APr

ojectRepor
t
On

“
STUDYANDGROWTHONMUTUALFUNDI
NDUSTRY”
At

I
NDI
AINFOLI
NELI
MITED(
II
FL)

UndertheGui
danceand
Submit
tedto:

PROF.I
SHADAVE(
Assi
stantPr
ofessor
)
Facul
tyofManagement

Submi
tt
edby
:
MEETHI
TESHKUMARSONI(
201600620010175)
NI
RAJPRAFULCHANDRAVAGHELA(
201600620010189)

Bat
ch:
2016-
18

NRI
NSTI
TUTEOFBUSI
NESSMANAGEMENT
(
GLSUNI
VERSI
TY)

CompanyCer
ti
fi
cat
e
I
I
I
I
II
 I
nst
it
uti
onCer
ti
fi
cat
e

Facul
tyofManagement

Cer
ti
fi
cat
e
Thi
sist
o cer
ti
fyt
hat Mr
.Meet Hi
teshkumar SoniEnr
olment No.
201600620010175,
andMr
.Ni
rajPr
aful
chandr
aVaghel
a Enr
olmentNo.
201600620010189 st
udent
s off
acul
tyofmanagementhassuccessf
ull
y
compl
etedhi
sSummerPr
ojecton“
StudyandGr
owt
hOnMut
ualFund”
at
“
Indi
aInf
oli
neLi
mit
ed(
II
FL)
”inpar
ti
alf
ulf
il
lmentoft
her
equi
rement
sof
MBApr
ogr
ammeofGLSUni
ver
sit
y.Thi
sishi
sor
igi
nalwor
kandhasnot
beensubmi
tt
edel
sewher
e.

¬_
___
___
___
___
___
___
___ _
___
___
___
___
___
__
Dr
.Hi
teshRupar
el Pr
of.I
shaDav
e

(
DeanFacul
tyofManagement
) (
Assi
stantPr
ofessor
)

Dat
e__
___
___

Pl
ace_
___
___
__

I
V
 Decl
arat
ion
We,MeetHi
teshkumarSoni
,Enr
olmentNo.201600620010175& Ni
raj
Pr
aful
chandr
a Vaghel
a,Enr
olmentNo.201600620010189 st
udent
s of
Facul
tyofManagementher
ebydecl
aret
hatIhav
esuccessf
ull
ycompl
eted
t
his pr
ojecton “
Study and Gr
owt
h On Mut
ualFund I
ndust
ry”i
nthe
academi
cyear2016-
17.
Wedecl
aret
hatt
hissubmi
tt
edwor
kisdonebymeandt
othebestofour
knowl
edge;nosuchwor
khasbeensubmi
tt
edbyanyot
herper
sonf
ort
he
awar
dofdegr
eeordi
ploma.
Weal
sodecl
aret
hatal
lthei
nfor
mat
ioncol
l
ect
edf
rom v
ari
oussecondar
y
andpr
imar
ysour
ceshasbeendul
yacknowl
edgedi
nthi
spr
ojectr
epor
t.

_
___
___
___
___
__

MEETSONI

_
___
___
___
___
___
_

NI
RAJVAGHELA

V
 PREFACE

Al
lst
udent
slear
ntheor
eti
calsubj
ect
sint
hei
rcl
assr
oom,butwear
ethemanagement
st
udent
s,apar
tfr
om t
heor
eti
calsubj
ect
sweneedt
ogetadeeperi
nsi
ghti
ntot
he
pr
act
ical
aspect
soft
heset
heor
ies.

Af
tercompl
eti
ononey
eari
nthi
ssummeri
nter
nshi
pwehadagr
eatexper
iencewher
e
wehav
etodost
udyi
nourdesi
redar
eaandhav
etomakear
epor
toni
t.

Thepr
ojecti
spr
epar
ed mai
nlyt
o under
stand and l
ear
n aboutpr
efer
encesoft
he
i
nvest
orsf
ori
nvest
menti
nMut
ual
Funds.

Wehadsur
vey
edal
most150r
espondent
sandcol
l
ect
edt
hedat
atopr
epar
ether
epor
t.
Thedat
a hasbeen anal
yzed and concl
usi
on hav
ebeen dr
awn.Asa st
udent
sof
managementwear
eex
pect
edwi
thsomet
hingmor
eor
gani
zed,speci
fi
candef
fect
ive
ef
for
tsent
rust
edt
ous.

Thi
spr
ojectcov
ersal
lthoseaspect
swhi
char
enecessar
ytoknowaboutPr
efer
encesof
i
nvest
ors.We hope t
hatt
his pr
ojectwi
l
lrecei
vei
ts gener
ous suppor
tand ki
nd
ar
gument
s.

Mut
ualFundsar
eli
keal
esserr
iskyi
nvest
mentt
handi
rectst
ocki
nvest
ment
.The
Mut
ualFund i
ndust
ryi
s gr
owi
ng i
ntoday
’s gener
ati
on.Ther
eis huge scope of
sy
stemat
ici
nvest
mentpl
anni
ngaswel
lasl
umpsum i
nvest
ment
.

VI
 ACKNOWLEDGEMENT

Wear
ethest
udent
sofMBAf
rom N.
R.I
nst
it
uteofBusi
nessManagementl
i
kest
otake
anoppor
tuni
tyt
othankal
loft
hosewhohav
econt
ri
but
edandgi
venust
hei
rhel
pandco-
oper
ati
on.

Fi
rst
ly,wewoul
dli
ket
othankouri
nter
nalgui
dePr
of.I
shaDav
eforgi
vi
ngherpr
eci
ous
t
imeandgui
dingust
owar
dsaccompl
i
shmentofr
epor
t.

Wewoul
dal
sol
i
ket
othankourext
ernalgui
deMr
.Raj
i
vJoshiwhohasgi
vent
his
oppor
tuni
tyandsuppor
tinourpr
act
ical
studi
esdur
ingt
heent
ir
epr
ojectwor
k.

Wear
ethankf
ult
heGuj
aratLawSoci
ety
,thet
rustandal
lit
smember
sfori
ntr
oduci
ng
t
her
epor
tpr
epar
ati
onasapar
tofM.
B.A.speci
all
yDr
.Hi
teshRupar
elf
ort
hewonder
ful
l
ear
ningandnur
tur
ingenv
ironmentatt
hei
nst
it
uteandt
heMBApr
ogr
am.Thi
spr
ogr
am
hel
pst
hest
udent
singai
ningpr
act
icalknowl
edgeandexposi
ngt
hemsel
vest
othe
pr
act
ical
busi
nessenv
ironment
.

VI
I
 I
NDEX

Chapt
e Cont
ent Page
rNo No

Ti
tl
ePage I

CompanyCer
ti
fi
cat
e I
I

I
nst
it
uteCer
ti
fi
cat
e I
V

Decl
arat
ion V

Pr
eface VI

Acknowl
edgement VI
I

1. Resear
chMet
hodol
ogy 1

1.
1 Li
ter
atur
eRev
iew 2

1.
2 Pr
obl
em St
atement 6

1.
3 Obj
ect
iveofst
udy 6

1.
4 ScopeofSt
udy 7

1.
5 Resear
chDesi
gn 7

VI
II
 1.
6 Sampl
i
ng 8

1.
6.1Sampl
i
ngmet
hod 8

1.
6.2sampl
i
ngsi
ze 8

1.
6.3Ar
ea 8

1.
6.4Dat
aAnal
ysi
sandTool
s 8

1.
6.5Hy
pot
hesi
s 8

1.
7 Dat
aCol
l
ect
ionSour
ces 9

1.
8 Benef
ici
ari
esoft
heSt
udy 9

1.
9 Li
mit
ati
ons 9

2. I
ndust
ryPr
ofi
l
e 11

2.
1 Meani
ngofMut
ual
Fund 13

2.
2 Def
ini
ti
on 13

2.
3 Hi
stor
yofMut
ual
Fundi
nIndi
a 14

2.
4 St
ruct
ureofMut
ual
Fund 15

2.
5 Sel
ect
ionPar
amet
erofMut
ual
Fund 19

2.
6 Mar
ket
ingSt
rat
egyForMut
ual
Fund 20

3. CompanyPr
ofi
l
e 22

3.
1 Hi
stor
yandOv
erv
iew 23

I
X
 3.
2 Pr
oduct
sandofI
IFL 24

3.
3 Ser
viceofI
IFL 26

3.
4 Vi
si
onSt
atementofI
IFL 27

3.
5 Qual
i
tySt
atementofI
IFL 28

3.
6 Mi
ssi
onSt
atementofI
IFL 28

3.
7 SWOTAnal
ysi
sofI
IFL 29

4. I
ntr
oduct
ionoft
heTopi
c 31

4.
1 Whati
sMut
ual
Fund 32

4.
2 Regul
ari
tyofMut
ual
Fundi
nIndi
a 33

4.
3 I
ndi
anMut
ual
FundI
ndust
ryTr
endsRepor
tCar
dFor2016 34

4.
4 Ty
pesofMut
ual
FundI
nIndi
a 37

4.
5 Adv
ant
agesOfMut
ual 43

4.
6 Di
sAdv
ant
ageofMut
ual
Fund 45

5. Anal
ysi
sandI
nter
pret
ati
on 47

5.
1 Pr
imar
yAnal
ysi
s 48

5.
2 Secondar
yAnal
ysi
s 62

5.
3 Hy
pot
hesi
sAnal
ysi
s 65

X
6. Fi
ndi
ngs 76

6.
1 Pr
imar
yFi
ndi
ngs 77

6.
2 Secondar
yFi
ndi
ngs 78

6.
3 Hy
pot
hesi
sFi
ndi
ngs 79

7. Recommendat
ion 80

7.
1 Recommendat
iont
ocompany 81

7.
2 Recommendat
iont
oInv
est
or 82

8. Concl
usi
on 83

9. Bi
bli
ogr
aphy 85

10. Annexur
e 87

XI
 GRAPHI
NDEX

Chapt
e Cont
ent PageNo
rNo

5.
1 Pr
imar
yDat
aInt
erpr
etat
ionAndAnal
ysi
s 48

5.
1.1 Mostpr
efer
abl
einv
est
mentr
anki
ngsofi
nvest
ors 48

5.
1.2 Fact
orsconsi
der
edbyi
nvest
orwhi
l
einv
est
ment 49

5.
1.3 Pr
efer
encesf
orMut
ual
Fundi
nvest
ment 50

5.
1.4 Knowl
edgeaboutMut
ual
Fund 51

5.
1.5 Peopl
e’
sawar
enessaboutMut
ual
Fundf
rom sour
ces 52

5.
1.6 Schemesusedbyi
nvest
ors 53

5.
1.7 Per
iodOfI
nvest
ment 54

5.
1.8 SI
PamountspendbyI
nvest
ors 55

5.
1.9 LUMPSUM amountspendi
ngbyi
nvest
ors 56

5.
1.1 Expect
edRet
urnOfMut
ual
Fund 57
0

5.
1.1 Feat
uresOfMut
ual
Fund 58
1

5.
1.1 Mut
ual
FundScheme 59
2

5.
1.1 Sour
cesofPur
chasi
ngMut
ual
Fund 60

XI
I
 3

5.
1.1 Reasonf
ornotI
nvest
ingMut
ual
Fund 61
4

5.
2 TwoVar
iabl
eTest 62

5.
2.1 Pr
efer
redt
imeper
iodf
ori
nvest
mentbyYoungst
ers 62

5.
2.2 Pr
efer
abl
esour
cesf
orv
ari
ousoccupi
edpeopl
e 63

5.
2.3 SI
Pinv
est
mentFr
om TheVar
iousSour
ces 64

5.
3 Hy
pot
hesi
sAnal
ysi
sandI
nter
pret
ati
on 65

XI
II
 CHAPTER1:

