Fi
ndi
ng 59

VI Suggest
ion 60
VI
I Concl
usi
on 61

VI
II Ref
erence 62

Annexur
e 63-
64
CHAPTER-
1 :I
NTRODUCTI
ON

1.
1WhatI
sInv
est
ment
 

I
ngener
al,t
oinv
esti
stodi
str
ibut
emoneyi
ntheexpect
ati
onofsomebenef
iti
nthe
f
utur
e.Forexampl
e,i
nvest
menti
ndur
abl
egoods,i
nrealest
atebyt
heser
vice
i
ndust
ry,
inf
act
ori
esf
ormanuf
act
uri
ng,
inpr
oductdev
elopment
,andi
nresear
chand
dev
elopment
. Howev
er,t
his ar
ti
cle f
ocuses speci
fi
cal
l
y on i
nvest
ment i
n
f
inanci
al 
Asset
s.

I
nfi
nance,
thebenef
itf
rom i
nvest
menti
scal
l
edar
etur
n.Ther
etur
nmayconsi
stofa
pr
ofi
tfr
om t
hesal
eofpr
oper
tyorani
nvest
ment
,ori
nvest
menti
ncomei
ncl
udi
ng
di
vi
dends,i
nter
est
s,r
ent
ali
ncomeet
c.,oracombi
nat
ionoft
het
wo.Thepr
oject
ed
economi
cret
urni
stheappr
opr
iat
elydi
scount
edv
alueoft
hef
utur
eret
urns.
 

I
nvest
orsgener
all
yexpecthi
gherr
etur
nsf
rom r
iski
eri
nvest
ment
s.Whenwemake
a 
l
owr
iski
nvest
ment
,ther
etur
nisal
sogener
all
ylow.
 

I
nvest
ors,par
ti
cul
arl
ynov
ices,ar
eof
tenadv
isedt
oadoptapar
ti
cul
ari
nvest
ment
st
rat
egyanddi
ver
sif
ythei
rpor
tfol
i
o.Di
ver
sif
icat
ionhast
hest
ati
sti
calef
fectof
r
educi
ngov
eral
lri  
sk.

1.
2WhyI
nvest
mentI
sImpor
tant
?
I
nvest
ing ensur
es pr
esentand f
utur
elong-
ter
m f
inanci
alsecur
it
y.The money
gener
atedf
rom y
ouri
nvest
ment
scanpr
ovi
def
inanci
alsecur
it
yandi
ncome.Oneof
t
heway
sinv
est
ment
sli
kest
ocks,bonds,andETFspr
ovi
dei
ncomei
sbywayofa
di
vi
dend.Thi
sisanamountpai
dtoshar
ehol
der
ssi
mpl
yforhol
dingt
hei
nvest
ment
.
Becausemanyi
nvest
ment
spaymont
hly
,quar
ter
ly,orannualdi
str
ibut
ions,y
oucan

1
enj
oypassi
vei
ncomet
hatul
ti
mat
elycoul
drepl
acey
ourpaychequei
fyouwantt
o
r
eti
reorbecomef
inanci
all
yindependent
;inv
est
ingi
sthewayt
odoi
t.

1.Longt
ermi
nvest
menthel
psy
out
ocr
eat
eweal
th.
 
2.A r
eti
rement
sfocused i
nvest
mentpl
an can ensur
ethaty
ou st
ayf
inanci
all
y
i
ndependentev
enaf
tery
oust
opear
ning 
3.Youcanr
eachal
lyourf
inanci
algoal
sbyi
nvest
ingwi
sel
y 
4.Atal
aterst
agei
nli
fe,y
oucanst
arty
ourownbusi
nessbyusi
ngt
heweal
th
gener
atedbyi
nvest
ment
s 
5.Youcani
nvesti
npr
oduct
sthatof
fert
axbenef
it
sandcansav
eonagoodamount
of
 
Tax.
 

1.
3Mut
ualf
und 

DEFI
NITI
ON:
Accor
dingt
oReg.2(
q)ofSEBIRegul
ati
ons,1996-mut
ualf
undmeansaf
und
est
abl
i
shedi
nthef
orm ofat
rustt
orai
semoni
est
hrought
hesal
eofuni
tst
othe
publ
i
corasect
ionoft
hepubl
i
cunderoneormor
eschemesf
ori
nvest
ingi
n
secur
it
iesi
ncl
udi
ngmoneymar
keti
nst
rument
sorgol
dorgol
drel
atedi
nst
rument
s
orr
ealest
ateasset
s:Pr
ovi
dedt
hati
nfr
ast
ruct
uredebtf
undschemesmayr
aise
moni
est
hroughpr
ivat
epl
acementofuni
ts.subj
ectt
ocondi
ti
onsspeci
fi
edi
nthese
r
egul
ati
ons.
 

FEATURES 

Keyf
eat
uresofamut
ual
fundt
hatf
lowsf
rom t
hedef
ini
ti
onabov
ear
e: 

Itisestablishedasatrust.
Itraisesmoneysthroughsaleofunitstothepublicorasectionofthepublic.
2
 Theunitsaresoldunderoneormoreschemes.
Theschemesinvestinsecurities(includingmoneymarketinstruments)or
gol
dorgol
d-r
elat
ed 
i
nst
rument
sorr
eal
est
ateasset
s.

Mut
ualf
undi
saf
inanci
ali
nter
medi
arywhi
chcol
l
ect
ssav
ingsoft
hepeopl
efor
secur
edandpr
ofi
tabl
einv
est
ment
.Themai
nfunct
ionofmut
ualf
undi
stomobi
l
ize
t
hesav
ingsoft
hegener
alpubl
i
candi
nvestt
hem i
nst
ockmar
ketsecur
it
ies.The
ent
ir
eincomeofmut
ualf
undi
sdi
str
ibut
edamongt
hei
nvest
orsi
npr
opor
ti
ont
o
t
hei
rinv
est
ment
s-Expensesf
ormanagi
ngt
hef
undar
echar
gedt
othef
und,l
i
ke
mut
ualf
undsi
nIndi
aar
eregi
ster
edast
rust
sundert
heI
ndi
anTr
ustAct
.The
t
rust
eesar
eappoi
ntedandt
heyl
ookaf
tert
hemanagementoft
het
rust
.Theydeci
de
t
hei
nvest
mentpol
i
cyandgi
vet
hebenef
itofpr
ofessi
onali
nvest
mentt
hrought
he
mut
ualf
unds.Thesef
undsar
emanagedbyf
inanci
alandpr
ofessi
onalexper
ts.The
sav
ingscol
l
ect
edf
rom smal
li
nvest
orsar
einv
est
edi
nasaf
e,secur
edandpr
ofi
tabl
e
manner
.Ther
efor
e,i
tissai
dthatmut
ualf
undi
saboont
othesmal
linv
est
ors.UTI
hadv
irt
ual
monopol
yint
hef
iel
dofmut
ual
fundf
rom 1964t
o1987.Af
ter1987,
Stat
e
BankofI
ndi
a,BankofI
ndi
aandot
herbanksst
art
edt
hei
rmut
ualf
unds.Af
ter1991
(
duet
oeconomi
cli
ber
ali
zat
ion)manyf
inanci
ali
nst
it
uti
onsst
art
edt
hei
rmut
ual
f
unds(
e.g.Kot
har
iPi
oneerFund,
CRBCapi
tal
Mar
ket
sandsoon)
.

1.
4Mut
ualFundConcept
 

AMut
ual
Fundi
sat
rustt
hatpool
sthesav
ingsofanumberofi
nvest
orswhoshar
ea
commonf
inanci
algoal
.Themoneyt
huscol
l
ect
edi
stheni
nvest
edi
ncapi
talmar
ket
I
nst
rument
ssuchasshar
es,debent
uresandot
hersecur
it
ies.Thei
ncomeear
ned
t
hrought
hesei
nvest
ment
sandt
hecapi
tal
appr
eci
ati
onr
eal
i
zedi
sshar
edbyi
tsuni
t 
hol
der
sinpr
opor
ti
ont
othenumberofuni
tsownedbyt
hem.ThusaMut
ualFundi
s
t
hemostsui
tabl
einv
est
mentf
ort
hecommonmanasi
tof
fer
sanoppor
tuni
tyt
o

3
i
nvesti
nadi
ver
sif
ied,
prof
essi
onal
l
ymanagedbasketofsecur
it
iesatar
elat
ivel
ylow
cost
. 

1.
5Hi
stor
yofmut
ualf
undsi
nIndi
a 

A st
rongf
inanci
almar
ketwi
thbr
oad par
ti
cipat
ioni
sessent
ialf
oradev
eloped
economy
.Wi
tht
hisbr
oadobj
ect
iveI
ndi
a'
sfi
rstmut
ualf
undwasest
abl
i
shmenti
n
1963,namel
y,Uni
tTr
ustofI
ndi
a(UTI
),att
hei
nit
iat
iveoft
heGov
ernmentofI
ndi
a
andReser
veBankofI
ndi
a‘wi
thav
iew t
oencour
agi
ngsav
ingandi
nvest
mentand
par
ti
cipat
ioni
nthei
ncome,pr
ofi
tsandgai
nsaccr
uingt
otheCor
por
ati
onf
rom t
he
acqui
sit
ion,
hol
ding,
managementanddi
sposal
ofsecur
it
ies.
 
I
nthel
astf
ewy
ear
stheMFI
ndust
ryhasgr
ownsi
gni
fi
cant
ly.Thehi
stor
yofMut
ual
Fundsi
nIndi
acanbebr
oadl
ydi
vi
dedi
ntof
ivedi
sti
nctphasesasf
oll
ows:
 

FI
RSTPHASE-1964-
1987 

TheMut
ualFundi
ndust
ryi
nIndi
ast
art
edi
n1963wi
thf
ormat
ionofUTIi
n1963by
anActofPar
li
amentandf
unct
ionedundert
heRegul
ator
yandadmi
nist
rat
ivecont
rol
oft
heReser
veBankofI
ndi
a(RBI
).
 

SECONDPHASE-1987-
1993

ENTRYOFPUBLI
CSECTORMUTUALFUNDS 

4
They
ear1987mar
kedt
heent
ryofpubl
i
csect
ormut
ualf
undssetupbyPubl
i
c
Sect
orbanksandLi
feI
nsur
anceCor
por
ati
onofI
ndi
a(LI
C)andGener
alI
nsur
ance
Cor
por
ati
onofI
ndi
a(GI
C).SBIMut
ualFundwast
hef
ir
st‘
non-
UTI
'mut
ualf
und
est
abl
i
shedi
nJune1987,f
oll
owedby
,Punj
abNat
ionalBankMut
ualFund(
Aug.
1989)
,BankofI
ndi
a(Jun1990)
,BankofBar
odaMut
ual
Fund(
Oct
.1992)
. 

THI
RDPHASE-1993-
2003

ENTRYOFPRI
VATESECTORMUTUALFUNDS 

TheI
ndi
ansecur
it
iesmar
ketgai
nedgr
eat
eri
mpor
tancewi
tht
heest
abl
i
shmentof
SEBIi
nApr
il1992t
opr
otectt
hei
nter
est
soft
hei
nvest
orsi
nsecur
it
iesmar
ketand
t
opr
omot
ethedev
elopmentof
,andt
oregul
ate,t
hesecur
it
iesmar
ket
.Int
hey
ear
1993,t
hef
ir
stsetofSEBIMut
ualFundRegul
ati
onscamei
ntobei
ngf
oral
lmut
ual
f
unds,ex
ceptUTI
.The er
stwhi
l
e Kot
har
iPi
oneer(
now mer
ged wi
th Fr
ankl
i
n
Templ
etonMF)wast
hef
ir
stpr
ivat
esect
orMFr
egi
ster
edi
nJul
y1993.Wi
tht
he
ent
ryofpr
ivat
esect
orf
undsi
n1993,anew er
abegani
ntheI
ndi
anMFi
ndust
ry,
gi
vi
ngt
heI
ndi
ani
nvest
orsawi
derchoi
ceofMFpr
oduct
s. 

FOURTHPHASE-SI
NCEFEBRUARY2003-APRI
L2014 

I
nFebr
uar
y2003,f
oll
owi
ngt
her
epealoft
heUni
tTr
ustofI
ndi
aAct1963,UTIwas
bi
fur
cat
edi
ntot
wosepar
ateent
it
ies,
viz.
,theSpeci
fi
edUnder
taki
ngoft
heUni
tTr
ust
ofI
ndi
a(SUUTI
)and UTIMut
ualFund whi
ch f
unct
ions undert
he SEBIMF
Regul
ati
ons.Wi
tht
hebi
fur
cat
ionoft
heer
stwhi
l
eUTIandsev
eralmer
ger
staki
ng
pl
aceamongdi
ff
erentpr
ivat
esect
orf
unds,
theMFi
ndust
ryent
eredi
tsf
our
thphase
ofconsol
i
dat
ion.
 

5
FI
FTH(
CURRENT)PHASE–SI
NCEMAY2014 

Taki
ngcogni
zanceoft
hel
ackofpenet
rat
ionofMFs,especi
all
yint
ierI
Iandt
ierI
II
ci
ti
es,andt
heneedf
orgr
eat
eral
i
gnmentoft
hei
nter
estofv
ari
ousst
akehol
der
s,
SEBIi
ntr
oducedsev
eralpr
ogr
essi
vemeasur
esi
nSept
ember2012t
o"r
e-ener
gize"
t
heI
ndi
anMut
ual
Fundi
ndust
ryandi
ncr
easeMFs'
penet
rat
ion.
 
I
nduecour
se,
themeasur
esdi
dsucceedi
nrev
ersi
ngt
henegat
ivet
rendt
hathadset
i
naf
tert
hegl
obalmel
t-
downandi
mpr
ovedsi
gni
fi
cant
lyaf
tert
henewGov
ernment
wasf
ormedatt
heCent
er.
 

1.
6SHAREMARKET 

Thest
ockmar
ketr
efer
stot
hecol
l
ect
ionofmar
ket
sandexchangeswher
ethe
r
egul
aract
ivi
ti
es ofbuy
ing,sel
l
ing and i
ssuance ofshar
es ofpubl
i
cly hel
d
compani
es t
ake pl
ace. Such f
inanci
al act
ivi
ti
es ar
e conduct
ed t
hrough
i
nst
it
uti
onal
i
zedf
ormalexchangesorov
er-
the-
count
er(
OTC)mar
ket
placeswhi
ch
oper
ateundert
hedef
inedsetofr
egul
ati
ons.Ther
ecanbemul
ti
plest
ockt
radi
ng
v
enuesi
nacount
ryorar
egi
onwhi
chal
l
owt
ransact
ionsi
nst
ocksandot
herf
orms
ofsecur
it
ies.Whi
l
ebot
hthet
erms-st
ockmar
ketandst
ockexchange-ar
eused
i
nter
changeabl
y,t
hef
ormert
ermi
sagener
alsuper
setoft
hel
att
er.I
fonesay
sthat
het
radesi
nthest
ockmar
ket
,itmeanst
hathebuy
sandsel
l
sshar
es/
equi
tyonone
(
ormor
e)oft
hest
ockexchange(
s)t
hatar
epar
tofov
eral
lst
ockmar
ket
.

1.
7Hi
stor
yofI
ndi
anShar
eMar
ket
 

TheI
ndi
anst
ockmar
kett
racesi
tshi
stor
ybackt
othel
ate18t
hcent
urywhent
he
t
radi
ngf
loorwasundert
heshadeofaspr
awl
i
ngbany
ant
reeopposi
tet
heTownHal
l
i
nMumbai
.Af
ew peopl
ewoul
dmeetundert
hist
reet
oinf
ormal
l
ytr
adei
ncot
ton.
Thi
swasmai
nlyduet
othef
actt
hatMumbaiwasabusyt
radi
ngpor
tandessent
ial
6
commodi
ti
eswer
etr
adedher
eof
ten.TheCompani
esActwasi
ntr
oducedi
n1850
f
oll
owi
ngwhi
chi
nvest
orsst
art
edshowi
ngani
nter
esti
ncor
por
atesecur
it
ies.The
conceptofl
i
mit
edl
i
abi
l
ityal
soputi
nanappear
ancear
oundt
hist
ime.By1875,an
or
gani
zat
ionknownas“
TheNat
iveShar
eandSt
ockBr
oker
'sAssoci
ati
oncame
i
nto 
bei
ng.
 
Thi
swast
hepr
edecessoroft
heBSE.
In1894,t
heAhmedabadSt
ockExchange
camei
ntobei
ngpr
imar
il
ywi
tht
heobj
ect
iveofenabl
i
ngdeal
i
ngi
ntheshar
esof
t
ext
il
emi
l
lsi
ntheci
ty.
TxheCal
cut
taSt
ockEx
changewasf
ormedi
n1908wi
tht
he
i
ntent
ionoff
aci
l
itat
ingamar
ketf
orshar
esofpl
ant
ati
onsandj
utemi
l
lsI
twasi
n
1920t
hatt
heMadr
asSt
ockExchanget
ookshape.
In1957,t
heBSEwast
hef
ir
st
st
ockexchanget
ober
ecogni
zedbyt
heGov
ernmentofI
ndi
aundert
heSecur
it
ies
Cont
ract
sRegul
ati
onAct
.TheSENSEXwasl
aunchedi
n1986f
oll
owedbyt
heBSE
Nat
ionalI
ndexi
n1989.TheSecur
it
iesandExchangeBoar
dofI
ndi
a(SEBI
)was
const
it
uted i
n 1988 t
o moni
torand r
egul
atet
he secur
it
iesi
ndust
ryand st
ock
exchanges.I
n1992i
tbecameanaut
onomousbodywi
thcompl
etel
yindependent
power
s.I
n1992,t
heNSEwasf
ormedast
hef
ir
stdemut
ual
i
zedel
ect
roni
cexchange
i
nthecount
rywi
tht
hei
ntent
ionofensur
ingt
ranspar
encyi
nthemar
ket
s.NSEbegan
oper
ati
onsi
ntheWhol
esal
eDebtMar
ket(
WDM)segmenti
n1994,t
heequi
ti
es
segmenti
n1994,andt
heder
ivat
ivessegmenti
n2000.
Itwasi
n1995t
hatt
heBSE
madet
heswi
tcht
oanel
ect
roni
csy
stem oft
radi
ngf
rom t
heopen-
fl
oorsy
stem.
Today
,theBSEi
smeasur
edast
hewor
ld'
s11t
hlar
gestst
ockexchangeandt
he
mar
ketcapi
tal
i
zat
ioni
sli
kel
ytobear
ound$1.
7tr
il
li
on.Themar
ketcapi
tal
i
zat
ionof
t
heNSEi
sest
imat
edt
obeov
er$1.
65t
ri
ll
i
on.
Over5,
000compani
esar
eli
stedont
he
BSEand1,
500f
igur
eont
heNSE.I
nter
msofshar
etr
adi
ngv
olumes,st
il
l,bot
hthe
exchangesar
eonpar
it
y.Nowaday
speopl
ear
eabl
etoconductonl
i
net
radi
ngsi
tt
ing
i
nthecomf
ortoft
hei
rhome.Faci
l
iti
essuchaszer
obr
oker
agedematandl
i
ve
updat
esar
eal
lav
ail
abl
ewi
tht
hehel
pofi
nter
net
.Ast
ockmar
ket
,equi
tymar
ketor
shar
emar
keti
stheaggr
egat
ionofbuy
ersandsel
l
ers(
aloosenet
wor
kofeconomi
c
t
ransact
ions,
notaphy
sicalf
aci
l
ityordi
scr
eteent
it
y)ofst
ocks(
alsocal
l
edshar
es)
,
whi
chr
epr
esentowner
shi
pcl
aimsonbusi
nesses,t
hesemayi
ncl
udesecur
it
ies
7
l
i
stedonapubl
i
cst
ockexchange,
aswel
lasst
ockt
hati
sonl
ytr
adedpr
ivat
e.

