EXCELSSIOR EDUCATION SOCIETY’S

K.C. COLLEGE OF ENGINEERING AND MANAGEMENT

STUDIES AND RESEARCH
(Affiliated to the University of Mumbai)
Kopri, Thane ( E ) – 400 063

Summer Internship Project Report

Titled

“Comparative Study of Investor Behavior with Respect to

Mutual Fund and Equity”
In the partial fulfillment of the Degree of
MMS
By
Ms. Bhalerao Sakshi Satish (16 FS)
[SYMMS, Roll No:M222405)
Semester III & Specialization :Finance
Batch: 2023-24
Under the Guidance of
Company Guide
Mr. Sagar Kokate
(CA, BR Trader Co.)

Faculty Guide
Prof. Sai Kiran Khanna
Project Guide

(Prof. Surendra Mourya)

2023-24
 EXCELSSIOR EDUCATION SOCIETY’S
K.C. COLLEGE OF ENGINEERING AND MANAGEMENT
STUDIES AND RESEARCH
(Affiliated to the University of Mumbai)
Kopri, Thane ( E ) – 400 063

CERTIFICATE
This is to certify that Ms. Sakshi Satish Bhalerao a student of Class: SYMMS Semester: 3rd
bearing Roll No. M222405 has successfully completed the project titled, ―Comparative
Study of Investor Behavior with Respect to Mutual Fund and Equity‖, in the partial
fulfillment of the Degree of MMS.

Place: Thane

Date: 28th Dec 2023

Name of the Project Guide: Prof. Surendra Mourya

Signature of the Project Guide:

Institutes Seal:
 STUDENT DECLARATION

I hereby declare that the project titled “Comparative Study of Investor Behavior with
Respect to Mutual Fund and Equity” is my own work conducted under the supervision of
Prof. Surendra Mourya.

I further declare that no part in this project work has been plagiarized without proper
citations and has not formed the basis for the award of any degree, diploma, associateship,
fellowship previously.

Name of Student: Ms. Sakshi Satish Bhalerao

Signature of the Student:

 LIST OF TABLES

Sr. No Description Chapter Page No

No
1 TITLE I

2. CERTIFICATE II
3. DECLARATION III
4. INDEX IV
5. LIST OF TABLES X
6. LIST OF CHARTS /GRAPHS XI
7. INTRODUCTION 1 1-27
9. 1.1 Introduction of Stock Market

10. 1.2 History of Stock Exchange in India (18th Century - 20th Century)
11. 1.3 Introduction of Mutual Funds
12. 1.4 How A Mutual Fund Works?
13. 1.5 Why Invest in Mutual Funds?
14. 1.6 History of Mutual Funds in India
15. 1.6 The Advantages of Mutual Funds in India Have Been Enumerated
Below:
16. 1.7: Disadvantages Of Mutual Fund
17. 1.8 Types of Mutual Funds Based on Structure
18. 1.9 Types of Mutual Funds Based on Asset Class
19. 1.10 Types of Mutual Funds Based on Investment Objective
20. 1.11 Types of Mutual Funds Based on Specialty
21. 1.11 Types of Mutual Funds Based on Risk
22. 1.12 Introduction of Equity Trading in Stock Market
23. 1.13 Advantages of Investing in Equity Share Capital
24. 1.14 Disadvantages of Investing in Equity Share Capital
25. 15 Types of Equity Share 1.
26. INDUSTRY OVERVIEW 2 26
27. RESEARCH METHOLOGY 3 27-40
28. 3.1 Objectives of Study
29. 3.2 Hypothesis
30. 3.3 Scope of the Study
31. 3.4 Purpose of the Study
32. 3.5 Limitations of Study
33. 3.6 Significance of Study
34. 3.7 Methodology
35. 3.8 Data Collection
36. 3.9 Methods of Data Collection
37. 3.10 Tabulation of Data
38. 3.11 Objectives of Tabulation
39. 3.12 Techniques & Tools
40. 3.13 Graphical Representation of Data
41. DATA ANALYSIS AND INTERPRETATION 4 41-46
42. 4.1 Meaning
43. 4.2 Importance of Data Analysis
44. 4.3 Interpretation
45. 4.4 Types of Data Interpretation
46. 4.5 Data Analysis and Interpretation
47. CONCLUSION AND FINDING OF THE STUDY 5 47-49
48. 5.1 Findings
49. 5.2 Suggestions & Recommendations
 EXECUTIVE SUMMARY

A mutual fund is a collective investment vehicle that collects & pools money from a number of investors and
invests the same in equities, bonds, government securities, money market instruments.

The money collected in a mutual fund scheme is invested by professional fund managers in stocks and bonds
etc. in line with a scheme‘s investment objective. The income / gains generated from this collective
investment scheme are distributed proportionately amongst the investors, after deducting applicable
expenses and levies, by calculating a scheme‘s ―Net Asset Value‖ or NAV. In return, mutual fund charges a
small fee.

In short, mutual fund is a collective pool of money contributed by several investors and managed by a
professional Fund Manager.

Mutual Funds in India are established in the form of a Trust under Indian Trust Act, 1882, in accordance
with SEBI (Mutual Funds) Regulations, 1996.

The fees and expenses charged by the mutual funds to manage a scheme are regulated and are subject to the
limits specified by SEBI.

A Mutual fund is a scheme in which several people invest their money for a financial clause. The money
collected is invested in Capital markets & the money which they earned is divided based on the number of
units which they hold.

The Mutual fund Industry was started in India in a small way with the UTI creating what was effectively a
small savings division within the RBI. This was fairly successful for the next 25 years as it gave investors
good returns. Due to this RBI gave a go ahead to public sector banks & financial institution to start Mutual
Funds in India and their success gave way to Private sector Mutual Funds.

The advantages of Mutual Funds are Portfolio Diversification, Liquidity, Professional Management, Ease of
Companies, Less Risk, Low Transaction cost, Transparency, Safety.

The Disadvantages of Mutual Funds are Cost, Index Does Better, Fees, No Control over Investments,
Profitability of High returns reduced significantly, and Personal Tax situation is not considered.

Mutual Funds have to follow specific rules and regulations which are prescribed by the SEBI. AMFI is the
apex body of all the Asset Management companies and is registered with the SEBI. Association of Mutual
Funds India has brought down the Indian Mutual Fund Industry to a professional and healthy market with
ethical lines enhancing.

There are many types of mutual funds in India. You can classify based on BY STRUCTURE (Open Ended
Schemes, Close-Ended Schemes & Interval schemes), BY NATURE (Equity Fund, Debt Fund, Balanced
Fund), BY INVESTMENT OBJECTIVE (Growth Schemes, Income Schemes, Balanced Schemes & Money
Market Schemes), OTHER SCHEMES (Tax Saving Schemes, Index Schemes, Sector Specific).

Mutual Funds are very easy to buy and sell. You can buy mutual funds directly from a company or a broker.
Before Investing in Mutual Funds, one has to look at all the factors like the performance of the mutual funds
in the last 5 years, the returns made by mutual funds in the last 5 years & the company's net worth must be
considered.

There are two types of Mutual Funds in India Public Sector Mutual Fund & private sector mutual Fund. In
Public Sector Mutual Funds there are UTI Mutual Fund, State bank of India Mutual Funds, Bank of Baroda
Mutual Funds & In Private sector Mutual Funds there are Birla Sun Life Mutual, HDFC Mutual Fund, ICICI
Prudential Mutual Fund, Reliance Mutual Fund etc.

The Most trend of Mutual Funds is the aggressive expansion of Mutual Funds. Nowadays there is lot of
Competition within the Mutual Fund as there are lot of private sector & Public sector mutual funds have
entered the industry.

"Mutual Funds are Subject to Market Risk, please read the offer document before Investing"

Similarly, an equity market is a place where stocks and shares of companies are traded. The equities that are
traded in an equity market are either over the counter or at stock exchanges. Often called stock market or
share market, an equity market allows sellers and buyers to deal in equity or shares in the same platform.

First things first, it is important to begin with a good understanding of what is equity market in the Indian
context. An equity market, often called as stock market or share market, is a place where shares of
companies or entities are traded. The market allows sellers and buyers to deal in equity or shares on the
same platform.

In the global context, equities are traded either over the counter or on stock exchanges. There are multiple
buyers and sellers of the same equity/share. Hence, you stand a good chance of striking a nice deal in the
equity market. Equities are mostly traded on the stock exchanges in India. In the Indian stock market,
equities are available for trading at the National Stock Exchange (NSE), and Bombay Stock Exchange BSE
the latest entrant, Metropolitan Stock Exchange of India (MSE). Shares of stock market listed companies are
bought/sold.

Equity share trading is roughly in two forms - spot/cash market and futures market. These are the
different types of equity market in India. The spot market or cash market is a public financial market in
which stocks are traded for immediate delivery. The futures market is a place where the shares' delivery is
due at a later date. With the help of an equity trading account, a trustworthy broker equity trading system,
investors can utilize the Indian equity market.
 CHAPTER 1

INTRODUCTION

In this study the comparison between investing in equity and mutual fund will be made. So, under this the
main topics like stock market as well as mutual fund industry will be undertaken as investing in equity
means stock market is included along with it the portfolio return and risk will also be discussed. There are
two kinds of share markets namely the Primary and the Secondary Markets. The primary share market is in
the primary market where companies register themselves to issue their shares and raise money. This process
is additionally referred to as known as listing on the stock exchange. The purpose of getting into the primary
market is to boost money and if the company is selling their shares for the very first time it's mentioned as
the Initial Public Offering (IPO). A mutual fund is an investment vehicle formed when an asset management
company (AMC) or fund house pools investments from several individuals and institutional investors with
common investment objectives. A fund manager, who is a finance professional, manages pooled investment.

The fund manager purchases securities such as stocks and bonds that are in line with the investment
mandate. The main intention of the fund manager is to provide optimum returns to investors by investing in
securities that are in sync with the fund's objectives. A return is often expressed as a percentage derived from
the ratio of profit to investment. Portfolio risks are often calculated, like calculating the risk of single
investments, by taking the standard deviation of the variance of actual returns of the portfolio over time.
Portfolio risk consists of two components: systemic risk and diversifiable risk. Systemic risks, also known as
systematic risks, are risks affecting all assets, such as general economic conditions, and, thus, systemic risk
is not reduced by diversification. Diversifiable risks are risks specific to assets, such as factors affecting
businesses and their stocks.