RESEARCHMETHODOLOGY

1
 1.
1Li
ter
atur
eRev
iew

1.(
DR.SARI
TABAHL,2012)hav
einv
est
igat
est
heper
for
manceof29open-
ended,
gr
owt
h-or
ient
edequi
tyschemesf
ort
heper
iodf
rom Apr
il2005t
oMar
ch2011
(
sixy
ear
s)oft
ransi
ti
oneconomy
.Mont
hlyNAVofdi
ff
erentschemeshav
ebeen
usedt
ocal
cul
atet
her
etur
nsf
rom t
hef
undschemes.BSE-
Sensexhasbeenused
f
ormar
ketpor
tfol
i
o.Thehi
stor
icalper
for
manceoft
hesel
ect
edschemeswas
ev
aluat
edont
hebasi
sofShar
pe,Tr
eynor
,andJensen’
smeasur
ewhoser
esul
ts
wi
l
lbeusef
ulf
ori
nvest
orsf
ort
aki
ngbet
teri
nvest
mentdeci
sions.Resul
tsoft
he
st
udyshowed t
hatt
hat14 outof29 (
48.
27 per
cent
)sampl
e mut
ualf
und
schemes had out
per
for
med t
he benchmar
kret
urn.Al
lthe schemes hav
e
r
epr
esent
edposi
ti
ver
etur
ns.Fr
om Shar
per
ati
o,i
tfoundt
hatShar
per
ati
ois
0.
00163ascompar
edt
omar
ket0.
00161t
hatshowsbet
terper
for
manceas
compar
ed t
othemar
ket
.Fr
om Tr
eynorr
esul
ts,i
tfound t
hat19 outof29
schemeshadout
per
for
medt
hebenchmar
k.Ther
esul
tsal
soshowedt
hatsome
of t
he schemes had under
per
for
med,t
hese schemes wer
efaci
ng t
he
di
ver
sif
icat
ion pr
obl
em.I
nthe st
udy
,the Shar
pe r
ati
o was posi
ti
vef
oral
l
schemeswhi
chshowedt
hatf
undswer
epr
ovi
dingr
etur
nsgr
eat
ert
hanr
iskf
ree
r
ate.Resul
tsofJensenmeasur
erev
eal
edt
hat19outof29(
65.
52per
cent
)
schemeswer
eshowedposi
ti
veal
phawhi
chi
ndi
cat
edsuper
iorper
for
manceof
t
heschemes.

2.(
Dr.Mamt
aShah,2012)hasdoner
esear
chonMar
ket
ingPr
act
icesofMut
ual
Funds.Dev
elopmentofan economynecessar
il
ydependsupon i
tsf
inanci
al
sy
stem and t
he r
ate ofnew capi
talf
ormat
ion whi
ch can be achi
eved by
mobi
l
izi
ngsav
ingsandadopt
ingani
nvest
mentpat
ter
n,bei
tssel
f-
fi
nanci
ng(
i.
e.
di
rectori
ndi
rect
)wher
efi
nanci
ali
nter
medi
ari
esl
i
kebanks,i
nsur
anceandot
her
f
inanci
alcompani
es come i
nthe pi
ctur
e and medi
ate bet
ween sav
ers and
bor
rower
soff
unds.I
nthesamewayt
her
ear
edi
ff
erentt
ypesofi
nvest
orsand
eachcat
egor
yofi
nvest
orsdi
ff
ersi
nit
sobj
ect
ivesandhencei
tisi
mper
ati
vef
or

2
 i
nvest
mentmanager
stochooseanappr
opr
iat
einv
est
mentpol
i
cyf
ort
hegr
oup
t
heyar
edeal
i
ngwi
th,f
urt
hermanagi
ngt
hei
nvest
menti
sady
nami
candan
ongoi
ngpr
ocess.

3.(DRBI
MALANJUM,
2012)expl
ainedi
nthei
rresear
cht
hati
n2009-
10exceptI
NG
cor
eequi
tyf
undandKot
aksel
ectf
ocusf
undal
lev
enschemesper
for
medbet
ter
t
han BSE-Sensex.Exceptoneschemeal
lwer
eabl
eto pr
ovi
der
ewar
dfor
v
ari
abi
l
ityandv
olat
il
it
ymor
ethant
hebenchmar
k.Fourschemeshav
emor
eri
sk
t
hanSensex.I
nthey
ear2010-
11benchmar
khasout
per
for
medt
hanal
lschemes.
Al
lschemeshav
efai
l
edt
ogi
vemor
erewar
dforv
ari
abi
l
ityt
hanbenchmar
k.Onl
y
f
ourschemeswer
eabl
etogi
ver
ewar
dforv
olat
il
it
ythanbenchmar
k.Soatt
he
endwecanseet
hatHDFCt
op200Fund,HDFCcapi
talbui
l
derf
undandUTI
oppor
tuni
tyf
undswer
eabl
etof
ulf
il
ltheexpect
ati
onsoft
hei
nvest
orsi
nter
msof
r
iskandr
etur
n.

4.(
Dhi
rendr
aKumar,2013)hadsai
dthatt
hemut
ualf
undi
ndust
ryi
sindeedt
wo
separ
atei
ndust
ri
es one i
sar
etai
l
-or
ient
ed equi
tyi
nvest
mentmanagement
i
ndust
ryandanot
heri
sacor
por
atedeposi
tser
vicet
hatcompr
isest
hef
ixed-
i
ncomef
unds.Ther
e i
s some connect
ion but t
his i
s t
he basi
c
det
achment
.Nat
ural
l
y,t
her
e's not
hing wr
ong i
n pl
aci
ng l
arge amount
s of
cor
por
atecash,
asi
tis an i
mpor
tantser
vice i
n af
inanci
alsy
stem andmut
ual
f
undsdoi
tbet
tert
hanbanks.

5.(
Mr.JayR.Joshi
,2013)
Mut
ualFunds:AnI
nvest
mentOpt
ionf
rom I
nvest
ors’
Poi
ntofVi
ew.Thi
sst
udyi
sofdescr
ipt
ivet
yper
esear
ch.Thet
argetpopul
ati
on
wi
l
lbei
ndi
vi
duali
nvest
ori
n Anand – Vi
dyanagarar
eaofr
elat
ivel
yaf
fl
uent
west
ern St
ate ofGuj
arat(
Indi
a).The sur
veywi
l
lbe based on conv
eni
ence
sampl
i
nghav
ing100i
nvest
orsassampl
esi
ze.Thest
udywi
l
ltr
ytoi
dent
if
ythe
consumer
s’pr
efer
ence f
orv
ari
ous mut
ualf
unds and t
he mai
nreasons f
or

3
 i
nvest
menti
nmut
ualf
undschemes.Thest
udywi
l
lal
sot
ryt
oinv
est
igat
evar
ious
f
act
orst
hati
nvest
ori
sthi
nki
ngbef
oresel
ect
ingamut
ualf
undcompany
.Ov
eral
l
,
t
hest
udyi
sfocusi
ngont
hebehav
iorofi
ndi
vi
duali
nvest
orsandhencef
orma
par
tofbehav
ior
alf
inancear
ea.

6.(
RAJI
V.G.SHARMA,2013)
hasdoneaCompar
ati
veSt
udyonPubl
i
candPr
ivat
e
Sect
orMut
ual
Fundsi
nIndi
a.Thest
udyatf
ir
stt
est
swhet
hert
her
eisanyr
elat
ion
bet
ween demogr
aphi
c pr
ofi
l
e oft
he i
nvest
orand sel
ect
ion ofmut
ualf
und
al
ter
nat
ivef
rom amongpubl
i
csect
orandpr
ivat
esect
or.Fort
hepur
poseof
anal
ysi
sper
cept
ionsofsel
ect
edi
nvest
orsf
rom publ
i
candpr
ivat
esect
ormut
ual
f
undsar
etakeni
ntoconsi
der
ati
on.Themaj
orf
act
orsi
nfl
uenci
ngt
hei
nvest
orsof
publ
i
c and pr
ivat
e sect
ors mut
ualf
unds ar
eident
if
ied.The f
act
ors under
consi
der
ati
on t
o compar
ebet
ween per
cept
ionsofpubl
i
cand pr
ivat
esect
or
mut
ualf
undi
nvest
orsar
eLi
qui
dit
y,Secur
it
y,Fl
exi
bil
i
ty,
Managementf
ee,
Ser
vice
Qual
i
ty,
Transpar
ency
,Ret
urnsandTaxbenef
it
s.

7.(
Dr.Nai
l
aIqbal
,2013)hasst
udi
edMar
ketPenet
rat
ionandI
nvest
mentPat
ter
nof
Mut
ualFundI
ndust
ryi
nIndi
a.Mar
ketpenet
rat
ioni
sat
ermt
hati
ndi
cat
eshow
deepl
yapr
oductorser
vicehasbecomeent
renchedwi
thagi
venconsumer
mar
ket
.Thedegr
eeofpenet
rat
ioni
sof
tenmeasur
edbyt
heamountofsal
est
hat
ar
egener
atedwi
thi
nthemar
keti
tsel
f.Apr
oductt
hatgener
atest
went
yper
cent
oft
hesal
esmadewi
thi
nagi
venmar
ketwoul
dbesai
dtohav
eahi
gherr
ateof
mar
ketpenet
rat
iont
hatasi
mil
arpr
oductt
hatr
eal
i
zest
enper
centoft
het
otal
sal
eswi
thi
nthatsamemar
ket
.Det
ermi
ning whatconst
it
utest
heconsumer
mar
keti
skeyt
othepr
ocessofpr
oper
lycal
cul
ati
ngmar
ketpenet
rat
ion.

8.(
Vij
ayal
akshmiSundar
,2014)
Indi
an MFs hav
e emer
ged as st
rong f
inanci
al
i
nter
medi
ari
es and t
heypl
aya si
gni
fi
cantr
olei
n br
ingi
ng st
abi
l
ityi
ntot
he

4
 f
inanci
alsy
stem andef
fi
ciencyi
nresour
ceal
l
ocat
ion.Mut
ualFundsoper
ati
ons
ut
il
izedt
hepubl
i
cmoneyofi
nvest
ors,henceFund Manager
s hav
etouset
his
publ
i
cmoneyi
napr
operwayand di
str
ibut
ereasonabl
eret
urnst
oinv
est
ors.
Fund Manager
smustf
indt
hepor
tfol
i
oal
l
ocat
ion under r
iskand r
etur
ns
pr
oposi
ti
on.Af
tert
hatt
heyhav
etosel
ectt
hest
ocks f
orf
und al
l
ocat
ion.I
n
gener
al,hi
ghl
evel of r
iskpr
ovi
des hi
gh r
etur
ns, hence Fund
Manager
s ar
erecommendedcont
inue t
osel
ectt
he cor
rectst
ocksaccor
ding
t
otheexpect
ati
onsofi
nvest
ors.I
nther
ecentst
udi
esofsect
orbasedf
unds
r
eveal
ed t
hatbanki
ng sect
orMut
ualf
unds t
opped t
he per
for
mance char
ts.
I
nvest
menti
nbanki
ngsect
orf
undsi
soneoft
hebestav
enuewhi
chguar
ant
ees
st
abl
eret
urnwi
thmedi
um r
iskwhencompar
etoot
hersect
ors.

