You are on page 1of 14

A SYNOPSIS on A Comparative Analysis on the investors preferences towards Mutual funds and ULIP in Indian Financial Market Submitted

In Partial Fulfillment of the Requirement Of Masters of Business Administration

Project Guide By:



This project has been a great learning experience for me, at the same time it gave me enough scope to implement my analytical ability. One can have a brief knowledge about mutual funds& ULIP and all its basics through the project. Other than that the real servings come when one moves ahead. Some of the most interesting questions regarding mutual funds& ULIP have been covered. Some of them are:
Why has it become one of the largest source of investment?

How investors do chose between funds? Most popular stocks among fund managers, most lucrative sectors for fund managers. All the topics have been covered in a very systematic way. The language has been kept simple so that even a layman could understand. All the datas have been well analyzed with the help of charts and graphs. It covers the topic A comparative Study on the investors preferences towards Mutual funds and Ulip In Indian Financial Market. The data collected has been well organized and presented. Hope the research findings and conclusions will be of use. It has also covered why people dont want to go for financial advisor? The advisors can take further steps to approach more and more people and indulge them for taking their advices.


A mutual Fund is a trust that pools the saving of a number of investors who share a common financial goal. The money thus collected is invested by the fund manager in different types of securities depending upon the objective of the scheme. These could range from shares to debentures to money market instruments. The income earned through these investments and the capital appreciation realized by the scheme is shared by its unit holders in proportion to the number of units owned by them (pro rata). Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed portfolio at a relatively low cost. Anybody with an investible surplus of as little as a few thousand rupees can invest in Mutual Funds. Each Mutual Fund scheme has a defined investment objective and strategy. A mutual fund is the ideal investment vehicle for today's complex and modern financial scenario. Markets for equity shares, bonds and other fixed income instruments, real estate, derivatives and other assets have become mature and information driven. Price changes in these assets are driven by global events occurring in faraway places. A typical individual is unlikely to have the knowledge, skills, inclination and time to keep track of events, understand their implications and act speedily. An individual also finds it difficult to keep track of ownership of his assets, investments, brokerage dues and bank transactions etc. A mutual fund is the answer to all these situations. To appoints professionally qualified and experienced staff that manages each of these functions on a full time basis. The large pool of money collected in the fund allows it to hire such staff at a very low cost to each investor. In effect, the mutual fund vehicle exploits economics of scale in all three areas research, investments and transaction processing. While the concept of individuals coming together to invest money collectively is not new, the mutual fund in its present form is a 20th century phenomenon. In fact, mutual funds gained popularity only after the Second World War. Globally, there are thousands of firms offering tens of thousands of mutual funds with different investment objectives. Today, mutual funds collectively managed most as much as or more money as compared to banks.



A unit linked insurance policy is one in which the customer is provided with a life insurance cover and the premium paid is invested in either debt or equity products or a combination of the two. In other words, it enables the buyer to secure some protection for his family in the event of his untimely death and at the same time provides him an opportunity to earn a return on his premium paid. In the event of the insured persons death, his nominees would normally receive an amount that is the higher of the sum assured (insurance cover) or the value of the units (investments). However, there are some schemes in which the policy holder receives the sum assured plus the value of the investments. Every insurance company has four to five ULIPs with varying investment options, charges and conditions for withdrawals and surrender. Moreover, schemes have been tailored to suit different customer profiles and, in that sense, offer great deal of choice. The advantage of ULIP is since the investments are made for long periods, the chances of earning a decent return are high. Just as in case of mutual funds, buyers who are risk averse can buy debt schemes while those who have an appetite for risk can opt for balanced or equity schemes. However the charges paid in these schemes in terms of the entry load, administrative fees, underwriting fees, buying and selling charges and asset management charges are fairly high and vary from insurer in the quantum as also the manner in which they are charged.



Standard Chartered was formed in 1969 through a merger of two banks: The Standard Bank of British South Africa, founded in 1863, and the Chartered Bank of India, Australia and China, founded in 1853. Both companies were keen to capitalise on the huge expansion of trade and to earn the handsome profits to be made from financing the movement of goods between Europe, Asia and Africa.

The Chartered Bank

Founded by James Wilson following the grant of a Royal Charter by Queen Victoria in 1853. Chartered opened its first branches in Mumbai (Bombay), Kolkata and Shanghai in 1858, followed by Hong Kong and Singapore in 1859. Traditional trade was in cotton from Mumbai (Bombay), indigo and tea from Kolkata, rice from Burma, sugar from Java, tobacco from Sumatra, hemp from Manila and silk from Yokohama.

Played a major role in the development of trade with the East which followed the opening of the Suez Canal in 1869 and the extension of the telegraph to China in 1871. In 1957 Chartered Bank bought the Eastern Bank together with the Ionian Bank's Cyprus Branches. This established a presence in the Gulf.

The Standard Bank

Founded in the Cape Province of South Africa in 1862 by John Paterson. Commenced business in Port Elizabeth, in January 1863. Was prominent in financing the development of the diamond fields of Kimberley from 1867 and later extended its network further north to the new town of Johannesburg when gold was discovered there in 1885.