1.1 INTRODUCTION OF STOCK MARKET

A stock exchange is ―a body of individuals, whether incorporated or not, constituted to regulate or control
the business of buying, selling or dealing in securities.‖

―Securities refers to shares, bonds, scrip, stocks, debentures stock, and other marketable securities of
incorporated companies or similar, government securities, and rights or interest in securities.‖
The history of the Indian stock market is a remarkable journey of financial development in India. It dates to
the late 18th century when the East India Company issued bonds and shares. In the 19th century, formal
stock exchanges, including the iconic Bombay Stock Exchange (BSE), were established.

The late 20th century brought transformative changes, with the inception of the National Stock Exchange
(NSE) in 1992, introducing electronic trading and fostering transparency. The introduction of key indices
like the BSE Sensex and Nifty 50 became vital benchmarks for monitoring market performance.
The history of stock exchange in India demonstrates that it has encountered numerous obstacles and
difficulties. Scandals, such as the Harshad Mehta scam in the 1990s and the Ketan Parekh scam, underscored
the need for regulatory enhancements. The 2008 global financial crisis also had a significant impact.
The Indian share market has thrived amid economic reforms, liberalization, and globalization. It continues to
attract domestic and international investors, reflecting India's economic growth. Over the years, it has
transitioned from a small, informal marketplace to a sophisticated, well-regulated financial ecosystem,
playing a pivotal role in India's economic development.
In India, the share market is a term used to refer to the two major stock exchanges in the country— the
Bombay Stock Exchange (BSE) and the National Stock Exchange of India (NSE). There are also 22 regional
stock exchanges.

1.2 History of Stock Exchange in India (18th Century - 20th Century)

A) 18th Century:
 The history of stock market in India can be traced back to the late 18th century when the East India
Company issued bonds and shares to raise capital for its operations. This was the first share market in
India where securities were informally traded among merchants in the region.
 The trading floor was under the shade of a sprawling banyan tree opposite the Town Hall in Mumbai.
A few people would meet under this tree to informally trade in cotton. his was because Mumbai was
a busy trading port, and essential commodities were traded here often.
 The Company's Act was introduced in 1850, following which investors started showing an interest in
corporate securities. The concept of limited liability also made an appearance around this time.
 By 1875, an organization known as ‗The Native Share and Stockbrokers Association‘ came into
being. This was the predecessor of the BSE.
 In 1894, the Ahmedabad Stock Exchange came primarily to enable dealing in the shares of textile
mills in the city.
B) 19th Century:
 During the 19th century, regional stock exchanges were established in major Indian cities.
 This was because Mumbai was a busy trading port, and essential commodities were traded here
often.
 The Company's Act was introduced in 1850, following which investors started showing an interest in
corporate securities. The concept of limited liability also made an appearance around this time.
 By 1875, an organization known as ‗The Native Share and Stockbrokers Association‘ came into
being. This was the predecessor of the BSE.
 In 1894, the Ahmedabad Stock Exchange came primarily to enable dealing in the shares of textile
mills in the city.
Post-Independence (1947):
After India's independence in 1947, the stock market underwent changes to adapt to the new economic
environment.

B.1 When Stock Market Started in India (1950s - 1960s)

 1950s: Formal stock market trading continued to evolve in India, with several regional stock
exchanges becoming operational. However, the market remained relatively small and primarily
served the needs of British colonial authorities and their commercial interests.
 1960s: During this decade, the Indian government introduced the Securities Contracts (Regulation)
Act in 1956, providing the first legal and regulatory framework for stock exchanges and securities
trading in India. This was a significant step in the development of the Indian stock market.

B.2 Who Started Stock Market in India (Late 20th Century)

 Late 20th Century: The late 20th century marked a significant transformation in the Indian stock
market. In 1992, the National Stock Exchange (NSE) was established, introducing electronic trading
and modern technology to the Indian stock market. It played a vital role in bringing transparency and
efficiency to the market.

B.3 Nifty and Sensex (1990s)

 1990s: The NSE introduced the Nifty 50 index, providing a benchmark for the performance of the
Indian stock market. The Bombay Stock Exchange's Sensex (S&P BSE Sensex) also became a
prominent stock market index tracking the top companies listed on the BSE.
1.3 INTRODUCTION OF MUTUAL FUNDS
A mutual fund is a collective investment vehicle that collects & pools money from a number of investors and
invests the same in equities, bonds, government securities, money market instruments.

The money collected in a mutual fund scheme is invested by professional fund managers in stocks and bonds
etc. in line with a scheme‘s investment objective. The income / gains generated from this collective
investment scheme are distributed proportionately amongst the investors, after deducting applicable
expenses and levies, by calculating a scheme‘s ―Net Asset Value‖ or NAV. In return, mutual fund charges a
small fee.

In short, mutual fund is a collective pool of money contributed by several investors and managed by a
professional Fund Manager.

Mutual Funds in India are established in the form of a Trust under Indian Trust Act, 1882, in accordance
with SEBI (Mutual Funds) Regulations, 1996.

The fees and expenses charged by the mutual funds to manage a scheme are regulated and are subject to the
limits specified by SEBI.

1.4 HOW A MUTUAL FUND WORKS?

One should avoid the temptation to review the fund's performance each time the market falls or jumps up
significantly. For an actively managed equity scheme, one must have patience and allow reasonable time -
between 18 and 24 months (about 2 years) - for the fund to generate returns in the portfolio.

When you invest in a mutual fund, you are pooling your money with many other investors. Mutual fund
issues ―Units‖ against the amount invested at the prevailing NAV. Returns from a mutual fund may include
income distributions to investors out of dividends, interest, capital gains or other income earned by the
mutual fund. You can also have capital gains (or losses) if you sell the mutual fund units for more (or less)
than the amount you invested.

Mutual funds are ideal for investors who –

a. lack the knowledge or skill / experience of investing in stock markets directly.
b. want to grow their wealth, but do not have the inclination or time to research the stock market.
c. wish to invest only small amounts.
1.5 WHY INVEST IN MUTUAL FUNDS?

As investment goals vary from person to person – post-retirement expenses, money for children‘s education
or marriage, house purchase, etc. – the investment products required to achieve these goals too vary. Mutual
funds provide certain distinct advantages over investing in individual securities. Mutual funds offer multiple
choices for investment across equity shares, corporate bonds, government securities, and money market
instruments, providing an excellent avenue for retail investors to participate and benefit from the uptrends in
capital markets. The main advantages are that you can invest in a variety of securities for a relatively low
cost and leave the investment decisions to a professional manager.

1.6 HISTORY OF MUTUAL FUNDS IN INDIA

A strong financial market with broad participation is essential for a developed economy. With this broad
objective India‘s first mutual fund was establishment in 1963, namely, Unit Trust of India (UTI), at the
initiative of the Government of India and Reserve Bank of India ‗with a view to encouraging saving and
investment and participation in the income, profits and gains accruing to the Corporation from the
acquisition, holding, management and disposal of securities.

In the last few years, the MF Industry has grown significantly. The history of Mutual Funds in India can be
broadly divided into five distinct phases as follows:

 FIRST PHASE - 1964-1987

The Mutual Fund industry in India started in 1963 with formation of UTI in 1963 by an Act of Parliament
and functioned under the Regulatory and administrative control of the Reserve Bank of India (RBI). In 1978,
UTI was de-linked from the RBI and the Industrial Development Bank of India (IDBI) took over the
regulatory and administrative control in place of RBI. Unit Scheme 1964 (US ‘64) was the first scheme
launched by UTI. At the end of 1988, UTI had ₹ 6,700 crores of Assets Under Management (AUM).

 SECOND PHASE - 1987-1993 - ENTRY OF PUBLIC SECTOR MUTUAL FUNDS

The year 1987 marked the entry of public sector mutual funds set up by Public Sector banks and Life
Insurance Corporation of India (LIC) and General Insurance Corporation of India (GIC). SBI Mutual Fund
was the first ‗non-UTI‘ mutual fund established in June 1987, followed by Canbank Mutual Fund (Dec.
1987), Punjab National Bank Mutual Fund (Aug. 1989), Indian Bank Mutual Fund (Nov 1989), Bank of
India (Jun 1990), Bank of Baroda Mutual Fund (Oct. 1992). LIC established its mutual fund in June 1989,
while GIC had set up its mutual fund in December 1990. At the end of 1993, the MF industry had assets
under management of ₹47,004 crores.

 THIRD PHASE - 1993-2003 - ENTRY OF PRIVATE SECTOR MUTUAL FUNDS

The Indian securities market gained greater importance with the establishment of SEBI in April 1992 to
protect the interests of the investors in securities market and to promote the development of, and to regulate,
the securities market.

In the year 1993, the first set of SEBI Mutual Fund Regulations came into being for all mutual funds, except
UTI. The erstwhile Kothari Pioneer (now merged with Franklin Templeton MF) was the first private sector
MF registered in July 1993. With the entry of private sector funds in 1993, a new era began in the Indian MF
industry, giving the Indian investors a wider choice of MF products. The initial SEBI MF Regulations were
revised and replaced in 1996 with a comprehensive set of regulations, viz., SEBI (Mutual Fund) Regulations,
1996, which is currently applicable.

The number of MFs increased over the years, with many foreign sponsors setting up mutual funds in India.
Also, the MF industry witnessed several mergers and acquisitions during this phase. As at the end of January
2003, there were 33 MFs with total AUM of ₹1,21,805 crores, out of which UTI alone had AUM of
₹44,541 crores.

 FOURTH PHASE - SINCE FEBRUARY 2003 – APRIL 2014

In February 2003, following the repeal of the Unit Trust of India Act 1963, UTI was bifurcated into two
separate entities, viz., the Specified Undertaking of the Unit Trust of India (SUUTI) and UTI Mutual Fund
which functions under the SEBI MF Regulations. With the bifurcation of the erstwhile UTI and several
mergers taking place among different private sector funds, the MF industry entered its fourth phase of
consolidation.
Following the global melt-down in the year 2009, securities markets all over the world had tanked and so
was the case in India. Most investors who had entered the capital market during the peak had lost money and
their faith in MF products was shaken greatly. The abolition of Entry Load by SEBI, coupled with the after-
effects of the global financial crisis, deepened the adverse impact on the Indian MF Industry, which
struggled to recover and remodel itself for over two years, in an attempt to maintain its economic viability
which is evident from the sluggish growth in MF Industry AUM between 2010 to 2013.

