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University of Mumbai

A Project Report on
PROS & CONS OF INVESTMENT IN MUTUAL FUNDS AS
COMPARED TO
BANK FIXED DEPOSITES.
Submitted by
NAME

ROLL NO

Prashantha Poojary
Sonali Salve

F.Y.MMS

MS141546

F.Y.MMS

MS141549

Chanchal Sharma

F.Y.MMS

MS141552

Deepak Shinde

F.Y.MMS

MS141554

Pooja Singh

F.Y.MMS

MS141559

Under the guidance of Prof. Shripad Bapat


Batch 2014 2016

INSTITUTE OF MANAGEMENT & COMPUTER STUDIES


C-4, WAGLE ESTATE, NEAR MULUND CHECK NAKA,THANE(w) 400604.

CERTIFICATE
Certified that the Project work entitled TO DO COMPARATIVE ANALYSIS
IN MUTUAL
FUND INVESTMENT AS AGAINST BANK FIXED DEPOSIT. Submitted by
Group no.03 (finance) having Roll nos. 46, 49,52,54 & 59 for internal
assessment of MMS 1st YEAR course for Semester IInd offered by
IMCOST, Thane affiliated to Mumbai University during the academic
year 2014 2016 is a original work carried out by the students under
my supervision, and this work has not formed the basis for the award
of any Degree, Diploma or such other titles.

Date:

Name of Guide: Prof. Mr. Shripad Bapat

Institution Address:
IMCOST, C-4, Near Mulund Check Naka,
Opp. APLAB Co, Thane (W) 400604.

DECLARATION
We, the undersigned, hereby declare that the project report entitled TO DO
COMPARATIVE ANALYSIS IN MUTUAL FUND INVESTMENT AS AGAINST
BANK FIXED
DEPOSIT.

Submitted by us to the institute under the guidance of Prof. Shripad Bapat

is our original work and the conclusions drawn therein are based on the material collected
by ourselves.
The Report submitted is our own work and has not been duplicated from any other source.
We shall be responsible for any unpleasant moment/situation.
Place: Mumbai
Date:

Signature of the Group Members

Name: Prashantha Poojary


Roll No. MS141546

Name: Sonali Salve


Roll No.MS141549

Name: Chanchal Sharma


Roll No.MS141552

Name: Deepak Shinde


Roll No.MS141554

Name: Pooja Singh


3

Roll No.MS141559

ACKNOWLEDGEMENT
A successful Project is the result of team work and co-ordination that
includes not only the group of developers who put forth the ideas, logic
and efforts but also those who guide them. So, at the completion of the
project, we feel obliged to extent our gratitude towards all those who
made valuable contributions throughout our various stages in Project
draft period.
We express our profound sense of gratitude and sincere thanks to our
Director, Dr.J.N.SHAH for enabling us to undertake such an excellent
project, which made us to acquire tremendous knowledge and selfconfidence.
We extend our special thanks to Prof. Shripad Bapat, (Project Guide)
who gave us a wonderful opportunity to select and work on this topic
and understand the challenges which we face in our career path while
dealing with people and the complexities of the job and for his valuable
guidance and inputs which helped us to select and focus our work on
this project.
We would also like to thank all teaching and non-teaching staff of
IMCOST, for their valuable guidance and inputs which helped us to
select and focus our work on this project.
Also we would like to thanks to our entire professor who are not directly
supported for the project but indirectly made support on the way of
improvement in presentation skills, deep knowledge sharing against
4

todays business environment as well as competitive world and current


updates.
We are very much thankful our parents and friends for their continuous
support.

INDEX
SR NO.

TABLE OF CONTENTS

PAGE NO.

1.

CHAPTER I INTRODUCTION (BANK FIXED


DEPOSIT)
CHAPTER II INTRODUCTION (MUTUAL
FUND)
CHAPTER III- RESEARCH METHODOLOGY
CHAPTER IV CONCLUSION &
RECOMMENDATION
BIBLIOGRAPHY
ANNEXURES

2.
3.
4.
5.
6.

6
15
32
34

LIST OF TABLES

TABLE NO.

TITLE OF THE TABLES

PAGE NO.