8
MUTUALFUND 

(
A)Obj
ect
iveofMut
ualFund 
Growt
hFunds:
Themostcommonobj
ect
iveofi
nvest
menti
sgr
owt
h.Thepr
imar
yobj
ect
iveofany
gr
owt
hfundi
scapi
talappr
eci
ati
onov
ert
hemedi
um t
olongt
erm.Gr
owt
hmut
ual
f
undsar
egener
all
yinv
est
edpr
imar
il
yinsmal
ltol
argecapst
ocks.
 
I
ncomeFunds:Her
etheobj
ect
ivei
scur
renti
ncomei
ncer
tai
nint
erv
alsasopposed
t
ocapi
talappr
eci
ati
on.Thesef
undsar
esui
tabl
efori
nvest
ors,whoar
elooki
ngf
or
cashf
low t
osuppl
ementt
hei
rincome.Toensur
est
eadyi
ncome,maj
orpor
ti
onof
t
heasseti
sinv
est
edi
nincomei
nst
rument
svi
z.f
ixedi
nter
estdebent
ures,bonds,
pr
efer
encest
ocksanddi
vi
dendpay
ingst
ockset
c. 

Sect
or/
Indust
ryFunds:
Thesef
undsai
msati
nvest
ingonl
yinspeci
fi
csect
orsori
ndust
ri
es,suchasr
eal
est
ateorheal
thcar
e.Themai
nobj
ect
ivebehi
ndt
hesef
undsi
stomaxi
mizi
ngt
he
r
etur
nbyexpl
oit
ingt
hegr
owt
hofboomi
ngsect
ors.
 

Val
ueFunds:
Thi
sfundsgener
all
yai
msati
nvest
ingi
nst
ockst
hatar
edeemedt
obeunder
val
ued
i
npr
icebecauseofsomei
nher
enti
nef
fi
cienci
esoft
heMar
ket
.Iti
sexpect
edt
hat
,
once t
he mar
ketcor
rect
sthese i
nef
fi
cienci
es,t
he st
ock pr
ice wi
l
lri
se t
hus
benef
it
ti
ngt
hei
nvest
or.
 

(
B)Ty
pesofMut
ualf
und 

1.Equi
tymut
ualf
unds:

Thesef
undsi
nvestamaxi
mum par
toft
hei
rcor
pusi
ntoequi
ti
eshol
dings.The
st
ruct
ure oft
he f
und mayv
arydi
ff
erentf
ordi
ff
erentschemes and t
he f
und
manager
'sout
lookondi
ff
erentst
ocks.Equi
tyi
nvest
ment
sar
emeantf
oral
onger
9
t
imehor
izon,
thusEqui
tyf
undsr
ankhi
ghont
her
isk-
ret
urnmat
ri
x. 

2.Debtmut
ualf
unds:

Theobj
ect
iveoft
heseFundsi
stoi
nvesti
ndebtpaper
s.Gov
ernmentaut
hor
it
ies,
pr
ivat
ecompani
es,
banksandf
inanci
ali
nst
it
uti
onsar
esomeoft
hemaj
ori
ssuer
sof
debtpaper
s.Byi
nvest
ingi
ndebti
nst
rument
s,t
hesef
undsensur
elow r
iskand
pr
ovi
dest
abl
eincomet
othei
nvest
ors.
 

3.Bal
ancedf
unds:

Ast
henamesuggestt
heyar
eami
xofbot
hequi
tyanddebtFunds.Theyi
nvesti
n
bot
h equi
ti
es and f
ixed i
ncome secur
it
ies,whi
ch ar
einl
i
ne wi
th pr
e-def
ined
i
nvest
mentobj
ect
iveoft
hescheme.Theseschemesai
mtopr
ovi
dei
nvest
orswi
th
t
hebestofbot
hthewor
lds.Equi
typar
tpr
ovi
desgr
owt
handt
hedebtpar
tpr
ovi
des
st
abi
l
ityi
nret
urns.Mor
ethan43mut
ual
fundsar
eoper
ati
ngi
nIndi
a. 

4.Moneymar
ketf
unds:

Thesef
undsi
nvesti
nshor
t-
ter
mfi
xedi
ncomesecur
it
iessuchasgov
ernmentbonds,
t
reasur
ybi
l
ls,banker
s'accept
ances,commer
cialpaperandcer
ti
fi
cat
esofdeposi
t.
Theyar
egener
all
yasaf
eri
nvest
ment
,butwi
thal
owerpot
ent
ialr
etur
nthenot
her
t
ypesofmut
ualf
unds.Canadi
anmoneymar
ketf
undst
ryt
okeept
hei
rnetasset
v
alue(
NAV)st
abl
eat$10persecur
it
y. 

5.Fi
xedi
ncomef
unds:
Thesef
undsbuyi
nvest
ment
sthatpayaf
ixedr
ateofr
etur
nli
kegov
ernmentbonds,
i
nvest
ment
-gr
adecor
por
atebondsandhi
gh-
yi
eldcor
por
atebonds.Theyai
mtohav
e
moneycomi
ngi
ntot
hef
undonar
egul
arbasi
s,most
lyt
hroughi
nter
estt
hatt
hef
und
ear
ns.Hi
gh-
yi
eldcor
por
atebondf
undsar
egener
all
yri
ski
ert
hanf
undst
hathol
d
10
gov
ernmentandi
nvest
ment
-gr
adebonds.
 

(
E)Adv
ant
agesofmut
ualf
und:

Di
ver
sif
icat
ion:

Oner
uleofi
nvest
ing,f
orbot
hlar
geandsmal
linv
est
ors,i
sassetdi
ver
sif
icat
ion.
Di
ver
sif
icat
ion i
nvol
ves t
he mi
xi
ng ofdi
ff
erentt
ypes ofi
nvest
ment
s wi
thi
na
por
tfol
i
oandi
susedt
omanager
isk.Toachi
eveat
rul
ydi
ver
sif
iedpor
tfol
i
o,y
oumay
hav
etobuyst
ockswi
thdi
ff
erentcapi
tal
i
zat
ionsf
rom di
ff
erenti
ndust
ri
esandbonds
wi
thv
ary
ingmat
uri
ti
esf
rom di
ff
erenti
ssuer
s 

Economi
esofScal
e:

Theeasi
estwayt
ounder
standeconomi
esofscal
eisbyt
hinki
ngaboutv
olume
di
scount
s,i
nmanyst
ores,t
hemor
eofonepr
oducty
oubuy
,thecheapert
hat
pr
oductbecomes.Thi
sal
sooccur
sint
hepur
chaseandsal
eofsecur
it
ies.I
fyoubuy
onl
yonesecur
it
yatat
ime,
thet
ransact
ionf
eeswi
l
lber
elat
ivel
ylar
ge.
 

Mut
ual
fundsar
eabl
etot
akeadv
ant
ageoft
hei
rbuy
ingandsel
l
ingv
olumet
oreduce
t
ransact
ioncost
sfori
nvest
ors.Wheny
oubuyamut
ualf
und,y
ouar
eabl
eto
di
ver
sif
ywi
thoutt
henumer
ouscommi
ssi
onchar
ges.
 

Di
vi
sibi
li
ty: 

Manyi
nvest
orsdon'
thav
etheex
actsumsofmoneyt
obuyr
oundl
otsofsecur
it
ies.
Oneort
wohundr
eddol
l
arsi
susual
l
ynotenought
obuyar
oundl
otofast
ock,
especi
all
yaf
terdeduct
ingcommi
ssi
ons.Smal
l
erdenomi
nat
ionsofmut
ualf
unds
pr
ovi
demut
ualf
undi
nvest
orst
heabi
l
ityt
omakeper
iodi
cinv
est
ment
sthr
ough
mont
hlypur
chasepl
answhi
l
etaki
ngadv
ant
ageofdol
l
ar-
costav
eragi
ng 

11
Li
qui
dit
y:

Anot
heradv
ant
ageofmut
ualf
undsi
stheabi
l
ityt
ogeti
nandoutwi
thr
elat
iveease.
I
ngener
al,y
ouar
eabl
etosel
lyourmut
ualf
undsi
nashor
tper
iodoft
imewi
thout
t
her
ebei
ngmuchdi
ff
erencebet
weent
hesal
epr
iceandt
hemostcur
rentmar
ket
v
alue.Al
so,unl
i
kest
ocksandexchange-
tr
adedf
unds(
ETFs)
,whi
cht
radeanyt
ime
dur
ingmar
kethour
s,mut
ualf
undst
ransactonl
yonceperdayaf
tert
hef
und'
snct
assetv
alue(
NAV)i
scal
cul
ated 

(
E).Di
sadv
ant
agesofmut
ualf
und 

Fl
uct
uat
ingRet
urns:
 

Li
kemanyot
heri
nvest
ment
swi
thoutaguar
ant
eed r
etur
n,t
her
eisal
way
sthe
possi
bil
i
tyt
hatt
hev
alueofy
ourmut
ualf
undwi
l
ldepr
eci
ate.Equi
tymut
ualf
unds
exper
iencepr
icef
luct
uat
ions,al
ongwi
tht
hest
ockst
hatmakeupt
hef
und.Of
cour
se,
 
almostev
eryi
nvest
mentcar
ri
es r
isk.Buti
t'
s especi
all
yimpor
tantf
or
i
nvest
orsi
nmoneymar
ketf
undst
oknowt
hat
,unl
i
ket
hei
rbankcount
erpar
ts,
these
wi
l
lnotbei
nsur
edbyt
heFDI
C. 

Cash:

Asy
ouknow al
ready
,mut
ualf
undspoolmoneyf
rom t
housandsofi
nvest
ors,so
ev
erydaypeopl
ear
eput
ti
ngmoneyi
ntot
hef
undaswel
laswi
thdr
awi
ngi
t.To
mai
ntai
nthecapaci
tyt
oaccommodat
ewi
thdr
awal
s,f
undst
ypi
cal
l
yhav
etokeepa
l
argepor
ti
onoft
hei
rpor
tfol
i
osi
ncash.Hav
ingampl
ecashi
sgr
eatf
orl
i
qui
dit
y,but
money si
tt
ing ar
ound as cash i
s notwor
king f
ory
ou and t
hus i
s notv
ery
adv
ant
ageous,
 

Cost
s: 

12
Mut
ualf
undspr
ovi
dei
nvest
orswi
thpr
ofessi
onalmanagement
,buti
tcomesata
cost-t
hoseexpenser
ati
osment
ionedear
li
er.Thesef
eesr
educet
hef
und'
sov
eral
l
pay
out
,and t
hey
'r
e assessed t
o mut
ualf
und i
nvest
orsr
egar
dless of t
he
per
for
manceoft
hef
und.Asy
oucani
magi
ne,i
nyear
swhent
hef
unddoesn'
tmake
money
,thesef
eesonl
ymagni
fyl
osses.
 

LackofTr
anspar
ency
: 

Onet
hingt
hatcanl
eadt
odi
ver
sif
icat
ioni
sthef
actt
hataf
und'
spur
poseormakeup
i
sn'
tal
way
scl
ear
.Fundadv
ert
isement
scangui
dei
nvest
orsdownt
hewr
ongpat
h.
TheSecur
it
iesandExchangeCommi
ssi
on(
SEC)r
equi
rest
hatf
undshav
eatl
east
80%ofasset
sint
hepar
ti
cul
art
ypeofi
nvest
menti
mpl
i
edi
nthei
rnames;how t
he
r
emai
ningasset
sar
einv
est
edi
supt
othef
undmanager
. 

(
F)Reasont
obuymut
ualf
und 

1.Bui
lt
-i
ndi
ver
sif
icat
ion:

Wheny
oubuyamut
ualf
und,y
ourmoneyi
scombi
nedwi
tht
hemoneyf
rom ot
her
i
nvest
ors,
andal
l
owsy
out
obuypar
tofapool
ofi
nvest
ment
s.Amut
ual
fundhol
dsa
v
ari
etyofi
nvest
ment
swhi
chcanmakei
teasi
erf
ori
nvest
orst
odi
ver
sif
ythan
t
hroughowner
shi
pofi
ndi
vi
dual
stocksorbonds.Notal
li
nvest
ment
sper
for
m wel
lat
t
hesamet
ime.Hol
dingav
ari
etyofi
nvest
ment
smayhel
pof
fsett
hei
mpactofpoor
per
for
mer
s,whi
l
etaki
ngadv
ant
ageoft
heear
ningpot
ent
ialoft
hef
est
.Thi
sis
knownasdi
ver
sif
icat
ion.Bef
orey
oudeci
deonamut
ualf
und,f
igur
eouthowi
tfi
ts
wi
tht
her
estoft
hei
nvest
ment
syouownandy
ourov
eral
lfi
nanci
algoal
s 

2.Pr
ofessi
onalmanagement
: 

13
Youmaynothav
etheski
l
lsandknowl
edget
omanagey
ourowni
nvest
ment
sor
wantt
ospendt
het
ime.Mut
ualf
undsal
l
ow y
out
opooly
ourmoneywi
thot
her
i
nvest
ors and l
eav
ethe speci
fi
cinv
est
mentdeci
sions t
o a por
tfol
i
o manager
Por
tfol
i
omanager
sdeci
dewher
etoi
nvestt
hemoneyi
nthef
und,andwhent
obuy
andsel
li
nvest
ment
s 

3.Easyt
obuyandsel
l:
 

Mut
ualf
unds ar
e wi
del
y av
ail
abl
ethr
ough banks,f
inanci
alpl
anni
ng f
ir
ms,
i
nvest
mentf
ir
ms,
credi
tuni
onsandt
rustcompani
es.Youcansel
lyourf
unduni
tsor
shar
esatal
mostanyt
imei
fyouneedt
ogetaccesst
oyourmoney
.Buty
oumayget
backl
esst
hany
oui
nvest
ed.
 

4.Awi
der
angeoff
undst
ochoosef
rom:

Mut
ualf
undscanbeusedt
omeetav
ari
etyoff
inanci
algoal
s.Forexampl
e: 
Ayoung
i
nvest
orwi
thast
abl
eincomeandmanyy
ear
stoi
nvestmayf
eelcomf
ort
abl
etaki
ng
mor
eri
skt
oachi
evegr
eat
erpot
ent
ialr
etur
n.Theymayi
nvesti
nanequi
tyf
und,
 
A
mi
d-car
eeri
nvest
ort
ryi
ngt
obal
ancer
iskandr
etur
nmor
emoder
atel
ycoul
dinv
esti
n
abal
ancedmut
ualf
undt
hatbuyami
xofst
ocksandbonds 
Ani
nvest
orappr
oachi
ng
r
eti
rementmi
ghtbel
esscomf
ort
abl
ewi
thr
iskandmor
eint
erest
edi
nfi
xedi
ncome
i
nvest
ment
s.Theymayi
nvesti
nabondf
und.

(
G)Ri
skmanagementi
nmut
ual
fund

Howmut
ual
fundscanhel
pinr
iskmanagement
? 
Amut
ualf
undi
snotani
nvest
menti
nit
sel
f,butani
nvest
mentv
ehi
cle,t
hatal
l
ows
y
out
ogetasl
i
ceofv
ari
ousassetcl
assessuchasequi
ty,
debtandev
enr
ealest
ate

14
&gol
d.Mut
ualf
undspr
ovi
deadequat
edi
ver
sif
icat
ionandani
nvest
orcaneasi
l
yuse
mut
ualf
undst
ospr
eadr
isksandkeephi
s/herpor
tfol
i
osaf
e.I
fyouchoosey
our
mut
ualf
undscar
eful
l
y,t
heycanser
veasagoodassetal
l
ocat
iont
oolt
hatwi
l
lhel
p
y
oubal
ancey
ourr
isksandmaxi
mizey
ourr
etur
ns.
 
Let
'st
akeacl
oserl
ookatt
hev
ari
ousr
isksy
ouar
eexposedt
oasani
nvest
orand
howmut
ual
fundscanhel
pinmanagi
ngt
hem.
 

Vol
ati
li
tyr
isk:
 

Vol
ati
l
ityi
sawor
dthati
ssy
nony
mouswi
tht
hemar
ket
s,bei
tequi
ti
es,debtorany
ot
herassetcl
assf
ort
hatmat
ter
.Youcannoti
nvesti
nthemar
ket
sandexpectt
hat
t
her
ewi
l
lbenov
olat
il
it
yatal
l
.Youcanhowev
erpr
otecty
our
sel
fagai
nsti
tbyusi
ng
sy
stemat
ici
nvest
mentpl
ansorSI
Psofmut
ualf
unds.I
nSI
Psy
ouputi
nsmal
l
amount
sofmoneyatper
iodi
cint
erv
als(
weekl
y/mont
hlyquar
ter
ly)
. 

Concent
rat
ionr
isk:

Asani
nvest
orwhohasj
ustbeeni
ntr
oducedt
ocapi
talmar
ket
s,i
tiseasyt
oget
car
ri
edawayandov
erexposey
our
sel
ftoapar
ti
cul
arassetcl
ass.Thel
ureofmaki
ng
qui
ckgai
nswhenapar
ti
cul
arst
ock/
sect
ororassetcl
assi
sper
for
mingwel
l
,may
seem har
dtoi
gnor
e.Howev
er,bydoi
ngt
haty
ouar
eput
ti
ngal
lyoureggsi
none
basket
,ther
ebyi
ncr
easi
ngy
ourr
isk.I
ncaset
hesect
orort
heassetcl
assmakesa
j
our
neydownhi
l
l,y
ouwi
l
lfi
ndy
our
sel
fint
hemi
dstofal
oss.
 

Taxat
ionandi
nfl
ati
onr
isk:
 

Taxat
ionandi
nfl
ati
onar
ethet
wot
hingsy
ousi
mpl
ycannotav
oidasani
nvest
or.I
f
y
oudonotpi
cki
nvest
mentpr
oduct
sthatbeati
nfl
ati
onandar
etaxef
fi
cient
,your
por
tfol
i
o wi
l
lnotper
for
m t
oit
s maxi
mum pot
ent
ial
.Whi
l
e Publ
i
c Pr
ovi
dent
Fund 
(PPF)i
sat
ax-
eff
ici
entopt
ionov
eri
nvest
ment
sli
kebankf
ixeddeposi
tsand

15
postof
fi
cedeposi
tswhi
char
etaxabl
e,i
tisi
mpor
tantt
oknow t
hati
tst
il
lhol
ds
i
nfl
ati
onar
yri
sk 

(
H)I
mpor
tantPoi
ntsy
oumustknowwhi
lei
nvest
ingi
nmut
ualf
und 

1.I
nvest
mentobj
ect
ive:
 

Ev
erymut
ualf
undscheme,
irr
espect
iveoft
hecat
egor
y-whet
herequi
tyordebthas
ani
nvest
mentobj
ect
ive.I
tist
hisi
nvest
mentobj
ect
ivewhi
chent
ail
sthem t
oinv
est
i
nvar
iousassetcl
assesi
ndef
inedpr
opor
ti
ons.Asi
nvest
orsi
tisi
mper
ati
vet
ocheck
t
hei
nvest
mentobj
ect
iveoft
her
espect
ivemut
ualf
undscheme,andt
her
ebysee
whet
heri
tsui
tsy
ourobj
ect
iveofi
nvest
ingaswel
l
.Forexampl
e,i
fyouhav
ean
obj
ect
iveofcapi
talappr
eci
ati
onwi
thal
ong-
ter
minv
est
menthor
izoni
nmi
ndandi
s
wi
l
li
ngt
otakehi
ghr
isk,
theny
oushoul
dbel
ooki
ngatequi
tyor
ient
edmut
ualf
unds.
Si
mil
arl
yify
ouar
ear
isk-
aver
sei
nvest
or,y
oushoul
dbel
ooki
ngatsui
tabl
edebt
mut
ual
fundschemes(
dependi
ngupony
ouri
nvest
mentt
imehor
izon)
. 