 FIFTH (CURRENT) PHASE – SINCE MAY 2014

Taking cognizance of the lack of penetration of MFs, especially in tier II and tier III cities, and the need for
greater alignment of the interest of various stakeholders, SEBI introduced several progressive measures in
September 2012 to "re-energize" the Indian Mutual Fund industry and increase MFs‘ penetration.

In due course, the measures did succeed in reversing the negative trend that had set in after the global melt-
down and improved significantly after the new Government was formed at the Center.

Since May 2014, the Industry has witnessed steady inflows and increase in the AUM as well as the number
of investor folios (accounts).

 The Industry‘s AUM crossed the milestone of ₹10 Trillion (₹10 Lakh Crore) for the first time as on
31st May 2014 and in a short span of about three years the AUM size had increased more than two
folds and crossed ₹ 20 trillion (₹20 Lakh Crore) for the first time in August 2017. The AUM size
crossed ₹ 30 trillion (₹30 Lakh Crore) for the first time in November 2020.
 The overall size of the Indian MF Industry has grown from ₹ 8.90 trillion as on 30th November 2013
to ₹ 49.05 trillion as on 30th November 2023, more than 5-fold increase in a span of 10 years.
 The MF Industry‘s AUM has grown from ₹ 24.03 trillion as on November 30, 2018, to ₹49.05
trillion as on November 30, 2023, more than 2-fold increase in a span of 5 years.
 The no. of investor folios has gone up from 7.97 crore folios as on 30-Nov-2018 to 16.18 crore as on
30-Nov-2023, more than 2-fold increase in a span of 5 years.
 On average 13.68 lakh new folios are added every month in the last 5 years since November 2018.
The growth in the size of the industry has been possible due to the twin effects of the regulatory measures
taken by SEBI in re-energizing the MF Industry in September 2012 and the support from mutual fund
distributors in expanding the retail base.
MF Distributors have been providing the much-needed last mile connects with investors, particularly in
smaller towns and this is not limited to just enabling investors to invest in appropriate schemes, but also in
helping investors stay on course through bouts of market volatility and thus experience the benefit of
investing in mutual funds.

MF distributors have also had a major role in popularizing Systematic Investment Plans (SIP) over the years.
In April 2016, the no. of SIP accounts crossed the 1 crore mark and as on 30th November 2023 the total no.
of SIP Accounts is 7.44 crore.

1.6 The advantages of mutual funds in India have been enumerated below:

1. Mutual Funds are Managed by Asset Managers Professionally

The fund house appoints asset managers, also known as fund managers, to manage the mutual funds in India.
These managers understand how to identify the best stocks that can generate maximum profits.

2. The Risk Gets Reduced through Diversification

The money in mutual funds is invested in multiple sector stocks. Hence, the loss incurred in one asset class
is managed by profit made in another sector or asset class.

3. Liquidity
One advantage of mutual funds that is often overlooked is liquidity. Mutual funds can be easily bought and
sold in the short-term during market hours and, hence, are considered highly liquid. Some funds like ELSS
are an exception as they have a specified lock-in period and cannot be easily liquidated.

4. Mutual Funds are Low Cost

Mutual funds in India also have low costs. The fund management fees charged by mutual funds are 1%-
2.50%. Mutual funds, though low in cost, provide you with higher returns. Returns are calculated based on
the amount grown within the given time frame.

5. Mutual Funds also Offer Tax Benefits

Investing in mutual funds in India via the equity market can offer you tax benefits. The investments made in
ELSS are exempt under Section 80C of the Income Tax Act, up to Rs. 1.5 lakhs.
 6. Mutual Funds are Affordable
You can start investing in mutual funds from a minimal amount, such as Rs. 500. As per your budget, you
can opt for SIP or lumpsum investment.

7. Safe and Transparent

Investments in mutual funds are very transparent. All mutual fund companies come under the purview of
SEBI, and they need to make necessary disclosures.

The value of stocks, the historical performance of the fund, fund manager‘s qualification, and track records
are known. The NAV (net asset value) of the fund is updated every day. On any mutual fund page like Grow
– you can look at the details about the mutual fund.

1.7:Disadvantages of mutual fund

There are some disadvantages to mutual funds, and we have discussed some of them below:
1. Costs
Although costs were an advantage in the section above, they are equally disadvantageous in mutual funds.
Some mutual funds in India have high costs associated with them. If you exit before the stipulated time, you
will have to incur exit charges. You cannot withdraw the amount before the given time frame.

2. Diversification of Funds
Though diversification of funds save you from incurring a loss, it can also be a disadvantage as it can
prevent you from gaining significant profits. Some sectors give huge profits, so not investing much in them
can be a big loss for you.

3. Lock-in Period

The lock-in period can sometimes prove to be a significant disadvantage as you cannot withdraw your
money before the specified time. Hence, in case of emergencies, you cannot liquidate your invested amount.

4. Fluctuating Returns
Mutual fund returns are not guaranteed as they keep fluctuating according to the market conditions. Hence,
investors must be aware of the risk profile of the fund before investing.
  Key Takeaways
1. You can invest in mutual funds with as little as Rs. 500 per month.
2. Money can be invested every month or week or daily via systematic investment plans (SIP) as per
your budget.
3. The investment manager manages the portfolio and makes investment decisions on your behalf.
4. Mutual funds up to Rs. 1.5 lakhs are tax exempted as per Section 80C of the Income Tax Act.
5. If you sell your investments within the stipulated time, exit loads are applicable.
6. Mutual funds do not guarantee returns as they depend entirely on the market.

1.8 Types of Mutual Funds based on Structure

The following are the types of mutual funds based on structural classification:

 Open-Ended Funds
These are funds in which units are open for purchase or redemption throughout the year. All purchases or
redemption of these fund units are done at prevailing NAVs. Basically, these funds will allow investors to
keep investing as long as they want.

There are no limits on how much can be invested in the fund. They also tend to be actively managed, which
means that there is a fund manager who picks the places where investments will be made. These funds also
charge a fee which can be higher than passively managed funds because of the active management.

They are an ideal investment for those who want investment along with liquidity because they are not bound
to any specific maturity periods. Which means that investors can withdraw their funds at any time they want
thus giving them the liquidity they need.

 Close-Ended Funds
These are funds in which units can be purchased only during the initial offer period. Units can be redeemed
at a specified maturity date. To provide liquidity, these schemes are often listed for trade on the stock
exchange.

Unlike open ended mutual funds, once the units or stocks are bought, they cannot be sold back to the mutual
fund, instead they need to be sold through the stock market at the prevailing price of the shares.

 Interval Funds
These are funds that have the features of open-ended and close-ended funds in that they are opened for
repurchase of shares at different intervals during the fund tenure. The fund management company offers to
repurchase units from existing unitholders during these intervals. If unitholders wish to, they can offload
shares in Favour of the fund.

 Solution-oriented Funds

These mutual fund plans are for specific objectives like saving money for your own retirement or for your
children's college or wedding. They have a minimum five-year lock-in duration.

 Other Funds

Index funds and funds of funds fall under this heading because they base their investments on certain stock
indices.

1.9 Types of Mutual Funds based on Asset Class

Here is the list of different types of mutual funds based on asset classes:

1. Equity Funds

These are funds that invest in equity stocks/shares of companies. These are considered high-risk funds but
also tend to provide high returns. Equity funds can include specialty funds like infrastructure, fast moving
consumer goods and banking to name a few. They are linked to the markets and tend to.

2. Debt Funds

These are funds that invest in debt instruments e.g. company debentures, government bonds and other fixed
income assets. They are considered safe investments and provide fixed returns. These funds do not deduct
tax at source so if the earning from the investment is more than Rs. 10,000 then the investor is liable to pay
the tax on it himself.

3. Money Market Funds

These are funds that invest in liquid instruments e.g. T-Bills, CPs etc. They are considered safe investments
for those looking to park surplus funds for immediate but moderate returns. Money markets are also referred
to as cash markets and come with risks in terms of interest risk, reinvestment risk and credit risks.

4. Balanced or Hybrid Funds

These are funds that invest in a mix of asset classes. In some cases, the proportion of equity is higher than
debt while in others it is the other way round. Risk and returns are balanced out this way.

An example of a hybrid fund would be Franklin India Balanced Fund-DP (G) because in this fund, 65% to
80% of the investment is made in equities and the remaining 20% to 35% is invested in the debt market. This
is so because the debt markets offer a lower risk than the equity market.

1.10 Types of Mutual Funds based on Investment Objective

Here is the list of mutual funds that caters to diverse investment goals of the customers:

 Growth funds: Under these schemes, money is invested primarily in equity stocks with the
purpose of providing capital appreciation. They are considered to be risky funds ideal for investors
with a long-term investment timeline. Since they are risky funds, they are also ideal for those who are
looking for higher returns on their investments.
 Income funds: Under these schemes, money is invested primarily in fixed-income instruments
e.g. bonds, debentures etc. with the purpose of providing capital protection and regular income for
investors.
 Liquid funds: Under these schemes, money is invested primarily in short-term or very short-term
instruments e.g. T-Bills, CPs etc. with the purpose of providing liquidity. They are considered to be
low on risk with moderate returns and are ideal for investors with short-term investment timelines.
 Tax-Saving Funds (ELSS): These are funds that invest primarily in equity shares. Investments
made in these funds qualify for deductions under the Income Tax Act. They are considered high on
risk but also offer high returns if the fund performs well.
 Capital Protection Funds: These are funds where funds are split between investment in fixed
income instruments and equity markets. This is done to ensure protection of the principal that has
been invested.
 Fixed Maturity Funds: Fixed maturity funds are those in which the assets are invested in debt
and money market instruments where the maturity date is either the same as that of the fund or earlier
than it.
 Pension Funds: Pension funds are mutual funds that are invested in with a long-term goal in
mind. They are primarily meant to provide regular returns around the time that the investor is ready
to retire. The investments in such a fund may be split between equities and debt markets where
equities act as the risky part of the investment providing higher return and debt markets balance the
risk and provide lower but steady returns. The returns from these funds can be taken in lump sums, as
a pension or a combination of the two.
  Aggressive Growth Funds: These funds ensure that you experience a steep monetary gain. As
per the beta (the tool to determine the movement of the fund in comparison with the market), one can
decide the return from the fund as the fund is susceptible to market volatility.
 Tax-saving funds: These funds not only offer tax-saving benefits but also support in enhancing
wealth and come with the lowest lock-in period of three years. Tax-saving funds that have become
one of the most preferrable options are ELSS or Equity Linked Saving Scheme.