9.(
Preet
iKhi
tol
i
ya,2014)st
udyexpl
oredt
hatonl
y49%r
espondentwer
eawar
eof
mut
ualf
undi
tisasur
pri
singf
actsi
ncet
he60%r
espondentwer
epostgr
aduat
e
and34% wer
egr
aduat
eofamet
ropol
i
tanci
ty.Oft
he95r
espondentwhoar
e
awar
eofmut
ual
fundonl
y57hadi
nvest
edi
nmut
ual
fund.Mostr
espondentwer
e
notawar
eoft
hei
ntr
icaci
esi
nvol
vedi
ndeal
i
ngwi
thmut
ualf
und.I
nspi
teoft
his
t
heydonotaskt
heassi
stanceofconsul
tant
s/adv
isor
sduet
odi
str
ustandhi
gh
consul
tat
ionf
ee.I
nvest
orsgener
all
ydi
scusswi
thf
ri
endsand r
elat
iveabout
di
ff
erentMFschemesbef
oremaki
ngi
nvest
mentdeci
sionwhi
chi
snotf
easi
blei
n
i
nvest
mentdeci
sions.I
twasper
cei
vedt
hatt
axbenef
itandf
lexi
bil
i
tyast
he
gr
eat
est benef
it of i
nvest
ing i
n mut
ualf
und f
oll
owed by t
ranspar
ency
,
di
ver
sif
icat
ion and r
etur
n.55% Mal
erespondentexpr
essed wi
l
li
ngness t
o
assume r
iskf
orweal
th maxi
mizat
ion and onl
y22% f
emal
e wer
e wi
l
li
ng t
o
assumehi
ghr
iskf
orgr
owt
hfund.Somal
eswer
efoundr
iskl
over
sandf
emal
es
wer
efoundr
iskav
ersi
veandexpr
essedt
ohav
ethatmut
ualf
undschemewhi
ch
guar
ant
eessaf
etyofpr
inci
palamountandr
egul
ari
ncome.Maj
ori
tyr
espondent
i
ntheageof35-
44wi
sht
oinv
esti
nthemut
ualf
undwhi
chensur
esweal
th
maxi
mizat
ionf
oll
owedbybal
ancedf
undandi
ncomef
undssi
mil
arr
esul
tswer
e
seeni
ntheagegr
oupof25-
34butar
ever
set
rendwasseeni
ntheagegr
oupof
45+y
ear
swher
emaj
ori
tywasr
iskav
ersi
veast
heyexpr
essedt
oinv
esti
nmut
ual

5
 f
undschemewhi
chguar
ant
eessaf
etyofpr
inci
palamountf
oll
owedbybal
anced
f
undandgr
owt
hfund.Peopl
ehi
ghl
yeducat
edandol
deri
nagebet
terunder
stand
mut
ual
funddi
mensi
on.

10.
(Dr
.MehulP.Desai
,2015)
Inv
est
orsconsi
deral
lthef
act
orsi
mpor
tantwhen
pur
chasi
ngamut
ualf
undexcl
udi
ngst
atus,f
ri
ends&r
elat
ivesandcompany
’s
r
eput
ati
on.Thei
nvest
orsar
esat
isf
iedwi
tht
hei
rmut
ual
fundper
for
mance.

11.
(Dr
.K.Mal
l
ikar
junaRao,
2015)hasst
udi
edmut
ual
fundi
sani
nvest
ment
companyort
rustt
hatpool
sther
esour
cesf
rom numberofi
nvest
ors,
whoshar
e
commoni
nvest
mentgoal
,andt
hendi
ver
sif
iesi
tsi
nvest
menti
ntot
hesecur
it
ies
ofdi
ff
erenti
ndust
ri
alsect
orsandcompani
esi
nor
dert
oreal
i
zepot
ent
ial
ret
urns
wi
thr
easonabl
esaf
ety
.Int
heer
aofgl
obal
i
zat
ion,
rapi
dpr
icef
luct
uat
ionsar
e
occur
ri
ngi
nfi
nanci
alasset
sli
keequi
tyshar
es,
bondsandal
soi
nphy
sical
asset
s
l
i
ker
eal
est
ate,
gol
dsi
l
veret
c.

12.
(Dr
.M.Shei
kMohamed,2016)Thet
hreet
opper
for
m FMCG’
sfundsar
egi
ven
goodr
etur
nbasedonf
ixedi
ncomesecur
it
ies.TheEqui
ty-
FMCG Mut
ualf
und
schemescanabl
etof
acei
nfl
ati
onr
ateandl
esserr
iskwi
thgoodr
etur
n.So,
t
heset
ypesofEqui
ty-
FMCG’
sfundsar
eencour
agi
ng t
he smal
linv
est
orst
o
i
nvest t
o meet oureconomy gr
owt
h wi
thl
esser r
isk.I
tsexpr
essFMCG
sect
ors per
for
m shar
emar
ketpr
iceandpr
ovi
degoodr
etur
ntot
hesoci
ety
.

1.
2 Pr
obl
em St
atement

 Ast
udyofpr
efer
encesoft
heI
nvest
orsf
orI
nvest
mentI
nMut
ual
Fund.

1.
3 Resear
chObj
ect
ive

6
Themai npur
poseoft hi
sr esearchistoaccesst
hepr
efer
encesofMut
ualFunds.
Speci
fi
cobj
ecti
vesoft
hisresearchareasf
oll
ows:

 Toi
dent
if
ythef
undament
alofMut
ual
Fundsi
nIndi
a.

 Tocomput
ether
iskandr
etur
nofMut
ual
Fundsav
ail
abl
einAhmedabadI
ndi
a.

 To under
stand t
hei
dealper
iod,t
ypeand r
etur
n expect
ed i
n amut
ualf
und
schemebyt
hei
nvest
or

 Todet
ermi
net
hemostpr
efer
redsect
orofmut
ual
fund

 Tounder
standt
hef
act
orsaf
fect
ingt
hemut
ual
funds

1.
4 Scopeoft
hest
udy

ScopeofMut
ualFundhasgr
ownenor
mousl
yov
ert
hey
ear
s.I
nthef
ir
stageof
mut
ualf
und,when t
hei
nvest
mentmanagementcompani
esst
art
ed t
o of
fer
mut
ualf
unds,choi
ceswer
efew.Ev
ent
houghpeopl
einv
est
edt
hei
rmoneyi
n
mut
ualf
undsast
hesef
undsof
fer
edt
hem di
ver
sif
iedi
nvest
mentopt
ionf
ort
he
f
ir
stt
ime.Byi
nvest
ingi
nthesef
undst
heywer
eabl
etodi
ver
sif
ythei
rinv
est
ment
i
ncommonst
ocks,pr
efer
redst
ocks,bondsandot
herf
inanci
alsecur
it
ies.Att
he
samet
ime,
theyal
soenj
oyedt
headv
ant
ageofl
i
qui
dit
y.Wi
thMut
ualFunds,
they
gott
hescopeofeasyaccesst
othei
rinv
est
edf
undonr
equi
rement
.

But
,int
oday
’swor
ld,ScopeofMut
ualFundshasbecomesowi
de,t
hatpeopl
e
somet
imest
akel
ongt
imet
odeci
det
hemut
ualf
undt
ype,t
heyar
egoi
ngt
o
i
nvesti
n.Sev
eralI
nvest
mentManagementCompani
eshav
eemer
gedov
ert
he
y
ear
swhoof
fer
edv
ari
oust
ypesofmut
ualf
unds,eacht
ypeofcar
ryi
nguni
que
char
act
eri
sti
csanddi
ff
erentbenef
ici
alf
eat
ures.

1.
5 Resear
chDesi
gn:
Descr
ipt
iveResear
ch

7
 Her
e,wear
egoi
ngwi
thDescr
ipt
iver
esear
chmet
hodol
ogy

Mai
nai
m oft
hisr
esear
chi
stogai
nexper
iencesoast
oobser
vev
ari
ousmut
ualf
undsi
n
t
hemar
ketandgat
herr
elev
anti
nfor
mat
ion.Wi
tht
her
esear
chdesi
gn,t
hepr
imar
ydat
a
neededi
nwi
l
lbeder
ivedf
rom t
heansweroft
her
espondentoft
hesur
veyt
hrought
he
f
ormul
atedquest
ionnai
res.

Ther
efor
e,acompet
it
ivesur
veyoft
hedescr
ipt
iver
esear
chdesi
gnwi
l
lbeempl
oyed.I
n
t
hiski
ndofsur
vey
,ther
esul
tgat
her
edf
rom t
heanswer
soft
hedi
ff
erentr
espondentwi
l
l
hav
etobecompar
ed.Suchcompar
isonwi
l
lenabl
emet
oassesst
hebenef
it
sandt
he
ef
fect
ivenessofmut
ualf
undst
oincr
easet
hecompet
it
ivenessi
nter
m ofi
ncr
easi
ngt
he
per
for
manceoft
hebusi
nessor
gani
zat
ion.

1.
6.Sampl
i
ngPl
an

 Sampl
ear
ea:
Ahmedabadci
ty
 Sampl
esi
ze:
150
 Sampl
i
ngUni
t:I
ndi
aInf
oli
nel
i
mit
edv
ast
rapurBr
anch’
sCust
omer
s
 Sampl
i
ngmet
hod:
Conv
eni
entsampl
i
ng
 Dat
aanal
ysi
sTool
s:Thedat
aanal
ysi
stool
swhi
chweusedi
sSPSS
sof
twar
e
 Hy
pot
hesi
s

1.H0:Ther
eisnosi
gni
fi
cantr
elat
ionshi
pbet
weeni
ncomeandt
ypeofmut
ual
f
undi
nvest
or.
H1:t
her
eissi
gni
fi
cantr
elat
ionshi
pbet
weeni
ncomeandt
ypeofmut
ualf
und
i
nvest
or.

2.H0:Ther
eisnosi
gni
fi
cantr
elat
ionshi
pbet
weenmut
ualf
undi
nvest
mentand
gender
.
H1:Ther
eissi
gni
fi
cantr
elat
ionshi
pbet
weenmut
ualf
undi
nvest
mentand

8
 gender
.

3.H0: Ther
eisnosi
gni
fi
cantr
elat
ionshi
pbet
weeni
nvest
ors’i
ncomeand
spendi
ngcapaci
tyofmut
ual
fundi
nvest
ment
H1:Ther
eissi
gni
fi
cantr
elat
ionshi
pbet
weeni
nvest
or’
sincomeandspendi
ng
capaci
tyofmut
ual
fundi
nvest
ment
.

4.H0:Ther
eisnosi
gni
fi
cantr
elat
ionshi
pbet
weenper
iodofi
nvest
mentand
gr
ofundscheme.
H1:Ther
eissi
gni
fi
cantr
elat
ionshi
p bet
ween per
iod ofi
nvest
mentand
gr
owt
hfundscheme.

5.H0:Ther
eisnosi
gni
fi
cantr
elat
ionshi
pbet
weeni
nvest
ors’agegr
oupand
per
iodofi
nvest
ment
.
H1:
Ther
eissi
gni
fi
cantr
elat
ionshi
pbet
weeni
nvest
or’
sagegr
oupandper
iod
ofi
nvest
ment
.

6.H0:
Peopl
ewoul
dli
ket
oinv
esti
nmut
ual
fund.
H1:
Peopl
ewoul
dnotl
i
ket
oinv
esti
nmut
ual
fund.

1.
7Dat
aCol
l
ect
ion

Thenecessar
ydat
awi
l
lbecol
l
ect
edf
rom t
wosour
ces.Theyar
e:

 Pr
imar
ysour
ces

Thi
sdat
awi
l
lbecol
l
ect
edf
rom t
hedi
rectf
il
edt
hr heQuest
oughoutt ionnai
re.

 Secondar
ysour
ces:i
nter
netandwebsi
te

 Thi
sdat
awi
l
lbecol
l
ect
edf
r heAr
om t ti
cles.
 Annual
repor
tofcompany
 Var
iousj
our
nal
booksandwebsi
tes.

9
 1.
8Benef
ici
ari
esoft
hest
udy

 Thi
sresear
ch wi
l
lhel
p us t
oful
l
yunder
stand t
he cont
ri
but
ion and t
he
necessi
tyofmut
ual
fundi
nreal
busi
nesswor
ld.
 Thi
sresear
chwi
l
lhel
pmet
oev
aluat
etheper
for
manceofv
ari
ousmut
ual
f
undsandt
hei
rpr
ofi
tabi
l
ity
.
 Thi
swoul
dhel
pinv
est
orst
oinv
esti
nthemut
ualf
undcar
eful
l
y,I
twi
l
lhel
pme
t
orel
atecl
assr
oom l
ear
ningwi
thr
eal
li
fesi
tuat
ion.
 Thi
sresear
chwecangetexper
ienceandknownt
hathow mucht
heor
eti
cal
knowl
edgei
sdev
iat
edf
rom t
her
eal
fact
s.