2.I
nvest
mentst
yle 

Fur
therdependi
ngupony
ourr
iskappet
it
e,y
oucanal
sost
ruct
urey
ourmut
ualf
und
por
tfol
i
oaspermar
ketcapi
tal
i
zat
ionbi
as(
i.
e.l
argecap,
midcap,
smal
l&mi
cro-
cap,
mul
ticapandf
lexicap)andf
undmanagementst
yle(
i.
e.oppor
tuni
ti
esst
yle,v
alue
st
yle,gr
owt
hst
yleandbl
endst
yle)
.Whi
l
eonemayar
gueov
erhowt
hel
aymancan
j
udgewhi
chmar
ketcapbi
asandi
nvest
mentst
ylet
hemut
ualf
undschemef
oll
ows,
wewoul
dli
ket
oappr
isey
out
hati
t'
sal
lther
eint
hemut
ualf
undscheme'
sof
fer
document
,whi
chy
ououghtt
oreadwel
lbef
orepar
kingy
ourhar
dear
nedmoney
, 

3.Fundper
for
mance:
 
Thepastper
for
manceofamut
ualf
undschemei
simpor
tanti
nanal
yzi
nganut
ual
16
f
und.Butr
emembert
hat
,pastper
for
mancei
snotev
ery
thi
ng,asi
tmayormaynot
be 
Sust
ainedi
nfut
ureandt
her
efor
eshoul
dnotbeusedast
heonl
ypar
amet
ert
o
sel
ectwi
nni
ngmut
ual
funds.Whi
l
edur
inggoodt
imesy
ourmut
ual
funddi
str
ibut
ori
n
pomp,mayexhi
bity
ouper
for
mancechar
tsandt
abl
es,y
oual
soneedt
oev
aluat
e
t
hem i
ncont
extt
o: 
Riskt
heyhav
eexposedy
out
oRi
sk-
adj
ust
edr
etur
nscl
ocked
Por
tfol
i
owhi
cht
heyhel
d(andi
tschar
act
eri
sti
cs)Howof
tent
hef
undhaschur
ned
i
tspor
tfol
i
o 

4.Expenser
ati
o: 

Li
keanyot
heror
gani
sat
ion,
amut
ualf
undhouseal
soi
ncur
sannualexpenses(
such
asadmi
nist
rat
ivecost
s,managementf
ees,
etc.
)tor
uni
tbusi
ness.ExpenseRat
ioi
s
t
heper
cent
ageofasset
sthatgot
owar
dst
heseexpenses.Ev
eryt
imet
hef
und
managerchur
nshi
spor
tfol
i
ohepay
sabr
oker
agef
ee,whi
chi
sul
ti
mat
elybor
neby
i
nvest
orsi
nthef
orm ofanExpenseRat
io.I
tisnot
ewor
thyt
hat
,hi
gherchur
ningnot
onl
yleadst
ohi
gherr
isk,butal
sohi
ghercostt
othei
nvest
orf
oral
lthebr
oker
age
char
gesandt
axesi
ncur
redonev
eryt
rade.Cost
sar
eal
way
sther
eandar
ededuct
ed
i
mmedi
atel
y,butt
her
etur
nsandahi
gherNAVar
eahopef
oral
linv
est
ors.Hencei
t
i
sal
way
srecommendt
osel
ectamut
ualf
undscheme,
whi
chhasgotal
owex
pense
r
ati
oascompar
edt
oit
s peer
s. 

5.Exi
tload:
 
Li
kewi
se,y
oushoul
dal
sobechecki
ngt
heexi
tloadwhi
char
espect
ivemut
ualf
und
schemewoul
dchar
ge.Anexi
tloadi
slev
iedwheny
ousel
lyouruni
tsofamut
ual
f
undwi
thi
napar
ti
cul
art
enur
e;mostf
undschar
gei
ftheuni
tsar
esol
dwi
thi
nay
ear
f
rom dat
eofpur
chase.Asexi
tloadi
saf
ract
ionoft
heNAV,i
teat
sint
oyour
i
nvest
mentv
alue.Thusi
tisi
mper
ati
vet
haty
oui
nvesti
naf
undwi
thal
owexi
tload,
andmor
eimpor
tant
lyst
ayi
nvest
edf
ort
hel
ong-
ter
m.

17
6.I
nvest
orser
viceandt
ranspar
ency
:

Ser
vicesof
fer
edbymut
ualf
undhousesmayv
aryacr
ossf
unds.Somef
undhouses
ar
eMor
einv
est
orf
ri
endl
ythanot
her
s,andof
feri
nfor
mat
ionatr
egul
ari
nter
val
s.For
i
nst
ance,f
actsheet
sofsomemut
ualf
undschemesar
enotdi
scl
osedi
nent
ir
ety
,
wher
etheundi
scl
osedpor
tfol
i
ohol
dsal
argecomposi
ti
on,
thusmaki
ngonewonder
i
nwhi
chsecur
it
iesi
sthemoneypar
kedbyt
hef
undhouse.
 

7.Thet
axi
mpl
icat
ions:

Manyat
ime'
sinv
est
orsgobyt
hewor
doft
hei
rmut
ualf
unddi
str
ibut
or/agent/
r
elat
ionshi
pmanagerandi
nvesti
nmut
ualf
unds.Whi
l
ewear
en'
tdebat
ingabout
qual
i
tyoft
headv
icet
heypr
ovi
de(
onar
espect
ivemut
ualf
undschemeperse)
,we
t
hinkt
hati
tisnecessar
yfory
out
obeawar
eoft
het
axi
mpl
i
cat
ionsofar
espect
ive
mut
ual
fundschemes.
 

(
1)Gol
denr
ulesofi
nvest
ingi
nmut
ualf
und 

1)
.Thoushal
linv
estf
ort
hel
ongt
erm.Longt
erm meansami
nimum off
ivey
ear
s
andamaxi
mum off
orev
er.

2)
.Thoushal
lunder
taket
hor
oughr
esear
chf
ori
nvest
ingi
nMut
ualFundsandnot
t
rustt
hyf
inanci
aladv
iser
,mom,
dad,
dist
antuncl
ebl
i
ndl
y.

3)
.Thoushal
lnott
ryt
oti
met
hemar
ketandi
nvestusi
ngaSy
stemat
icI
nvest
ment
Pl
an(
SIP)ev
erymont
h.

4)
.Thoushal
lnotcheckt
hemut
ualf
undNetAssetVal
ue(
NAV)dai
l
yandcompar
e
i
t 
Wit
hther
etur
nsoft
hynei
ghbor
.

18
SHAREMARKET 

(
A),
OBJECTI
VESOFSHAREMARKET.
 

RAI
SINGMONEYFORBUSI
NESS:

St
ockex
changesar
oundt
hewor
ldenabl
ecompani
esar
oundt
hewor
ldt
orai
se
money
.Nowaday
s,t
hey
'r
e most
ly el
ect
roni
c mar
ket
s wher
eli
censed st
ock
br
oker
ages,and t
he t
rader
srepr
esent
ing t
hem,buyand sel
lshar
es.Thr
ough
exchanges,pr
ivat
ecompani
essel
lst
ocki
nthef
orm ofpubl
i
clyt
radedshar
es.
Those wi
shi
ng t
oinv
esti
n st
ock pl
ace buyorsel
lor
der
sthr
ough r
egul
ated
br
oker
agef
ir
ms.
 

CAPI
TALFORMATI
ON:

Thepr
imar
yfunct
ionofast
ockexchangei
stohel
pcompani
esr
aisemoney
.To
accompl
i
sht
hist
ask,owner
shi
pinapr
ivat
ecor
por
ati
oni
ssol
dtot
hepubl
i
cint
he
f
orm ofshar
esofst
ock.Fundsr
ecei
vedf
rom t
hesal
eofst
ockcont
ri
but
etot
he
f
ir
m'scapi
talf
ormat
ionCompani
espl
ant
ouset
henewl
y-
rai
sedf
undst
oinv
esti
n
pr
oduct
ivebusi
nessasset
sandgr
ow r
evenuesandpr
ofi
ts.Thi
sposi
ti
vebusi
ness
expansi
ont
henmayber
efl
ect
edi
nahi
gherst
ockt
radi
ngpr
ice.
 

SECURI
TYANDTRANSPARENCY:

The l
egi
ti
mat
e sal
e ofst
ock on anyexchange r
equi
res r
eli
abl
e and accur
ate
i
nfor
mat
ion.Byr
equi
ri
ngahi
ghl
evel
oft
ranspar
encyf
rom al
ltr
adi
ngcompani
es,
the
st
ockexchangecr
eat
esamor
esecur
eenv
ironmentf
ori
nvest
ors,
whi
chhel
pst
hem
t
odet
ermi
net
her
isksofi
nvest
ing.
 

19
TRADI
NGOFSTOCKS:

Anor
gani
zedandr
egul
atedst
ockexchangef
aci
l
itat
est
heef
fi
cientt
radi
ngofst
ock
andot
heri
nvest
mentv
ehi
cles.Wi
thoutt
hishi
ghl
ycont
rol
l
edandcoor
dinat
edst
ock
exchange,t
hegl
obalt
radi
ngofst
ockwoul
dnotbepossi
ble.Thr
ought
hest
ock
exchange,anyi
ndi
vi
dualorcompanymaybuyorsel
lshar
esi
nanot
hercompany
.In
f
actatanyonet
ime,t
her
ear
ethousandsofcompanyshar
esbei
ngt
radedt
hrough
mi
l
li
onsofi
ndi
vi
dual
transact
ions.
 

Feat
uresofst
ockexchangear
e: 

1.Mar
ketf
orsecur
it
ies:St
ockexchangei
samar
ket
,wher
esecur
it
iesofcor
por
ate
bodi
es,
gov
ernmentandsemi
-gov
ernmentbodi
esar
eboughtandsol
d. 

2.Regul
atest
radei
nsecur
it
ies:St
ockexchangedoesnotbuyorsel
lanysecur
it
ies
oni
tsownaccount
.Itmer
elypr
ovi
dest
henecessar
yinf
rast
ruct
uresandf
aci
l
iti
es
f
ort
radei
n secur
it
iest
oit
smember
sand br
oker
swho t
radei
n secur
it
ies.I
t
r
egul
atest
het
radeact
ivi
ti
essoast
oensur
efr
eeandf
airt
rade.
 

3.Associ
ati
onofper
sons:Ast
ockexchangei
sanassoci
ati
onofper
sonsorbodyof
i
ndi
vi
dual
swhi
chmayber
egi
ster
edorunr
egi
ster
ed.
 
4.Wor
kingasperr
ules:Buy
ingandsel
l
ingt
ransact
ionsi
nsecur
it
iesatt
hest
ock
exchangear
egov
ernedbyt
her
ulesandr
egul
ati
onsofst
ockexchangeaswel
las
SEBIGui
del
i
nes.Nodev
iat
ionf
rom t
her
ulesandgui
del
i
nesi
sal
l
owedi
nanycase.
 

5.Deal
sinsecondhandsecur
it
ies:I
tdeal
swi
thshar
es,
debent
uresbondsandsuch
secur
it
iesal
readyi
ssuedbyt
hecompani
es.I
nshor
titdeal
swi
thexi
sti
ngorsecond
handsecur
it
iesandhencei
tiscal
l
edsecondar
ymar
ket
. 

20
(
C).
WHYDOWEI
NVESTI
NSHAREMARKET?
 

Ther
ear
enamel
yTWOmai
nst
ockmar
ket
sinI
ndi
aar
easf
oll
ows:
 

NATI
ONALSTOCKEXCHANGE(
NSE)
:

TheNat
ionalSt
ockExchangeofI
ndi
aLi
mit
ed(
NSE)i
sthel
eadi
ngst
ockexchange
ofI
ndi
a,l
ocat
ed i
n Mumbai
.The NSE was est
abl
i
shed i
n 1992 as t
he f
ir
st
demut
ual
i
zedel
ect
roni
cexchangei
nthecount
ry.NSEwast
hef
ir
stexchangei
nthe
count
ryt
o pr
ovi
de a moder
n,f
ull
yaut
omat
ed scr
een-
based el
ect
roni
ctr
adi
ng
sy
stem whi
chof
fer
edeasyt
radi
ngf
aci
l
ityt
othei
nvest
orsspr
eadacr
osst
hel
engt
h
andbr
eadt
hoft
hecount
ry.Vi
kram Li
may
eisManagi
ngDi
rect
or&Chi
efExecut
ive
Of
fi
cerofNSE.
 
Nat
ionalSt
ockExchangehasat
otalmar
ketcapi
tal
i
zat
ionofmor
ethanUS$2.
27
t
ri
ll
i
on,maki
ngi
tthewor
ld'
s11t
h-l
argestst
ockexchangeasofApr
il2018.
[1]NSE'
s
f
lagshi
pindex,t
heNI
FTY50,t
he50st
ocki
ndexi
susedext
ensi
vel
ybyi
nvest
orsi
n
I
ndi
aandar
oundt
hewor
ldasabar
omet
eroft
heI
ndi
ancapi
talmar
ket
s.Ni
ft
y50
i
ndex was l
aunched i
n 1996 by t
he NSE.[
2]Howev
er,Vai
dyanat
han (
2016)
est
imat
est
hatonl
yabout4%oft
heI
ndi
aneconomy/GDPi
sact
ual
l
yder
ivedf
rom
t
hest
ockexchangesi
nIndi
a. 

BOMBAYSTOCKEXCHANGE(
BSE)
: 

Bombayst
ockExchangewasf
oundedbyPr
emchandRoy
chand.Hewasoneoft
he
mosti
nfl
uent
ial
busi
nessmeni
n19t
h-cent
uryBombay
.Amanwhomadeaf
ort
unei
n
t
hest
ockbr
oki
ngbusi
nessandcamet
obeknownast
heCot
tonKi
ng,t
heBul
l
ion
Ki
ngorj
ustt
heBi
gBul
l
.Hewasal
sot
hef
ounderoft
heNat
iveShar
eandSt
ock
Br
oker
s 
Associ
ati
on,an i
nst
it
uti
on t
hati
s now known as t
he BSE.Whi
l
e BSE Lt
dis
21
now 
Synony
mouswi
thDal
alSt
reet
,itwasnotal
way
sso.Thef
ir
stv
enueoft
he
ear
li
estst
ockbr
okermeet
ingsi
nthe1850swasi
nrat
hernat
uralenv
irons-under
bany
ant
rees-i
nfr
ontoft
heTownHal
l
,wher
eHor
nimanCi
rcl
eisnow si
tuat
ed.A
decadel
ater
,thebr
oker
smov
edt
hei
rvenuet
oanot
hersetoff
oli
age,
thi
sti
meunder
bany
ant
reesatt
hej
unct
iorofMeadowsSt
reetandwhati
snow cal
l
edMahat
ma
GandhiRoad.TheBombaySt
ockExchangei
stheol
destst
ockexchangei
nAsi
a.[
7]
I
tshi
stor
ydat
esbackt
o1855,
when22st
ockbr
oker
s[8]woul
dgat
herunderbany
an
t
reesi
nfr
ontofMumbai
'
sTownHal
l
.Thel
ocat
ionoft
hesemeet
ingschangedmany
t
imest
oaccommodat
eani
ncr
easi
ngnumberofbr
oker
s.Thegr
oupev
ent
ual
l
y
mov
edt
oDal
alSt
reeti
n1874andbecameanof
fi
cialor
gani
zat
ionknownas"
The
Nat
iveShar
e&St
ockBr
oker
sAssoci
ati
on"i
n1875.
OnAugust31,1957,t
heBSE
becamet
hef
ir
stst
ockexchanget
ober
ecogni
zedbyt
heI
ndi
anGov
ernmentunder
t
heSecur
it
iesCont
ract
sRegul
ati
onAct
.In1980,
theexchangemov
edt
othePhi
roze
Jeej
eebhoyTower
satDal
alSt
reet
,For
tar
ea.

Pr
imar
yMar
ket
:

Thepr
imar
ymar
keti
swher
esecur
it
iesar
ecr
eat
ed.I
t'
sint
hismar
kett
hatf
ir
mssel
l
(
fl
oat
)newst
ocksandbondst
othepubl
i
cfort
hef
ir
stt
ime.Ani
nit
ialpubl
i
cof
fer
ing,
orI
PO,i
sanexampl
eofapr
imar
ymar
ket
.Theset
radespr
ovi
deanoppor
tuni
tyf
or
i
nvest
orst
obuysecur
it
iesf
rom t
hebankt
hatdi
dthei
nit
ialunder
wri
ti
ngf
ora
par
ti
cul
arst
ock.AnI
POoccur
swhenapr
ivat
ecompanyi
ssuesst
ockt
othepubl
i
c
f
ort
hef
ir
stt
ime.
 

Forexampl
e,companyABCWXYZI
nc.hi
resf
iveunder
wri
ti
ngf
ir
mst
odet
ermi
net
he
f
inanci
aldet
ail
sofi
tsI
PO.Theunder
wri
ter
sdet
ailt
hatt
hei
ssuepr
iceoft
hest
ock
wi
l
lbe $15.I
nvest
ors can t
hen buy t
he I
PO att
his pr
ice di
rect
lyf
rom t
he
i
ssui
ng 
company
. 
Thi
sist
hef
ir
stoppor
tuni
tyt
hati
nvest
orshav
etocont
ri
but
ecapi
talt
oacompany
t
hrought
hepur
chaseofi
tsst
ock.Acompany
'sequi
tycapi
tali
scompr
isedoft
he
22
f
undsgener
atedbyt
hesal
eofst
ockont
hepr
imar
ymar
ket
. 

Secondar
yMar
ket
: 

Forbuy
ingequi
ti
es,t
hesecondar
ymar
keti
scommonl
yref
err
edt
oast
he"
stock
mar
ket
."Thi
sincl
udest
heNewYor
kSt
ockExchange(
NYSE)
,NASDAQandal
lmaj
or
exchangesar
oundt
hewor
ld.Thedef
ini
ngchar
act
eri
sti
coft
hesecondar
ymar
keti
s
t
hati
nvest
or'
str
adeamongt
hemsel
ves.
 