2.1
2.2
2.3
3.1

TYPES OF MUTUAL FUNDS


MUTUAL FUND VS BANK FIXED DEPOSIT
TOP 10 MUTUAL FUNDS
INVESTORS THINK RISKEST INVESTMENT
PRODUCT
AGE GROUP
KIND OF INVESTMENT
INVESTMENT OPTION
REASON OF INVESTMENT
FACTORS CONSIDERED FOR INVESTMENT
MORE RISKY
KONWLEDGE OF SCHEME
BENEFECIAL SECTOR FOR INVESTORS
INVESTMENT TYPE
INVESTMENT OPTION RECOMMEND

8
14
14
18

3.2
3.3
3.4
3.5
3.6
3.7
3.8
3.9
3.10
3.11

22
23
24
25
26
27
28
29
30
31

EXECUTIVE SUMMARY
A growing India offers opportunity across the various investments, a
substantial part of financial wealth. Therefore investment plays an
important role in growth of these economies. Also there is rapid growth
in income of peoples in India due to some factors because of this
investment is increased day by day in various investment options. As
income range rapidly increasing there is need to increase awareness
among the people related with various investment option and different
schemes.
The project is an attempt to study or awareness among the people
related with some investment option and also the preference of people
while implementing the same. It provides thorough knowledge of
different aspects related with the behavior of people for mutual fund as
compare to bank fixed deposit. The report is divided in four parts. The
first part is dealing with information related with advantage and
disadvantage Bank fixed deposit. Second is concept of advantage and
disadvantage mutual fund. Third is concept of research methodology.
Fourth deals with interpretation of data collected.
Most of metro cities people like to put the money in market related
schemes instead of dumping it in the bank lockers, so it is quite
obvious that they want to invest their money in profitable venture. But
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still people prefer to go for traditional schemes as well for safety and
security purpose.
Now a days people become more sensible while choosing any type of
investment. It is more important to have good knowledge and
understanding related with such scheme which will help to choose
better and safety investment tools.

CHAPTER I
INTRODUCTION
1.1 BANK FIXED DEPOSIT:
A fixed deposit is a financial instrument provided by banks which
provides investors with a higher rate of interest than a regular
saving account, until the date of maturity date. It may or may not
require the creation of a separate account.
It is also term as TERM OR TIME Deposit. They are considered to
be very safe investment as it denotes a larger class of
investments with varying levels of liquidity. Here, interest rate
varies between from 4 to 11 percent. The tenure of a Fixed
Deposit a vary from 7, 15, or 45 days to 1.5 years and can be high
as 10 years.

1.2 TYPES OF FIXED DEPOSIT :


BASICALLY THERE ARE TWO TYPES OF DEPOSIT:
A. DEMAND DEPOSIT:- The money we keep in our saving accounts
is like a medium of exchange and this is called Demand Deposit.
There is no fixed term to maturity for demand deposits.
B. TIME DEPOSIT:- If we deposit our money has an FD in the bank it
becomes a Time Deposit on which No cheque is drawn. They are
paid on maturity at a particular time.

a. FIXED DEPOSIT:- A fixed rate of interest is paid at fixed, regular


intervals.
b. RECURRING DEPOSIT:- Fixed amount is deposited at regular
intervals for a fixed term and the repayment of principal and
accumulated interest is made at the end of the term.

1.3 ADVANTAGES OF BANK FIXED DEPOSIT:


A. SAFETY :- The fixed deposits of reputed banks and financial
institution regulated by RBI the banking regulator in India are
very secure and considered as one of the safest investment
methods.

B. REGULAR INCOME:- Fixed deposit earn fixed interest rates for


their entire tenure, which is usually compounded quarterly. So,
those who want an income on a regular basis can invest into
fixed deposit and use the interest rate as their income. This
makes a fixed deposit very popular way of investing money for
retirees.

C. LIQUIDITY:- Bank deposits have good liquidity. They can be


closed and the principal withdrawn within a few hours in some
banks to a couple of days in others.

The other option is to take a loan on the fixed deposit. Banks


lend up to 90% of the principal of the deposit. Interest
charged for this is only about 1 to 2 per cent and only for the
period that we have used the cash (The feature works like an
over-draft against the fixed deposit).

