A Synopsis On

A Study on Mutual Fund : A Tool for Wealth Creation

Submitted By

Name:- Umesh Narayan Kudhekar

Roll No:- MBA-21 F-11

MBA 2nd Year IV Sem

Guided By

Pro. Chandrakant Jadhav

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 CONTENT

1. Project Title…………………………………………..……... 1
2. Introduction …………………………………………..……. 3-4
3. Problem Statement…………………………………………. 5
4. Literature Review………………………………………….. 5
5. Objectives of the Study…………………………………….. 6
6. Research Methodology……………………….…………… 6
a. Significance of the study
b. Limitation of the study
c. Data collection
7. Chapter Scheme…………………………………………… 7
8. References………………………………………………… 8

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 INTRODUCTION

This dissertation is assigned to me as a part of the partial fulfillment of the

requirement of MBA Program. The aim of the study is to analyze the Mutua Fund
Industry in Indian and evaluate the substantial effect of Mutual Fund Tool.

The Indian mutual fund industry has gone a long way since the inception of
UTI in 1963. A mutual fund is an investment vehicle which is professionally managed
and run by fund houses, called Asset Management Company (AMC). The AMC
collects the savings of a group of people to invest in stocks, bonds and other securities
with the prime objective of maximum yield and capital appreciation along with safety
and liquidity of funds. Collection of savings from small investors is the unique feature
of the mutual fund concept. The investors get units of the mutual fund according to
the amount of investment. The AMCs are responsible for managing the investment for
various schemes operated by the mutual fund. Unitholders share the profit and losses
in the proportion of their investment. A mutual fund is required to be registered with
the Securities and Exchange Board of India (SEBI) before collecting funds from the
public. After the SEBI Act passed in 1992, SEBI Mutual Fund regulations came into
existence in 1996 which infused mutual fund companies to grow exponentially. As
the industry expanded, The Association of Mutual Funds in India (AMFI) was
established in 1995 as a non -profit organization with the prior objective of promoting
healthy and fair market practices in mutual fund sector. A mutual fund is found to be
an ideal investment vehicle in present sophisticated and modern financial scenario. A
general individual is unlikely to have the knowledge, skills, inclination and time to
keep track of events, understand their implication and act speedily. A mutual fund is
an answer to the situations in regards to low-risk investment.

The Indian financial system in general and the mutual fund industry in
particular continue to take turnaround from early 1990s. During this period mutual
funds have polled huge investment for the corporate sector. The investment habit of
the small investors particularly has undergone a sea change. Increasing number of
players form public as well as private sectors has entered in to the market with
innovative scheme to cater to the requirements of the investors in Indian and abroad.
The reason for launching of these large number of mutual fund products is the
distributed pattern of investment behaviour of Indian small investor. The purchase

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decision of a mutual fund is largely dependent upon investors level of savings,
investment pattern and the risk profile.

In this project I am studying how mutual funds is wealth creation for investors.
How they earn money form mutual funds investment along with that studying various
benefits offered by mutual fund industry. As well as to identifying the investment
preference of investors.

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 PROBLEM STATEMENT

One of the imperative problem with investing in mutual fund has been to ascertain the
precise investment horizon that can be treated as long term. In this project problem of
statement is people who interested in investment they does not have knowledge about
investing. This project report helpful for find out the above questions answer.

LITERATURE REVIEW

Madhusudhan (1996) conducted a study and revealed that income schemes and open
ended schemes are preferred over growth schemes and close-ended schemes during
the prevalent market conditions. Investors look for safety of principle, liquidity and
capital appreciation in order of importance in the selection of mutual fund.

Irwin, Brown, FE (1965) analyzed issues relating to investment policy, portfolio

turnover rate, performance of mutual funds and its impact on the stock markets. They
identified that mutual funds had a significant impact on the price movement in the
stock market. They concluded that, on an average, funds did not perform better than
the composite markets and there was no persistent relationship between portfolio
turnover and fund performance.
S.Narayan Rao (2003) et. al., evaluated performance of Indian mutual funds in a bear
market through relative performance index, riskreturn analysis, Treynor‟s ratio,
Sharpe‟s ratio, Jensen‟s measure, and Fama‟s measure. The study used 269 open-
ended schemes (out of total schemes of 433) for computing relative performance
index. Then after excluding funds whose returns are less than risk-free returns, 58
schemes are finally used for further

analysis. The results of performance measures suggest that most of mutual fund
schemes in the sample of 58 were able to satisfy investor‟s expectations by giving
excess returns over expected returns based on both premium for systematic risk and
total risk.

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OBJECTIVE OF THE STUDY

1. To study the various benefits offered by mutual fund sector.

2. To identify the features the investors look for the mutual fund product.
3. To find factors influencing on a consumer investing behavior.
4. To identify the investment preference of investors.

RESEARCH METHODOLOGY

 Significance Of The Study

This study is on Mutual Fund and how Mutual Fund is a tool for investors
increase their wealth. This study will helpful for new investors who want to invest in
mutual fund and they get knowledge more about the mutual fund.

 Limitation Of The Study

1. This study is based on secondary data no primary data has been
collected for this study.
2. Not face to face interaction with people for get more information.

Data Collection

Primary Data:-

In this this primary data is not collected.

Secondary Data:-

Secondary data is the data that has already been collected through primary
source and made readily available for researchers to use for their own research. It is a
type of data that has been already collected. Source of secondary data include books,
journals, news papers, websites and government records etc.

This study is based on secondary data only no primary data has been collected
for this project.

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 CHAPTER SCHEME

Chapter No Chapter Name

1 Introduction

2 Review Of Literature

3 Industry Profile

4 Research Methodology

5 Data Analysis and Interpretation

6 Findings and Recommendation

7 Conclusion

8 Bibliography

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 REFERENCES

1. www.google.com
2. www.wikipedia.com
3. www.amfiindia.com

 Kothari C R (2004), Research Methodology, New age International

Publishers.
 Friend Irwin, Brown F. E, Herman Edward S. Vickers Douglas,(1965) A
Study of Mutual Funds.
 Jambodekar V. Madhusudhan, (1996) Marketing Strategies of Mutual Fund-
Current Policies and Future Direction, Working Paper, UTI-IMB Centre of
Capital Markets Education and Research, Bangalore.
 Avadhani V A, Investment for Beginners, Himalaya Publishing House.
 Sapar Narayan Rao, Octomber 2003, Performance Evaluation of Indian
Mutual Funds, SSRNsearch library.

Signature of Project Guide

Pro. Chandarakant Jadhav

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