Thati
s,i
nthe secondar
ymar
ket
,inv
est
or'
str
ade pr
evi
ousl
yissued secur
it
ies
wi
thoutt
hei
ssui
ngcompani
es'
inv
olv
ement
.Forexampl
e,i
fyougot
obuyAmazon
(
AMZN)st
ock,y
ouar
edeal
i
ngonl
ywi
thanot
heri
nvest
orwhoownsshar
esi
n
Amazon.Amazoni
snotdi
rect
lyi
nvol
vedwi
tht
het
ransact
ion.
 

1.Auct
ionmar
ket
:

I
ntheauct
ionmar
ket
,al
lindi
vi
dual
sandi
nst
it
uti
onst
hat
 wantt
otr
adesecur
it
ies
congr
egat
einonear
eaandannouncet
hepr
icesatwhi
cht
heyar
ewi
l
li
ngt
obuyand
sel
l
.Thesear
eref
err
edt
oasbi
dandaskpr
ices.Thei
deai
sthatanef
fi
cientmar
ket
shoul
dpr
evai
lbybr
ingi
ngt
oget
her
 al
lpar
ti
esandhav
ingt
hem publ
i
clydecl
aret
hei
r
pr
ices.Thus,
theor
eti
cal
l
y,t
hebestpr
iceofagoodneednotbesoughtoutbecause
t
he conv
ergenceofbuy
ersand sel
l
erswi
l
lcausemut
ual
l
y-agr
eeabl
e pr
icest
o
emer
ge.Thebestexampl
eofanauct
ionmar
keti
stheNew Yor
kSt
ockExchange
(
NYSE)
.Deal
ermar
ket
:Incont
rast
,adeal
ermar
ketdoesnotr
equi
repar
ti
est
o
conv
ergei
nacent
rall
ocat
ion.Rat
her
,par
ti
cipant
sint
hemar
ketar
ejoi
nedt
hrough
el
ect
roni
cnet
wor
ks.Thedeal
ershol
dani
nvent
oryofasecur
it
y,t
henst
andr
eadyt
o
buyorsel
lwi
thmar
ketpar
ti
cipant
s.Thesedeal
ersear
npr
ofi
tst
hrought
hespr
ead
bet
weent
hepr
icesatwhi
cht
heybuyandsel
lsecur
it
ies.Anexampl
eofadeal
er
mar
keti
stheNASDAQ,i
nwhi
cht
hedeal
ers,whoar
eknownasmar
ketmaker
s,
pr
ovi
def
ir
m bi
dandaskpr
icesatwhi
cht
heyar
ewi
l
li
ngt
obuyandsel
lasecur
it
y.
Thet
heor
yist
hatcompet
it
ionbet
weendeal
erswi
l
lpr
ovi
det
hebestpossi
blepr
ice
23
f
ori
nvest
. 

(
D).Adv
ant
agesofshar
emar
ket
 

I
nvest
mentGai
ns 
Oneoft
hepr
imar
ybenef
it
sofi
nvest
ingi
nthest
ockmar
keti
sthe
chancet
ogr
ow y
ourmoney
.Ov
ert
ime,t
hest
ockmar
kett
endst
ori
sei
nval
ue,
t
hought
hepr
icesofi
ndi
vi
dualst
ocksr
iseandf
alldai
l
y.I
nvest
ment
sinst
abl
e
compani
est
hatar
eabl
eto gr
ow t
endt
o makepr
ofi
tsf
ori
nvest
ors.Li
kewi
se,
i
nvest
ingi
nmanydi
ff
erentst
ockswi
l
lhel
pbui
l
dyourweal
thbyl
ever
agi
nggr
owt
hin
di
ff
erentsect
orsoft
heeconomy
,resul
ti
ngi
napr
ofi
tev
eni
fsomeofy
ouri
ndi
vi
dual
st
ocksl
osev
alue.
 

Di
vi
dendI
ncome:
 

Somest
ockspr
ovi
dei
ncomei
nthef
orm ofadi
vi
dend.Whi
l
enotal
lst
ocksof
fer
di
vi
dends,t
hoset
hatdodel
i
verannualpay
ment
stoi
nvest
ors.Thesepay
ment
s
ar
ri
veev
eni
fthest
ockhasl
ostv
alueandr
epr
esenti
ncomeont
opofanypr
ofi
ts
t
hatcomef
rom ev
ent
ual
l
ysel
l
ingt
hest
ock.Di
vi
dendi
ncomecanhel
pfunda
r
eti
rementorpayf
orev
enmor
einv
est
ingasy
ougr
ow y
ouri
nvest
mentpor
tfol
i
o
ov
ert
ime.

Di
ver
sif
icat
ion 
ori
nvest
ors who putmoney i
nto di
ff
erentt
ypes ofi
nvest
ment
pr
oduct
s,ast
ockmar
keti
nvest
menthast
hebenef
itofpr
ovi
dingdi
ver
sif
icat
ion
St
ockmar
ket
 
i
nvest
ment
schangev
aluei
ndependent
lyofot
hert
ypesofi
nvest
ment
s,suchas
bonds 
r
eal
est
ate.Hol
dingst
ockcanhel
pyouweat
herl
ossest
oot
heri
nvest
mentpr
oduct
s,
St
ockal
soaddsr
iskt
oapor
tfol
i
o,aswel
last
hepot
ent
ial
forl
arge,
rapi
d 
gai
ns,hel
ping i
nvest
ors av
oidr
isk-
aver
se or ov
erl
y conser
vat
ivei
nvest
ment
st
rat
egi
es.
 
24
Owner
shi
p Buy
ingshar
esofst
ockmeanst
aki
ngonanowner
shi
pst
akei
nthe
companyy
oupur
chasest
ocki
n.Thi
smeanst
hati
nvest
ingi
nthest
ockmar
ketal
so
br
ingsbenef
it
sthatar
epar
tofbei
ngoneofabusi
ness'
sowner
s.Shar
ehol
der
svot
e
oncor
por
ateboar
dmember
sandcer
tai
nbusi
nessdeci
sions.Theyal
sor
ecei
ve
annualr
epor
tst
olear
nmor
eaboutt
hecompany
.Owni
ngst
ocki
nthecompanyy
ou
wor
kforcanbeawayt
oexpr
essl
oyal
tyandt
iey
ourper
sonalf
inancest
othe
successoft
hebusi
nessas 
awhol
e. 

EasyLi
qui
dit
y:

I
tist
hev
eryf
ir
stbenef
it
sofi
nvest
ing,I
nst
ockmar
ketshar
esandsecur
it
iesar
e
t
radedi
nver
yhi
ghv
olumewhi
chmakei
tav
olat
il
emar
ketsot
her
eisv
eryeasy
l
i
qui
dit
yinst
ockmar
ket
,li
kei
fyouwantt
otur
nyouri
nvest
menti
nst
ockmar
keti
nto
casht
heny
oucandot
hatv
eryeasi
l
y. 

Fl
exi
bil
it
y:

I
nvest
ingi
nst
ockmar
keti
svpr
icesatev
eryt
radesessi
onf
lexi
bil
i
tyoft
hismar
ket
. 
i
nst
ockmar
keti
sver
yfl
exi
blel
i
ket
hemar
kethav
eupsanddownsi
nev
eryt
rade
sessi
on,
pri
ceofst
ockmar
ketmov
eswi
tht
her
api
dit
yand 

(
E).Di
sadv
ant
agesofshar
emar
ket
 

Vol
ati
leI
nvest
ment
s: 

I
nvest
menti
nBSEi
ssubj
ect
edt
omanyr
iskssi
ncet
hemar
keti
svol
ati
l
e.The
shar
es 
ofacompanygoupandcomedownsomanyt
imesi
njustasi
ngl
eday
.Thesepr
ice
f
luct
uat
ionsar
eunpr
edi
ctabl
emostoft
het
imesandt
hei
nvest
orsomet
imeshav
e
25
t
o 
f
acesev
erel
ossduet
osuchuncer
tai
nty
. 

Br
oker
ageCommi
ssi
onsKi
l
lPr
ofi
tMar
gin 
Ever
yti
meani
nvest
orbuy
sorsel
l
shi
s
shar
es,
hehast
opaysomeamountasabr
oker
agecommi
ssi
ont
othebr
oker
,whi
ch
ki
l
lst
hepr
ofi
tmar
gin.
 

Ti
meConsumi
ng:
 

I
nvest
menti
nNSEi
snotaseasyasi
nvest
ingi
nal
ott
eryasy
ouhav
etocompl
ete
manyf
ormal
i
tiesi
nthepr
ocessandhencei
sti
meconsumi
ng.Thest
ockmar
keti
sa
popul
ari
nvest
mentchoi
ceandt
hev
alueofst
ocksownedbyi
nvest
orsi
smor
ethan
$15t
ri
ll
i
onf
ort
het
womai
nst
ockexchangesl
ocat
edi
ntheU.
S.,accor
dingt
othe
Wor
ldFeder
ati
onofExchanges.Formanyi
ndi
vi
duali
nvest
orst
her
ear
esomegood
r
easonst
onotbei
nvest
edi
nthest
ockmar
ket
.Under
standi
ngt
hedi
sadv
ant
agesof
st
ockmar
keti
nvest
ingwi
l
lhel
pani
nvest
ordeci
dei
fthemar
keti
sther
ightchoi
ce.
 

NotSui
tabl
etoPr
ovi
deRet
ir
ementI
ncome:

Ani
ndi
vi
dualatr
eti
rementagemaynotwantal
argepr
opor
ti
onofr
eti
rementasset
s
i
nthest
ockmar
ket
.Ar
eti
reeneedsr
egul
ari
ncomeandmanyst
ockspayl
i
ttl
eorno
di
vi
dends.Topr
ovi
demoneyf
orl
i
vingexpenses,shar
esofst
ockwoul
dhav
etobe
sol
d,r
educi
ngt
hepor
tfol
i
oandi
ncur
ri
ngcommi
ssi
ons.

Lar
geNumberofChoi
ces:

I
nvest
orst
hatwantt
oinv
esti
nchoi
ces.TheWi
l
shi
reandi
ncl
udesov
er6,
000st
ock
l
otoft
ime,educat
ionandapor
tfol
i
o.Thesi
zeandt
oinv
esti
nthemar
ketmaybe
di
scour
agedbyt
hel
argenumberofWi
l
shi
re5000st
ockmar
keti
ndexcov
erst
he
ent
ir
eU.
S.st
ockmar
ketov
er6,
000st
ocks.Ther
ear
eov
er4,
000st
ockmut
ual
funds.
26
I
tcant
akeaducat
ionandef
for
ttor
esear
cht
hemar
ketandsel
ectanappr
opr
iat
e
st
ockThesi
zeandcompl
exi
tyoft
hest
ockmar
ketmakesi
tdi
ff
icul
tforan i
nvest
or
t
osuccessf
ull
ymeeti
nvest
mentgoal
s,
 

Ri
sksofOwner
shi
p: 

St
ocki
sowni
ngpar
tofacor
por
ati
on.I
fthecor
por
ati
ondecl
aresbankr
upt
cy,
 
t
heowner
sorshar
ehol
der
sar
elasti
nli
net
orecei
veanypr
ovr
ate 
Leakup orr
eor
gani
zat
ion.I
n mostcases i
fa company goes bankr
uptt
he
shar
ehol
der
s 
ei
venot
hing f
ort
hei
rshar
es.Ver
ylar
geand wel
lknow compani
eshav
egone
bankr
upt
.Thel
i
sti
ncl
udesGener
alMot
orsi
n2009,
LehmanBr
other
sin2008and 
Enr
oni
n2001.
 

(
F).Reasont
oInv
esti
nSt
ockMar
ket
 

Ther
e'smor
ethanonewayt
oinv
est
.Inv
est
ingcanbedoneonami
cro-
lev
elwi
th
i
ndi
vi
dualst
ocksoronamacr
oeconomi
clev
elbypur
chasi
ngabasketofi
ndexes
t
hatmapbackt
otheSt
andar
dandPoor
's500i
ndexorot
hergl
obal
benchmar
ks.
 
"
Youcani
nvesti
nmut
ualf
undsbutt
hosecomewi
thhi
gherf
ees,
"Sei
densay
s."
You
cani
nvesti
nindi
vi
dualst
ocks,
whi
chwi
l
ltendt
ohav
ethebi
ggestmar
ketmov
es,
or
ETFs.Youcanal
soi
nvesti
nopt
ionsont
hest
ockmar
ket
,whi
chof
fer
slowercapi
tal
i
nvest
ingandmor
ecust
omi
zedst
rat
egi
es.
" 
"
Alotofi
nvest
orshav
eacer
tai
nper
cept
ionofwhatt
heyshoul
dbedoi
ng,
"shesay
s.
"
Alotofnew i
nvest
orst
hinkt
heyshoul
dinv
est90or100per
centi
nequi
ti
es
becauset
heyhav
eal
ongt
imet
oret
ir
e."
 mar
keti
sdesi
gnedt
ogoupov
ert
ime.Due
t
o401(
k)pr
ogr
amsandot
her
 r
eti
rementpl
ans,t
her
ear
ehuge 
ther
ear
ehugedi
rect
i
nvest
ment
sint
othest
ockmar
keteachmont
h t
hatusual
l
yfor
cepr
iceshi
gher
,
Sei
densav
s 
"
Whenacompanyi
ntheS&P5per
for
m wel
l
,theexchangeanyi
ntheS&P500,
27
Nasdaq,orDow Jonesi
ndust
ri
alav
eragedoesn'
t 
hel
pingpr
opuppr
ices,"Sei
den
say
s. 
al
ltheexchangesi
mpl
yremov
esi
tandr
epl
acesi
twi
thabet
terone.
 because 
asi
tisi
nWal
lSt
reet
'sbesti
nter
estt
ohav
est
ockmar
ketpr
icesmov
ehi
ghermany
oft
hef
ir
m'sownmuchoft
hest
ockt
hemsel
ves.
 
i
nfl
ati
on.Whi
l
ether
eisn'
ta100per
centguar
ant
ee,
thest
ockmar
ketmayhel
pst
ors
ear
nmor
emoneysi
nceequi
ti
eshav
ehi
stor
ical
l
ybeenknownt
okeepupi
thor
exceedi
nfl
ati
onr
ates.Accor
dingt
oJ.
P.Mor
ganAssetManagement
,the50 
or
av
eragef
ort
heconsumerpr
icei
ndex,whi
chi
susedt
ogaugei
nfl
ati
onr
ates,i
s 4.
1
per
cent
. 
"
Youwantt
omakesur
eyourmoneyi
sout
paci
ngi
nfl
ati
on,
"Johndr
ow say
s,whi
ch
hel
pswi
thr
etai
ningpur
chasi
ngpoweri
nthel
ongt
erm.
 
Forexampl
e,mor
ethan50y
ear
sago,t
hepr
iceofaCoke(
ti
cker
:KO)was5cent
s.
"
Ify
ouaskedpeopl
etopay$1.
50backt
hen,t
heywoul
dsayy
ouwer
ecr
azy
,but
t
hat
'swhatwear
epay
ingt
oday
,"Johndr
owsay
s. 
Compoundy
ouri
nter
est
.Get
ti
ngi
near
lyandsav
ingof
teni
sal
way
sbet
ter
. 
Forexampl
e,i
fani
nvest
orbegi
nsi
nvest
ing$3,
600pery
earatage25f
or15y
ear
sat
an8per
centi
nter
estr
ateandt
henst
ops,
shewi
l
lhav
eear
ned$1,
050,
000byage70,
Johndr
owsay
s. 
I
fanot
heri
nvest
orbegi
nsi
nvest
ing$3,
600pery
earatage40anddoesi
tfor30
y
ear
s 
atan8per
centi
nter
estr
ate,
shewi
l
lonl
yhav
eear
ned$450,
000.
 
Mi
ti
gat
eyourr
iskwi
thdi
ver
sif
icat
ion.Al
thoughy
oucan'
tcompl
etel
yremov
eri
sk,
 
I
t'
sbeenhi
stor
ical
l
yshownt
hatwheny
oudi
ver
sif
ywi
thmor
eassetcl
assesy
oumay
beabl
etogetabet
terr
etur
n,Johndr
owsay
s.I
fonehol
dingorpar
ti
cul
arsect
orof
t
hemar
ketunder
per
for
ms,
otheri
nvest
ment
swi
l
lhopef
ull
yhel
pbal
anceoutt
her
est
oft
he por
tfol
i
o To mi
ti
gat
ethe r
isk,John Bur
ke,pr
esi
dentatBur
ke Fi
nanci
al
St
rat
egi
esi
nIsel
i
n, 
New Jer
sey
,say
sinv
est
orsneedt
ost
ayi
nthest
ockmar
keta
mi
nimum oft
hreey
ear
s. 

28
FACTORS 

Thev
ari
ouspar
amet
erst
hataf
fectt
hedeci
sionmaki
ngofi
nvest
orsi
nmut
ualf
und
i
ndust
rycanbecat
egor
izedas:
 

Ri
skFact
ors:

Thei
nvest
ment
sint
hemut
ualf
undandsecur
it
iesar
esubj
ect
edt
omar
ketr
iskand
t
heNAVoft
heschemesmayv
arydependi
ngupont
hef
act
orsandf
orcesaf
fect
ing
t
hesecur
it
iesmar
ket
.Int
hisr
espect
,theof
ferdocument
s/SAI
/SI
D/KI
M maybe
hel
pfult
othei
nvest
ors.Al
lmut
ualf
undsal
sor
equi
redt
odi
scl
oset
her
iskf
act
orsi
n
t
hei
rof
ferdocument
s 

Awar
enessFact
ors:
 

Fr
om i
nvest
or'
spoi
ntofv
iew,
thel
evelofawar
enessofmut
ualf
undscanbet
ermed
ast
hef
ir
standf
oremostst
agef
ori
nvest
menti
nanysuchf
und.Asur
veysay
sthati
f
t
hei
nvest
orshav
ebeenpr
ovi
dedmor
efunds,
50percentoft
hei
nvest
orswoul
dli
ke
t
oinv
esti
ntheRealEst
ate,f
oll
owedby23percenti
nMut
ualFundsandonl
y2per
centi
nEqui
tyShar
es.Anot
hersur
veyst
atedt
hathi
ghsal
ari
edandhi
ghi
ncomesel
f-
empl
oyedar
emaj
ori
nvest
orduet
otaxconcessi
ons.

Speci
ali
zat
ionFact
ors:
 

I
nthecont
extofspeci
ali
zat
ion,
li
 t
extofspeci
ali
zat
ion,
financi
all
i
ter
acypl
aysav
ital
r
ole.Fi
nanci
all
i
ter
acy
 mut
ualf
undsar
etoext
endt
hei
rreacht
osmal
l
ert
owns.The
f
inanci
alJul
edeei
sneededt
oful
l
ypar
ti
cipat
eint
heeconomyort
omakei
nfor
med 
aboutownf
inanci
alf
utur
es.Af
inanci
ali
gnor
antper
sonsuf
fer
sfr
om 
deci
sionsaboutownf
inanci
aldi
seasesl
i
keunder
insur
ance,debtt
rap,i
nsuf
fi
cient
r
eti
rementf
undsand 
ret
urnoni
nvest
ment
.Thr
ee-
four
thofI
ndi
anadul
tsdonot
29
adequat
elyunder
standbayf
inanci
alconcept
ssuchasi
nfl
ati
on,compoundi
nter
est
andr
iskdi
ver
sif
icat
ion.
 