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1.4 DISADVANTAGES OF BANK FIXED DEPOSIT:


A. CAPITAL APPRECIATION:- Capital appreciation does
not
apply to bank fixed deposits. Only the principal invested is
returned back at the time of maturity.

B. TAX TREATMENT:- Bank fixed deposits are not tax


efficient.
The interest is taxed. Also there is no benefit from making
the investment. There are the 5-year bank deposits (tax
saving) that give benefit under section 80C of the Income
Tax Act. But the benefits such as partial withdrawal or
closure, and loan facility are not available. The deposit rates
are also lower compared to the normal fixed deposits. This
effectively negates the tax saved.

C. RISK:- Perhaps the main reason for investment in bank


deposits is safety of the principal. The capital (only up to
Rs1,00,000 though) has the highest safety compared to any
other investment as it is guaranteed by the Deposit
Insurance & Credit Guarantee Scheme of India. All banks
operating in India are covered under this scheme.

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1.5 IN SHORT
The risk faced when investing in bank deposits is the interest
rate risk. This is associated with the lost opportunity to invest
in an instrument that has a higher return. Getting out of a
fixed deposit can be costly (up to 1 per cent of the principal),
when we exit prematurely. So we may have to forgo potential
earnings when the interest rate has risen only by about 1 per
cent.
The highest risk faced with fixed deposits is the effect of
inflation. The real return after adjusting for inflation is very
less or sometimes negative for fixed deposits of banks. This is
a big burden, particularly for retired people, who have
invested their retirement proceeds to get regular income.
Their income may be regular and steady but the money's
worth keeps going down during the tenure of the fixed
deposit.
The bank deposit primarily serves us to preserve capital.
Banks now-a-days have added a lot of additional benefits to
the traditionally benign service. Retired people could make
the best use of this avenue for securing a fixed and steady
income.
The caution is not to use the fixed deposit as a long term
investment avenue. The reason is that the real return is very
less when adjusted for inflation. The tax treatment of the
interest also eats into the returns.

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CHAPTER II
INTRODUCTION
2.1 MUTUAL FUND
The first introduction of a mutual fund in India occurred in 1961,
when the Government of India launched Unit Trust of India (UTI).
Until 1987, UTI enjoyed a monopoly in the Indian mutual fund
market. Then a host of other government-controlled Indian
financial companies came up with their own funds. These included
State Bank of India, Canara Bank, and Punjab National Bank. This
market was made open to private players in 1993.
As a result of the historic constitutional amendments brought
forward by the then Congress-led government under the existing
regime of Liberalization, Privatization and Globalization (LPG). The
first private sector fund to operate in India was Kothari Pioneer,
which later merged with Franklin Templeton.
An investment vehicle that is made up of a pool of funds collected
from many investors for the purpose of investing in securities
such as stocks, bonds, money market instruments and similar
assets. Mutual funds are operated by money managers, who
invest the fund's capital and attempt to produce capital gains and
income for the fund's investors. A mutual fund's portfolio is
structured and maintained to match the investment objectives.
One of the main advantages of mutual funds is that they give
small investors access to professionally managed, diversified
portfolios of equities, bonds and other securities, which would be
quite difficult (if not impossible) to create with a small amount of
capital. Each shareholder participates proportionally in the gain or
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loss of the fund. Mutual fund units, or shares, are issued and can
typically be purchased or redeemed as needed at the fund's
current net asset value (NAV) per share, which is sometimes
expressed as NAVPS.

2.2 NET ASSET VALUE NAV


A mutual fund's price per units, the per- units Rupee amount of
the fund is calculated by dividing the total value of all the
securities in its portfolio, less any liabilities, by the number of fund
units outstanding.
In the context of mutual funds, NAV per units is computed once a
day based on the closing market prices of the securities in the
funds portfolio. All mutual funds buy and sell orders are
processed at the NAV of the trade date.

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2.3 TYPES AND KINDS OF MUTUAL FUNDS


FIG 2.1 TYPES OF MUTUAL FUNDS

1. OPEN-ENDED:- This scheme allows investors to buy or sell units


at any point in time. This does not have a fixed maturity date.