1.11 Types of Mutual Funds based on Specialty

The following are the types of mutual funds based on specialty:

 Sector Funds: These are funds that invest in a particular sector of the market e.g. Infrastructure
funds invest only in those instruments or companies that relate to the infrastructure sector. Returns
are tied to the performance of the chosen sector. The risk involved in these schemes depends on the
nature of the sector.
 Index Funds: These are funds that invest in instruments that represent a particular index on an
exchange so as to mirror the movement and returns of the index e.g. buying shares representative of
the BSE Sensex.
 Fund of funds: These are funds that invest in other mutual funds and returns depend on the
performance of the target fund. These funds can also be referred to as multi-managed funds. These
investments can be considered relatively safe because the funds that investors invest in actually hold
other funds under them thereby adjusting for risk from any one fund.
 Emerging market funds: These are funds where investments are made in developing countries
that show good prospects for the future. They do come with higher risks as a result of the dynamic
political and economic situations prevailing in the country.
 International funds: These are also known as foreign funds and offer investments in companies
located in other parts of the world. These companies could also be located in emerging economies.
The only companies that won‘t be invested in will be those located in the investor‘s own country.
 Global funds: These are funds where the investment made by the fund can be in a company in any
part of the world. They are different from international/foreign funds because in global funds,
investments can be made even in the investor's own country.
 Real estate funds: These are the funds that are invested in companies that operate in the real
estate sector. These funds can be invested in realtors, builders, property management companies and
 even in companies providing loans. Investment in real estate can be made at any stage, including
projects that are in the planning phase, partially completed and are actually completed.

 Commodity focused stock funds: These funds don‘t invest directly in the commodities. They
invest in companies that are working in the commodities market, such as mining companies or
producers of commodities. These funds can, at times, perform the same way the commodity is as a
result of their association with their production.
 Market neutral funds: The reason that these funds are called market neutral is that they don‘t
invest in the markets directly. They invest in treasury bills, ETFs and securities and try to target a
fixed and steady growth.
 Inverse/leveraged funds: These are funds that operate unlike traditional mutual funds. The
earnings from these funds happen when the markets fall and when markets do well these funds tend
to go to a loss. These are generally meant only for those who are willing to incur massive losses but
at the same time can provide huge returns as well, as a result of the higher risk they carry.
 Asset allocation funds: The asset allocation fund comes in two variants, the target date fund and
the target allocation funds. In these funds, the portfolio managers can adjust the allocated assets to
achieve results. These funds split the invested amounts and invest it in various instruments like bonds
and equity.
 Gilt Funds: Gilt funds are mutual funds where the funds are invested in government securities for
a long term. Since they are invested in government securities, they are virtually risk free and can be
the ideal investment for those who don‘t want to take risks.
 Exchange traded funds: These are funds that are a mix of both open and close ended mutual
funds and are traded on the stock markets. These funds are not actively managed, they are managed
passively and can offer a lot of liquidity. As a result of their being managed passively, they tend to
have lower service charges (entry/exit load) associated with them.

1.11 Types of Mutual Funds based on Risk

Here is the list of types of mutual funds that you can invest in depending on your risk appetite:

 Low risk: These are the mutual funds where the investments made are by those who do not want to
take a risk with their money. The investment in such cases is made in places like the debt market and
tend to be long term investments. As a result of their being low risk, the return on these investments
is also low. One example of a low-risk fund would be gilt funds where investments are made in
 government securities.

 Very-low risk funds: To fulfil the short-term financial goals, very-low risk funds, such as liquid
funds and ultra-short-term funds are ideal to invest in. The investment period is from one month to
one year and offers considerably low returns while keeping your fund safe from market fluctuations.
 Medium risk: These are the investments that come with a medium amount of risk to the investor.
They are ideal for those who are willing to take some risk with the investment and tend to offer
higher returns. These funds can be used as an investment to build wealth over a longer period.
 High risk: These are those mutual funds that are ideal for those who are willing to take higher risks
with their money and are looking to build their wealth. One example of high-risk funds would be
inverse mutual funds. Even though the risks are high with these funds, they also offer higher returns.

 Important Key Words Related to Mutual Funds

 NAV: Net asset value refers to the total value of the related mutual fund scheme. It shows the overall
value which may vary everyday as per the changes in the market.
 Units: The value of mutual fund is divided into units as per the number of persons it is sold. The
value of each unit changes every day.
 Unit holder: The investor who purchases the units of mutual funds is called unit holder. He/she
may keep as many units as he/she wants.

1.12 INTRODUCTION OF EQUITY TRADING IN STOCK MARKET

Trading in the equity market primarily entails the seller fixing a price and a buyer agreeing to pay that price
to purchase the security, thus executing a sale. In a general context, the understanding of what equity is in
the share market extends to all types of shares and securities traded that are also termed as stock. Equity and
stock are thus used interchangeably for the purpose of trading.

An equity market is a platform that allows companies to raise capital via different investors. A company thus
issues stocks that investors or traders purchase in expectation of earning gains from future sales of said
stock.
Often, the equity market is also interchangeably used with the stock market, which more or less serves the
same purpose of facilitating stock trading. Nevertheless, equity markets also encompass over-the-counter
trading markets alongside exchanges.

Thereby, equity markets serve as a platform for both private stocks traded over the counter and public stocks
listed on exchanges such as BSE, NSE, etc.

Traders can realize gains based on the future performance of a stock they have invested in. Equity markets
can also be represented as a common point where sellers and buyers of the stock meet to trade. Here‘s an
elaboration on the sub-parts of an equity market.

An equity market does not solely serve to facilitate trading. Its functioning also encompasses other
procedures. Here‘s the gist of these procedures.

 Trading
As explained earlier, trading is a fundamental procedure that involves buying and selling securities
belonging to listed companies. The procedure is completed through the screen-based automated system, with
brokering agents providing these services to individual traders against stipulated fees. It serves as an open
platform where buyers and sellers can place an order as per trade option availability

 Risk management
Risk management is another specific procedure associated with stock markets. As investing in the equity
market involves risk, the comprehensive system of risk management ensures that investors‘ interest remains
protected while exercising any curbs on frauds from a company‘s end. The system also enables the stock
market to remain updated with any changing trading mechanisms and hedge possible market failures.

 Settlement and clearing

Every investment or trading made throughout the day is cleared and settled by the end of this day. A stock
exchange does this through a well-defined cycle of settlement. In Indian exchanges, the T+2 cycle is adopted
for such settlements, which means the settlements are made within two days after the trade has been
concluded for a specific day, considered day 1.

An equity market comes with immense opportunities for individuals to fulfil their financial requirements for
the future via strategic trading and investment. Such gains can help ride off the increasing inflationary
pressure and the consequent strain on finances due to rising prices. It is thus ideal to get accustomed to the
basics of the stock market along with its regulations for disciplined earning via investment and trading in the
long run.

1.13 Advantages of Investing in Equity Share Capital

The following are the various advantages of investing in equity shares:

1. Dividend Income
An investor is entitled to receive some share of the profits of the company in the form of dividends. It is one
of the two primary sources of return on his investment.

2. Capital Gain
The other source of return on investment apart from dividends is capital gains. This means gains arising due
to a rise in the market price of the shares.

3. Limited Liability
Equity shareholders are not personally liable for the company‘s debts or obligations beyond the amount they
have invested in the company.
 4. Ownership & Voting Rights
Equity is just another word for ownership. Making an investment in equity shares of the company provides
voting rights to the investors. This ensures that their interests as shareholders are being represented. Voting
rights also provide a level of control over the company‘s operations that is not available to other types of
investors, such as bondholders or preferred stockholders.

5. Claim over Assets and Income

An investor of an equity share is the owner of the company, and so is the owner of the assets of that
company. He also enjoys a share of the income of the company.

6. Rights Shares
Whenever companies require additional capital for expansion, they tend to issue ‗rights shares‗. Issuing such
shares preserves the ownership and control of existing shareholders, and the investor receives investment
priority over other general investors. Right Shares are issued at a price lower than the current market price of
the equity share. So, an existing investor can take that advantage or renounce the right in someone‘s favor to
get the value of the right.

7. Bonus Shares
A bonus share is an additional share given to existing shareholders at no cost, based on the number of shares
they already hold. It increases the number of shares held by the investor, which increases the value of the
investment if the share price increases.

8. Liquidity
Though not always true for private equity investments, liquidity is a sure-shot benefit for listed and public
stocks. There is a ready market available for shares in listed companies. The volume and number of
transactions are always large enough to assure the investor of a ready sale whenever he intends to. Cashing
out and squaring position at any time is possible. Therefore, equity investments serve as a lucrative means of
investment for investors with a not-so-long horizon.

9. Diversification
Equity investments can be diversified across various sectors, caps, geographies, and even the phase of
business cycles. The investor is thus protected against the consequences of ―putting all eggs in one basket.‖
Turbulence in any specific stocks or sectors is unable to adversely impact the value of the portfolio.
 10.Long-term Investment
Equity shares are typically viewed as a long-term investment because the company does not redeem its
equity capital until liquidation. And, as per the going concern concept, no business is done with the intention
of winding up. Therefore, this provides investors with the potential for steady returns over time.

11.Stock Split
Stock split means splitting one share into many. It is a process where a company increases the number of
shares outstanding while reducing the value of each share. But how could an investor benefit from this? It
increases the liquidity of the shares by making them more affordable to a wider range of investors. This
increases the demand for the shares and potentially drives up the share price.

1.14 Disadvantages of Investing in Equity Share Capital

While equity shares offer several advantages to investors, there are various disadvantages of
equity share investments to consider.

1. No Guaranteed Returns
The dividend which a shareholder receives is neither fixed nor controllable by the investor. The management
of the company decides how much dividend should be given. If there is a loss, there is no question of
dividend. If there is a profit, investors will not receive the dividend unless the Board of Directors proposes a
dividend.

2. High Risk
Equity share investment is a risky investment compared to any other investment like debts, etc. The money
is invested based on an investor‘s faith in the company. The companies operate in an ecosystem and are
subject to business cycles, adverse government policies, and sector-specific disturbances. Equity investments
display more movement than their counterpart index or bonds. Therefore, risk-averse investors may be
uncomfortable parking their funds into such investments.

3. Fluctuation in Market Price

The market price of any equity share has a wide variation. It is always very difficult to book profits from the
market. On the contrary, there are equal chances of losses. The market forces of demand and supply
determine the prices of equity investments. A highly random variable that can‘t be in control is investment
perception. The perception of investors plays a key role. A negative sentiment or false information about a
stock can spread like wildfire. This inadvertently impacts on its prices.
 4. Limited Control
An equity investor is a small investor in the company; therefore, it is hardly possible to impact the decision
of the company using voting rights.