St
andar
d&Poor
'sRat
ingsSer
vicessai
d. 

Li
qui
dit
yFact
ors:
 

Bef
oret
hegl
obalf
inanci
alcr
isi
sli
qui
dit
yfact
orsofanyi
nvest
mentwasnoton
ev
ery
body
'sr
adar
.Li
qui
dit
yri
skcanbecat
egor
ized as:1.Fundi
ng (
cashf
low)
l
i
qui
dit
y:I
ttendst
omani
festacr
edi
tri
skt
hati
sinabi
l
ityt
ofundl
i
abi
l
itypr
oduces
def
aul
ts.Thebasi
cway
sofi
tsmeasur
ementar
ecur
rentr
ati
osandqui
ckr
ati
os.
2.
Mar
ket(
Asset
)li
qui
dit
y:I
ttendst
omani
fest
sasmar
ketr
iskst
hati
sinabi
l
ityt
osel
l
anassetatt
imeofr
equi
rementi
.e.t
hemar
ketpr
icei
ndeci
pher
abi
l
ityofast
ock.The
mar
ketl
i
qui
dit
yofani
nvest
mentcanbemeasur
edi
nrespectofwi
dth(
bidask
spr
ead)
,dept
h(posi
ti
onsi
ze)andr
esi
l
iency
 

Consi
stencyFact
ors:
 

Thei
nvest
ment
sinmut
ual
fundsdependupont
heneedoft
hei
nvest
or.Forexampl
e,
debti
nvest
ment
smaynotbeappr
opr
iat
efori
nvest
orsofshor
tter
m obj
ect
ives.For
medi
um t
olongt
erm obj
ect
ives,equi
tyf
undi
nvest
ment
sar
eadv
isabl
e.Hi
stor
ical
l
ong t
erm per
for
mance,whi
l
e a good i
ndi
cat
oroff
und'
s pot
ent
ial
,does not
guar
ant
eef
utur
eper
for
mance.Theconsi
stencyofaf
und'
sper
for
mancecanbe
measur
edi
nter
msofi
tsper
for
mancewi
thr
espectt
oit
sbenchmar
ksandcat
egor
y
av
erage.I
nabear
ishmodemar
ket
,ther
etur
nsmaybenegat
ive,butt
hef
undst
hat
f
alll
esst
hant
hei
rbenchmar
ksorcat
egor
yav
eragear
eout
per
for
mer
s.Si
mil
arl
y,i
n
t
hebul
lmar
kett
heout
per
for
mer
sar
ethoset
hatgai
nmor
ethant
hei
rbenchmar
ks
orcat
egor
yav
erages.

I
mpor
tantpoi
ntsy
oumustknowi
nvest
ingi
nshar
emar
ket
 

30
1.Nev
erj
umpbl
indl
yint
ost
ockmar
ket
s: 

Manyat
imesi
thappenst
hatwhi
l
etal
ki
ngt
oyourf
ri
endsandcol
l
eagues,t
he
di
scussi
onheadst
owar
dst
hest
ockmar
ket
,andal
sohow t
hest
ockmar
kethel
ps
i
nvest
orsmakebi
gmoney
.Youmi
ghtnev
erhav
einv
est
edi
nthemar
ket
,butaf
ter
hear
ingaboutal
lthoset
hingsy
oual
sodeci
det
obuysomest
ocks.Howev
er,i
fyou
ent
eredt
hemar
ketj
ustt
oremai
nint
hemai
nst
ream f
ashi
on,
youhav
elandedi
nfor
t
hewr
ongr
eason.Youshoul
dinv
esti
nthest
ockmar
ketaf
terget
ti
ngt
hebasi
c
knowl
edgeabouti
tandi
naccor
dancewi
thy
ourf
inanci
algoal
s. 

2.St
ockmar
keti
snotamoney
-maki
ngmachi
ne:

Youmusthav
ehear
dthest
oryaboutmanyi
nvest
orswho madet
hei
rfor
tune
t
hrought
hemar
ket
.Manybel
i
evet
hatt
hest
ockmar
keti
sli
keamoney
-maki
ng
machi
ne,whi
chcant
urnt
hem i
ntomi
l
li
onai
resov
eraper
iodoft
ime.Whi
l
esome
hav
ebeenf
orcedt
osel
lthei
rper
sonal
asset
stocov
ert
hel
ossi
nthemar
ket
. 

3.Educat
eyour
sel
f,handl
ebasi
csf
ir
st:

Bef
oremaki
ngy
ourf
ir
sti
nvest
ment
,taket
het
imet
olear
nthebasi
csaboutt
he
st
ockmar
ketandt
hei
ndi
vi
dualsecur
it
iescomposi
ngt
hemar
ket
.Ther
eisanol
d
adage:I
tisnotast
ockmar
ket
,butamar
ketofst
ocks.Yourf
ocuswi
l
lbeupon
i
ndi
vi
dualsecur
it
ieswhi
chy
ouar
einv
est
ingi
nandt
her
elat
ionshi
pwi
tht
hebr
oader
economyandt
hef
act
orst
hatdr
ivey
ourst
ock.Somei
mpor
tantar
easwhi
chy
ou
shoul
dbef
ami
l
iarwi
thbef
oreent
eri
ngt
hemar
ketar
e: 

4.I
nvestonl
yyoursur
plusf
unds:

Thebi
ggestmi
stakenewbi
einv
est
orsmakei
stoi
nvestmoneyt
hatt
heycan'
t
act
ual
l
yaf
for
dtol
ose.I
nvest
ingi
nthest
ockmar
keti
sri
sky
,andt
hatmeanst
hat
31
y
oucanpot
ent
ial
l
yloseev
ery
thi
ng.Li
keanyi
nvest
ment
,ther
ear
einher
entr
isks
associ
atedwi
tht
hest
ockmar
ket
.Somear
ether
isksr
elat
edt
otheov
eral
lmar
ket
assy
stemat
icr
iskt
haty
oucan'
tav
oidbydi
ver
sif
yingy
ourpor
tfol
i
o. 

5.Av
oidLev
erage:

Lev
eragesi
mpl
ymeansuseofbor
rowedmoneyt
oexecut
eyourst
ockmar
ket
st
rat
egy
.Inamar
ginaccount
,banksandbr
oker
agef
ir
mscanl
endy
oumoneyt
obuy
st
ocks.I
t 
f
undsgr
eatwhent
hest
ockmar
keti
smov
ingup,butconsi
dert
heot
hersi
dewhen
t
hest
ockmar
ketory
ourst
ockgoesdown.I
nthatcasey
ourl
osswoul
dnotonl
y
er
odev
ouri
nit
ial
inv
est
ment
,buty
ouwi
l
lal
sohav
etopayi
nter
estt
othebr
oker
. 

CHAPTER2:REVI
EW OFLI
TERATURE

1.Wal
iaandKi
ran(
2009)conduct
edt
hesur
veyt
oanal
yzet
her
iskandr
etur
n
per
cept
ion ofi
nvest
orsr
egar
ding t
he mut
ualf
unds. The r
esul
tshowed t
hat
pr
ofessi
onal
i
sm and good cust
omerser
vicesar
ethe t
wo f
act
orst
hathad an
i
mmensei
mpactont
hei
nvest
or’
sper
cept
ionr
egar
dingt
hemut
ualf
unds.Besi
des
t
heset
wo,t
heoodi
mageal
socont
ri
but
essi
gni
fi
cant
lyi
ndev
elopi
ngt
hei
nvest
or’
s
per
cept
ion

2.Si
mranSai
niandBi
malAnj
um (
2011)hadanal
ysest
hemut
ualf
undi
nvest
ment
s
i
nrel
ati
on t
oinv
est
or’
s behav
iort
hatat
tractt
hem t
oinv
esti
n mut
ualf
unds.
I
nvest
or’
sopi
nionandper
cept
ionhasbeenst
udi
edr
elat
ingt
ovar
iousi
ssuesl
i
ke
t
ypeofmut
ual
fundscheme,
mai
nobj
ect
ivebehi
ndi
nvest
ingi
nmut
ual
fundscheme,
l
evelofsat
isf
act
ion,r
oleoff
inanci
aladv
isor
sandbr
oker
s,sour
cesofi
nfor
mat
ion,
def
ici
enci
esi
ntheser
vicespr
ovi
dedbyt
hemut
ualf
undmanager
s,chal
l
enges
bef
oret
hemut
ual
fundi
ndust
ryet
c.

32
3.Ahmedetal
.(2011)al
sost
udi
edandusedt
hedi
mensi
onofI
nvest
or’
sper
cept
ion.
Theyconduct
edast
udyt
oexami
net
heper
cept
ionofi
nvest
orst
owar
dsr
iskand
r
etur
nini
nvest
mentoppor
tuni
ty.I
nthi
sresear
ch,sev
eraldemogr
aphi
cvar
iabl
es
wer
etakeni
ntoaccount
,butt
hest
udyr
eveal
sthatwheni
nvest
ori
smor
eeducat
ed,
he/
shewi
l
lbemor
eri
skt
oler
antandhewi
l
lhav
eabet
terunder
standi
ngoft
he
i
nvest
mentoppor
tuni
ti
es.Thesecondaspectoft
her
esear
chi
sthesal
aryl
evelor
i
ncome. I
finv
est
or’
sincome i
ncr
eases,he/
she can br
oaden t
hei
rinv
est
ment
hor
izonandcanmakei
nvest
mentdeci
sioni
nabet
terway
.

4.Sai
nietal
.(2011)conduct
edast
udyi
nIndi
atogauget
hei
nvest
ors’awar
eness
andper
cept
ionaboutt
hemut
ualf
undsi
nIndi
a.Thef
act
orst
hathadbeent
aken
i
ntoaccounti
nther
esear
chwer
eexper
ti
se,saf
ety
,li
qui
dit
y,di
ver
sif
icat
ion,t
ax
benef
it
,regul
ari
ncome,andr
egul
arsav
ings.Fact
orst
hatat
tractt
hei
nvest
orst
he
mostwer
ethef
und’
spastper
for
mance,pastdi
vi
dendr
ecor
dsandst
abi
l
ityoft
he
r
etur
n.St
udyal
sor
eveal
edt
hati
nIndi
a,mai
nobj
ect
iveofi
nvest
orsf
oropt
ingt
o
i
nvesti
nmut
ualf
undsi
sthet
axbenef
it
swhi
chwer
efol
l
owedbyhi
ghr
etur
nandt
he
saf
etyt
hatt
hemut
ualf
undspr
ovi
de.Thi
sst
udyal
sor
eveal
edt
hef
actt
hatont
he
basi
sofage,occupat
ion,andi
ncome,maj
ori
tyoft
hepeopl
ebel
i
evet
hatt
hrough
appr
opr
iat
ecommuni
cat
ion and pr
ovi
ding necessar
yeducat
ion t
oinv
est
orsf
or
maki
ng an i
nvest
menti
n mut
ualf
unds can encour
age t
he i
nvest
orst
o make
i
nvest
ment
sinv
ari
ous di
ff
erentmut
ualf
unds schemes.The r
esear
ch al
so
hi
ghl
i
ght
edt
hatSai
nietal
.(2011)conduct
edast
udyi
nIndi
atogauget
hei
nvest
ors’
awar
enessandper
cept
ionaboutt
hemut
ualf
undsi
nIndi
a.Thef
act
orst
hathad
been t
aken i
nto account i
n t
he r
esear
ch wer
e exper
ti
se,saf
ety
,li
qui
dit
y,
di
ver
sif
icat
ion,t
axbenef
it
,regul
ari
ncome,andr
egul
arsav
ings.Fact
orst
hatat
tract
t
hei
nvest
orst
hemostwer
ethef
und’
spastper
for
mance,
pastdi
vi
dendr
ecor
dsand
st
abi
l
ityoft
her
etur
n.St
udyal
sor
eveal
edt
hati
nIndi
a,mai
nobj
ect
iveofi
nvest
ors
f
oropt
ingt
oinv
esti
nmut
ualf
undsi
sthet
axbenef
it
swhi
chwer
efol
l
owedbyhi
gh
r
etur
nandt
hesaf
etyt
hatt
hemut
ual
fundspr
ovi
de.Thi
sst
udyal
sor
eveal
edt
hef
act
33
t
hatont
hebasi
sofage,
occupat
ion,
andi
ncome,
maj
ori
tyoft
hepeopl
ebel
i
evet
hat
t
hroughappr
opr
iat
ecommuni
cat
ionandpr
ovi
dingnecessar
yeducat
iont
oinv
est
ors
f
ormaki
ngani
nvest
menti
nmut
ualf
undscanencour
aget
hei
nvest
orst
omake
i
nvest
ment
sinv
ari
ous di
ff
erentmut
ualf
unds schemes.The r
esear
ch al
so
hi
ghl
i
ght
edt
hatsomeoft
hemaj
orf
act
orst
hatar
eamat
terofconcer
nformostof
t
hepot
ent
iali
nvest
orsar
ethatt
hemut
ualf
undsmanager
sof
tenar
eunabl
eto
pr
ovi
det
henecessar
ytr
anspar
ency
,per
iodi
calst
atement
sand t
he necessar
y
i
nfor
mat
iont
hatar
eessent
ialf
ort
hepur
poseofcr
eat
inggoodawar
eness.

5.Pandey(
2011)f
ocusesont
hebehav
ioraspectoft
hei
nvest
or.Hi
sresear
ched
t
opi
cwas“
Inv
est
or'
sBehav
ior
:Mut
ualFunds”
,Inwhi
chhest
udi
edt
hati
nspi
teof
sev
eralpay
ment
s,whi
chmut
ualf
undscompr
omi
set
oret
ailf
inanci
ers,t
her
ear
e
l
i
ttl
eri
sksconv
olut
edwhi
l
ecapi
tal
i
zingi
nthi
spr
ospect
.Ther
ecanbedownsi
der
isk
associ
ated,whi
chi
sther
iskper
cei
vedofsuf
fer
ingf
inanci
aldamagecausedby
undesi
rabl
edev
iat
ionofr
etur
ns,
cer
tai
nly
,Mut
ualFundsi
snotaunwav
eri
ngmar
ket
,
andt
heappar
entv
ari
ati
oni
nret
urnsov
erat
imeper
iodl
eadst
owar
dsmar
ket
v
olat
il
it
y.Besi
dewi
tht
hist
ypeofr
isk,t
her
eisaper
sist
entsenseofv
agueness
amongstf
inanci
ersbecauseofl
ackofst
ati
sti
cs,i
nfor
mat
ionandabsenceofsel
f-
compet
ence
Pr
iyankaShar
maandPay
alAgr
awal(
2015)i
nthei
rst
udymadeanat
temptt
o
under
standt
heef
fectofdemogr
aphi
cfact
orsi
nmut
ualf
undi
nvest
mentdeci
sions.
Thest
udyr
eveal
sthatt
hei
nvest
ors’per
cept
ioni
sdependentont
hei
rdemogr
aphi
c
pr
ofi
l
e.I
nvest
or’
s age,mar
it
alst
atus and occupat
ion has a di
recti
mpacton
i
nvest
ors’choi
ceofi
nvest
ment
.Thest
udyf
urt
herr
eveal
sthatt
hef
emal
esegment
i
snotf
ull
ytapped.Ther
esear
chal
sor
eveal
sthatt
hel
i
qui
dit
yandt
ranspar
encyar
e
somef
act
orswhi
chhav
eahi
ghi
mpactoni
nvest
mentdeci
sions.

6.Debasi
sh(
2009)st
udi
edt
heper
for
manceofsel
ect
edschemesofmut
ualf
unds
basedonr
iskandr
etur
nmodel
sandmeasur
es.Thest
udycov
eredt
heper
iodf
rom
Apr
il1996t
oMar
ch2005ni
ney
ear
s).Thest
udyr
eveal
edt
hatFr
ankl
i
nTempl
eton
34
andUTIwer
ethebestper
for
mer
sandBi
rl
aSunl
i
fe,HDFCandLI
Cmut
ualf
unds
showedpoorper
for
mance.

7.SondhiandJai
n(2010)exami
nedt
hemar
ketr
iskandi
nvest
mentper
for
manceof
equi
tymut
ualf
undsi
nIndi
a.Thest
udyusedasampl
eof36equi
tyf
undf
oraper
iod
of3y
ear
s.Thest
udyexami
nedwhet
herhi
ghbet
aoff
undshav
eact
ual
l
ypr
oduced
hi
ghr
etur
nsov
ert
hest
udyper
iod.Thest
udyal
soexami
nedt
hatopen-
endedor
cl
oseendedcat
egor
ies,si
zeoff
undandt
heowner
shi
ppat
ter
nsi
gni
fi
cant
lyaf
fect
r
isk-
adj
ust
ed i
nvest
mentper
for
manceofequi
tyf
und.Ther
esul
tsoft
hest
udy
conf
ir
medwi
tht
heempi
ri
calev
idencepr
oducedbyf
ama1992)t
hathi
ghbet
afunds
mar
ketr
isks)maynotnecessar
il
ypr
oducedhi
ghr
etur
ns.Thest
udyr
eveal
edt
hat
t
he cat
egor
y,si
ze and owner
shi
p hav
e been si
gni
fi
cant
ly det
ermi
nantoft
he
per
for
manceofmut
ual
fundsdur
ingt
hest
udyper
iod.
8.Al
i
,Naseem andRehman(
2010)i
nthei
rst
udyexami
nedt
heper
for
manceof10
mut
ualf
undsi
nwhi
ch5wer
econv
ent
ionaland5wer
eIsl
ami
cfort
heper
iodf
rom
2006t
o2008byusi
ngShar
peandTr
eynormeasur
es.Ther
esul
tsf
oundt
hatt
he
f
undsofPaki
stanwer
eabl
etoaddmor
eval
ueei
therconv
ent
ionalorI
slami
c.The
st
udyal
sof
oundt
hatsomeoft
hef
undswer
eunder
per
for
med,
sot
hesef
undswer
e
f
aci
ngdi
ver
sif
icat
ionpr
obl
emsdur
ingt
hest
udyper
iod.

9.Pr
abakar
an and Jay
abal(
2010)ev
aluat
ed t
he per
for
mance ofmut
ualf
und
Schemes.Thest
udyconduct
edasampl
eof23schemeswer
echosenaspert
he
pr
ior
it
ygi
venbyt
her
espondent
sinDhar
mapur
idi
str
ictcov
eredaper
iodf
rom Apr
il
2002t
oMar
ch2007.Thest
udyusedt
hemet
hodol
ogyofShar
pe,
JensenandFama
f
ort
heper
for
manceev
aluat
ionofmut
ualf
unds.Ther
esul
tsoft
hest
udyf
oundt
hat
13 schemes outof23 schemes sel
ect
ed had super
iorper
for
mance t
han t
he
benchmar
kpor
tfol
i
oint
ermsofShar
per
ati
o,13schemeshadsuper
iorper
for
mance
ofTr
eynorr
ati
oand14schemeshadsuper
iorper
for
manceaccor
dingt
oJensen
measur
e.The Fama’
s measur
eindi
cat
ed i
nthe st
udyt
hatt
he r
etur
ns outof
di
ver
sif
icat
ionwer
eless.Thus,
theI
ndi
aMut
ual
fundswer
enotpr
oper
lydi
ver
sif
ied.
35
10.Gar
g(2011)exami
ned t
heper
for
manceoft
op t
en mut
ualf
undst
hatwas
sel
ect
edont
hebasi
sofpr
evi
ousy
ear
sret
urn.Thest
udyanal
yzedt
heper
for
mance
ont
hebasi
sofr
etur
n,st
andar
ddev
iat
ion,bet
aaswel
lasTr
eynor
,Jensenand
Shar
pei
ndexes.Thest
udyal
sousedCar
har
t’
sfour
-f
act
ormodelf
oranal
yzet
he
per
for
manceofmut
ualf
unds.Ther
esul
tsr
eveal
edt
hatRel
i
anceRegul
arSav
ing
SchemeFundhadachi
evedt
hehi
ghestf
inal
scor
e.