A. DEBT/ INCOME:-

A major part of the investable fund is


channelized towards debentures, government securities, and
other debt instruments. Although capital appreciation is low
(compared to the equity mutual funds), this is a relatively
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low risk-low return investment avenue which is ideal for


investors seeing a steady income.

B. MONEY MARKET/ LIQUID:- This is ideal for investors looking


to utilize their surplus funds in short term instruments while
awaiting better options. These schemes invest in short-term
debt instruments and seek to provide reasonable returns for
the investors.

C. EQUITY/ GROWTH:- Equities are a popular mutual fund


category amongst retail investors. Although it could be a
high-risk investment in the short term, investors can expect
capital appreciation in the long run.
a. Index Scheme:- Index schemes are a widely popular
concept in the west. These follow a passive investment
strategy where our investments replicate the
movements of benchmark indices like Nifty, Sensex,
etc.
b. Sectoral Scheme:- Sectoral funds are invested in a specific
sector like infrastructure, IT, pharmaceuticals, etc. or
segments of the capital market like large caps, midcaps, etc. This scheme provides a relatively high riskhigh return opportunity within the equity space.

c. Tax Saving:- As the name suggests, this scheme offers tax


benefits to its investors. The funds are invested in
equities
thereby
offering
long-term
growth
opportunities. Tax saving mutual funds (called Equity
Linked Savings Schemes) has a 3-year lock-in period.

D. BALANCED:- This scheme allows investors to enjoy growth


and income at regular intervals. Funds are invested in both
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equities and fixed income securities; the proportion is predetermined and disclosed in the scheme related offer
document. These are ideal for the cautiously aggressive
investors

2. CLOSED-ENDED:- In India, this type of scheme has a stipulated


maturity period and investors can invest only during the initial
launch period known as the NFO (New Fund Offer) period.

A. CAPITAL PROTECTION:- The primary objective of this


scheme is to safeguard the principal amount while trying to
deliver reasonable returns. These invest in high-quality fixed
income securities with marginal exposure to equities and
mature along with the maturity period of the scheme.

B. FIXED MATURITY PLANS (FMPS):-

Mutual fund schemes


with a defined maturity period. These schemes normally
comprise of debt instruments which mature in line with the
maturity of the scheme, thereby earning through the interest
component (also called coupons) of the securities in the
portfolio. FMPs are normally passively managed, i.e. there is
no active trading of debt instruments in the portfolio. The
expenses which are charged to the scheme are hence,
generally lower than actively managed schemes.

17

3. INTERVAL:- Operating as a combination of open and closed


ended schemes, it allows investors to trade units at pre-defined
intervals.

2.4 ADVANTAGES OF MUTUAL FUNDS

Mutual funds have been a popular investment vehicle for investors. Their simplicity along
with other attributes provides great benefit to investors with limited knowledge, time or
money. To help us decide whether mutual funds are best for us, we are going to look at
some reasons to consider investing in mutual funds.

A. DIVERSIFICATION:- One rule of investing, for both large


and small investors, is asset diversification. Diversification
involves the mixing of investments within a portfolio and is
18

used to manage risk. Mutual fund provides immediate


benefit of instant diversification and asset allocation without
the large amounts of cash needed to create individual
portfolios.

B. ADVANCED PORTFOLIO MANAGEMENT:- We pay a


management fee as part of our expense ratio, which is used
to hire a professional portfolio manager who buys and sells
stocks, bonds, etc. This is a relatively small price to pay for
help in the management of an investment portfolio.

C. CONVENIENCE AND FAIR PRICING:- Mutual funds are


common and easy to buy. They typically have low minimum
investments and they are traded only once per day at the
closing NET ASSET VALUE (NAV). This eliminates price
fluctuation throughout the day and various arbitrage
opportunities that day traders practice.

D.LIQUIDITY AND SIMPLICITY:- We can sell or buy mutual


funds anytime. So mutual funds are good if we want to
invest in something which we can liquidate easily. Also
mutual funds are very simple to buy and sell.

E. DIVIDEND REINVESTMENT:- As dividends and other


interest income is declared for the fund, it can be used to
purchase additional units in the mutual fund, thus helping
your investment grow.