5. Residual Claim
An equity shareholder has a residual claim over both the assets and the income. The income that is available
to equity shareholders is after the payment of all other stakeholders‘ viz., debenture holders, etc.

6. Over Diversification
While diversification helps eliminate unsystematic risks, there is also the possibility of over-diversification.
While, on the one hand, diversification helps in capping the downside, over-diversification may also limit
one‘s upside. A fund that may be diversified to the extent that it no longer reaps additional returns but only
averages out the results. In such cases, the investor ends up merely replicating the index. An efficient
diversification strategy is one in which stocks are carefully handpicked to harness their growth potential.
Blindly adding stocks to the basket defeats the purpose

1.15 Types of Equity Shares

There are various classes of shares (equity) dependent on multiple things. Let‘s discuss them.
 A. Authorized Share Capital

It is the maximum amount of capital that a company can issue. Companies can increase it from time to time
by altering their memorandum.

B. Issued Share Capital

It is part of the authorized capital that the company offers to investors.

C. Subscribed Share Capital

Subscribed share capital is that part of issued share capital that an investor accepts and agrees upon.

D. Paid Up Capital
It is part of the subscribed capital for which the investors have paid. Normally, all companies accept
complete money in one shot, and therefore issued, subscribed, and paid capital becomes the same.
Conceptually, paid-up capital is the amount of money a company invests in the business. It is also known as
contributed capital.

Apart from the above, other types of shares (equity) also exist.

E. Rights Shares
Right shares are those that a company issues to its existing shareholders. The company issues such kinds of
shares to protect the ownership rights of the existing investors.

F. Bonus Shares
When the company issues share to its shareholders in the form of a dividend, we shall call them bonus
shares.

G. Sweat Equity Share

Sweat equity shares are issued to exceptional employees or directors of the company for their exceptional
job in terms of providing know-how or intellectual property rights to the company.

H. Treasury Stock
Treasury stock means the share that the company has bought back. Read Treasury Stock Vs Common Stock
to understand what treasury shares are and how these are different from common shares.

 Price Terminology Related to Equity Shares

The following are the various terms used to determine different prices of equity shares:

♦ Par or Face Value

Par or face value is the value of shares that we record in the books of accounts. It is also termed the legal
capital in the books of accounts of the company.

♦ Issue Price

This price is the price at which a company offers its shares to investors.

♦ Share/Security Premium
When the issuance of shares is at a price higher than face value, we shall call this excess amount a security
premium.
 ♦ Share at Discount
On the contrary to the above, when the issuance of shares is at a price lower than face value, we call this
deficit amount as share issued at discount.

♦ Book Value
The book value of equity shares, also known as ―shareholders‘ equity‖ or ―net assets‖, represents the residual
value of a company‘s assets after deducting its liabilities. In other words, it is the total amount of assets that
would remain if all the company‘s debts were paid off. The formula to calculate the book value is:

Book Value of Equity Shares = (Paid-up Capital + Reserves and Surplus – Any Loss) /
The total number of equity shares of the company

♦ Market Value
In the case of companies listed on stock exchanges, the market value of the equity share is the price at which
they are currently sold in the market. The other term for it is market capitalization. It may happen that stock
market value and value as per fundamental principles differ. Because there are a number of sentiments that
affect the stock market value.

♦ Fundamental Value
The fundamental value of equity shares, also known as ―intrinsic value―, is an estimate of the true value of a
company‘s shares based on its underlying financial and economic factors. This value is determined by
analyzing the company‘s financial statements, business model, industry trends, management team, and other
relevant factors that may affect its future earnings and growth prospects.

CHAPTER 2

INDUSTRY OVERVIEW

A stock market sector is a group of stocks that have a lot in common with each other, usually because they
are in similar industries. There are 11 different stock market sectors, according to the most used
classification system, known as the Global Industry Classification Standard (GICS).
We categorize stocks into sectors to make it easy to compare companies that have similar business models.
Sectors also make it easier to compare which stocks are making the most money.

1. Energy sector
The energy sector covers companies that do business in the oil and natural gas industry. It includes oil and
gas exploration and production companies, as well as producers of other consumable fuels like coal and
ethanol. The energy sector also includes the related businesses that provide equipment, materials, and
services to oil and gas producers. It doesn't include many renewable energy companies which instead are
considered utilities.

2. Materials sector
The materials sector includes companies that provide various goods for use in manufacturing and other
applications. You'll find makers of chemicals, construction materials, containers and packaging within the
materials sector, along with mining stocks and companies specializing in making paper and forest products.
3. Industrials sector
The industrials sector encompasses a wide range of different businesses that generally involve the use of
heavy equipment. Transportation stocks such as airlines, railroads, and logistics companies are found within
the industrials sector, as are companies in the aerospace, defense, construction, and engineering industries.
Companies making building products, electrical equipment, and machinery also fall into this sector, as do
many conglomerates.

4. Utilities sector
The utilities sector encompasses every different type of utility company you can imagine. Within the sector,
you'll find utilities specializing in making electrical power available to residential and commercial
customers, as well as specialists in natural gas transmission and distribution. Other utilities are responsible
for delivering water to customers. Some utility companies engage in more than one of these different
subspecialties. In addition, independent producers of power and renewable electricity also land in the
utilities sector, even though they don't exactly resemble the traditional regulated utility.

5. Healthcare sector
The healthcare sector has two primary components. One component includes companies that develop,
pharmaceuticals and treatments based on biotechnology, as well as the analytical tools and supplies needed
for the clinical trials that test those treatments. The other encompasses healthcare equipment and services,
including surgical supplies, medical diagnostic tools, and health insurance. Telemedicine is a particularly
interesting part of the healthcare sector that falls into the latter category.

6. Financials sector
The financials sector includes businesses that are primarily related to handling money. Banks are a key
industry group within the sector, but you'll also find insurance companies, brokerage houses, consumer
finance providers, and mortgage-related real estate investment trusts among financials. The financial sector
also includes some of the best-known financial technology, or fintech, companies.

7. Consumer discretionary sector

The consumer discretionary sector covers goods and services for which consumer demand depends upon
consumer financial status. For example, if you make $25,000 per year, you probably buy a different car than
someone who makes $25 million per year. The sector includes companies that sell higher-priced items like
automobiles and luxury goods, as well as leisure products. You'll find both brick-and-mortar and e-
commerce-based retail companies in this category, along with hotel and restaurant stocks.
8. Consumer staples sector
The consumer staples sector includes goods and services that consumers need, regardless of their current
financial condition or the current economic climate. The category includes companies in the food, beverage,
and tobacco industries, as well as household and personal care products. You'll also find retail companies
that specialize in selling staples, such as supermarkets, in this group.

9. Information technology sector

Also commonly referred to as simply the "tech sector," the information technology sector covers companies
involved in the different categories of technological innovation. Some companies in information technology
focus on creating software or providing services related to implementing technological solutions like
cybersecurity, while others are more involved in building the equipment, components, and hardware that
make tech possible. Information technology also includes makers of, semiconductors and the equipment
used to produce semiconductor chips.

10. Communication services sector

The communication services sector is among the newest of the GICS sectors and includes a couple of major
areas that used to be part of other sectors. Telecommunication services providers make up one wing of the
sector. At the other end are media and entertainment companies, including both older media like television
and radio and interactive media via the internet and newer forms of communication.

11. Real estate sector

The real estate sector is the newest, having formerly been part of the financial sector. It generally includes
two different types of investments related to real estate. Some stocks in the sector are responsible for
developing new real estate projects and then managing them by obtaining tenants for various spaces within
the project property. In addition, most real estate investment trusts, or REITs (pronounced REETS), which
are special tax-favored business entities that operate in various areas of the real estate industry, get counted
within the real estate sector.

Sector investing
If you are interested in a certain sector but are not ready to invest in a specific company within that sector,
you can still participate in sector investing. Seek out lower-risk investments like exchange-traded funds
(ETFs) and mutual funds that are specifically tied to a sector. Sector investing plays an increasingly
important role in the strategies that investors use today.
 CHAPTER 3

RESEARCH METHODOLOGY

Research methodology simply refers to the practical ―how‖ of any given piece of research. More
specifically, it‘s about how a researcher systematically designs a study to ensure valid and reliable results
that address the research aims and objectives.

For example, how did the researcher go about deciding:

● What data to collect (and what data to ignore)

● Who to collect it from (in research, this is called ―sampling design‖)

● How to collect it (this is called ―data collection methods‖)

● How to analyze it (this is called ―data analysis methods‖)

In a dissertation, thesis, academic journal article (or pretty much any formal piece of research), you‘ll find a
research methodology chapter (or section) which covers the aspects mentioned above. Importantly, a good
methodology chapter in a dissertation or thesis explains not just what methodological choices were made,
but also explains why they were made.

In other words, the methodology chapter should justify the design choices by showing that the chosen
methods and techniques are the best fit for the research aims and objectives and will provide valid and
reliable results. A good research methodology provides scientifically sound findings, whereas a poor
methodology doesn‘t. We‘ll look at the main design choices below.

Qualitative, quantitative and mixed methods are different types of methodologies, distinguished by whether
they focus on words, numbers or both. This is a bit of an oversimplification, but it's a good starting point for
understanding. Let‘s take a closer look. Qualitative research refers to research which focuses on collecting
and analyzing words (written or spoken) and textual data, whereas quantitative research focuses on
measurement and testing using numerical data. Qualitative analysis can also focus on other ―softer‖ data
points, such as body language or visual elements.

It‘s quite common for a qualitative methodology to be used when the research aims and objectives are
exploratory in nature. For example, a qualitative methodology might be used to understand peoples‘
perceptions about an event that took place, or a candidate running for president. Contrasted to this, a
quantitative methodology is typically used when the research aims and objectives are confirmatory in nature.
For example, a quantitative methodology might be used to measure the relationship between two variables
(e.g. personality type and likelihood to commit a crime) or to test a set of hypotheses. As you‘ve probably
guessed, the mixed method methodology attempts to combine the best of both qualitative and quantitative
methodologies to integrate perspectives and create a rich picture.

To study the Investors perception towards Mutual Fund and Equity the primary and secondary data has been
collected. During the survey the questionnaire was handed over to respondents and they were asked to return
the filled questionnaire after completion. The secondary data were collected from the books, records, and
journals. An aggregate of 90 respondents responded to the questionnaire.