9L
1. i
mit
ati
onsoft
hest
udy

1.Oneoft
hel
i
mit
ati
onsi
sti
meconst
rai
nt.6weekswer
eenought
ost
udyt
he
pr
obl
em i
ndept
h.
2.Sampl
esi
zei
sonl
y150.
3.Thi
sresear
chi
srest
ri
ctedt
oAhmedabadonl
y.
4.Someoft
hepeopl
ewer
enotbeabl
etocl
ear
lyunder
standt
hequest
ionsas
l
anguagewasapr
obl
em.
5.Empl
oyeesar
enotal
l
owedt
opr
ovi
desensi
ti
veanddept
hinf
ormat
ion.

10
Chapt
er2:I
ndust
ryPr
ofi
l
e

11
I
ndust
ryPr
ofi
l
e

12
Ther
ear
eal
otofi
nvest
mentav
enuesav
ail
abl
etodayi
nthef
inanci
almar
ketf
oran
i
nvest
orwi
th an i
nvest
abl
e sur
plus.He can i
nvesti
n Bank Deposi
ts,Cor
por
ate
Debent
ures,
andBondswher
ether
eisl
owr
iskbutl
owr
etur
n.Hemayi
nvesti
nSt
ockof
compani
eswher
ether
iski
shi
ghandt
her
etur
nsar
eal
sopr
opor
ti
onat
elyhi
gh.The
r
ecentt
rendi
nthest
okemar
kethav
eshownt
hatanav
erager
etai
linv
est
oral
way
slost
wi
thper
iodi
cbear
isht
ends.peopl
ebeganopt
ingf
orpor
tfol
i
omanager
swi
thexper
ti
se
i
nst
ockmar
ketwhowoul
dinv
estont
hei
rbehal
f.
ThuswehadWeal
thmanagementser
vicepr
ovi
debymanyi
nst
it
uti
ons.Howev
er,t
hey
pr
ovedt
oocost
lyf
orsmal
linv
est
or.Ther
einv
est
orhav
efoundagoodshel
terwi
tht
he
mut
ual
funds.

2.
1Meani
ngofMut
ual
Fund

Amut
ualf
undi
sacommonpoolofmoneyi
ntowhi
chi
nvest
orspl
acecont
ri
but
ionst
hat
ar
etobei
nvest
edi
naccor
dancewi
thst
atedobj
ect
ives.Theowner
shi
poft
hef
undi
s
t
husj
ointor“
mut
ual
”;t
hef
undbel
ongst
oal
li
nvest
ors.Asi
ngl
einv
est
or’
sowner
shi
pof
t
hef
undi
sint
hesamepr
opor
ti
onast
heamountoft
hecont
ri
but
ionmadebyhi
m orher
bear
stot
het
otal
amountoft
hef
und.

Mut
ualFundar
etr
ust
s,whi
chacceptsav
ingf
rom i
nvest
orsandi
nvestt
hesamei
n
di
ver
sif
iedf
inanci
ali
nst
rument
sint
het
erm ofobj
ect
ivesetouti
nthet
rust
sdeedwi
th
t
hev
iew t
oreducet
her
iskandmaxi
mizet
hei
ncomeandcapi
talappr
eci
ati
onf
or
di
str
ibut
ionf
ort
hemember
s.
AMut
ualFundi
sacor
por
ati
onandt
hef
undmanager
sint
eresti
stopr
ofessi
onal
l
y

13
managet
hef
undpr
ovi
debyt
hei
nvest
orsandpr
ovi
der
etur
nont
hem af
terdeduct
ing
r
easonabl
emanagementf
ees.

2.
2Def
ini
ti
on

“
Mut
ualf
undsar
ecol
l
ect
ivesav
ingandi
nvest
mentv
ehi
cleswher
esav
ingofsmal
l
i
nvest
orsar
epool
edt
oget
hert
oinv
estf
ort
hei
rmut
ualbenef
itandr
etur
nsdi
str
ibut
ed
pr
opor
ti
onal
l
y”

“
A mut
ualf
undi
sani
nvest
mentt
hatpool
swi
tht
hemoneywi
tht
hemoneyofan
unl
i
mit
ednumberofot
heri
nvest
ors.I
nret
urny
ouandt
heot
heri
nvest
orseachshar
eof
t
hef
und.Thef
und’
sasset
sar
einv
est
edaccor
dingt
oani
nvest
menti
ntot
hef
und’
s
por
tfol
i
oofi
nvest
ment
.Aggr
essi
vegr
owt
hfundsseekl
ong-
ter
m capi
talgr
owt
hby
i
nvest
ingpr
imar
yinst
okeoff
ast
-gr
owi
ngsmal
l
ercompani
esormar
ketsegment
s.
Aggr
essi
vegr
owt
hfundsar
eal
socal
l
edcapi
tal
appr
eci
ati
onf
unds”
.

2.
3HI
STORYOFMUAULFUNDI
NINDI
A
Themut
ualf
undi
ndust
ryi
nIndi
ast
art
edi
n1963wi
tht
hef
ormat
ionofUni
tTr
ustof
I
ndi
a,att
hei
nit
iat
iveoft
heGov
ernmentofI
ndi
aandReser
veBank.Thehi
stor
yof
mut
ual
fundsi
nIndi
acanbebr
oadl
ydi
vi
dedi
ntof
ourdi
sti
nctphases.

FI
RSTPHASE-
1964-
87

Uni
tTr
ustofI
ndi
a(UTI
)wasest
abl
i
shedon1963byActPar
li
ament
.Itwassetupby
t
heReser
veBankofI
ndi
aandf
unct
ionedundert
heRegul
ator
yandadmi
nist
rat
ive
cont
rolofTheReser
veBankoft
heI
ndi
a.I
n1978UTIwasde-
li
nkedf
rom t
heRBIand
i
ndust
ri
alDev
elopmentBankofI
ndi
a(I
DBI
)tookov
ert
her
egul
ator
yandadmi
nist
rat
ive

14
cont
roli
npl
aceofRBI
.Thef
ir
stschemel
aunchedbyUTIwasuni
tscheme1964.Att
he
endof1988UTIhadRs.
6,700cr
oresofasset
sundermanagement
.

SECONDPHASE–1987-
1993(
ENTRYOFPUBLI
CSECTORFUNDS)
:

1987mar
kedt
heent
ryofnon-UTI
,publ
i
csect
ormut
ualf
undsetupbypubl
i
csect
or
banksandLi
feI
nsur
anceCor
por
ati
onofI
ndi
a(LI
C)andGener
alI
nsur
anceCor
por
ati
on
ofI
ndi
a(GI
C).SBImut
ualf
undwast
hef
ir
stnon–UTImut
ualf
undest
abl
i
shedi
nJune
1987f
oll
owedbyPunj
abNat
ionalBankMut
ualFund(
Aug89)
,Indi
anBankMut
ualFund
(
Nov89)
,BankofBar
odaMut
ualFund(
Oct92)
.LI
Cest
abl
i
shedi
tsmut
ualf
undi
nJune
1989whi
l
eGI
Chadsetupi
tsmut
ual
fundi
nDecember1990.

Att
heendof1993,t
hemut
ualf
undi
ndust
ryhadundermanagementofRs.
47004
cr
ores.

THI
REDPHASE-1993-
2003(
ENTRYOFPRI
VATESECTORFUNDS)

Wi
tht
heent
ryoft
hepr
ivat
esect
orf
undi
n1993,anewer
ast
art
edi
nthemut
ualf
und
i
ndust
ry,
giv
ingt
heI
ndi
ani
nvest
orsawi
derchoi
ceoff
undf
ami
l
ies.Al
so,
1993wast
he
y
eari
nwhi
cht
hef
ir
stMut
ualFundRegul
ati
onscamei
ntobei
ng.Underwhi
chal
lmut
ual
f
und,
exceptUTIwer
etober
egi
ster
edandgov
erned.Thecr
stwhi
l
eKot
har
iPi
oneer(
now
mer
gedwi
thFr
ankl
i
nTempl
eton)wast
hef
ir
stpr
ivat
esect
ormut
ualf
undr
egi
ster
edi
n
Jul
y1993.The1993(
SEBI
)Regul
ati
onwer
esubst
it
utedbyamor
ecompr
ehensi
veand
r
evi
sedMut
ualFundRegul
ati
oni
n1996.Thei
ndust
rynow f
unct
ionsundert
heSEBI
r
egul
ati
on1996.

FOURTHPHASE–SI
NCEFEBRUARY2003

I
nFebr
uar
y2003,f
oll
owi
ngt
her
epealoft
heUni
tTr
ustofI
ndi
aAct1963UTIwas
bi
fur
cat
edi
ntot
wosepar
ateent
it
ies.Onei
stheSpeci
fi
edUnder
taki
ngoft
heUni
tTr
ust
ofI
ndi
awi
thasset
sundermanagementofRs29,
835cr
oresast
heendofJanuar
y2003.
Repr
esent
ingbr
oadl
y,t
heasset
sofUS64scheme,assur
edr
etur
nandcer
tai
not
her
scheme.

15
Thesecondi
stheUTIMut
ualFundLt
d,sponsor
edbySBI
,PNB,BOB,andLI
C.I
tis
r
egi
ster
ed wi
th SEBIand f
unct
ion undert
he Mut
ualFund Regul
ati
ons.Wi
tht
he
bi
fur
cat
ionoft
heer
stwhi
l
eUTIwhi
chhadi
nMar
ch2000mor
ethanRs.76,
000cr
oresof
asset
sundermanagementandwhi
l
etheset
ti
ngupofaUTIMut
ual
Fund,
conf
ormi
ngt
o
t
he SEBIMut
ualFund Regul
ati
ons and wi
thr
ecentmer
ger
staki
ng pl
ace among
di
ff
erentpr
ivat
esect
orf
unds,
themut
ualf
undi
ndust
ryhasent
eredi
tscur
rentphaseof
consol
i
dat
ionandgr
owt
h.Asatt
heendofSept
ember
,2004t
her
ewer
e29f
und,whi
ch
manageasset
sofRs,
153108cr
oresunder421schemes.

2.
4STRUCTUREOFMUTUALFUND

I
ndi
ahasal
egalf
ramewor
kwi
thi
nwhi
chMut
ualFundhav
etobeconst
it
uted.I
nIndi
a
openandcl
ose-
endedf
undsoper
ateundert
hesamer
egul
ator
yst
ruct
urei
.e.asuni
t
Tr
ust
s.A Mut
ualFund i
nIndi
ais al
l
owed t
oissue open-
ended and cl
ose-
ended
schemesunderacommonl
egalst
ruct
ure.Thest
ruct
uret
hati
srequi
redt
obef
oll
owed
byanymut
ual
fundi
nIndi
aisl
aiddownunderSEBI(
Mut
ual
Fund)r
egul
ati
ons,
1996.

 Thef
undsect
or

Sponsori
sdef
inedunderSEBIr
egul
ati
onsasanyper
sonwho,act
ingal
oneori
n
combi
nat
ionofanot
hercor
por
atebodyest
abl
i
shesaMut
ualFund.Thesponsor
oft
hef
undi
saki
ntot
hepr
omot
erofacompanyasheget
sthef
undr
egi
ster
ed
wi
thSEBI
.Thesponsorf
ormsat
rustandappoi
ntsaBoar
dOft
rust
ees.The
sponsoral
soappoi
ntst
heAssetManagementCompanyasf
undmanager
s.The
sponsorei
therdi
rect
ly oract
ing t
hrough t
he t
rust
ees wi
l
lal
so appoi
nta
cust
odi
ant
ohol
dfundsasset
s.Al
lthesear
emadei
naccor
dancewi
tht
he

16
 r
egul
ati
onandgui
del
i
nesofSEBI
.