Expanded in Southern, Central and Eastern Africa and, by 1953, had 600 offices. In 1965, it merged with the Bank of West Africa, expanding its operations into Cameroon, Gambia, Ghana, Nigeria and Sierra Leone.


From the early 1990s, Standard Chartered has focused on developing its strong franchises in Asia, Africa and the Middle East. It has concentrated on consumer, corporate and institutional banking and on the provision of treasury services - areas in which the Group had particular strength and expertise. Since 2000 the Bank has achieved several milestones with a number of strategic alliances and acquisitions, which have extended the customer and geographic reach and broadened the product range that Standard Chartered offers.



The study was done with the primary objective to get an insight of the investors decision making process while investing in Mutual Fund & ULIP. However the other secondary objectives were:

Toanalyse the customer perception towards Mutual Fund & ULIP. To analyse which is better investment option between Mutual Fund & ULIP. To analysethe various expenses incurred in Mutual Fund & ULIP.



Universe of the Research:

The project concentrates on comparative analysis between ULIP and mutual funds. The data collected has been well organized and presented from the strata of people how invest in mutual funds or in ULIPs

Primary sources
For data collection primary source is used in the form of structured questionnaire

Secondary Sources
The study is based on secondary data collected from the various volumes ofbanking statistics published by standard charted. Journals, Research Papers, Banking articles, News paper clippings, various related website, Business news on electronic media etc.

Sample Size
100 respondents selected from the customers of ULIP and Mutual Fund Holders at standard Charted Bank in Delhi and NCR region.

Data Collection Technique Stratified Convenient sampling technique Type of Research

The research is exploratory and applied.

Data Analysis Tools

The analysis is been carried out on the basis of comparative analysis in proportion. Through Bar Diagram and Pie Charts.



1. Some respondents dont perceive about brand equity through marketing tool, advertising tool.
2. A sample of 100 respondents is too less to generalize the results for the whole population.

Thus the results do not have much practical application value. 3. There was shortage of time. 4. Respondents were sometimes very conservatives and introvert which turns into criticism about availability by some of the respondents and
5. Some respondents didnt respond about their choices.



The most vital problem spotted is ignorance. Investors should be made aware of the benefits. Nobody will invest until and unless he is fully convinced. Investors should be made to realize that ignorance is no longer bliss and what they are losing by not investing. To AMCs: AMCs should continuously design suitable schemes to meet the triple needs of adequate returns, safety and liquidity in a balanced proportion and develop infrastructure to reach to the investors. There is a general ignorance and questions about, what are mutual funds? What are ULIPs? What are different scheme of mutual and ULIPs? And many more. This thing should be handled by companies and their brokers to provide knowledge to their clients. Income schemes with sure and steady returns for retired people can be marketed. By proper segmentation and by targeting the right product to the right customers, companies can hope to win the confidence of their customers and own them for lifetime. To Investors: Determine your financial objective and how much money you have to invest. Make sure that the funds objectives coincide with your own. Dont change your objectives or exceed the amount set aside for investment unless you have good reason. Always obtain all available information before you invest. Request the prospectus, the Statement of Additional Information and the latest shareholder report from each fund you are considering. Never invest in periodic payment plans unless you are virtually certain that you will not have to redeem early.

10 | P a g e

Always determine all sales charges, fees and expenses before you invest. Never treat the risk of investment in a fund lightly.

11 | P a g e

Dear respondent, I am conducting the survey on Comparative Analysis of Mutual Fund vs ULIP which is a part of M.B.A. Program. All the information provided by you will be kept secret & will be used exclusively for academic purpose. Name Address Age : : : _______________________________________________ ________________________________________________ Sex : _____________________


1. What is your source of income? Service Business Other 2. What is your annual income? 1lac-2lac 2lac-4lac Above 4 lac 3. Which service you avail from bank? Insurance Mutual ATM Card Others 4. Do you know about Standard Charted Bank? Yes No

5. Where did you get the information about Standard Charted Bank? Newspaper Employee Mutual Fund Friends Electronic Media ULIP
12 | P a g e

6. Do you know about mutual fund or ULIP?

Yes No 7. Where did you invest your money? Mutual Fund ULIP Both

8. How much %age of your income you invest in mutual fund or ULIP? Upto 10% 15-20% 10-15% Above 20%

9. What are your selection criteria while selecting Mutual Fund or ULIP? Returns Tax benefits Security Past Performance

10. Do you know about changes or expenses incurred in Mutual Fund or ULIP? For Mutual Fund Entry Load Exit Load Fund Mgt. Changes For ULIP Allocation Changes Administrative Fund Management Changes

11. According to you whoare more flexible? Mutual Fund ULIP

12. According to you whoare more beneficial on time perspective? Mutual Fund Long Term Short term 13. Are you aware about these features of Mutual Fund or ULIP? Mutual Fund Diversification of Bank Liquidity Less time Less Expenses ULIP Top Ups Switching Operation Tax Saving Additional risk ULIP

13 | P a g e

14. Do you agree that there the +ve relationship between sensex fluctuation & return of Mutual Fund or ULIP Mutual Fund Agree Strongly Agree Disagree Strongly Disagree
15. Are you satisfied with overall performance of Mutual Fund or ULIP you invested in?


Mutual Fund Yes No 16. Any suggestions:-


14 | P a g e