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2.5 DISADVANTAGES OF MUTUAL FUNDS

There are risks involved in buying mutual funds. These investment


vehicles can experience market fluctuations and sometimes provide
returns below the overall market. Also, the advantages gained from
mutual funds are not free: many of them carry loads, annual expense
fees and penalties for early withdrawal.

A. RISKS AND COSTS:- Changing market conditions can create


fluctuations in the value of a mutual fund investment. Also
there are fees and expenses associated with investing in

20

mutual funds that do not usually occur when purchasing


individual securities directly.

B. NO GUARANTEES:- As Mutual funds invest in debt as well


equities, there are no sure returns. Returns depend on the
market conditions.

C. NO CONTROL:- Investor does not have control on


investment; all the decisions are taken by the fund manager.
Investor can just join or leave the show.

D.TAX INEFFICIENCY:- Investors do not have a choice when


it comes to capital gain payouts in mutual funds. Due to the
turnover, redemptions, gains and losses in security holdings
throughout the year, investors typically receive distributions
from the fund that are an uncontrollable tax event.

2.6 COMPARISON BETWEEN MUTUAL FUNDS AND


FIXED DEPOSITS
FIG 2.2 MUTUAL FUND VS BANK FIXED DEPOSIT
PARAMETERS

MUTUAL FUNDS

FIXED DEPOSITS

A. Rate Of Returns

No Assured Returns

Fixed Returns

B. Inflation Adjusted
Returns

Potential For High


InflationAdjusted
Returns

Usually Low
InflationAdjusted
Returns

C. Risk

Medium To High Risk

Low Risk

D. Liquidity

Liquid

Medium To Low
Liquidity

E. Premature Withdrawal Allowed With Exit Load

Allowed With Penalty

F. Cost Of Investment

Management Cost

No Cost

G. Tax Status

Favorable Tax Status

As Per Tax Slab


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TOP 10 MUTUAL FUNDS HOUSE


FIG 2.3 TOP 10 MUTUAL FUNDS
Sr No
Mutual Fund
1
2
3

HDFC Mutual Fund


Reliance Mutual Fund
ICICI Prudential Mutual Fund

4
5
6
7
8
9
10

Average

1,034.42
952.28
853.03

12.70%
11.69%
10.48%

Birla Sun Life Mutual Fund

773.44

9.50%

UTI Mutual Fund


SBI Mutual Fund
Franklin Templeton Mutual
Fund
IDFC Mutual Fund
Kotak Mahindra Mutual Fund

700.57
595.58
448.12

8.60%
7.31%
5.50%

396.65
352.99

4.87%
4.34%

DSP BlackRock Mutual Fund

304.86

3.74%

CHAPTER III:
RESEARCH METHODOLOGY
Research refers to search for knowledge. One can also define research
as a scientific and systematic search for pertinent information on a
specific topic. It is an art of scientific investigation.

3.1 OBJECTIVES:
The study will give an overview about mutual funds and bank
fixed deposit. And also will give brief comparison between mutual
fund and bank fixed deposit. It will help investors to take effective
investment decision.

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The research has been undertaken from the investor point of view
and hence will be important to investors as follow:

1.

To study/ find the various scheme at mutual fund investment as


well as bank fixed deposit.

2.

To study the pros and consequences of the mutual fund and


bank fixed deposit investment.

3.

To study the consumers preferences about mutual fund


investment as against bank fixed deposit.

3.2 DATA COLLECTION METHOD:To achieve the objectives of to do comparative analysis of mutual fund
investment as against bank fixed deposit data has to be collected from
different sources.

3.2.1 SECONDARY DATA


This data is collected from various sources like magazines,
websites and especially from the books of well-known
authors.
BOOKS FOLLOWS-

Indian Mutual Funds Handbook: - Sundar Sankaran


16 Personal Finance Principles Every Investor Should Know - Manish
Chauhan
FOLLOWING ARE THE URLS

http://mutualfund.birlasunlife.com
http://www.tatamutualfund.com
23

https://www.valueresearchonline.com
http://www.moneycontrol.com
http://economictimes.indiatimes.com

3.2.2 ADVANTAGES OF SECONDARY DATA


A. SAVING OF TIME:- The process has been simplified.
Precise information may be obtained via search engines.
All worth library has digitized its collection so that
students and researchers may perform more advance
searches.
B. SAVING OF MONEY:- In general, it is much less expensive
than other ways of collecting data. One may analyze
larger data sets like those collected by government
surveys with no additional cost.
C. GENERATING NEW INSIGHTS:- Reanalyzing data can also
lead to unexpected new discoveries. Returning to the
previous. we can analyze the data and0 come up with
new relevant conclusions or simply verify and confirm
previous results.