As perSEBIr
egul
ati
ons,f
ort
he per
son t
o qual
i
fyas a sponsor
,he must
cont
ri
but
eatl
east40%oft
henetwor
thoft
heAssesManagementCompanyand
possessesasoundoff
inanci
alt
rackr
ecor
dov
er5y
ear
spr
iort
oregi
str
ati
on.

 Mut
ualFundasTr
ust
s

Amut
ualf
undi
nIndi
aiscont
ri
but
edi
nthef
orm ofpubl
i
ctr
ustAct
,1882.The
f
undsponsoract
saset
tl
eroft
het
rust
,cont
ri
but
ingt
oit
sini
ti
alcapi
taland
appoi
ntsat
rust
eet
ohol
dtheasset
soft
het
rustf
ort
hebenef
itoft
heuni
t
br
oker
s,whoar
ethebenef
ici
ari
esoft
het
rust
.Thef
undt
heni
nvi
tesi
nvest
orst
o
cont
ri
but
ethei
rmoneyi
ncommonpool
,byscr
ibi
ngt
o“uni
ts”i
ssuedbyv
ari
ous
schemesest
abl
i
shedbyt
het
rust
sasev
idenceoft
hei
rbenef
ici
ali
nter
esti
nthe
f
und.

I
tshoul
dbeunder
stoodt
hatt
hef
undshoul
dbej
ust“
passt
hrough”v
ehi
cle.
Undert
heI
ndi
ant
rust
sact
,thet
rustoft
hef
undhasno i
ndependentl
egal
capaci
tyi
tsel
f,r
atheri
tist
het
rust
eeort
het
rust
eeswhohav
ethel
egalcapaci
ty
andt
her
efor
eal
lacti
nrel
ati
ont
othet
rust
sar
etakenoni
tsbehal
fbyt
he
t
rust
ees.I
nlegalpar
lancet
hei
nvest
orsort
heuni
thol
derar
ethebenef
ici
al
owner
soft
hei
nvest
menthel
dbyt
het
rust
s.Bei
ngpubl
i
ctr
ust
s,Mut
ualFundcan
i
nvi
teanynumberofi
nvest
orsasbenef
ici
alowner
sint
hei
rinv
est
mentschemes.

 Tr
ust
ees

ATr
usti
scr
eat
edt
hroughadocumentcal
l
edt
heTr
ustDebtt
hati
sexecut
edby
t
hef
undsponsori
nfav
oroft
het
rust
ee.Mostoft
hef
undsi
nindi
aar
emanaged
byBoar
dofTr
ust
ee.Whi
l
etheboar
doft
rust
eesar
egov
ernedbyt
heI
ndi
an
Tr
ust
sAct
,wher
ethet
rustacor
por
atebody
,itwoul
dal
sor
equi
ret
ocompl
ywi
th
t
hecompani
esAct
,1956.Thet
rust
eedonnotdi
rect
lymanaget
hepor
tfol
i
oof

17
 secur
it
ies.Fort
his speci
ali
stf
unct
ion t
he appoi
ntan asset
s management
company
.Theensur
ethatt
hef
undi
smanagedbyhtAMCaspert
hedef
ined
obj
ect
ivesandi
naccor
dancewi
tht
het
rust
sdeedsandSEBIr
egul
ati
ons.

 TheAssetManagementCompani
es

Ther
oleofanasset
smanagementcompani
esi
stobeactast
hei
nvest
ment
manageroft
het
rustundert
heboar
dsuper
visi
onandgui
danceoft
het
rust
ees.
TheAMCi
srequi
redt
obeappr
ovedandr
egi
ster
edwi
thSEBIasanAMC.The
AMCofamut
ual
fundmusthav
eanetwor
thofatl
eastRs.10cr
oresatal
lti
mes.
TheAMCcannotactasat
rust
eeofanyot
hermut
ualf
und.Besi
desi
tsr
oleasa
f
undmanager
,itmayunder
takespeci
fi
edact
ivi
ti
essuchasadv
isor
yser
vices
andf
inanci
alconsul
ti
ng,pr
ovi
dingt
heseact
ivi
ti
esar
eruni
ndependentofone
anot
herandt
heAMC’
sresour
cesar
epr
oper
lysegr
egat
edbyt
heact
ivi
ty.The
AMC mustal
way
sacti
nthei
nter
estoft
heuni
t-hol
der
sandr
epor
tst
othe
t
rust
eewi
thr
espectt
oit
sact
ivi
ti
es

 Banker
s

af
und’
sact
ivi
ti
esi
nvol
vedeal
i
ngi
nmoneyonacont
inuousbasi
spr
imar
il
ywi
th
r
espectt
obuy
ingandsel
l
inguni
ts,pay
ingf
ori
nvest
mentmade,r
ecei
vi
ngt
he
pr
oceedsf
rom sal
eoft
hei
nvest
mentanddi
schar
gingi
tsobl
i
gat
ionst
owar
ds
oper
ati
ngexpences.Thust
hebankerpl
aysani
mpor
tantr
olet
odet
ermi
nequal
i
ty
ofser
vicet
hatf
undgi
vesi
nti
mel
ydel
i
ver
yofr
emi
tt
anceset
c.

 Tr
ansf
eragent
s

Tr
ansf
eragent
sar
eresponsi
blef
ori
ssui
ngandr
edeemi
nguni
tsoft
heMut
ual
Fund and pr
ovi
de ot
herr
elat
ed ser
vice such as pr
epar
ati
on of t
ransf
er
document
sandupdat
ingi
nvest
orr
ecor
ds.Af
undmaychooset
ocar
ryouti
ts
act
ivi
tyi
n–houseandchar
get
heschemef
ort
heser
viceatacompet
it
ivemar
ket

18
 r
ate.Wher
eout
sidet
ransf
eragenti
sused,
thef
undi
nvest
orwi
l
lfi
ndt
heagentt
o
beani
mpor
tanti
nter
facet
odealwi
th,si
nceal
loft
hei
nvest
orser
vicest
hata
f
undpr
ovi
desar
egoi
ngt
obedependentont
het
ransf
eragent
.

 Regul
ator
yst
ruct
ureofmut
ualf
undsi
nIndi
a

Thest
ruct
ureofmut
ualf
und i
nIndi
aisgui
ded bySEBI
.Regul
ati
ons,
1996.These
r
egul
ati
onsmakei
nmandat
oryf
ormut
ualf
undt
ohav
ethr
eest
ruct
ureofsponsor
t
rust
ee and asset
s managementcompany
.The sponsoroft
he mut
ualf
und and
appoi
ntst
het
rust
ees.Thet
rust
eesar
eresponsi
blet
othei
nvest
orsi
nmut
ualf
undand
appoi
ntt
heAMC f
ormanagesal
ltheaf
fai
rsoft
hemut
ualf
und.TheAMC andt
he
mut
ual
fundhav
etober
egi
ster
edwi
thSEBI
.

2.
5SELECTI
ONPARAMETERSFORMUTUALFUND

 Yourobj
ect
ive

19
 Thef
ir
stpoi
ntt
onot
ebef
orei
nvest
ingi
naf
undi
stof
indoutwhet
hery
our
obj
ect
ivesmat
cheswi
tht
heschemes.I
tisnecessar
y,asantconf
li
ctwoul
d
di
rect
lyaf
fect
edy
ourpr
ospect
iver
etur
ns,
simi
l
ari
ty,
youshoul
dpi
ckschemet
hat
meety
ourspeci
fi
cneeds,exampl
es:pensi
onpl
ans,chi
l
dren’
spl
ans,sect
or-
speci
fi
cschemes,
etc.

 Yourr
iskcapaci
tyandcapabi
l
ity
Thi
sdi
ctat
est
hechoi
ceofschemes.Thosewi
thnor
iskt
oler
anceshoul
dgof
ordebt
schemes,as t
hey ar
erel
ati
vel
y saf
er.Aggr
essi
vei
nvest
ors can go f
orequi
ty
i
nvest
ment
s.I
nvest
orst
hatar
eev
enmor
eaggr
essi
vecant
ryschemet
hati
nvesti
n
speci
fi
cindust
ryorsect
ors.

 Fundmanager
’sandschemet
rackr
ecor
d
Si
nce y
ou gi
vi
ng y
ourhar
d eased moneyt
o someone t
o manage i
t,i
tis
i
mper
ati
vet
hathemanagesi
twel
l
.Iti
sal
soessent
ialt
hatt
hef
undhousey
ou
choosehasexcel
l
entt
rackr
ecor
d.I
tisal
soshoul
dbepr
ofessi
onalandmai
ntai
n
hi
gh t
ranspar
encyi
n oper
ati
ons.Look att
he per
for
mance oft
he schemes
agai
nst r
elev
ant mar
ket benchmar
ks and i
ts compet
it
ors. Look at t
he
per
for
manceofl
ongerper
iod,asi
twi
l
lgi
vey
ou how t
heschemef
ared i
n
di
ff
erentmar
ketcondi
ti
ons.

 Costf
act
or
Thr
ought
heAMCf
eei
sregul
ated,y
oushoul
dlookatt
heexpenser
ati
ooft
he
f
und bef
orei
nvest
ing.Thi
sis because t
he money i
s deduct
ed f
rom y
our
i
nvest
ment
s.Ahi
gherent
ryl
oadorexi
tloadal
sowi
l
leati
ntoy
ourr
etur
ns.A
hi
gherexpenser
ati
ocanbeonl
ybysuper
lat
iver
etur
ns.I
tisv
erycr
uci
ali
nadebt
f
und,
aswi
l
ldev
ouraf
ewper
cent
agesf
rom y
ourmodestr
etur
ns.

2.
6Mar
ket
ingst
rat
egi
esf
orMut
ual
Funds
20
  Busi
nessAccount
s
Themostcommonsal
esandmar
ket
ingst
rat
egi
esf
ormut
ualf
undsi
stosi
gn-
up
compani
esasapr
efer
redopt
ionf
ort
hei
rret
ir
ementpl
ans.Thi
spr
ovi
desa
si
mpl
ewaysi
gn-
upnumer
ousaccount
swi
thonemast
ercont
ract
.Tomar
kett
o
t
hesef
ir
ms,
sal
espeopl
etar
gethumanr
esour
cepr
ofessi
onal
s.Mar
ket
ingoccur
s
t
hrough t
radi
ti
onal busi
ness-
to-
busi
ness mar
ket
ing t
echni
ques i
ncl
udi
ng
conf
erences,ni
che adv
ert
isi
ng and pr
ofessi
onalor
gani
zat
ions.Forbusi
ness
account
s,f
undr
epr
esent
ati
veswi
l
lst
resseaseofuseandcompat
ibi
l
itywi
tht
he
company
’spr
esentsy
stems.

 ConsumerMar
ket
ing
Consumermar
ket
ingofmut
ualf
undsi
ssi
mil
art
othewayot
herf
inanci
alpr
oduct
sar
e
sol
d.Mar
ket
ersemphasi
zesaf
ety
,rel
i
abi
l
ityandper
for
mance.I
naddi
ti
on,t
heymay
pr
ovi
dei
nfor
mat
ionont
hei
rdi
ver
sit
yofchoi
ces,easeofuseandl
owcost
s.Mar
ket
ers
t
ryt
oaccessal
lsegment
soft
hepopul
ati
on.Theyusebr
oadmar
ket
ingpl
atf
ormssuch
as t
elev
isi
on,newspaper
s and i
nter
net
.Mar
ket
ers especi
all
yfocus on f
inanci
all
y
or
ient
edmedi
asuchasCNBCt
elev
isi
onandBusi
nessweekmagazi
ne.