11.Pasal
kar
,N.
V.(
2015)acompar
ati
vest
udyofMut
ualFundI
nvest
mentv
s.Equi
ty
I
nvest
mentofI
ndi
anI
ndi
vi
dualI
nvest
orst
ocompar
emut
ualf
undi
nvest
mentwi
th
di
rectequi
tyi
nvest
ment
.Tost
udyt
hepr
efer
encesofi
ndi
vi
duali
nvest
orsi
nvest
ing
i
nmut
ualf
unds.Tost
udyt
hepr
esentpr
act
icesofmut
ualf
undi
nvest
ors.Sour
ce:
Pr
imar
y dat
a Secondar
y dat
a Sampl
e si
ze:100 Respondent
s met
hod:Si
mpl
e
r
andom sampl
i
ngEqui
tyi
nvest
menti
smor
efav
ored.Pr
opereducat
ioni
srequi
red
aboutmut
ual
funds.

12.Shukl
a,S.(
2015)Acompar
ati
veper
for
manceev
olut
ionofsel
ect
edmut
ual
funds
Tost
udyt
heper
for
manceofsel
ect
edmut
ualf
undsschemesunderdi
ff
erent5
cat
egor
iesToexami
net
her
etur
nfr
om t
heabov
esel
ect
edmut
ualf
undsSour
ce:
Secondar
ydat
aTool
s:St
andar
ddev
iat
ion,Bet
a,Al
pha,Rsquar
ed,Shar
per
ati
oAl
l
t
hef
undsar
ehav
ingposi
ti
vecor
rel
ati
onwi
thNi
ft
y.

13.Ramanuj
am,V,Bhuv
aneswar
i,A (
2015)Gr
owt
hand Per
for
manceofI
ndi
an
Mut
ualFund I
ndust
rydur
ing PastDecadeTo anal
ysesGr
owt
hofAssetUnder
Managementt
oanal
yzet
hegr
owt
hofAssetunderManagementI
nst
it
uti
onWi
se.To
exami
neSect
orwi
semut
ualf
undsal
esandmut
ualf
undr
edempt
ion.Toanal
yzet
he
Schemewi
ser
esour
cemobi
l
izat
ionbymut
ualf
undt
oexami
net
het
otalnumberof
SchemesandNumberoff
oli
osDescr
ipt
iver
esear
chSour
ce:Secondar
ydat
aPr
ivat
e
sect
orhasi
ncr
easedt
hei
rassetbasemani
fol
d.Theassetundermanagementhas
showngr
owt
hinal
lthesect
ors.
36
14.Mane,P.(
2016)ASt
udyofI
nvest
orsPer
cept
iont
owar
dsMut
ualFundsi
nthe
Ci
tyofAur
angabad t
o know i
nvest
orv
iew t
owar
ds Mut
ualf
und t
o know t
he
awar
enessofmut
ualf
undi
nAur
angabadpeopl
etoknowt
hepr
efer
enceofpeopl
e
f
ori
nvest
mentSour
ce:Pr
imar
ydat
aSampl
eSi
ze:30Tool
s:ChiSquar
eMostoft
he
peopl
ear
ehesi
tanti
ngoi
ngf
ornew agei
nvest
ment
sli
kemut
ualf
unds.Peopl
e
pr
eferl
essr
iskyi
nvest
ment
.

15.Das (
2008)i
dent
if
ied t
he pr
efer
ences ofi
nvest
orsl
ook f
ori
ninv
est
ment
pr
oduct
s.Theyhav
etakent
hesampl
esi
zeof100i
nvest
orsf
rom t
womet
rosof
Or
issast
ate.Theyhav
eusedChi
-Squar
e,Two-
wayAnov
a,Rankcor
rel
ati
on,
ttest
,Z-
t
estandKendal
l
’sConcor
dancet
estf
ort
heanal
ysi
sofdat
a.Ont
hebasi
sofAnov
a
t
hest
udyf
indt
hati
nvest
orshav
esi
gni
fi
cantdi
ff
erencesi
nthepat
ter
nofi
nvest
ment
wi
thr
espectt
othei
rageandt
her
ehasnodi
ff
erencei
nthei
nvest
mentpat
ter
non
t
hebasi
sofl
evelofeducat
ion.Theyconcl
udedt
hatmaj
ori
tyofi
nvest
orsl
i
ket
o
i
nvesti
ninsur
ancef
oll
owedbymut
ualf
unds.And68%i
nvest
orsl
i
ket
oinv
esti
nLI
C
ascompar
edt
oICI
CI.

16.RaoandPr
ashar(
2010)i
dent
if
iedt
hef
act
orsaf
fect
ingper
cept
ionofi
nvest
ors
t
owar
dsmut
ualf
unds.Theyhav
econduct
edt
hest
udyi
nthr
eest
atesnamel
y:
Raj
ast
han,Guj
aratandMadhy
aPr
adesh.Sampl
esi
zehast
aken400i
nvest
ors.The
dat
ahasbeenanal
yzedwi
tht
heFact
oranal
ysi
s.Theyhav
eext
ract
edt
hedi
ff
erent
f
act
orsf
rom di
ff
erentst
ates.Fr
om Madhy
aPr
adesht
hemosti
mpor
tantamong
t
hem ar
emonet
ary
,inv
est
orsexpect
ati
onf
oll
owedbybenef
it
sandi
nfr
ast
ruct
ure,
SchemesNAVf
oll
owedbypr
omot
ionalmeasur
esandmi
scel
l
aneous.Fr
om Guj
arat
t
hemosti
mpor
tantamong t
hem ar
emonet
aryand schemesNAV,r
etur
n,r
isk
f
oll
owed by i
mage and benef
it
s f
oll
owed by i
nvest
ment pr
efer
ence and
adv
ert
isement
.Fr
om Raj
ast
hant
hemosti
mpor
tantamongt
hem ar
epr
omot
ional
t
ool
s and benef
it
s,NAV and monet
ary
,Ri
sk and r
etur
nfol
l
owed byI
nvest
ors
pr
efer
enceandMi
scel
l
aneous.
37
17.Das(
2011)anal
yzedt
hei
nfl
uenceofdemogr
aphi
cfact
orsonmut
ualf
unds,
f
act
orsi
nfl
uenci
ngt
hemut
ualf
unds.Hehasal
soexami
nedt
hepr
obl
emsi
nmut
ual
f
unds and f
act
ors af
fect
ing i
nvest
ors’per
cept
ions.He has col
l
ect
ed t
he dat
a
t
hroughquest
ionnai
re,f
rom t
heper
iodJune-
Jul
y2011,f
rom 250smal
linv
est
orsof
Assam.He has appl
i
ed per
cent
age met
hod,cr
oss t
abul
ati
on and chi
-squar
e
met
hodf
oranal
ysi
s.Thest
udyf
oundt
hatmaj
ori
tyoft
her
espondent
sar
emal
es
andt
hemaxi
mum i
nvest
orsbel
ongedt
otheagebet
ween35-
45y
ear
s.Hef
urt
her
f
ound t
hatt
her
e has a si
gni
fi
cantr
elat
ionshi
p bet
ween genderand i
nvest
or
sat
isf
act
ion.Butt
her
e has no si
gni
fi
cantr
elat
ionshi
p bet
ween age,educat
ion,
amountofi
nvest
mentandi
ncomewi
tht
hatofsat
isf
act
ion.I
nvest
orsi
nvesti
n
mut
ualf
undsf
ort
axbenef
it
sfol
l
owedbyhi
ghr
etur
ns,saf
ety
,regul
ari
ncomesand
l
i
qui
dit
y.Hef
oundt
hemanager
slackexper
ience.
18.Gupt
a(2011)exami
nedt
hei
nvest
or’
sper
cept
ionr
egar
dingmut
ualf
undsand
f
ixeddeposi
tsandt
heyhav
eal
soev
aluat
edt
her
elat
ionbet
weenmut
ualf
undsand
occupat
ionoft
hei
nvest
ors.Sampl
esi
zeoft
hest
udyhast
aken100i
nvest
orsand
t
hedat
ahasbeenanal
yzedwi
thZt
estandChi
-squar
etest
.Thef
indi
ngsoft
he
st
udyr
eveal
edt
hat88% ofi
nvest
orsar
ewi
l
li
ngt
oinv
esti
nmut
ualf
unds.Zt
est
showedt
hatmut
ualf
undsar
enotmor
esi
gni
fi
cantt
hanf
ixeddeposi
tsandt
he
i
nvest
mentdonei
nnearf
utur
einmut
ual
fundi
snotst
ati
sti
cal
l
ysi
gni
fi
cant
.

19.Sai
ni,
Anj
um andSai
ni(
2011)ev
aluat
edt
hei
nvest
or’
sawar
enessandper
cept
ion
r
egar
dingmut
ualf
undsi
nIndi
aandt
oknow t
hegr
owt
handmaj
ordef
ici
enci
esi
n
t
hewor
kingofmut
ualf
undsi
nIndi
a.Theyhav
etakent
hesampl
eof200i
nvest
ors
byusi
ngst
rat
if
iedsampl
i
ng.Theyhav
eanal
yzedt
hedat
athr
oughChi
-Squar
etest
.
Themaj
orf
indi
ngsoft
hest
udyr
eveal
edt
hati
nvest
orsi
nvest
edi
nthemut
ualf
unds
f
ort
axbenef
it
sfol
l
owedbyhi
ghr
etur
nandsaf
ety
.Agehassi
gni
fi
cantr
elat
ionwi
th
t
hef
act
orst
hatcanwi
nbackt
hei
nvest
ors’conf
idence.Theyf
oundt
hati
nvest
ors
chooseaschemef
ori
nvest
mentont
hebasi
sofpastper
for
mance,st
abi
l
ityof
r
etur
nsandpastdi
vi
dends.
38
20.Shar
ma (
2012)anal
yzed t
hei
nvest
or’
sper
spect
ivest
owar
dsi
nvest
menti
n
mut
ualf
unds.Shehasal
soexami
nedt
hef
act
orst
hatmayaf
fectt
hesel
ect
ionof
mut
ualf
undsschemes.Shehasconduct
edasur
veyon250i
nvest
ors.Shehas
anal
yzedt
hedat
athr
oughmean,SD,cor
rel
ati
onandf
act
oranal
ysi
s.Thest
udyhas
f
oundt
hebenef
it
swhi
chemer
geoutf
rom i
nvest
mentandi
thasgr
oupedi
ntot
hree
cat
egor
iesont
hebasi
soff
act
oranal
ysi
s.Thef
ir
stcat
egor
yhasr
elat
edt
ofund
r
elat
edat
tri
but
es.Secondhasr
elat
edt
omonet
arybenef
it
spr
ovi
dedbyt
hef
unds
andt
hel
astcat
egor
yhasr
elat
edt
osponsorr
elat
edat
tri
but
es.

21.Si
ngh(
2012)conduct
edast
udyt
oanal
yzet
hei
mpactofv
ari
ousdemogr
aphi
c
f
act
orsoni
nvest
or’
sat
ti
tudet
owar
dsmut
ual
fundsandt
ofi
ndoutt
hef
act
orswhi
ch
l
eadsf
orsel
ect
ionofmut
ualf
undsbyusi
ngChiSquar
etest
.Hehasconduct
edt
his
st
udyon250i
nvest
ors.Hehasf
oundt
hatt
her
eisnoassoci
ati
onbet
weenage,
occupat
ionandat
ti
tudet
owar
dsmut
ualf
unds.Butt
her
eisanassoci
ati
onbet
ween
sex,
income,
educat
ionalqual
i
ficat
ionsandat
ti
tudet
owar
dsmut
ualf
unds.Asf
aras
t
hebenef
it
soft
hemut
ualf
undsar
econcer
ned,r
etur
npot
ent
ialandl
i
qui
dit
yhav
e
been per
cei
ved t
o be most at
tract
ive by i
nvest
ors,f
oll
owed by f
lex
ibi
l
ity
,
t
ranspar
encyandaf
for
dabi
l
ity
.

22.Vy
as(
2012)ev
aluat
edt
hef
ormsofi
nvest
ment
,modeofi
nvest
mentpr
efer
redby
i
nvest
ors.Hehasal
soexami
nedt
hei
nvest
or’
sknowl
edgeofr
iskandpr
efer
ence
ov
erswi
tchi
ngoff
undsbyusi
ngChi
-Squar
etest
,Pear
son’
scor
rel
ati
on,meanand
medi
an.Hehast
aken363i
nvest
orsf
ort
heanal
ysi
soft
hedat
a.Hef
oundt
hat
i
nvest
orspr
efer
redi
nvest
menti
ngol
dfol
l
owedbybankdeposi
ts,Li
fei
nsur
ance
schemesandpostof
fi
ceschemes.I
nvest
orspr
efer
redl
umpsum i
nvest
mentas
compar
etot
hatofSI
P.Ther
ehasasi
gni
fi
cantr
elat
ionshi
pbet
weenoccupat
ionof
i
nvest
orsandmodeofi
nvest
ment
.Maj
ori
tyoft
hei
nvest
orshav
etheknowl
edgeof
r
iskf
act
orsi
nmut
ualf
unds.I
nvest
orsswi
tchedt
hei
nvest
mentonl
yfort
hesakeof
pr
ofi
tabi
l
ityand i
nvest
ors pr
efer
red exi
sti
ng schemes f
ori
nvest
mentand t
hey
39
pr
efer
redt
oinv
esti
nequi
tyschemes.

23.Pal
ani
vel
u and Chandr
akumar(
2013)i
dent
if
ied t
he pr
efer
red i
nvest
ment
av
enuesamong t
hesal
ari
ed peopl
eofNamakkalTal
uk.Theyhav
etaken 100
sal
ari
edpeopl
eforsur
vey
.Thest
udyhasf
oundt
hatsal
ari
edcl
assi
ntheabov
e
st
atedr
egi
onwasnotawar
eaboutt
heequi
ty,bond,st
ockmar
ketanddebent
ures.
Al
ltheagegr
oup peopl
epr
efer
red i
nsur
ancef
oll
owed bybankdeposi
ts.They
suggest
edt
hatt
her
eisast
rongneedt
ocr
eat
etheawar
enessamongt
hepeopl
eof
t
hatr
egi
onr
egar
dingv
ari
ousi
nvest
mentav
enues.

24.Shar
pe,Wi
l
li
am F.(
1966)suggest
edameasur
efort
heev
aluat
ionofpor
tfol
i
o
per
for
mance.Dr
awi
ng on r
esul
ts obt
ained i
nthe f
iel
d ofpor
tfol
i
o anal
ysi
s,
economi
stJack L.Tr
eynorhas suggest
ed a new pr
edi
ctorofmut
ualf
und
per
for
mance,one t
hat di
ff
ersf
rom v
irt
ual
l
y al
lthose used pr
evi
ousl
y by
i
ncor
por
ati
ngt
hev
olat
il
it
yofaf
und'
sret
urni
nasi
mpl
eyetmeani
ngf
ulmanner
.

25.Accor
dingt
oKPMGr
epor
t,TheMut
ual
fundi
ndust
ryneedst
ohav
ean‘
out
side-
in’
per
spect
iveascompar
edt
o‘i
nsi
de-
out
’per
spect
ive.Under
standi
ngi
nvest
ors’
needs
shoul
dbef
oll
owedbyapr
oductchannelal
i
gnment
.Anumberofchangecat
aly
sts
di
scussed i
nthe pr
evi
ous sect
ion l
i
ke t
echnol
ogy
,inv
est
menti
n B-
15 ci
ti
es,
i
nvest
mentadv
iseret
c.woul
dber
equi
redt
ohel
pensur
etheov
eral
lobj
ect
iveof
pr
udent gr
owt
h and pr
ofi
tabi
l
ity
.Inv
est
or awar
eness campai
gns shoul
d be
conduct
edt
oincr
easet
heAUM i
nsmal
l
erci
ti
eswhi
chwoul
dhel
pindust
ryt
o
pr
ogr
essi
nahol
i
sti
cmanner
.
AMC,
dist
ri
but
orsandI
FAsar
eal
ldoi
ngt
hei
rbi
tbutAMFIandSEBIshoul
dal
sopl
ay
amaj
orr
olei
ncr
eat
ingawar
eness.Forf
utur
egr
owt
h,t
axcoul
dactasanenabl
eras
t
axbenef
it
scanbeapul
lfact
orf
ori
nvest
ors.Thef
utur
epot
ent
ialofI
nvest
ment
Adv
isor
scoul
dbedeci
dedbyI
nvest
orsandt
her
egul
ator
s.Pr
esenceofanunbi
ased
adv
isorcoul
dbui
l
dinv
est
ort
rustont
heonehandandr
ewar
dper
for
mingpr
oduct
s
ont
heot
her
.
40
26.Accor
dingt
oCI
IMut
ualf
undsummi
t2013,t
heout
lookoft
hemut
ualf
und
i
ndust
ryi
sgov
ernedt
oagr
eatext
entbyt
heeconomi
csi
tuat
ioni
nthecount
ry.The
cur
renteconomi
cscenar
iowi
thst
ickyi
nfl
ati
onandr
isi
ngf
uelpr
icesi
sli
kel
yto
adv
ersel
yimpactper
cept
ions,
resul
ti
ngi
ndepr
essedequi
tyi
nfl
owsi
ntot
hemar
ket
.
Theybel
i
evet
hatt
hemut
ualf
undi
ndust
rymani
fest
shugeoppor
tuni
tyf
orgr
owt
h
andf
urt
herpenet
rat
ion,andt
hiscanbeachi
evedov
ert
ime,wi
thsuppor
tfr
om
t
echnol
ogy
.Thekeyl
i
esi
nst
rengt
heni
ngdi
str
ibut
ionnet
wor
ksandenhanci
ngl
evel
s
ofi
nvest
oreducat
iont
oincr
easepr
esencei
nrur
alar
eas.I
nter
msofoppor
tuni
ty,
t
hei
nfr
ast
ruct
uredebtmar
kethasbecomev
eryat
tract
ive,l
uri
ngi
nvest
orst
oinv
est
i
nthi
sspace.