3.1 OBJECTIVES OF STUDY

Project objectives are what you plan to achieve by the end of your project. This might include deliverables
and assets, or more intangible objectives like increasing productivity or motivation. Your project objectives
should be attainable, time-bound, with specific goals . You can measure at the end of your project.

Project objectives are a critical element of project management—without them, you don‘t have a succinct
way to communicate your goals before and during the project, nor do you have a measurable way to evaluate
your success after the project ends. An objective is something you plan to achieve. A military objective is
the overall plan for a mission. The objective for a bake sale is to raise money. If your objective is to learn a
new word, you have succeeded. A clear project objective helps you know where you‘re going with your
project. Without a project objective, you don‘t have an easy way to know if your project succeeded or
failed—nor can you plan improvements for the next project you work on. Research objectives describe
concisely what research is trying to achieve.

They summarize the accomplishments a researcher wishes to achieve through the project and provide
direction to the study. A research objective must be achievable i.e., it must be framed keeping in mind
available time, infrastructure required for research, and other resources. Before forming a research objective,
researchers should read about all the developments in research and find gaps in knowledge that need to be
addressed.
The Primary objective of the study are as follows:

 The main purpose is to study whether mutual fund or equity which one is investors best choice.

 The objective of this project is to make a study of various investment schemes in the Secondary

Market.

 To study Investors perception towards Mutual Fund and Equity.

 To provide feasible solutions on the basis of the findings of the study.

 To identify reasons for preferring mutual funds and direct equity investment.

 To identify factors considered while investing in mutual funds

 To identify the investment objective while investing in equity stock.

 To compare Equity and Mutual fund in respect of their risk and returns

 Analyzing the performance of equity and mutual fund schemes with their benchmark NSE, BSE,

Nifty & SENSEX.

 Finding performance by taking the quarterly average of 10 Years.

 Provide Information about pros and cons of investing in equity and mutual funds

3.2 HYPOTHESIS

A. What is Hypothesis?
An assumption that is made based on some limited evidence collected is known as a hypothesis. It is the
beginning point of study that translates research questions into predictions that might or might not be true. It
depends on the variables and population used, also the relation between the variables. The hypothesis used to
test the relationship between two or multiple variables is known as the research hypothesis.

B. Hypothesis Properties.
The properties of the hypothesis are as follows:

 It should be empirically tested irrespective of being right or wrong.

 It should establish the relationship between the variables that are considered.
 It must be specific, clear, and precise.
 It should possess the scope for future studies and be capable of conducting more tests.
  It should be capable of testing it in a reasonable time and it must be reliable.

C. Hypothesis of the study:

HO: There is a considerable difference between equity and mutual fund investment with respect to risk and
reward functions.
H1: There is no significant difference between the equity and mutual fund investment with respect to risk
and reward functions.
There is a significant difference between investment in equity and mutual fund with regards to overall
satisfaction of investors.

3.3 SCOPE OF THE STUDY

The scope of a study explains the extent to which the research area will be explored in the work and specifies
the parameters within the study will be operating.

Basically, this means that you will have to define what the study is going to cover and what it is focusing on.
Similarly, you also have to define what the study is not going to cover. This will come under the limitations.
Generally, the scope of a research paper is followed by its limitations.

As a researcher, you have to be careful when you define your scope or area of focus. Remember that if you
broaden the scope too much, you might not be able to do justice to the work or it might take a very long time
to complete. Consider the feasibility of your work before you write down the scope. Again, if the scope is
too narrow, the findings might not be generalizable.

Typically, the information that you need to include in the scope would cover the following:

1. General purpose of the study.

2. The population or sample that you are studying.

3. The duration of the study.

4. The topics or theories that you will discuss.

5. The geographical location is covered in the study.

3.4 PURPOSE OF THE STUDY

The present study is an attempt to know the investors perception regarding equities and mutual funds with
the avenues available to the investor. Research has been carried out with the help of primary and secondary
data. The study is restricted, and analysis was done based on the responses given by the investors.

The main purpose of this study is to attain the knowledge of the investment systems of various stock market,
the main purpose of the study are as follows:

1. To know the ideas of investors about investment with respect to future opportunity.
2. To study the satisfaction level of investors about return on investment in equity and mutual fund
sector.
3. To learn about the various aspects of Risk and reward function of investment.

3.5 LIMITATIONS OF STUDY

In the clearest terms, research limitations are the practical or theoretical shortcomings of a study that are
often outside of the researcher’s control. While these weaknesses limit the generalizability of a study‘s
conclusions, they also present a foundation for future research.

Sometimes limitations arise from tangible circumstances like time and funding constraints, or equipment and
participant availability. Other times the rationale is more obscure and buried within the research design.
Common types of limitations and their ramifications include:

 Theoretical: limits the scope, depth, or applicability of a study.

 Methodological: limits the quality, quantity, or diversity of the data.
 Empirical: limits the representativeness, validity, or reliability of the data.
 Analytical: limits the accuracy, completeness, or significance of the findings.
 Ethical: limits the access, consent, or confidentiality of the data.
Regardless of how, when, or why they arise, limitations are a natural part of the research process and
should never be ignored. Like all other aspects, they are vital in their own purpose.

By identifying and addressing limitations throughout a project, researchers strengthen their arguments and
curtail the chance of peer censure based on overlooked mistakes. Pointing out these flaws shows an
understanding of variable limits and a scrupulous research process.
Showing awareness of and taking responsibility for a project‘s boundaries and challenges validates the
integrity and transparency of a researcher. It further demonstrates the researchers understand the applicable
literature and have thoroughly evaluated their chosen research methods.

Presenting limitations also benefits the readers by providing context for research findings. It guides them to
interpret the project‘s conclusions only within the scope of very specific conditions. By allowing for an
appropriate generalization of the findings that is accurately confined by research boundaries and is not too
broad, limitations boost a study’s credibility.

Limitations are true assets to the research process. They highlight opportunities for future research. When
researchers identify the limitations of their particular approach to a study question, they enable precise
transferability and improve chances for reproducibility.

Simply stating a project‘s limitations is not adequate for spurring further research, though. To spark the
interest of other researchers, these acknowledgements must come with thorough explanations regarding how
the limitations affected the current study and how they can potentially be overcome with amended methods.

Some of the Limitations of the study that were encountered during the study are:

 This research study was time bound and only certain criteria were taken up for the study.
 There was a limitation of time to conduct such a big survey in limited available time.
 Generally, the Data on the official website of the mutual fund and equity investment are not fully
disclosed.
 To access such a large number of investors was difficult because of the non-operative attitude of
respondent.
 The respondents were unable or unwilling to give a complete and accurate response to certain
questions.
 Some of the respondents might have been biased in their responses as it depends on their experience
gained by them during the investment process.
 This research study was time bound and due to this only a few aspects of the investments were taken
up for study.

3.6 SIGNIFICANCE OF STUDY

The significance of the study is a written statement that explains why your research was needed. It‘s a
justification of the importance of your work and impact it has on your research field, it‘s contribution to new
knowledge and how others will benefit from it.

Significance means having the quality of being "significant" — meaningful, important. It also refers to the
meaning of something. A certain date might have significance because it's your birthday or the anniversary
of Princess Di's wedding.

Significance starts with the word sign for a reason. An item's significance is a sign of its importance. The
significance of something can be implicit or explicit — meaning it can be clear or only known with a deeper
understanding of the situation. Your perfect score on the Calculus exam might have added significance for
people who know that you never even opened your textbook to study.

3.7 METHODOLOGY

The data analyzing techniques used were Bar chart, Pie Chart, Percentage Method and Column Method. The
data collected from Primary sources is represented by using Bar Chart, Pie chart etc. Actual data processing
was as follows: The task of data collection would be complete when all entries (or almost all) would be filled
with the appropriate responses or values.

This section includes the methodology which includes. The research design, objectives of study, scope of
study along with research methodology and limitations of study etc.

➢To know the investors perception about investment opportunity.

➢To study the satisfaction level of the investment about mutual fund and equity.

➢To make comparative study of risk and reward ratio of investment.

3.8 DATA COLLECTION

Data collection is defined as the procedure of collecting, measuring and analysing accurate insights for
research using standard validated techniques. A researcher can evaluate their hypothesis on the basis of
collected data. In most cases, data collection is the primary and most important step for research, irrespective
of the field of research. The approach of data collection is different for different fields of study, depending
on the required information. The most critical objective of data collection is ensuring that information-rich
and reliable data is collected for statistical analysis so that data-driven decisions can be made for research.

Data collection is important step in any project and success of any project will be largely depend upon now
much accurate you will be able to collect and how much time, money and effort will be required to collect
that necessary data, this is also important step. Data collection plays an important role in research work.
Without proper data available for analysis, you cannot do the research work accurately. Data collection is a
process of collecting information from all the relevant sources to find answers to the research problem, test
the hypothesis and evaluate the outcomes. Data collection methods can be divided into two categories:
primary methods of data collection and secondary methods of data collection. Present study is based on
primary as well as secondary data. Secondary data was collected from various sources like research journals,
websites and articles to ensure detailed understanding of the subject and authenticity of information

3.9 METHODS OF DATA COLLECTION

A) PRIMARY DATA

Primary data are usually collected from the source—where the data originally originates from and are
regarded as the best kind of data in research. Primary data is a first hand data and it is most relevant data.
Primary data constitute first-hand information which is collected for the first time in order to solve research
problem. It is the data collected from primary sources which are original sources. It is fresh data collected for
the first time directly from the respondents. Primary data is important as it gives reliable factual firsthand
information for research purpose. Researcher collects primary data as per the need of his research project
and from the source or sources which he considers appropriate. Primary data are collected for detailed
information on certain aspects of research project. Such data are also collected when the secondary data are
old, outdated or inadequate. I decided primary data collection because our study nature does not permit to
apply observational method. In survey approach we had selected a questionnaire method for taking a
customer view because it is feasible from the point of view of our subject & survey purpose. I conduct 125
sample of survey in my project to judge the satisfaction level of investment in equity and mutual fund. A
researcher have did survey to collect information for preparation of this project. Researcher also used various
other primary methods of data collection i.e. Questionnaire, interview of the investors and review of family
who is invest in mutual fund and equity

B) SECONDARY DATA

Along with primary data, secondary data are also useful in marketing research. Such data are collected by
some other agency for some other purpose. Secondary data are easily or readily available in the published
form and are used for the conduct of research activity. This data is not collected by the researcher through
survey, etc. but are actually borrowed by the researcher for his research purpose. The term is used in contrast
with the term secondary data. Secondary data is data gathered from studies, surveys, or experiments that
have been run by other people or for other research. Secondary data refers to data that is collected by
someone other than the primary user. Researchers have taken the various modes of secondary data
collection. It includes various journals, news papers magazines, etc. Researcher Also used different internet
websites and various authors for completion of this project.