 Per
for
mance
Mut
ualf
undsmustbev
erycar
efulabouthowt
heymar
kett
hei
rper
for
mance,as
t
hisi
sheav
il
yregul
ated.Mut
ualf
undmustmar
kett
hei
rshor
t,medi
um andl
ong-
t
erm av
erager
etur
nst
ogi
vet
hepr
ospect
ivei
nvest
oragoodi
deaoft
heact
ual
per
for
mance.Forexampl
e,mostf
undsdi
dver
ywel
ldur
ingt
hehousi
ngboom
howev
er,i
fthebearmar
kett
hatf
oll
owedi
sincl
uded,per
for
mancel
ooksmuch
mor
e av
erage.Fundsmayal
so hav
e had di
ff
erentmanager
swi
th di
ff
erent
per
for
mancer
ecor
dswor
kingont
hesamef
unds,mar
ket
ingi
thar
dtoj
udge
t
hem.

21
 Mar
ket
ingf
ees
Mut
ualf
undmustbev
erycl
earaboutt
hei
rfeesandr
epor
tthem i
nal
loft
hei
r
mar
ket
ingmat
eri
als.Themai
nty
pesoff
eesi
ncl
udet
hesal
es(
load)andt
he
managementf
ee.Thel
oadi
sanupf
rontchar
get
hatamut
ualf
undchar
gesas
soonast
hei
nvest
menti
smade.Themanagementf
eei
saper
cent
ageofasset
s
eachy
ear
,usual
l
y1t
o2per
cent
.

22
 Chapt
er3:
CompanyPr
ofi
le

23
3.
1Hi
stor
yandOv
erv
iew-I
IFLGr
oup

I
IFLwasf
oundedonOct17,
1995byNi
rmalJai
n,a 
1989gr
aduat
efr I
om ndi
anI
nst
it
uteof
Management
, 
Ahmedabad 
and t
opper
 char
ter
ed account
ant
.Jai
nisamong t
hef
ew
successf
ulent
repr
eneur
s postt
he economi
cli
ber
ali
zat
ion er
ainI
ndi
a usher
ed
by
 Manmohan Si
ngh 
and 
PV Nar
asi
mha Rao.
 Jai
n was pr
evi
ousl
y empl
oyed wi
th
Hi
ndust
anLev
erLi
mit
ed.Thecompanywasf
oundedasPr
obi
tyResear
chandSer
vices
Pr
ivat
e Li
mit
ed whi
ch pr
ovi
ded r
esear
ch on t
he I
ndi
an economy
,busi
nesses and
cor
por
ate.Thenot
iceabl
eint
hemar
ket
.Int
hemeanwhi
l
e,t
hedot
com r
evol
uti
onwas
begi
nni
ngt
otakepl
acenamewasl
aterchangedt
oIndi
aInf
oli
neLi
mit
ed.

Af
ewy
ear
sint
othebusi
ness,t
heor
gani
zat
ionf
oundi
tsel
fwi
thcl
i
ent
swhi
chi
ncl
uded
r
esear
chor
gani
zat
ions,banksandcor
por
ate.
 Theyt
henbeganl
aunchi
ngt
hei
rresear
ch
pr
oduct
stobecomemor
einI
ndi
a.Thewebsi
tewascr
eat
edi
n1999.

Taki
ngt
hebusi
nessonest
epaheadt
hisgr
oupofconsul
tant
sopenedat
radi
ngpor
tal–
www.
5pai
sa.
com –i
n2000t
husmov
edi
ntot
hebusi
nessofbei
ngaf
ullser
vicebr
oki
ng
agency
.Dur
ingt
hist
ime,
theywi
denedt
hei
rdi
str
ibut
ionnet
wor
k.

24
I
n2001,
theI
ndi
andot
com i
ndust
rysawadownf
all
.Dur
ingt
hist
ime,
sust
aini
ngbecame
t
ough.Theor
gani
zat
iont
hendeci
dedt
oti
e-upwi
thl
eadi
ngLi
feI
nsur
ancecompany
I
CICIPr
udent
ial
,thusput
ti
ngt
ousei
tsdi
str
ibut
ionnet
wor
kandbecomi
ngI
ndi
a'
sfi
rst
cor
por
ateagentf
ori
nsur
ance.

Today
,II
FLHol
dingsLi
mit
ed(
Bloomber
gCode:
IIFLI
N,NSE:
IIFL,
BSE:
532636)i
sIndi
a’
s
l
eadi
ngi
ntegr
atedf
inanci
alser
vicesgr
oupwi
thdi
ver
seoper
ati
ngbusi
nesses,mai
nly
Non-
Banki
ngandHousi
ngFi
nance,Weal
thandAssetManagement
,Br
oki
ng,Fi
nanci
al
Pr
oductDi
str
ibut
ion,I
nvest
mentBanki
ng,I
nst
it
uti
onalEqui
ti
es,Real
tyandPr
oper
ty
Adv
isor
ySer
vices.

I
IFLHol
dingshasaconsol
i
dat
ednet
-wor
thofov
erRs30bi
l
li
onwi
thagl
obalpr
esence
i
n US,
 
UK,
 
Singapor
e,HongKong,Swi
tzer
land,Maur
it
ius,andUAE.Wi
thanempl
oyee
wor
kfor
ceofov
er10,
000,ast
rongnet
wor
kofov
er2,
000ser
vicel
ocat
ionsspr
ead
acr
ossI
ndi
a,ov
erRs200bi
l
li
onl
oanasset
sundermanagement
,ov
er500st
ocksunder
r
esear
ch,
mor
ethan300oft
hewor
ld’
stopi
nst
it
uti
onal
inv
est
orsr
elyonI
IFL'
sresear
ch.

3.
2Pr
oduct
sandSer
viceofI
IFLGr
oup

 Pr
oduct
sof
fer
ing

1.Equi
ty

Weof
ferabouquetofEqui
tyof
fer
ingssui
tabl
eforhi
ght
rader
stol
ongt
ermi
nvest
ors,
begi
nner
stodi
ver
secl
assofcapi
talmar
ketpar
ti
cipant
s.Wehav
eadedi
cat
eddesk
assi
sti
ngcl
i
ent
sonAssetal
l
ocat
ion,t
radi
ngst
rat
egi
es,por
tfol
i
oopt
imi
zat
ion.Awar
d

25
wi
nni
ngr
esear
chonFundament
al,Techni
cal&Der
ivat
ivesai
medatgr
owi
ngasset
sby
out
per
for
mingmar
ket
.

2.Der
ivat
ives

Ext
ensi
ver
esear
chcov
erageonst
rat
egi
essuchasHedgi
ng,Car
ry-
over
s,Spr
eads,et
c.,
hel
pscl
i
ent
stobal
ancet
her
iskandr
ewar
dsofder
ivat
ivet
radi
ng.Ourexper
ienced
adv
isor
ssuppor
thi
ght
rader
stomakemostoft
hispopul
armar
ketsegment
.

3.Mut
ual
Funds

A mi
xtur
eofcompr
ehensi
vecov
erageofal
lmut
ualf
und of
fer
ingsand seaml
ess
execut
ionofi
nst
ruct
ions.I
IFLr
esear
chandMut
ualFundt
racker
shel
pscl
i
ent
sto
nav
igat
etheev
ergr
owi
ngmar
ketofMFOf
fer
swi
thout
mostease.

4.St
ruct
uredPr
oduct

Cust
omi
zedSt
ruct
uresof
fer
inguni
quecombi
nat
ionofcoupons,mar
ketpar
ti
cipat
ion
r
epr
esent
ingwi
dev
ari
etyofI
ndust
rysegmenthel
psHi
ghNetWor
thCl
i
ent
smanage
andpr
eser
vet
hei
rweal
th.

5.Li
feI
nsur
ance

I
IFL-
oneoft
hel
argesti
nsur
ancebr
oker
spr
esent
sit
scl
i
ent
swi
thabouquetofpr
oduct
s
acr
ossmul
ti
pleser
vicepr
ovi
der
sinmostconv
eni
entmanner
.Ourexper
ti
sei
ndi
ff
erent
cl
assesal
ongwi
thI
nsur
ancecompl
etesacl
i
ent
'
sfi
nanci
alpl
anni
ngpr
ocess.

26
 3.
3Ser
viceGi
venbyI
IFL

1.Dedi
cat
edTeam

Thehi
ghl
yexper
iencedPREMI
Ateam makesi
nvest
mentr
elat
eddeci
sion-
maki
ngmuch
easi
er.Rel
ati
onshi
pManager
sandAdv
isor
sconst
ant
lyst
ri
vet
oaddv
aluei
nser
vicesby
pr
ovi
dingcust
omi
zedanal
yti
csandt
ool
stomeetcl
i
ent
s’uni
quer
equi
rement
skeepi
ng
i
nmi
ndt
hei
rri
skt
aki
ngabi
l
iti
es.

2.Wor
ld-
classResear
chmadesi
mpl
eforourcl
i
ent
s

I
IFLPREMI
A hasaf
ull
-f
ledgedr
esear
cht
eam i
nvol
vedi
nmacr
o-economi
cst
udi
es,
sect
oralr
esear
chandi
ndust
ryspeci
fi
cequi
tyr
esear
chcov
eri
ngI
ndi
an,emer
gingand
gl
obalmar
ket
s.Al
so,I
IFL'
s'For
bes-
accl
aimed'wor
ld-
classr
esear
cht
eam of
fer
sIQ
(
Insi
ght
sQui
ck)
,acust
omi
zed,pr
emi
um r
esear
chof
fer
ing,t
ail
or-
madef
orPREMI
A
cust
omer
s.

3.EasyAccessandCompl
eteAccountTr
anspar
ency

Accesst
oonl
i
nebackof
fi
cesy
stems,char
ti
ngt
ool
s,r
ealt
imet
ermi
nal
sandr
esear
ch
mi
nes–al
lint
egr
atedt
hroughanawar
dwi
nni
ngt
radi
ngpl
atf
orm.Now,keept
rackof
y
ouri
nvest
ment
s,any
time.

4.Dedi
cat
edCust
omerSer
vice

I
IFLPREMI
Ahasadedi
cat
edcust
omercar
eser
vicedeskt
oensur
ethatal
lquer
ies
per
tai
ningt
oyouraccount
,tr
ansact
iondet
ail
sandf
undst
atusar
ecl
ari
fi
ed.Ourexper
ts
ar
eal
way
skeen on hel
ping t
hePr
ior
it
yCl
i
ent
stakean i
nfor
med deci
sion aswe
27
under
standt
hev
alueofspot
ti
nganoppor
tuni
tybef
oreot
her
sdo.

5.Top-
of-
the-
li
neDeal
i
ngDesk

Mor
ethan25st
ate-
of-
the-
artCent
ralDeal
i
ngRoomsdel
i
veranunpar
all
eledequi
ty
t
radi
ngexper
ience.Hav
ethePREMI
A edgewi
thourexper
tteamshandl
i
ngal
lyour
i
nvest
mentwor
ri
es.

6.Cust
omi
zedI
nvest
mentSt
rat
egi
es

The I
IFL PREMI
Ateam empl
oys adv
anced st
rat
egi
es f
ort
radi
ng wi
th cust
omi
zed
pr
oduct
sinEqui
ty,
MF,
Str
uct
uredandmanymor
e.Ev
eryst
epi
sbackedbyacent
ral
i
zed,
r
eal
timeRi
skManagementSy
stem wi
thcut
ti
ngedget
echnol
ogy
.

3.
4Vi
sionSt
atementofI
IFL

Ourent
repr
eneur
ialVi
si
ongoesbey
ondr
egi
onsandboundar
ies.Weai
mtogr
owr
api
dly
byest
abl
i
shi
ngast
rongt
radi
ti
onofhi
ghqual
i
ty,r
eli
abi
l
ityandcost
-ef
fect
ivesof
twar
e
educat
ionwi
tht
heul
ti
mat
eai
m ofcust
omersat
isf
act
ion.Weai
mtochur
nter
msof

28
i
ndi
vi
dual
s ev
eryy
earwho can br
ing aboutt
echnol
ogi
calchanges i
nthe gl
obal
env
ironment
.