27.Mi
chaelC.Jensen (
1967)der
ived a r
isk-
adj
ust
ed measur
e ofpor
tfol
i
o
per
for
mance)(
Jensen’
sal
phat
hatest
imat
eshow muchamanager
’sf
orecast
ing
abi
l
itycont
ri
but
est
ofund’
sret
urns.Asi
ndi
cat
edbySt
atman(
2000)
,theeSDARofa
f
undpor
tfol
i
oist
heexcessr
etur
noft
hepor
tfol
i
oov
ert
her
etur
noft
hebenchmar
k
i
ndex,wher
ethepor
tfol
i
oisl
ever
agedt
ohav
ethebenchmar
kindex’
sst
andar
d
dev
iat
ion

28.Zakr
iY.Bel
l
o(2005)mat
chedasampl
eofsoci
all
yresponsi
blest
ockmut
ual
f
undsmat
chedt
orandoml
ysel
ect
edconv
ent
ionalf
undsofsi
mil
arnetasset
sto
i
nvest
igat
e di
ff
erences i
nchar
act
eri
sti
cs of asset
s hel
d,degr
ee of por
tfol
i
o
di
ver
sif
icat
ionandv
ari
abl
eef
fect
sofdi
ver
sif
icat
iononi
nvest
mentper
for
mance.
Thest
udyf
ound t
hatsoci
all
yresponsi
blef
undsdonotdi
ff
ersi
gni
fi
cant
lyf
rom
conv
ent
ionalf
undsi
nter
msofanyoft
heseat
tri
but
es.Mor
eov
er,t
heef
fectof
di
ver
sif
icat
iononi
nvest
mentper
for
mancei
snotdi
ff
erentbet
weent
het
wogr
oups.
Bot
hgr
oupsunder
per
for
medt
heDomi
ni400Soci
alI
ndexandS&P500dur
ingt
he
st
udyper
iod.

29.Accor
dingt
o Deept
iGoelDept
.ofEconomi
cs,Assi
stantPr
ofessor
,PGDAV
41
Col
l
ege,
D.U.
,Indi
aandRi
chaGupt
aDept
.ofCommer
ceAssi
stantPr
ofessorPGDAV
Col
l
ege,
D.U.
,Indi
afound t
hatt
hel
andscapeoft
hef
inanci
alsect
ori
nIndi
ais
cont
inuousl
yev
olv
ing,accr
edi
tedt
oregul
ator
ychangesbei
ngunder
taken,whi
chi
s
l
eadi
ng mar
ketpar
ti
cipantl
i
ke t
heassetmanagementcompani
es(
AMCs)and
di
str
ibut
orst
orest
ruct
uret
hei
rst
rat
egi
esandadoptbusi
nessmodel
swhi
chwi
l
l
y
iel
dsust
ainabl
ebenef
it
s.Someoft
heot
hert
rendswhi
chhav
eemer
gedst
rongl
y
ov
ert
hepasty
earar
eheav
yout
fl
owst
ri
gger
edbymar
ketv
olat
il
it
yandpar
tner
ingof
assetmanagementcompani
eswi
thbanks,t
oincr
easet
hest
rengt
hofdi
str
ibut
ion
net
wor
ks.

30.Dr
.B.
S.NAVI(
FEB2015)
ASPeranal
ysi
smut
ualf
undar
ethebestopt
ionf
ort
hei
nvest
or.I
nvest
orshav
ethe
per
cept
iont
hatr
iski
nequi
tyi
shi
ghert
hanmut
ualf
und.I
nthusst
udyt
heyt
aken90
sampl
e outofwhi
ch 50% r
espondent
s ar
ethe y
out
hs.And mostt
hem ar
e
busi
nessmanand63% t
hem i
nvest
edi
nmut
ualf
und.Tocr
eat
etheawar
enessby
anal
ysi
ng despondenti
ntend t
oinv
esti
n mut
ualf
und l
ong t
erm basi
sand by
anal
ysi
ngr
espondenti
ntendmut
ualf
undi
sgi
vebet
terr
etur
nbecauseoft
hisr
eason
peopl
einv
esti
nmut
ual
fund.

31.MR.
AKASHJEEVAN(
2014)
Aspert
heanal
ysi
sforast
artupi
nvest
ormut
ualf
undi
nvest
mentmet
hodi
smor
e
f
avour
abl
eand af
for
dabl
e,asr
iski
slow compar
ed t
o di
recti
nvest
ing.Foran
i
nvest
orwi
thl
essormoney
,he/
sheshoul
dgof
ormut
ualf
undi
nvest
ingasNAVi
s
l
owert
hant
hepr
iceofst
ock.Mut
ualf
undi
nvest
ingi
ster
medasl
ongt
erm hor
izon
ofget
ti
ngagoodr
etur
n,ast
hei
sgoi
ngi
nasy
stemat
icway
.Ifi
nvest
orl
i
kei
nbuy
ing
andsel
l
ingst
ock,
managi
ngt
hest
ocki
nhi
spor
tfol
i
oshoul
dchoosedi
recti
nvest
ing
i
nequi
tyst
ock.
asIseen10equi
tyand10mut
ualf
und,
andt
hei
rper
for
mancef
or10
f
inanci
aly
earper
iod.Mostofequi
tyshar
ehadgi
venunexpect
edr
etur
n.

32.RAGHAVENDRAYADAV(
2012)
42
Asperanal
ysi
sint
hist
opi
ccompar
ati
vest
udyi
smadebycompar
ingt
hedi
ff
erent
i
nvest
ment schemes i
ncl
udi
ng mut
ualf
und,equi
ty and r
elat
ivei
ndex.The
compar
isonal
soconcl
udedt
hatmut
ualf
undshowbet
tery
iel
dcompar
etoequi
ti
es.
Ev
ent
houghmut
ualf
undshowsi
nshor
tter
m negat
iver
etur
nsbuti
t’
sbet
tert
o
i
nvesti
nmut
ualf
und.Theyanal
ysi
sthei
sitmut
ualf
undi
sinv
est
orsbestchoi
ceor
equi
ti
esi
sbestchoi
cebyt
aki
ngt
hedat
aofFMGCandPHARMAsect
ors.

33.Sapar&Nar
ayan(
2003)
Exami
nest
heper
for
manceofI
ndi
anmut
ualf
undsi
nabearmar
kett
hroughr
elat
ive
per
for
mancei
ndex,
risk-
ret
urnanal
ysi
s,Tr
eyor
'sr
ati
o,Shar
p'sr
ati
o,Shar
p'smeasur
e
wi
thasampl
eof269openendedschemes(
outoft
otal
schemesof433)
.

34.RaoD.N(
2006)
St
udi
edt
hef
inanci
alper
for
manceofsel
ectopen-
endedequi
tymut
ual
fundschemes
f
ort
heper
iod1stApr
il2005-31stMar
ch2006per
tai
ningt
othet
wodomi
nant
i
nvest
mentst
ylesandt
est
edt
hehy
pot
hesi
swhet
hert
hedi
ff
erencesi
nper
for
mance
ar
est
ati
sti
cal
l
ysi
gni
fi
cant
.Theanal
ysi
sindi
cat
edt
hatgr
owt
hpl
anshav
egener
ated
hi
gherr
etur
nst
hant
hatofdi
vi
dendpl
ansbutatahi
gherr
iskst
udi
edcl
assi
fi
edt
he
419open-
endedequi
tymut
ual
fundschemesi
ntosi
xdi
sti
ncti
nvest
mentst
yles.
Agr
awal
Deepak&Pat
idar

35.Deepak(
2009)st
udi
edt
heempi
ri
cal
l
ytest
ingont
hebasi
soff
undmanager
per
for
manceandanal
yzi
ngdat
aatt
hef
und-
managerandf
und-
inv
est
orl
evel
s.The
obj
ect
iveoft
hest
udyi
stopr
ovi
deanov
erv
iewofmut
ualf
undact
ivi
tyi
nemer
ging
mar
ket
s,t
odescr
ibet
hei
rsi
ze,assetal
l
ocat
ion,t
oanal
yzet
heI
ndi
anMut
ualFund
I
ndust
rypr
ici
ngmechani
sm wi
thempi
ri
calst
udi
esoni
tsv
aluat
ion,t
oanal
yzedat
a
atbot
hthef
und-
managerand f
und-
inv
est
orl
evel
s.Thest
udyr
evel
ed t
hatt
he
per
for
mancei
saf
fect
edsav
ingandi
nvest
menthabi
tsoft
hepeopl
eatt
hesecond
si
det
heconf
idenceand l
oyal
tyoft
hef
und Managerand r
ewar
dsaf
fect
sthe
43
per
for
manceoft
heMFi
ndust
ryi
nIndi
a.

36.Meht
aSushi
l
kumar(
2010)
Anal
yzet
heper
for
manceofmut
ualf
undschemesofSBIandUTIandf
oundoutt
hat
SBIschemeshav
eper
for
medbet
tert
hent
heUTIi
nthey
ear2007-
2008st
udi
edt
he
r
iskandr
etur
nrel
ati
onshi
pofI
ndi
anmut
ualf
undschemes.Thest
udyf
oundoutt
hat
outoft
hir
tyf
ivesampl
eschemes,el
evenshowedsi
gni
fi
cantt
–val
uesandal
lot
her
t
went
yfoursampl
eschemesdi
dnotpr
ovesi
gni
fi
cantr
elat
ionshi
pbet
weent
her
isk
andr
etur
n.Accor
dingt
ot-
alphav
alues,
maj
ori
ty(
thi
rt
ytwo)oft
hesampl
eschemes'
r
etur
nswer
enotsi
gni
fi
cant
lydi
ff
erentf
rom t
hei
rmar
ketr
etur
nsand v
eryf
ew
numberofsampl
eschemes'r
etur
nswer
esi
gni
fi
cant
lydi
ff
erentf
rom t
hei
rmar
ket
r
etur
nsdur
ingt
hest
udyper
iod.
37.Mr
.Vi
j
ayAnand(
2000)
Mr
.Vi
j
ayAnandi
nIFMR,Chennai(
June2000)
.Thest
udyf
ocusedont
ounder
stand
t
heposi
ti
onoft
heschemesofbi
rl
asunl
i
feandt
hecompet
it
orsschemesav
ail
abl
e
i
nthemar
ket
.Thest
udydi
dAnal
ysi
sofPer
for
manceofEqui
tyf
undf
or3y
ear
sand
SWOT Anal
ysi
sofBi
rl
aSunl
i
febyLi
ter
atur
esur
vey
,Del
phit
echni
que,i
ndept
h
f
inanci
alr
evi
ew t
oident
if
yamong t
hesel
ect
ed equi
tyf
undst
hatear
nshi
gher
r
etur
nst
hanbenchmar
kandcompet
it
orsandconcl
udedt
hatBi
rl
aSunl
i
feper
for
ms
wel
lcompar
edt
othebenchmar
ksandcompet
it
ors.

38.R.
Nit
hya(
2004)
R.
Nit
hyai
ntheI
FMRChennai(
2004)
.Theobj
ect
iveoft
hest
udyi
stoanal
yset
he
per
for
manceofal
ltheschemesav
ail
abl
eint
heFr
ankl
i
nTempl
etonMut
ualf
unds
andEmphasi
zet
hev
aluesofmut
ualf
undst
othet
argetpeopl
ebyi
dent
if
yingAsset
ManagementCompanyt
hati
sper
for
mingwel
landi
dent
if
yingt
het
opschemesi
n
t
hecat
egor
ysuchasequi
ty,bal
anced,Mont
hlyI
ncomePl
an(
MIP)&I
ncomei
nthe
AMC.TheAMCchosenwasFr
ankl
i
nTempl
etonMut
ualf
undsandi
tper
for
medwel
l
andmett
heexpect
ati
ons.

44
39.
Prasat
h.R.
H(2009)
Thest
udyi
str
yingt
oemphasi
zet
hecor
eval
uesofmut
ual
fundi
nvest
ment
,benef
it
s
ofmut
ualf
unds,t
ypesofmut
ualf
unds,et
c.,Thest
udyi
sgoi
ngt
oconduct
edby
t
aki
ngt
heNAVv
aluesofdi
ff
erentt
ypesofHDFCmut
ualf
undpr
oduct
s.Thest
udy
concl
udes t
hatbef
ore choosi
ng t
he mut
ualf
und scheme,t
he i
nvest
orshoul
d
under
gof
actsheett
hor
oughl
yandhehast
ochooset
hebestonebycal
cul
ati
ng
NAVcal
cul
ati
on.I
fthei
nvest
orf
indsdi
ff
icul
tyofget
ti
ngRp,Rf
,St
andar
ddev
iat
ion,
and Bet
a par
amet
ers,NAV cal
cul
ati
onsar
ethebestal
ter
nat
ivet
o assesst
he
per
for
mance.

40.DrSNar
ayanRao(
2002)
TheSt
udyi
sconduct
edt
ounder
standwhet
hermostoft
hemut
ualf
undschemes
wer
eabl
etosat
isf
yinv
est
or’
sexpect
ati
onsbygi
vi
ngexcessr
etur
nsov
erexpect
ed
r
etur
ns.Theobj
ect
iveoft
hisst
udywast
oev
aluat
etheper
for
manceofI
ndi
an
Mut
ualFundSchemesdur
ingbearmar
kett
hroughr
elat
iveper
for
mancei
ndex(
RPI
),
r
isk-r
etur
nanal
ysi
s.Ther
esear
chst
udyconcl
udedt
hatoutof269schemes,49
wer
eunderper
for
mer
s,102wer
eparper
for
mer
sand118wer
eoutper
for
mer
sof
t
hemar
ketandMedi
um Ter
m DebtFundswer
ethebest.
Itwasal
soconcl
udedt
hat
58of269openendedmut
ualf
undshav
epr
ovi
dedbet
terr
etur
nst
hant
hemar
ket
dur
ingt
hebearper
iodofSept
ember98-
Apr
il2002.Someoft
hef
undspr
ovi
ded
excessr
etur
nsov
erexpect
edr
etur
nsbasedonbot
hpr
emi
um f
orsy
stemat
icr
isk
andt
otal
risk.

41.Shar
adPanwarandDr
.R.Madhumat
hi(
2005)
Theobj
ect
iveoft
hest
udyi
stoi
dent
if
ydi
ff
erencesi
nchar
act
eri
sti
csofpubl
i
c-
sect
orsponsor
ed&pr
ivat
e-sect
orsponsor
edmut
ualf
undsandt
ofi
ndt
heext
entof
di
ver
sif
icat
ioni
nthepor
tfol
i
oofsecur
it
iesofpubl
i
c-sect
orsponsor
edandpr
ivat
e-
sect
orsponsor
edmut
ualf
undsandt
ocompar
etheper
for
manceofpubl
i
c-sect
or
45
sponsor
edandpr
ivat
e-sect
orsponsor
edmut
ualf
undsusi
ngt
radi
ti
onali
nvest
ment
measur
es.Thest
udyf
oundt
hatpubl
i
c-sect
orsponsor
ed,pr
ivat
e-sect
orI
ndi
an
sponsor
ed and pr
ivat
e-sect
orf
orei
gn sponsor
ed mut
ualf
unds do notdi
ff
er
st
ati
sti
cal
l
yint
ermsofpor
tfol
i
ochar
act
eri
sti
cssuchasnetasset
s,commonst
ock%,
mar
ketcapi
tal
i
zat
ion,hol
dings,TopTen%.Por
tfol
i
ori
skchar
act
eri
sti
csmeasur
ed
t
hroughpr
ivat
e-sect
orI
ndi
ansponsor
edmut
ualf
undsseemst
ohav
eout
per
for
med
bot
hPubl
i
c-sect
orsponsor
edandPr
ivat
e-sect
orf
orei
gnsponsor
edmut
ual
funds.
Jaspal
SinghandSubhashChander(
2006)

Ther
esul
tsshowt
hatt
hei
nvest
orsconsi
dergol
dtobet
hemostpr
efer
redf
orm of
i
nvest
ment
,fol
l
owedbyNSCandPostOf
fi
ceschemes.Hence,t
hebasi
cpsy
cheof
anI
ndi
ani
nvest
or,whost
il
lpr
efer
stokeephi
ssav
ingsi
nthef
orm ofy
ell
owmet
al,
i
sindi
cat
ed.I
nvest
orsbel
ongi
ngt
othesal
ari
edcat
egor
y,andi
ntheagegr
oupof20-
35,
year
sshowedi
ncl
i
nat
iont
owar
dscl
ose-
endedgr
owt
h(equi
ty-
ori
ent
ed)schemes
ov
ert
heot
herschemet
ype.

42.Dr
.S.Anand&Dr
.VMur
ugai
ah(
2003)
Thepur
poseoft
hisst
udyi
stoappl
ythemeasur
ementt
ool
sofmoder
npor
tfol
i
o
t
heor
ytot
heper
for
manceofmut
ualf
unds.Thest
udyai
mst
oexami
net
hedegr
ee
ofcor
rel
ati
ont
hatexi
stsbet
weenf
undandmar
ketr
etur
n,t
ounder
standt
hei
mpact
off
undspeci
fi
cchar
act
eri
sti
csonper
for
mance,
toev
aluat
ethedi
ver
sif
icat
ionand
sel
ect
ivi
tyski
l
lsoff
undmanager
s.Thest
udyconcl
udedont
hebasi
sofov
eral
l
anal
ysi
sincanbei
nfer
redher
ethatt
headdi
ti
onalr
etur
nonsampl
edschemesand
t
hemar
ketov
err
iskf
reer
etur
nwassi
gni
fi
cant
lyl
ow dur
ingt
hest
udyper
iod.The
st
udycov
erst
heper
iodbet
weenApr
il1999andMar
ch2003Thi
sindi
cat
est
hatt
he
maj
ori
tyofschemeswer
eshowedunder
per
for
mancei
ncompar
isonwi
thr
iskf
ree
r
etur
n.
Soumy
aGuhaDeb,
Prof
.AshokBaner
jee,
Prof
.BBChakr
abar
tii
nII
M,Cal
cut
ta(
2005)

Ther
esear
ch“
Per
for
manceofI
ndi
anEqui
tyMut
ualFunds,
Thei
rSt
yleBenchmar
ks–
46
anEmpi
ri
calExpl
orat
ion”i
sdoneby
.Indi
anequi
tymut
ualf
undsandt
oper
for
ma
r
etur
nbasedst
yleanal
ysi
sofequi
tymut
ualf
undsi
nIndi
aandanal
yzedt
hei
rrel
ati
ve
per
for
mancewi
thr
espectt
ost
ylebenchmar
ks.Theanal
ysi
sshowst
hatI
ndi
an
equi
tymut
ualf
undmanager
shav
enotbeenabl
etobeatt
hei
rst
ylebenchmar
kson
t
heav
erage.I
tal
soshowst
hatal
thoughal
lthef
undsi
noursampl
ear
eequi
tyf
unds,
t
hef
ixedi
ncomeassetcl
asseshav
ecomeouti
mpor
tantcomponent
soft
hei
rst
yle
exposur
es,maybeduet
o„st
icky
‟ret
urnsoft
hei
rcomponentsecur
it
ies.Themost
i
mpor
tantcomponentoft
hei
rst
yleexposur
esar
ethemi
dcapst
ocks.Thi
smay
i
ndi
cat
eact
ual
inv
est
menti
nthosest
ocks,
ori
nsomeot
herst
ockst
hatbehav
edl
i
ke
t
hemi
dcapi
ndex.
Mohi
tGupt
aandNav
deepAgar
wal
(2009)
Ther
eisv
eryl
i
ttl
eresear
chont
heconst
ruct
ionofmut
ual
fundpor
tfol
i
o.Thepr
esent
st
udyseekst
ofi
l
lthi
sgap.Theobj
ect
iveoft
her
esear
chi
stoconst
ructt
hepor
tfol
i
o
usi
ngusest
hecl
ust
ermet
hod,t
aki
ngi
ndust
ryconcent
rat
ionasav
ari
abl
eandt
o
compar
etheper
for
manceoft
wot
ypesofpor
tfol
i
oswi
thsel
ect
edbenchmar
ks,
sel
ect
edaccor
dingt
othepr
eval
entmodesofmut
ualf
undpur
chaseResul
tsar
e
f
oundt
obeencour
agi
ng,asf
arasr
iskmi
ti
gat
ioni
sconcer
ned.Thi
sst
udyal
so
expect
edt
ohel
pint
heconst
ruct
ionoff
unds.