3.10 TABULATION OF DATA

Tabulation refers to the system of processing data or information by arranging it into a table. With
tabulation, numeric data is arrayed logically and systematically into columns and rows, to aid in their
statistical analysis. The purpose of tabulation is to present a large mass of complicated information in an
orderly fashion and allow viewers to draw reasonable conclusions and interpretations from them.

 Need of tabulation of data-

✓ Tabulation is needed as it brings orderly arrangement of data for analysis. It acts as a connecting link
between organization of data and the interpretation of data.
✓ Tabulation of data is needed as it brings accuracy and speed in arranging data for drawing conclusions. It
provides the form of statistical tables.
✓ Tabulation of data is needed as it facilitates correct analysis and interpretation of data. It can be used to
find out the correlation between two or more variables.

3.11 OBJECTIVES OF TABULATION

Tabulation essentially bridges the gap between the collection of data and analysing them. The primary
objectives of tabulation can be encapsulated below -
• For Simplification of Complex Data- When any information is tabulated, the volume of raw data is
compressed and presented in a much more simplified manner. This facilitates comprehension and previously
complex data.
• To Highlight Important Information - Representing any data in tabular form increases the scope to
highlight important information. Since data is presented in a 29 concise manner without any textual
explanation, any crucial information is automatically highlighted without difficulty.
• To Enable Easy Comparison - When data is presented in an orderly fashion in rows and columns, it
becomes easier to compare between them on parameters. the basis of several. For example, it becomes easier
to determine the month when a country has received the maximum amount of rainfall if the data is presented
in a table. Otherwise, there always remains room for making a mistake in processing the data correctly.
• To Help in the Statistical Analysis of Data - Statistical analysis involves the computing correlation,
average, dispersion, etc. of data. When information is presented in an organized manner in a table, statistical
analysis becomes a lot simpler.
• Saves Space- Even though it might not seem as important as the other objective of tabulation, saving space
without sacrificing the quality of data can be extremely helpful in the long run. Additionally, a table helps to
present facts in a much more concise manner than page after page of text. These are the five most important
objectives of tabulating data The data in the proposed research us tabulated in tables and charts form for the
purpose of better understanding and clearance of learners of the project.

3.12 TECHNIQUES & TOOLS

Tools are instruments used to collect information for performance assessments, self evaluations, and external
evaluations. ′ Tools need to be strong enough to support what the evaluations find during research. ′
Depending on the nature of the information to be gathered, different instruments are used to conduct the
assessment forms for gathering data.

3.13 GRAPHICAL REPRESENTATION OF DATA

The researcher has used pie chart and bar graphs for displaying data in the study. Pie chart is a graphic data
display in which sectors of a circle correspond in area to the relative size of the quantities represented. While
bar graphs is a mathematical representation of data. It uses bars to show comparisons between categories of
data. The bars can be either horizontal or vertical.

CHAPTER 4

DATA ANALYSIS AND INTERPRETATION

4.1 MEANING

Data analysis is a process of inspecting, cleansing, transforming, and modelling data with the goal of
discovering useful information, informing conclusions, and supporting decision-making. Data analysis has
multiple facets and approaches, encompassing diverse techniques under a variety of names, and is used in
different business, science, and social science domains. In today's business world, data analysis plays a role
in making decisions more scientific and helping businesses operate more effectively. Data mining is a
particular data analysis technique that focuses on statistical modelling and knowledge discovery for
predictive rather than purely descriptive purposes, while business intelligence covers data analysis that relies
heavily on aggregation, focusing mainly on business information.. In statistical applications, data analysis
can be divided into descriptive statistics, exploratory data analysis (EDA), and confirmatory data analysis
(CDA). EDA focuses on discovering new features in the data while CDA focuses on confirming or falsifying
existing hypotheses. Predictive analytics focuses on the application of statistical models for predictive
forecasting or classification, while text analytics applies statistical, linguistic, and structural techniques to
extract and classify 70 information from textual sources, a species of unstructured data. All of the above are
varieties of data analysis. Data integration is a precursor to data analysis, and data analysis is closely linked
to data visualization and data dissemination. Analysis, refers to dividing a whole into its separate
components for individual examination. Data analysis, is a process for obtaining raw data, and subsequently
converting it into information useful for decision-making by users. Data, is collected and analyzed to answer
questions, test hypotheses, or disprove theories.

4.2 Importance of Data Analysis

Data analysis is a process used to transform, remodel and revise certain information (data) with a view to
reach to a certain conclusion for a given situation or problem. Data analysis can be done by different
methods as according to the needs and requirement of different domains like science, business, social
science dissertation, etc. data analysis, in a research supports the researcher to reach to a conclusion.
Therefore, simply stating that data analysis is important for a research will be an understatement rather no
research can survive without data analysis. Data analysis is a way to study and analyse huge amounts of
data. Research often includes going through heaps of data, which is getting more and more for the
researchers to handle with every passing minute.

Hence, data analysis knowledge is a huge edge for researchers in the current era, making them very efficient
and productive. There are many benefits of data analysis however; the most important ones are as follows: -
Data analysis helps in structuring the findings from different sources of data collections like survey research.
It is again very helpful in breaking a macro problem into micro parts. Data analysis acts like a filter when it
comes to acquiring meaningful insights out of huge data-set. Every researcher has sort out huge pile of data
that he/she has collected, before reaching to a conclusion of the research question. One of the most important
uses of data analysis is that it helps in keeping human bias away from research conclusion with the help of
proper statistical treatment. With the help of data analysis, a researcher can filter both qualitative and
quantitative data for an assignment writing projects.

4.3 Interpretation

Interpretation means explaining the meaning and significance of the data so simplified/Analysed. However,
both analysis and interpretation are inter linked and complementary to each other. Analysis is useless
without interpretation and interpretation with out analysis is difficult or even impossible. The objective of
analysis is to study the relationship between the various elements of a financial statement by interpretation

4.4 Types of Data Interpretation

1) Pie Charts: It is a circular chart divided in various sectors. The sectors of the circle are constructed in
such a way that the area of each sector is proportional to the corresponding values of information provided.
In pie charts total quantity is distributed over a total angle of 360° or 100%. Pie graphs have the shape of a
pie and each slice of the pie represents the portion of the entire pie allocated to each category. Many times,
Statisticians may use exact figures against these sectors inside or outside as the case may be. Pie charts can
be classified into two main types such as Exploded Pie Chart and Doughnut Pie Chart.

Exploded Pie Chart: A pie chart with one or more sectors separated from the rest of the disk is called an
exploded pie chart. This pie chart is used to either highlight a sector or to highlight smaller segments of the
chart with a small proportion.

Doughnut Pie Chart: A doughnut pie chart (also spelt as donut) is functionally identical to a pie chart, with
the exception of a blank Centre and the ability to support multiple statistics at once. There are two types of
doughnut pie charts, doughnut and exploded doughnut pie charts.

2) Bar Graph:- In this section, data is represented as horizontal or vertical bars. One of the parameters is
given on the x-axis and other on y-axis. Here we need to understand the given information and thereafter
answer the given questions. A bar graph or a bar chart that presents the grouped data with the help of
rectangular bars. These bars are either horizontal or vertical and their lengths are proportional to the value
that they represent. There are two axes in the graph in which one represents particular categories being
compared and the other axis shows a discrete value.

4.5 DATA ANALYSIS AND INTERPRETATION

1)GENDER
Table No: 1

Gender Frequency Count

Male 60% 6
Female 40% 4
Total 100% 10

Interpretation: -

From the above table no.1 and chart no. 1 the pie chart clearly states about the gender
frequency. According to the survey Female investor frequency is 40% and Male Investors
frequency is 60% and Therefore, Male ratio is higher than the female.
2) AGE

Table No 2

Age Frequency Count

18 To 30 20% 2
30 to 40 30% 3
40 to 50 40% 4
50 and Above 10% 1
Total 100% 10

Interpretation: -

From the above table no. 5.2 and chart no. 5.2 the pie chart clearly states the age frequency.
According to the survey Age 18 to 30 Investors are 20%, Age 30 to 40 Investors are 30% ,
Age 40 to 50 Investors are 40% and then Age 50 and above Investors are 10%.

Source- Primary data

3)Occupation

Table No 3

Occupation Frequency Count

Government Employee 20% 2
Self Employed 25% 2.5
Professional 30% 3
Salaried 20% 2
Others 5% 0.5
Total 100% 10

Interpretation: -

From the above table no. 3 and chart no. 3 the pie chart clearly states about the Occupation
Frequency. According to the survey Investors Occupation of Government Employee
frequency is 20% , Self Employed frequency is 25% , Professional frequency is 30% ,
salaried frequency is 20% and Others frequency is 5%.

4)Marital Status?

Table No 4

Marital Status Frequency Count

Married 34% 3.4
Unmarried 66% 6.6
Total 100% 10

Interpretation: -
From the above table no. 4 and chart no. 4 the pie chart clearly states about the Age Frequency. From the
above figure it interprets the gender of the respondent from that 34 people are married and 66 people are
Unmarried. So we can say that the highest numbers of people are Unmarried.

Source- Primary data

5) Which income group do you belong? (Per Annum)

Table No 5

Income Group Frequency Count

Below 5 Lakhs 50% 5
5 Lakhs to 10 lakhs 25% 2.5
10 Lakhs to 15 lakhs 17% 1.7
15 Lakhs and Above 8% 0.8
Total 100% 10

Interpretation: -
From the above table no. 5 and chart no. 5 the pie chart clearly states about the role Frequency. According to
survey frequency of Income Group Below 5 lakhs is 50%, 5 lakhs – 10 lakhs is 25% , 10 lakhs – 15 lakhs is
17% and 15 lakhs and above is 8%.

Source- Primary data

6) INVESTMENT AVENUE OF RESPONDENTS.

Investment Choice

Table No 6
 Investment Frequency Count
Equities 25% 2.5
Mutual Fund 15% 1.5
Insurance 17% 1.7
Gold 16% 1.6
Bank Deposits 14% 1.4
Post Office Saving 13% 1.3
Total 100% 10

Interpretation:

It is inferred from the above table no 6 that, of the 100 respondents 14 investors have invested their funds in
banks, 13 of them have invested in post office savings, 17 respondents are invested in insurance, 16
respondents are invested in gold, 15 respondents have invested in mutual funds and 25 respondents are
invested in equities. It clearly indicates that majority of the investors are not ready to take risk so they have
invested in equities and Insurance.