3.
5Qual
i
tySt
atementofI
IFL

“
II
FL,Ahmedabad i
s commi
tt
ed t
o est
abl
i
sh a t
radi
ti
on ofcostef
fect
ive qual
i
ty
educat
ionandser
vicet
hroughcont
inual
impr
ovement
”

3.
6Mi
ssi
onSt
atementofI
IFL

Weai
mtoaccompl
i
shourmi
ssi
onbypr
ovi
dingt
her
ightpeopl
ewi
thgr
eatski
l
lsand
compl
etededi
cat
iont
hroughat
eam ofhar
d-wor
kingpr
ofessi
onal
swhoar
ewor
king
ov
ert
imet
obui
l
dexper
tmanpowert
oful
lfi
l
lourai
m ofcont
ri
but
ingt
othenat
ionby
pr
oduci
ngcompl
eteI
Tpr
ofessi
onal
s.

29
 3.
7SWOTAnal
ysi
s

I
ndi
ainf
oli
ne(
II
FL)

Par
entCompany I
ndi
aInf
oli
neLt
d.

Cat
egor
y Br
oker
ageHouses,
 
ConsumerFi
nanci
alSer
vices

Sect
or Banki
ngandFi
nanci
alSer
vices

Tagl
i
ne/Sl
ogan Knowl
edgei
stheedge;
It’
sal
laboutmoney
,honey

Oneoft
hel
eadi
ngpl
ayer
sint
heI
ndi
anf
inanci
alser
vicess-
USP pace

STP

Segment Br
oker
age

Tar
getGr
oup Ur
banandRur
alI
nvest
ors

Posi
ti
oni
ng Compl
eteI
nvest
mentandSt
ockt
radi
ngSol
uti
ons

30
 SWOTAnal
ysi
s

1.Wi
der
angeofpr
oduct
s 
2.Successf
uli
mpl
ement
ati
onof“
Insur
ancebr
oki
ng”model

3.Onl
i
nepor
tal
’
ssuccessf
ulbr
andi
ngas“
5pai
sa.
com”

4.Hav
eov
er 
2500of
fi
cesi
nIndi
ainov
er500ci
ti
es

5.Fi
rstI
ndi
an br
oker
age house t
o getmember
shi
p of
Si
ngapor
eExchange
6.I
IFLhasbeenawar
dedt
he‘
BestBr
oker
,Indi
a’,‘
Most
i
mpr
ovedbr
oker
age,I
ndi
a’,‘
Fast
estGr
owi
ngEqui
tyBr
oki
ng
St
rengt
hs House’

1. 
Highr
iskexposur
easseenbyconser
vat
ivepopul
ati
on

2.
 Less emphasi
s on adv
ert
isi
ng causes l
ack ofbr
and
Weaknesses v
isi
bil
i
ty

1.Hi
ghi
ncomeUr
banf
ami
l
ies
Oppor
tuni
ti
es 2.Mor
epenet
rat
ioni
ntot
hegr
owi
ngci
ti
es

1.St
ri
ngentEconomi
cmeasur
esbyGov
ernmentandRBI

2.Ent
ryoff
orei
gnf
inancef
ir
msi
nIndi
anMar
ket

Thr
eat
s 3.Mut
ualf
undopt
ionsbybanki
ngsect
or

Compet
it
ion

1.
 Shar
ekhan

2.
 Indi
abul
l
s

Compet
it
ors 3.
 AngelBr
oki
ng

31
 Chapt
er4:
I
ntr
oducti
onofthet
opi
c

32
 4.
1Mut
ual
Funds

Amut
ualf
undi
sacommonpoolofmoneyi
ntowhi
chi
nvest
orspl
acecont
ri
but
ions
t
hatar
etobei
nvest
edi
naccor
dancewi
thst
atedobj
ect
ives.Theowner
shi
poft
hef
und
i
sthusj
ointor“
mut
ual
”;t
hef
undbel
ongst
oal
linv
est
ors.Asi
ngl
einv
est
or’
sowner
shi
p
oft
hef
undi
sint
hesamepr
opor
ti
onast
heamountoft
hecont
ri
but
ionmadebyhi
m or

33
herbear
stot
het
otal
amountoft
hef
und.

Mut
ualFundar
etr
ust
s,whi
chacceptsav
ingf
rom i
nvest
orsandi
nvestt
hesamei
n
di
ver
sif
iedf
inanci
ali
nst
rument
sint
het
erm ofobj
ect
ivesetouti
nthet
rust
sdeedwi
th
t
hev
iew t
oreducet
her
iskandmaxi
mizet
hei
ncomeandcapi
talappr
eci
ati
onf
or
di
str
ibut
ionf
ort
hemember
s.

AMut
ualFundi
sacor
por
ati
onandt
hef
undmanager
sint
eresti
stopr
ofessi
onal
l
y
managet
hef
undpr
ovi
debyt
hei
nvest
orsandpr
ovi
der
etur
nont
hem af
terdeduct
ing
r
easonabl
emanagementf
ees.

4.
2Regul
ator
yofMut
ual
Fundi
nIndi
a

 SEBI

Thecapi
talmar
ket
sregul
atet
hemut
ualf
undsi
nIndi
a.SEBIr
equi
resal
lmut
ual
f
undst
ober
egi
ster
edwi
tht
hem.SEBIi
ssuesgui
del
i
nesf
oral
lmut
ualf
unds
oper
ati
ons-
inv
est
ment
,account
s,expenseset
c.Recent
ly,i
thasbeendeci
ded
t
hatMoneyMar
ketMut
ualFundsofr
egi
ster
edmut
ualf
undwi
l
lber
egul
atedby
SEBIt
hrough(
Mut
ual
Fund)r
egul
ati
on1996.

 RBI

RBI
,asuper
visoroft
heBanksownedMut
ualFunds-
Asbanksi
nIndi
acomeundert
he
r
egul
ator
yjur
isdi
cti
onofRBI
,banksownedf
indst
obeundersuper
visi
onofRBIand
SEBI
.RBIhassuper
visor
yresponsi
bil
i
tyov
eral
lent
it
iest
hatoper
atei
nthemoney
mar
ket
s.

 Mi
nist
ryoff
inance(
MOF)

Mi
nist
ryofFi
nanceul
ti
mat
elysuper
visesbot
htheRBIandt
heSEBIandpl
ayst
he
r
oleofapexaut
hor
it
yforanymaj
ordi
sput
esov
erSEBIgui
del
i
nes.

34
  Companyl
owboar
d
Regi
sterofcompani
esi
scal
l
edcompanyl
owboar
d.AMCsofMut
ualFundar
e
compani
esr
egi
ster
edundert
hecompani
esAct1956andt
her
efor
eanswer
abl
e
t
oregul
ator
yaut
hor
it
iesempower
edbyt
hecompani
esAct
.

 St
ockexchange

St
ockExchangear
esel
f-
regul
ator
yor
gani
zat
ionssuper
visedbySEBI
.Manycl
osed
endedf
undsofAMCsar
eli
stedasst
ockexchangesandar
etr
eat
edl
i
keshar
es.

 Of
fi
ceoft
hepubl
i
ctr
ust
ee

Mut
ualf
undbei
ngpubl
i
ctr
usti
sgov
ernedt
heI
ndi
anTr
ustAct1882,TheBoar
d
oft
rust
eeofTr
ust
eeCompanyi
saccount
abl
etot
heof
fi
cepubl
i
ctr
ust
ee,whi
ch
i
ntur
nrepor
tst
oChar
it
ycommi
ssi
oner
.

4.
3Indi
anMut
ual
FundI
ndust
ryTr
endsRepor
tCar
dforMay2016

 
 

35
AMFIhasst
art
edt
odi
scl
osesomeaddi
ti
onal
dat
arel
atedt
oMut
ual
Fundi
nvest
ment
s
f
rom Oct
ober
,2015.Today
,wel
ookatasnapshotoft
hisdat
a:

14.
5LakhCr
oresi
nMut
ual
Funds 
Asset
s managedbyt
heMFI
ndust
ryhasi
ncr
eased
f
rom Rs.10.
7lakhcr
orei
nOct
-14t
oRs.
 14.
5lakhcr
orei
nMay
-16 
wit
hDebtf
unds
t
aki
ngt
hemosti
nvest
mentat45pai
saofev
eryr
upeei
nvest
ed.

36
Her
eist
hechar
tcl
ear
ingshowi
ngt
hedomi
nat
ion 
oft
heI
nst
it
uti
onswhi
l
einv
est
ingi
n
Mut
ual
Funds:

I
nst
it
uti
onsv
sIndi
vi
dual
s

 I
nvest
ment
sbyI
ndi
vi
dual
saccountf
ora 
l
itt
leov
er45% 
oft
het
otalasset
s
whi
l
ether
emai
ning55%i
sconst
it
utedbyI
nst
it
uti
ons
 I
nvest
ment
sfr
om I
ndi
vi
dual
sst
andsat
 Rs.6.
57l
akhcr
ore 
fort
hemont
hof
May
-16compar
edt
oRs.5.
63l
akhcr
oref
ort
hesamemont
hofpr
evi
ousy
ear
whi
l
einv
est
ment
sfr
om I
nst
it
uti
ons st
ands at
 Rs.7.
88 l
akh cr
ore 
fort
he
mont
hofMay
-16compar
edt
oRs.6.
62l
akhcr
oref
ort
hesamemont
hof
pr
evi
ousy
ear
.Thati
sIndi
vi
dual
sar
eatl
eastay
earbehi
nd i
nter
msof
monet
aryi
nvest
ment
sinMFcompar
edt
oInst
it
uti
ons.

37
  I
nvest
mentamounthasi
ncr
easedev
erymont
hexceptf
orMar
-16i
ncaseof
I
nst
it
uti
onswhi
chwi
tnessedaRs.0.
1lakhcr
oredr
opwhi
l
eforI
ndi
vi
dual
sit
wasi
nthemont
hofFeb-
16–adr
opofRs.0.
15l
akhcr
ore.

4.
4Ty
pesofMut
ual
Fundsi
nIndi
a

Wi
deVar
iet
yofMut
ualFundSchemeexi
stt
ocat
ert
otheneedsuchaf
inanci
al
posi
ti
on,
riskt
oler
anceandr
etur
nexpat
iat
ionet
c.,
thusmut
ualf
undshasv
ari
ety
off
lav
ors,bei
ngacol
l
ect
ionofanyst
okes,ani
nvest
orcangof
orpi
cki
nga
mut
ualf
undmi
ghtbeeasy
.Ther
ear
eov
erhundr
edsofmut
ualf
undschemet
o
choosef
rom.I
tiseasi
ert
othi
nkofmut
ual
fundi
ncat
egor
ies,
ment
ionedbel
ow.

TYPESOFMUTUALFUNDS

 BYSTRUCTURE

38
  Open-
EndedScheme
 Cl
ose-
EndedScheme
 I
nter
val
Scheme

 BYNATURE

 Equi
tyFund
 DebtFund
 Bal
anceFund

 BYI
NVESTMENTOBJECTI
VES

 Gr
owt
hScheme
 I
ncomeScheme
 Bal
anceScheme
 MoneyMar
ketScheme

 OTHERSCHEMES

 TaxSav
ingSchemes
 I
ndexScheme
 Sect
orSpeci
fi
cScheme

A)BYSTRUCTURE

1.Open–EndedSchemes

Anopen-
endf
undi
sonet
hati
sav
ail
abl
eforsubscr
ipt
ional
lthr
ought
hey
ear
.Thesedo
nothav
eaf
ixedmat
uri
ty.I
nvest
orscanconv
eni
ent
lybuyandsel
luni
tsatNetAsset
s
Val
ue(
“NAV”
)rel
atedPr
ices.Thekeyf
utur
eofopen-
endschemesi
sli
qui
dit
y.