3.2.3 DISADVANTAGES OF SECONDARY DATA


A. INAPPROPRIATENESS OF THE DATA:-

Secondary data
sources may provide you with vast amount of information,
but quantity is not synonymous of appropriateness. This is
simply because it has been collected to answer a different
research question or objectives.

B. LACK OF CONTROL OVER DATA QUALITY:- Government


and other official institutions are often a guarantee of
quality data, but it is not always the case. For this reason,
quality issues must be verify as outlined in this post.
24

3.1 INVESTORS THINK RISKEST INVESTMENT PRODUCT


Investors think riskest investment product
Mutual Funds
Life insurance
Post office saving
Equity
Company fixed deposits
Bonds
Gold
Property
Chit Funds
Bank FD

High risk

Medium risk

Low risk

83

13

19

77

18

78

41

46

13

24

53

23

26

51

23

13

38

59

39

52

30

52

18

20

77

25

Secondary data are already collected information. It is generally


difficult to

scrutiny of

secondary data

because

it may be a

inconsistencies, errors and omission etc. Thus it is very risky to use


methods and derived to conclusion. For that our group are go for
primary data method.
Data collected by primary data is collected with a concrete idea in
mind. Usually to answer a research question or just meet certain
objectives.

3.3 PRIMARY DATA


On the basis of pilot study stage, a structured has been
constructed to conduct the sample survey. The questionnaire
includes quotations on each of the 4-5 variables related to the
respondents. A questionnaire with 13 questions has been used as
survey instrument for conducting survey. A total of 51
respondents were interviewed and data has been generated by
face to face interview. The questionnaire has options against
which the respondent has to select as per his/her perception from
his/her experiences.

3.3.1 ADVANTAGES OF PRIMARY DATA


A.DATA INTERPRETATION IS BETTER:- The collected
data can be examined and interpreted by the
marketers depending on their needs rather than relying
on the interpretation made by collectors of secondary
data.

B. RECENCY OF DATA:- Thus primary data becomes a


more accurate tool since we can use data which is
useful for us.

26

C. PROPRIETARY ISSUES:- Collector of primary data is the


owner of that information and he need not share it with
other competitors. This gives an edge over competitors
replying on secondary data.

3.3.2 DISADVANTAGES OF PRIMARY DATA


A. HIGHCOST:- Collecting data using primary research is a costly
proposition as marketer has to be involved throughout and has
design everything.

to

B. TIME CONSUMING:- Because of exhaustive nature of the exercise,


the time required to do research accurately is very long as compared
to secondary data, which can be collected in much lesser time
duration.

C. MORE NUMBER OF RESOURCES ARE REQUIRED:Leaving aside cost and time, other resources like
human resources and materials too are needed in
larger quantity to do surveys and data collection.

3.4 METODS OF COLLECTING PRIMARY DATA:A. SAMPLING:- It represents whole population. It is the
processes of choosing a sample from whole population .We
have chosen a sample of high class & middle class people
who have invested either in mutual funds or Bank Fixed
Deposits.
B. CENSUS SURVEY:- It is a systematics method. It covers entire
population or universe and not very practical as it requires
enormous huge amount of time, manpower and money.

27

C. SAMPLING SIZE:- We had chosen sample of 51 candidates.

3.4 DATA ANALYSIS AND INTERPRETATION:Data analysis and interpretation is the process of inspecting,
cleaning, transforming and modeling data with the goal of
discoveries useful information, suggesting conclusion and
supporting decision making.
Data interpretation is that in which we analysis the whole
collected data & tries to give it in simple words to be
understandable.
We have used some charts (Pie chart, column chart, cylinder
chart, cone chart) and hypothesis tests (chi-square one
sample T- test etc.)