7) INVESTMENT OBJECTIVES OF THE RESPONDENTS.

Table No 7

Investment Objective Frequency Count

Future Security 40% 4
Risk Involved 10% 1
Regular Return 30% 3
Tax benefits 10% 1
Assets buildup 10% 1
Total 100% 10
Interpretation:

From the above table it is understood that, of the 100 respondents 40% of the investors for future security.
30% of the investors have invested their money for regular returns followed by. Very least number of
investors i.e. 10% of the investors was invested with the objective chasing risk. The remaining investors fall
in between 10% for tax benefits and assets buildup.
8) SOURCES TO KNOW ABOUT MUTUAL FUND AND EQUITY MARKET

Table No 8

Sources of information Frequency Count

Periodicals 12% 1.2
Self-analysis 11% 1.1
Brokers advice 32% 3.2
Friends & Relative 45% 4.5
Total 100% 10

Interpretation:

It is inferred from the above table that, only 12% of the respondents come to know about investment avenues
by periodicals, 32% of them have the source of brokers advice, 45% of them know by friends and relatives
and majority i.e. 11% of them know by themselves with investment trust
9) RESPONDENTS INTEREST TO INVEST IN LONG TERM

Table No 9

Particular Frequency Count

Yes 60% 6
No 40% 4
Total 100% 10

Interpretation:
By analyzing the above table 9, it is clear that 60% of the respondents intend to invest in mutual fund &
equities for long term basis; whereas only 40% of the investors intend to invest in short-term mutual funds &
equities. It means majority of them are interested in long term investment.
10) INVESTMENT OPTION BASED ON INVESTMENT OBJECTIVES

Table No 10
Particulars Frequency Count
Equity Fund 41% 4.1
Debt Fund 14% 1.4
Balanced Fund 25% 2.5
Liquid Fund 12% 1.2
Gilt Fund 8% 8
Total 100% 10

Interpretation:
From the above table it is clear that, 41% of the investors invested in equity fund, 25% of the investors
invested in balanced fund, 12% of the investors invested in liquid fund, 8% of investors invested in gilt fund
and only 14% of the investors are invested in debt fund. It indicates the maximum number of investors have
an objective to invest in equity.

11) OPTION AVAILABLE TO INVEST IN EQUITY MARKET

Table No 11

Particulars Frequency Count

IPO 20% 2
Cash 55% 5.5
Future & Options 25% 2.5
Total 100% 10
Interpretation:

By analyzing the above graph clears that, in equity market 55% of the investors Invested in cash, 25% of the
investors invested in future and options and only 20% of the investors invested in initial public offers

CHAPTER 5

CONCLUSION AND FINDING OF THE STUDY

A conclusion is the last part of something, its end or result. When you write a paper, you always end up
summing up your arguments and drawing a conclusion about what you've been writing about.

Saving money is not enough. Each of us also need to invest one's savings intelligently in order to have
enough money available for funding the higher education of one's children, for buying a house, or for one's
own golden years.

The study recommends new investors to go for in both mutual funds and equities, because of high risk and
market instability.

People who need a systematic way of investing should go for mutual fund investing. Investing with a fixed
income strategy, you should choose mutual fund as an investment choice. Short term as well as medium term
investors should choose direct equity investing as an investment choice. Mutual fund investing is termed as a
long-term horizon of getting a good return, as the fund is going in a systematic way.
If an investor has got time in making a market study and managing his/her portfolio, should invest in equity
shares directly, otherwise go for mutual fund investing. If an investor likes buying and selling stocks,
managing the stocks in his portfolio should choose direct investing in equity stocks.

5.1 FINDINGS

The findings are result of your reading, observations, interviews and investigation. They form the basis of
your report. Depending on the type of report you are writing, you may also wish to include photos, tables or
graphs to make your report more readable and/or easier to follow.

1) From the above table no. 1 and chart no. 1 the pie chart clearly states about the gender frequency.
According to the survey Female investor frequency is 40% and Male Investors frequency is 60% and
Therefore, Male ratio is higher than the female.
2) From the above table no. 2 and chart no. 2 the pie chart clearly states the age frequency. According to
the survey Age 18 to 30 Investors are 20%, Age 30 to 40 Investors are 30% , Age 40 to 50 Investors
are 40% and then Age 50 and above Investors are 10%.
3) From the above table no. 3 and chart no. 3 the pie chart clearly states about the Occupation
Frequency. According to the survey Investors Occupation of Government Employee frequency is
20% , Self Employed frequency is 25% , Professional frequency is 30% , salaried frequency is 20%
and Others frequency is 5%.
4) From the above table no. 4 and chart no. 4 the pie chart clearly states about the Age Frequency. From
the above figure it interprets the gender of the respondent from that 43 people are married and 82
people are Unmarried. So we can say that the highest numbers of people are Unmarried.
5) From the above table no.5 and chart no. 5 the pie chart clearly states about the role Frequency.
According to survey frequency of Income Group Below 5 lakhs is 50%, 5 lakhs – 10 lakhs is 25% ,
10 lakhs – 15 lakhs is 17% and 15 lakhs and above is 8%.
6) It is inferred from the above table no 6 that, of the 100 respondents 14 investors have invested their
funds in banks, 13 of them have invested in post office savings, 17 respondents are invested in
insurance, 16 respondents are invested in gold, 15 respondents have invested in mutual funds and 25
respondents are invested in equities. It clearly indicates that majority of the investors are not ready to
take risk so they have invested in equities and Insurance.
7) From the above table no 7 it is understood that, of the 100 respondents 40% of the investors for
future security. 30% of the investors have invested their money for regular returns followed by. Very
least number of investors i.e. 10% of the investors was invested with the objective chasing risk. The
remaining investors fall in between 10% for tax benefits and assets buildup.
 8) It is inferred from the above table no 8 that, only 12% of the respondents come to know about
investment avenues by periodicals, 32% of them have the source of brokers advice, 45% of them
know by friends and relatives and majority i.e. 11% of them know by themselves with investment
trust
9) By analyzing the above table no 9 , it is clear that 60% of the respondents intend to invest in mutual
fund & equities for long term basis; whereas only 40% of the investors intend to invest in short-term
mutual funds & equities. It means majority of them are interested in long term investment.
10) From the above table no 10 it is clear that, 41% of the investors invested in equity fund, 25% of the
investors invested in balanced fund, 12% of the investors invested in liquid fund, 8% of investors
invested in gilt fund and only 14% of the investors are invested in debt fund. It indicates the
maximum number of investors have an objective to invest in equity.
11) By analyzing the above graph no 11 clears that, in equity market 55% of the investors Invested in
cash, 25% of the investors invested in future and options and only 20% of the investors invested in
initial public offers

5.2 SUGGESTIONS & RECOMMONDATIONS

knowledge about various funds and schemes are available in mutual fund.

goals and decide your

risk tolerance capacity.

KEY LEARININGS

 A mutual fund is a type of investment vehicle consisting of a portfolio of stocks, bonds, or other
securities.
 Mutual funds give small or individual investors access to diversified, professionally managed
portfolios.
 Mutual funds are divided into several kinds of categories, representing the kinds of securities they
invest in, their investment objectives, and the type of returns they seek.
 Mutual funds charge annual fees, expense ratios, or commissions, which may affect their overall
returns.
 Employer-sponsored retirement plans commonly invest in mutual funds.
  The main benefit from an equity investment is the possibility to increase the value of the principal
amount invested. This comes in the form of capital gains and dividends.
 An equity fund offers investors a diversified investment option typically for a minimum initial
investment amount.
 If an investor wanted to achieve the same level of diversification as an equity fund, it would require
much more – and much more manual – capital investment.
 Investors may also be able to increase investment through rights shares, should a company wish to
raise additional capital in equity markets.
 Safety, income, and capital gains are the big three objectives of investing but there are others that
should be kept in mind as well
 Investment goals provide structure and purpose to the money we allocate to investment products,
such as stocks, bonds and funds. Investing and investment goal setting go hand in hand with sound
personal finance practices, such as building an emergency fund and managing spending.
 An investment strategy is a plan designed to help individual investors achieve their financial and
investment goals. Your investment strategy depends on your personal circumstances, including your
age, capital, risk tolerance, and goals

BIBLIOGRAPHY

A Bibliography is a list of all of the resources you have used (whether referred or not)

 https://en.wikipedia.org/wiki/Financial_market
  https://getmoneyrich.com/direct-equity-investment/
 https://www.investopedia.com/terms/m/mutualfund.asp
 https://en.wikipedia.org/wiki/Mutual_fund
 https://www.investopedia.com/articles/stocks/09/indian-stock
 https://www.nseindia.com
 https://www.bseindia.com
 https://www.moneycontrol.com
 https://www.mutualfundsindia.com

ANNEXURE

Questionnaire :-
1) Gender

a. •Male
b. • Female

2) Age: -

a. 21-30
b. 30-40
c. 40-50
d. 50 and above

3) Occupation:

a. Government Employee
b. Self – employed
c. Professional
d. Salaried
e. Others

4)Marital Status

a. Married
b. Unmarried

5) Which Income group do you belong? (per Annum)

a. Below 5 Lakhs
b. 5 Lakhs – 10 Lakhs
c. 10 Lakhs – 15 Lakhs
d. 15 Lakhs and above
6) INVESTMENT AVENUE OF RESPONDENTS.

a. Equities
b. Mutual Fund
c. Insurance
d. Gold
e. Bank Deposits
f. Post Office Saving
7) INVESTMENT OBJECTIVES OF THE RESPONDENTS.

a. Future Security
b. Risk Involved
c. Regular Return
d. Tax benefits
e. Assets buildup
8) SOURCES TO KNOW ABOUT MUTUAL FUND AND EQUITY MARKET
a. Periodicals
b. Self-analysis
c. Brokers advice
e. Friends & Relative
9) RESPONDENTS INTEREST TO INVEST IN LONG TERM

a. Yes
b. No

10) INVESTMENT OPTION BASED ON INVESTMENT OBJECTIVES

a. Equity Fund
b. Debt Fund
c. Balanced Fund
d. Liquid Fund
e. Gilt Fund

11) OPTION AVAILABLE TO INVEST IN EQUITY MARKET

a. IPO
b. Cash
c. Future & Options