43.Dr
.Shant
anuMeht
a,Char
miShah(
2012)
,thest
udyi
stoknowt
hepr
efer
enceof
i
nvest
ors and t
hei
r needs t
owar
ds mut
ualf
unds i
nvest
ment
,based upon
conv
eni
ence sampl
i
ng.I
nvest
ors most
ly pr
eferequi
ty schemes whi
l
e maki
ng
i
nvest
menti
ntomut
ualf
unds.Amongstequi
tyschemesal
soequi
tyt
axsav
ings
(
ELSS)
,Equi
tydi
ver
sif
iedschemeandEqui
tysect
oralschemesar
emost
lypr
efer
red
byt
hei
nvest
.
Abhi
j
eetBi
rar
i&UmeshPat
il(
2014)st
udi
edt
hespendi
ngandsav
ingshabi
tofy
out
h
i
ntheci
tyofAur
angabad.Thest
udyf
indst
hatsi
gni
fi
cantdi
ff
erenceexi
stsi
nthe
spendi
nghabi
tsofst
udent
sbel
ongi
ngt
odi
ff
erenteducat
ionl
evel
s.Thest
udyf
inds
t
hatmostoft
hey
out
hint
hesampl
espendal
argepor
ti
onoft
hemoneyon
consumabl
egoodsandt
hatduet
olackofawar
eness,t
heamountofmoneysav
ed
47
ori
nvest
edi
sver
yli
tt
le.

44.Gi
naChowa,
MatDespar
d&I
saacOsei
-Akot
o(2012)i
nthei
rpaper‘
Yout
hsav
ing
pat
ter
ns and per
for
mance i
n Ghana’at
tempt
ed t
ofi
nd whet
hert
he y
out
h wi
l
l
par
ti
cipat
einsav
ingsv
iaf
ormal
financi
alser
vicesi
fgi
vent
heoppor
tuni
ty.Thest
udy
f
oundt
hatmosty
out
hint
hesampl
e,setasi
demoneyr
egul
arl
y,hol
dont
othei
rset
asi
demoneyf
orshor
tper
iodsoft
imeandusei
tmost
lyf
orshor
t-
ter
m consumpt
ive
pur
poses.Thest
udyconcl
udedt
hat
,yout
hofadev
elopi
ngcount
ryhav
eahi
gh
pr
opensi
tyt
osav
ebut
,lackofpr
operknowl
edgeandi
nfor
mat
ionr
est
ri
ctedt
he
y
out
hfr
om v
ent
uri
ngouti
ntot
hear
eaf
ormal
sav
ingsandi
nvest
ment
s.

45.Pat
el&Pat
el(
2012)st
udi
edt
hei
nvest
mentper
spect
iveofsal
ari
edpeopl
e.The
paperai
medatst
udy
ingt
hebehav
iour
alpat
ter
n&di
ff
erencei
nper
cept
ionofan
i
ndi
vi
dualr
elat
edt
ovar
iousi
nvest
mental
ter
nat
ives.Thest
udyf
indst
hatt
hey
out
h
t
hatwassur
vey
edpr
efer
redi
nvest
ment
sov
ersav
ings.Thest
udyal
sodi
scov
ers
t
hat
,rat
hert
hansaf
eandsecur
einv
est
ment
s,t
hey
out
hpr
eferi
nvest
ment
sthatar
e
hi
ghr
iskbutal
soy
iel
dhi
ghr
etur
ns.

48
 CHAPTER3:RESEARCHANDMETHODOLOGY

Ther
esear
chmet
hodol
ogyi
sspeci
fi
cat
ionofmet
hodofacqui
ri
ngt
hei
nfor
mat
ion
neededt
ost
ruct
ureorsol
vet
hepr
obl
em.I
tisnotconsi
der
edt
obet
hedeci
sionof
f
act
sbutal
sobui
l
dingupt
hedat
aknowl
edgeandt
odi
scov
ert
henewf
act
sinv
olv
ed
t
hrought
hepr
ocessi
nthedy
nami
cchangei
nthesoci
ety
.

3.
1OBJECTI
VESOFTHESTUDY

 Tost
udyt
hepr
efer
encesofy
out
hregar
dingi
nvest
menti
nmut
ualf
undsand
shar
emar
ket
.
 Toanal
ysi
sfact
orsaf
fect
iondesi
gni
ngmaki
ngofy
out
hinv
est
ors.
 Tof
indoutwhet
herf
inanci
alknowl
edgeabl
epeopl
ear
emor
eli
kel
ytost
ock
mar
keti
npar
ti
cul
ar.

3.
2SCOPEOFTHESTUDY

Thescopeoft
hest
udyi
stogett
hef
ir
st-
handknowl
edgeabouty
out
hpr
efer
ences
r
egar
dingi
nvest
menti
nmut
ualf
undorshar
emar
ketorbot
h.Thest
udycov
erst
he
conceptanddet
ail
sofmut
ual
fundandshar
emar
keti
nvest
mentofy
out
h.

3.
3DATACOLLECTI
ON

PRI
MARYDATA:

Thepr
esentst
udyi
ncor
por
atest
hecol
l
ect
ionofbot
hpr
imar
yandsecondar
ydat
a
f
orani
ndept
hinv
est
igat
ion.Pr
imar
ydat
ahasbeengat
her
edt
hroughst
ruct
ured
unbi
ased quest
ionnai
re.The quest
ionnai
re was pr
e-t
est
ed on some of t
he
r
espondent
sandmi
normodi
fi
cat
ionswer
emadeont
hebasi
sofpr
e-t
est
ing.

49
SECONDARYDATA:

Secondar
ydat
awasgener
atedt
hrough,t
hei
nfor
mat
ionr
ecei
vedf
rom t
hej
our
nal
s
andonl
i
nesour
ces.

3.
4SAMPLESI
ZE:

I
nthi
ssur
veyIhav
esur
vey
ed100r
espondent
s.

3.
5SELECTI
ONOFTHEPROBLEM

Asiwantt
oknow abouti
nwhi
cht
ypeofi
nvest
menty
out
hinv
est
ingt
hei
rmoney
andal
sogett
oknow aboutwhi
chf
act
ory
out
hspr
efermostwhi
l
einv
est
ingt
hei
r
money
.

3.
6LI
MITATI
ONSOFTHESTUDY

Thi
sst
udyf
ocusesonv
erysmal
lsubsetoft
hey
out
hinI
ndi
aandi
sli
mit
edt
othe
ci
ty
ofMumbai
.

►Ther
egi
oni
sver
yvastandi
twasnotpossi
blet
ocov
ereachandev
eryuni
tint
he
sampl
eint
heav
ail
abl
eshor
tspanoft
ime.

►Thesampl
esi
zei
squi
tesmal
landmaynotbet
ruepoi
nteroft
heent
ir
euni
ver
se.
Thei
nfor
mat
ionpr
ovi
dedbyr
espondent
smaynotbef
ull
yaccur
ateduet
o
unav
oidabl
ebi
ases.

►Thesampl
esi
zeoft
hest
udy(
i.
e.Noofquest
ionsaskedt
oyout
h)i
sli
mit
ed.

50
 CHAPTER4:DATAANALYSI
SANDI
NTERPRETI
ON

PRI
MERYDATA

1.GENDER:

MALE FEMALE
GENDER

%OFRESPONSE 65% 35%

I
NTERPRETATI
ON:

1. Theabov
epi
edi
agr
am showst
hegenderwhoar
einv
est
ingt
hei
rmoneyi
nto
mut
ual
fundandst
ockmar
ket
.

51
2. Theabov
epi
edi
agr
am 65%r
espondentar
emal
eandr
emai
ningar
efemal
ethat
i
s35%.

2.AGEGROUP:

AGEGROUP 18-
25 25-
30 30ANDABOVE

%OFRESPONSES 88% 10% 2%

I
NTERPRETATI
ON:

1.Theabov
epi
edi
agr
am pr
esentageofr
espondent
.

2.88%ofr
espondentar
eagegr
oupof18–25.

3.10%ofr
espondentar
eagegr
oupof25-
30.

4.2%ofr
espondentar
eagegr
oupof30andabov
e.
52
53
3.OCCUPATI
ON:

SELF-
OCCUPATI
ON STUDENT SERVI
CE OTHERS
EMPLOYED

%OF
74% 14% 8% 4%
RESPONSES

I
NTERPRETATI
ON:

1.Theabov
epi
edi
agr
am showst
hathowmanypeopl
einv
est
.

2.74%ar
est
udentwhoi
nvest
.

3.14%ofpeopl
ewhoar
eengagedi
nser
viceandt
heyi
nvest
.

4.8%ar
esel
f-
empl
oyedand4%ot
heri
nvest
.

4.QUALI
FICATI
ON:

54
QUALI
FICATI
ON SSC HSC GRADUATE PROFESSI
ONAL

%OF
NI
LL 19% 71% 10%
RESPONSES

I
NTERPRETATI
ON:

1.Theabov
epi
edi
agr
am showst
hequal
i
ficat
ion.

2.19%ar
eHSCqual
i
fied.

3.
71%ar
ethegr
aduat
e.

55
5.MONTHLYI
NCOME:

I
NCOME 10,
000-
20,
000 20,
000-
50,
000 50,
000ANDABOVE

%OFRESPONSES 70.
7% 14.
7% 14.
7%

I
NTERPRETATI
ON:

1.70.
70%ofr
esponsesar
ebel
ongi
ngt
oincomeof10,
000TO20,
000.

2.14.
70%ofr
esponsesar
ebl
ongt
oincomeof20,
000t
o50.
000.

3.
14.
70%ofr
esponsesar
ebl
ongt
iincomeof50,
000&abov
e.

6.DOYOUHAVEEVERI
NVESTI
NMUTUALFUNDORSHAREMARKET?

56
 I
NVESTMENT YES NO

%OFRESPODENTS 46% 54%

I
NTERPRETATI
ON:

1.54% ofr
espondentar
enot i
nvest t
hei
r moneyi
nanymut
ualf
undandst
ock
market
.

2.Remaini
ng46%r
espondentt
heyar
einv
estt
hei
rmoneyi
nmut
ualf
undandshar
e
market
.

57
7.
WHEREDOYOUI
NVESTYOURMONEY?

TYPESOF SHARE
MUTUALFUND BOTH OTHER
I
NVESTMENT MARKET

%OF
21.
3% 19.
1% 24.
7% 34.
8%
RESPONSES

I
NTERPRETATI
ON:

1.
21.
30%ofr
espondentar
einv
esti
nmut
ual
fund.

2.And19.
10%ar
einv
est
ingi
nshar
emar
ket
.

3.24.
70%ofr
espondenti
nvesti
nbot
h.

4.Hi
gheri
nvest
mentdonei
not
her
.

58
8.What%ofi
nvesti
nmut
ualf
und?
MUTUALFUND 10%TO25% 25%TO50% 50%TO75% 75%&ABOVE

%OF
58.
20% 31.
20% 5.
4% 5.
2%
RESPONSES

I
NTERPRETATI
ON:

1.
58.
20%ofr
espondentar
einv
esti
nmut
ual
fundi
nrangeof10%TO25%.

2.31.
20%ofr
espondentar
einv
esti
nmut
ual
fundi
nrangeof25%TO50%.

3.5.
45%ofr
espondentar
einv
esti
nther
angeof50%t
o75%.

4.Andr
emai
ning5.
2%ar
einv
esti
nther
angeof75%andabov
e.

59
9.WHAT%OFI
NVESTI
NSHAREMARKET?

SHARE
10%TO25% 25%TO50% 50%TO75% 75%&ABOVE
MARKET

%OF
67% 16% 11% 6%
RESPONSES

I
NTERPRETATI
ON:

1.67%ofr
espondentar
einv
esti
nrangeof10%t
o25%.

2.16%ofr
espondentar
einv
esti
nrangeof25%t
o50%.

3.11%ofr
espondentar
einv
esti
nrangeof50%t
o75%.

4.Andr
emai
ningi
n75%andabov
e.

5.peopl
edonotwanttot
aker
iskt
her
efor
emor
epeopl
einv
esti
nmut
ualf
undand
l
esspeopl
einequi
ty.

60
10.HOW I
SYOURI
NVESTMENTPATTERN?

I
NVESTMENT MONTHLY YEARLY RARELY
PATTERN

%OFRESPONSES 47% 24% 29%

I
NTERPRETATI
ON:

1.I
nvest
mentpat
ter
nisshowst
hepeopl
einv
estonwhi
chbasi
s.

2.47%ofr
espondentar
edonei
nvest
mentmont
hlybasi
s.

3.24%ofr
espondentar
einv
esty
ear
ly.

4.Ot
heri
nvest
srar
ely
.

61
11.WHI
CHI
NVESTMENTI
SVERYRI
SKY?

I
NVESTMENT MUTUALFUND EQUI
TY

%OFRESPONSES 25% 75%

I
NTERPRETATI
ON:

1.Ther
eisresponsesshowst
hatt
hehi
gherr
iski
nthest
ock mar
ketr
athert
han
mutualf
und.

2.Hi
gherr
iski
nvol
vedi
nst
ockmar
ket
.

3.Lowerr
iski
nmut
ual
fund.

62
12.WHAT ARE THE FACTORS AFFECT THE DECI
SION MAKI
NG OF
I
NVESTOR?
FACTORS RI
SKFACTOR PROFI
T/LOSS OTHER
FACTOR

%OFRESPONSES 54% 34% 12%

I
NTERPRETATI
ON:

1.54%ofr
esponsear
eaf
fect
ingwi
thr
iskf
act
or.

2.34%ofr
esponsesar
eaf
fect
ingwi
thpr
ofi
t/l
ossf
act
or.

3.12%ofr
esponsesar
eaf
fect
ingwi
thot
herf
act
or.

63
 CHAPTER5:FI
NDI
NG

1.54% ofrespondentar
ethosepeopl
ewhodoesnoti
nvesti
nmut
ualf
undand
st
ockmarket.

2.21%ofr
espondenti
nvesti
nmut
ualf
undt
her
efor
emut
ualf
undi
sbestopt
ionf
or
yout
h.

3.I
nshar
emar
kety
out
har
einv
estLess.

4.Mostofr
espondentar
einv
est
mentpat
ter
nisr
arel
y.

5.Mut
ual
fundar
elessr
iskyt
hanst
ockmar
keti
nvest
ment
.

6.Ri
skf
act
ori
smor
eaf
fectt
heDeci
sionmaki
ngofi
nvest
or.

7.Mostofyouthi
nvestt
hei
rmoneyi
nmut
ualf
undbecauset
heywantmor
eret
urn
wit
hlessr
isk.

64
 CHAPTER6:SUGGESTI
ON

1.Mut
ualfundi
sbet
teropt
ionf
ort
oday
’sy
out
h,becausei
t’
sgi
vet
ohi
ghr
etur
nand
l
essri
sk.

2.Mutualfundinvest
ingi
stermedasalongt
erm hor
izonofget
ti
ngagoodr
etur
n,
asthefundisgoinginasyst
emati
cway.

3.Peopl
eneedasy
stemat
icwayofi
nvest
ingshoul
dgof
ormut
ual
fundi
nvest
ing.

4.Inv
est
ing wi
thafi
xed i
ncome st
rat
egy
,shoul
d choose mut
ualf
und as an
i
nvest
mentchoi
ce.

5.Ifyoudon’
tknow anythi
ngaboutst
ockmarket
,justget
ti
ngani
ncomei
syour
concer
n,y
oushouldchooseamutualf
undscheme.

6.Beforemakeinvest
menti
nvest
orshoul
ddonepr
operst
udyt
hatwhi
chopt
ioni
s
bet
terforani
nvest
ment .

7.St
ockmar
keti
nvest
menti
sri
skybuti
t’
sgi
vemor
eret
urnt
hanmut
ual
fund.

65
 CHAPTER7:CONCLUSI
ON

Aspartheabov
eresearchanddataanal
ysi
sprovedthat
,mutualf
undarebet
ter
opti
onsint
oday
’sscenari
o.Thoughi
thashighri
sk,butwit
hpati
entsi
thashi
gh
ret
urnt
o.

I
tisthefactthati
nvest
ingi
nmutual
fundi
sti
meconsuming,
ast
hesamet
imei
tisa
myththatinv
estmentImutual
fundl
eadst
owardsl
oss.

Mutualfundisinv
estmentv
ehicl
est
hatpoolmoneyf r
om manydi
ff
erenti
nvest
ors
t
oincreasethei
rbuyi
ngpoweranddi
ver
sif
ythei
rhol
ding.

Thi
sal
lowsinvest
orstoaddasubst
anti
alnumberofsecur
it
iest
othei
rpor
tfol
i
ofor
amuchlowerpri
cethanpur
chasi
ngeachsecur
it
yindi
vi
dual
ly.

Also,ital
l
owsi
nvest
orst
orei
nvestt
hei
rdi
vi
dendandi
nter
esti
naddi
ti
onalf
und
shares.

66
 CHAPTER8:REFERENCE

WEBSI
TES:

WWW.
Adi
tyat
radi
ng.
in/mar
ket/mut
ual
fund

www.
money
cont
rol
.com

www.
compar
ati
vest
udyondi
rectequi
tyi
nvest
ingandmut
ual
fund

www.
academi
a.COM

67
ANNEXURE

1.GENDER?
• MALE
• FEMALE

2.AGE
• 18-
25
• 25-
30
• 30&ABOVE

3.QUALIFI
CATION
• SSC
• HSC
• GRADUATE
• PROFESSIONAL

4.WHATISYOUROCCUPATI
ON?
• STUDENT
• SELF-
EMPLOYED
• SERVI
CE
• OTHER

5.MONTHLYI
NCOME
• 10,
000-
20,000
• 20,
000-
50,000
• 50,
000-
1,00,
000

6.DOYOUHAVEEVERI
NVESTI
NMUTUALFUNDORSHAREMARKET?
• YES
• NO

7.WHEREDOYOUI
NVESTYOURMONEY?

• MUTUALFUND
• SHAREMARKET
68
• BOTH
• OTHER
8.WHAT%OFI NVESTI
NMUTUALFUND?
• 10%-25%
• 25%50%
• 50%-75%
• 75%&ABOVE

9.WHAT%OFINVESTI
NSHAREMARKET?
• 10%-
25%
• 25%-
50%
• 50%-
75%
• 75%&ABOVE

10.HOW ISYOURI
NVESTMENTPATTERN?
• MONTHLY
• YEARLY
• RERELY

11.WHICHINVESTMENTI
SVERYRI
SKY?
• EQUI
TY
• MUTUALFUND

12.WHATARETHEFACTORAFFECTTHEDECI
SIONMAKI
NGOFI
NVESTOR?
• RI
SKFACTOR
• PROFI
T/LOSSFACTOR
• OTHER

69
70