3.5 LIMITATIONS:-

A. The study is limited to selected investment avenues.


B. Due to shortage or less availability of time it may be possible
that all the related and concerned aspects may not be covered
in this project.
C. As we have used sampling method to collect data so there was
lack of support from respondent in some cases. Maximum
respondents were not interested to entertain us.

28

TABLE 3.2 AGE GROUP:


Age Group
Frequency
Percentage

21-30 31-40
24
51

11
24

41-50

Above 50

Total

11

51

24

100

The above schedule and the diagram mentioned below explain the
relationship between different ages of respondents investing either in
Mutual Fund or Bank Fixed Deposits.

FIG.3.2

29

AGE GROUP
1%

24%

21-30
31-40
51%

41-50
Above 50

24%

The above figure shows that the age group of 21-30 respondents
investing more either in Mutual Fund or Bank Fixed Deposits i.e. (51%)
and age group of above 50 makes less investment i.e. (1%).

Table 3.3 Date Was Collected For Analyzing Whether Customer Have Ever
Invested In Any Kind Of Investment:
Yes/No
Yes
No
Total
Frequency

45

51

Percentage

88

12

100

The above schedule and the diagram mentioned below reflects whether
customer have ever Invested in any kind of Investment.

FIG.3.3

30

INVESTMENT
12%
Yes
No

88%

The above figure shows that 88% of Customer are interested in of


Investment and 12% Customers are not interested in any type of
investment.

Table 3.4 Date was collected for analyzing Investment Options most
preferable for investment either in Mutual Fund or in Bank Fixed Deposits:
Investment
Options
Frequency
Percentage

Bank Fixed
Deposits
31
61

Mutual Fund

Total

20

51

39

100

The above Investment Options schedule and the Investment Option


diagram mentioned below reflects number of respondents investing
either in Mutual Fund or in Bank Fixed Deposits.

FIG.3.4

31

INVESTMENT OPTION

Bank Fixed Deposits

39%

Mutual Fund
61%

The above figure shows that Bank fixed deposits is more preferable
(61%) than Mutual Funds (39%).

Table 3.5 Date Was Collected For Analyzing Reasons For Selecting Mutual
Fund Or Bank Fixed Deposits:
Reasons

Rate Of
Interest

Low risk

Tax Saving

Total

Frequency
Percentage

21
41

24
47

6
12

51
100

The above schedule and the diagram mentioned below reflects number
of respondents reason for investing either in Mutual Fund or in Bank
Fixed Deposits.

FIG.3.5

32

REASON FOR INVESTMENT


12%
Rate Of Interest
41%

Low risk
Tax Saving

47%

The above figure shows that bank fixed deposit is more preferable if
Risk is Low i.e.
(47%) then Tax Saving (12%).

Table 3.6 Date Was Collected For Analyzing What Factors Considered By
Customers For Investment In Mutual Fund Or Fixed Deposits:
Factors

Frequency
Percentag
e

Preservati
on of
Capital
20
39

Increase in
current
income
13
24

Aggressi Growth Conservatio Total


ve
and
n Growth
Growth Income
8
6
4
51
16
12
8
100

The above schedule and the diagram mentioned below reflects


factors customers consider for investment in Mutual Fund or
Fixed Deposits. FIG.3.6

33

FACTORS CONSIDERED FOR INVESTMENT


Preservation of
Capital

8%

Increase in current

12%

income

40%

Aggressive Growth
16%
Growth and Income
24%

Conservation Growth

The above figure shows that Preservation of capital (40%) is a major


factor considered by consumers for investment rather than investing for
Conservation Growth (8%)

Table 3.7 Date Was Collected For Analyzing Which Investments Option Is
More Risky:
Investment
Options
Frequency
Percentage

Bank Fixed
Deposits
2

Mutual Fund

Total

49

51

96

100

The above Investment Options schedule and the diagram mentioned


below reflects which investments option is more risky between Mutual
Fund and Fixed Deposits. FIG.3.7

34

INVESTMENT OPTION
4%

Bank Fixed Deposits


Mutual Fund

96%

The above figure shows about 96% of Customer finds more risk in
investment in Mutual Fund then Bank Deposits.

35

Table 3.8 Date Was Collected For Analyzing Knowledge Of Schemes In


Investment Options:
KNOWLEDGE

YES

NO

TOTAL

Frequency

27

24

51

Percentage

53

47

100

The schedule and the diagram mentioned below reflects knowledge of


Schemes in investment options between Mutual Fund and Fixed
Deposits.

FIG.3.8

KNOWLEDGE OF SCHEMES

Yes
47%

No
53%

The above figure shows that about 53% customers have knowledge of
Schemes available in Mutual Fund and Bank Fixed Deposits and 47%
dont have idea about schemes.

36

Table 3.9 Date Was Collected For Analyzing Investment In Which Sector
Will Make Benefit For Customers:
Sector

Public Sector

Private Sector

Total

Frequency

31

20

51

Percentage

61

39

100

The schedule and the diagram mentioned below reflects investment


sector which is more beneficial according to investors.

FIG.3.9

BENEFICIAL SECTOR

Public Sector

39%

Private Sector
61%

The above figure shows that Public Sector (61%) is more beneficial
than Private Sector (39%).

37

Table 3.10 Date Was Collected For Analyzing Investment Type Preferred By
Investors:
INVESTMENT
TYPE
Frequency
Percentage

SHORT TERM

LONG TERM

TOTAL

21

30

51

41

59

100

The schedule and the diagram mentioned below reflect Investment


type preferred by investors.

Fig.3.10

INVESTMENT TYPE

41%

Short term
Long Term

59%

The above figure shows that Long Term investment (59%) is more
preferred than Short term investment (41%).

Table 3.11 Date Was Collected For Analyzing Investment


Option Referred By Investors:
38

Investment
Option
Frequency

Bank Fixed
Deposits
32

Percentage

63

Mutual Fund

Total

19

51

37

100

The schedule and the diagram mentioned below reflect Investment


option referred by investors.

FIG.3.11

INVESTMENT OPTION RECOMMEND

Bank Fixed Deposits

37%

Mutual Fund

63%

The above figure shows that Bank Fixed Deposits (63%) is


recommended highly than Mutual Fund investment (37%).

39

CHAPTER IV:
CONCLUSION & RECOMMEDATION
4.1 CONCLUSIONS

A. On the basis of conclusion it has been seen that many people


prefer to invest their money in bank fixed deposit as compare to
Mutual funds
B. People will be aware of the risk involved in investments.

C. Mutual fund is introduced in 1961, till 54years after mutual funds


not change the mind set of people. Till present traditional
investment is dominating other investments.
D. Data collected also reveals that peoples are investing their some
part of their income.
E. It also has been found that people are preferring public sector as
beneficial.
F. People invest their money in low risk instrument as a first
preference not choose high rate of return. People are more
focused preservation of capital as factor for their investment.
G. Majority of people are feeling mutual fund is more risky than bank
fixed deposits. But people dont know bank also give only 1 lac
grantee of their fixed deposit investment.
H. More than 50 percent of people dont know investment scheme of
mutual fund and bank fixed deposit.

40

I. More people are investing their money in bank fixed deposit for a
long term.
J. People are recommending bank fixed deposit as good investment
to others.

4.2 RECOMMEDATIONS:
A. Seminars and promotional activities should be held to increase
knowledge and awareness among the peoples related with
market related schemes.
B. For long term investments mutual funds is best option and it can
beat inflation of the economy.
C. People regularly invest part thereof income to mutual fund for
longer term.
D. From

the

advance

technology

now

people

improve

their

knowledge about mutual fund investments and they take correct


decision about investments.
E. Increase in rate of return and proper allocation of funds will help
to increase investments to modern investments.
F. Mutual Funds Company improves their operational transaction
and bring more professionalism in their work.
G. Mutual funds give better return compared to bank fixed deposits.

41

H. Mutual funds are a tax saving tools if people invest their money in
tax saving funds.

BIBLIOGRAPHY
BOOK REFERRED

Indian Mutual Funds Handbook: - Sundar Sankaran . 16


Personal Finance Principles Every Investor Should Know - Manish
Chauhan.

MAGAZINES

ET WEALTH
BRUNCH

WEBSITES

http://mutualfund.birlasunlife.com
http://www.tatamutualfund.com
https://www.valueresearchonline.com
http://www.moneycontrol.com
42

http://economictimes.indiatimes.com
http://www.sebi.gov.in

43