2.Cl
ose–EndedSchemes

39
Acl
ose-
endf
undhasast
ipul
atedmat
uri
typer
iodwhi
chgener
all
yrangi
ngf
rom 3t
o15
y
ear
s.Thef
undi
sopenf
orsubscr
ipt
iononl
ydur
ingaspeci
fi
cper
iod.I
nvest
orscan
i
nvesti
ntheschemeatt
het
imeoft
hei
nit
ialpubl
i
cissueandt
her
eaf
tert
heycanbuyor
sel
ltheuni
tsoft
heschemeont
hest
okeexchangewher
etheyar
eli
sted.I
nor
dert
o
pr
ovi
deanexi
trout
etot
hei
nvest
ors,somecl
ose-
endf
undsgi
veanopt
ionofsel
l
ing
backt
heuni
tst
otheMut
ualFundt
hroughper
iodi
crepur
chaseatNAVr
elat
edpr
ice.
SEBIRegul
ati
onst
ipul
atet
hatatl
eastoneoft
het
woexi
str
out
eist
obepr
ovi
det
othe
i
nvest
ors.

3.I
nter
valschemes

I
nter
valSchemesar
ethatscheme,whi
chcombi
nest
hef
eat
ureofOpen-
end&Cl
ose-
endschemes.Theuni
tsmaybet
radedont
hest
okeexchangeormaybeopenf
orsel
lor
r
edempt
iondur
ingpr
e-det
ermi
nedi
nter
val
satNAVr
elat
epr
ices.

B)BYNATURE

I
nvest
mentgoal
sver
yfr
om per
sont
oper
son.Whi
l
esomebodywant
ssecur
it
y,ot
her
s
mi
ghtgi
vemor
ewei
ght
aget
oret
urnal
one.Somebodyel
semi
ghtwantt
opl
anf
orhi
s
chi
l
d’seducat
ionwhi
l
esomebodymi
ghtbesav
ingf
ort
hepr
over
bialr
ainydayorev
en
l
i
teaf
terr
eti
rement
.Wi
thobj
ect
ivesdef
yinganyr
ang,i
tisobv
ioust
hatt
hepr
oduct
s
r
equi
redwi
l
lver
yaswel
l
.So,Mut
ualFundcanbecl
assi
fi
edbasedont
heobj
ect
ivesof
t
hei
nvest
or.

1.Equi
tyFund

Thesef
undsi
nvestmaxi
mum par
toft
hei
rcor
pusi
ntoequi
tyhol
dings.Thest
ruct
ureof
t
hef
undmayv
erydi
ff
erentf
rom v
erydi
ff
erentschemeandhef
undmanager
’sout
look
on di
ff
erentst
ocks.The Equi
ty Funds ar
e sub-
classi
fi
ed dependi
ng upon t
hei
r
i
nvest
mentobj
ect
ive,
asf
oll
ows:

 Di
ver
sif
iedEqui
tyFunds

40
  Mi
d-CapFunds
 Sect
orSpeci
fi
cFund
 TaxSav
ingFunds(
ELSS)

Equi
tyi
nvest
ment
sar
emeantf
oral
ongert
imehor
izon;t
husEqui
tyf
undsr
ankhi
ghon
t
her
isk-
ret
urnmat
ri

2.DebtFunds

Theobj
ect
iveoft
heseFundsi
stoi
nvesti
ndebtpaper
s.Gov
ernmentaut
hor
it
ies,
pri
vat
e
compani
es,banksandf
inanci
ali
nst
it
uti
onsar
esomeoft
hemaj
ori
ssuer
sofdebt
paper
s.Byi
nvest
ingi
ndebti
nst
rument
s,t
hesef
undsensur
elowr
iskandpr
ovi
dest
abl
e
i
ncomet
othei
nvest
ors.Debtf
undsar
efur
thercl
assi
fi
edas:

 Gi
l
tFunds:I
nvestt
hei
rcor
pusi
n secur
it
yissued byGov
ernment
,popul
arl
y
knownasGov
ernmentofI
ndi
adebtpaper
s.Thesef
undscar
ryzer
oDef
aul
tri
sk
butar
eassoci
atedwi
thi
nter
estRat
eri
sk.Theseschemesar
esaf
erast
hey
i
nvesti
npaperbackedbyGov
ernment
.

 I
ncomeFunds:I
nvestamaj
orpor
ti
oni
ntov
ari
ousdebti
nst
rument
ssuchas
bonds,
cor
por
atedebent
ureandGov
ernmentsecur
it
ies.

 MI
Ps:I
nvestmaxi
mum oft
hei
rtot
alcor
pusi
ndebti
nst
rumentwhi
l
etheyt
ake
mi
nimum exposur
einequi
ti
es.I
tget
sbenef
itofbot
hequi
tyanddebtmar
ket
.
Theseschemer
ankssl
i
ght
lyhi
ghont
her
isk-
ret
urnmat
ri
xwhencompar
edwi
th
ot
herdebtschemes.

 Shor
tTer
m Pl
ans(
STPs)
:Meantf
ori
nvest
menthor
izonf
ort
hreet
osi
xmont
hs.
Thesef
undspr
imar
il
yinv
esti
nshor
tter
m paperl
i
kecer
ti
fi
cat
eofDeposi
ts(
CDs)
andCommer
cialPaper
s(CPs)
.Somepor
ti
onoft
hecor
pusi
sal
soi
nvest
edi
n

41
 cor
por
atedebent
ures.

 Li
qui
dFunds:Al
soknowsMoneyMar
ketSchemes,t
hesef
undspr
ovi
deeasy
l
i
qui
dit
y and pr
eser
vat
ion ofcapi
tal
.These schemes i
nvesti
n shor
t-
ter
m
i
nst
rument
sli
keTr
easur
yBi
l
ls.Thesef
undsar
emeantf
orshor
t-
ter
m cash
managementofcor
por
atehouseandar
emeantf
orani
nvest
menthor
izonof
1dayt
o 3 mont
hs.These scheme r
ank l
ow on r
isk-
ret
urn mat
ri
x and ar
e
consi
der
edt
obet
hesaf
estamongstal
lcat
egor
iesofmut
ual
fund

3.Bal
anceFund
Ast
henamesuggestt
hey
,ar
emi
xofbot
hequi
tyanddebtf
unds.Theyi
nvestequi
ty
andf
ixedi
ncomesecur
it
ies,
whi
char
einl
i
newi
thpr
e-def
inei
nvest
mentobj
ect
iveoft
he
scheme.Theseschemesai
mtopr
ovi
dei
nvest
orswi
tht
hebestofbot
hthewor
lds.
Equi
typar
tpr
ovi
desgr
owt
handt
hedebtpar
tpr
ovi
desst
abi
l
ityi
nret
urns.

Fur
thert
he manualf
unds can be br
oadl
ycl
assi
fi
ed on t
he basi
s ofi
nvest
ment
par
amet
erwi
se,

Eachcat
egor
yoff
undsi
sbackedbyani
nvest
mentphi
l
osophy
,whi
chi
spr
e-def
inedi
n
t
heobj
ect
ivesoft
hef
unds.Thei
nvest
orcanal
i
gnhi
sowni
nvest
mentneedswi
tht
he
f
undobj
ect
iveandi
nvestaccor
dingl
y.

C)BYI
NVESTMENTOBJECTI
VE

Gr
owt
hSchemes

Gr
owt
hSchemesar
eal
soknownasequi
tyschemes.Theai
m oft
heseschemesi
sto
pr
ovi
decapi
talappr
eci
ati
onov
ermedi
um t
olongt
erm.Theseschemesnor
mal
l
yinv
est

42
amaj
orpar
toft
hei
rfundi
nequi
ti
esandar
ewi
l
li
ngt
obearshor
t-
ter
m decl
i
nei
nval
ueof
possi
blef
utur
eappr
eci
ati
on.

I
ncomeSchemes
I
ncomeSchemesar
eal
soknownasdebtschemes.Theai
m oft
heseschemesi
sto
pr
ovi
der
egul
arandst
eadyi
ncomet
oinv
est
ors.Theseschemesgener
all
yinv
esti
nfi
xed
i
ncomesecur
it
iessuchasbondsandcor
por
atedebent
ures.Capi
talappr
eci
ati
oni
n
suchschemesmaybel
i
mit
ed.

Bal
ancedSchemes

Bal
anceSchemeai
mtopr
ovi
debot
hgr
owt
handi
ncomeby
per
iodi
cal
l
ydi
str
ibut
inga
par
toft
hecapi
tali
ncomeandcapi
talgai
ntheyear
n.Theseschemesi
nvesti
nbot
h
shar
esandf
ixedi
ncomesecur
it
ies,i
nthepr
opor
ti
oni
ndi
cat
eint
hei
rof
ferdocument
(
nor
mal
l
y50-
50)
.

MoneyMar
ketSchemes

MoneyMar
ketSchemesai
m t
o pr
ovi
deeasyl
i
qui
dit
y,pr
eser
vat
ion ofcapi
taland
moder
atei
ncome.TheseSchemesgener
all
yinv
esti
nsaf
er,shor
t-
ter
minst
rument
s,
suchast
reasur
ybi
l
ls,cer
ti
fi
cat
eofdeposi
t,commer
cialpaperandi
nter
-bankcal
l
money
.

LoadFunds

ALoadFundsi
sonet
hatchar
gesacommi
ssi
onf
orent
ryorexi
t.Thati
s,eacht
imey
ou
buyorsel
luni
ts’f
unds,acommi
ssi
onwi
l
lbepay
abl
e.Ty
pical
l
y,ent
ryandexi
tloads
r
angef
rom 1% t
o 2%.I
tcoul
dbewor
thpay
ingt
hel
oad,i
fthef
undhasagood
per
for
mancehi
stor
y.

43
No-
LoadFunds

ANo-
LoadFundi
sonet
hatdoesnotchangeacommi
ssi
onf
oeent
ryorexi
t.Thati
sno
commi
ssi
oni
spay
abl
eonpur
chaseorsal
eofuni
tint
hef
und.Theadv
ant
ageofano
l
oadf
undi
sthatt
heent
ir
ecor
pusi
sputi
swor
k.

D)
.OTHERSCHEMES

TaxSav
ingSchemes

Tax-
sav
ingschemesof
fert
axr
ebat
est
othei
nvest
orsundert
axl
owspr
escr
ibedf
rom
t
imet
oti
me.UnderSec.
88oft
heI
ncomeTaxAct
,cont
ri
but
ionsmadet
oanyEqui
ty
Li
nkedSav
ingsScheme(
ELSS)ar
eel
i
gibl
eforr
ebat
e.

I
ndexSchemes

I
ndexSchemesat
temptt
orepl
i
cat
etheper
for
manceofapar
ti
cul
ari
ndexsuchast
he
BSESensexort
heNSE50.Thepor
tfol
i
ooft
heseschemeswi
l
lconsi
stofonl
ythose
st
ockst
hatconst
it
utet
hei
ndex
.Theper
cent
ageofeachst
ockt
othet
otalhol
dingwi
l
l
bei
dent
icalt
othest
ocksi
ndexwei
ght
age.Andhence,t
her
etur
nfr
om suchscheme
woul
dbemor
eorl
essequi
val
entt
othoseoft
heI
ndex.

Sect
orSpeci
fi
cSchemes

Thesear
ethef
unds/
schemeswhi
chi
nvesti
nthesecur
it
iesofonl
ythosesect
orsor
i
ndust
ri
esasspeci
fi
edi
ntheof
fi
cedocument
s.e.
g.Phar
maceut
ical
s,Sof
twar
e,Fast
Mov
ingConsumerGoods(
FMCG)
,Pet
rol
eum st
okes.et
c.Ther
etur
nsi
ntheseschemes
ar
edependentont
heper
for
manceoft
her
espect
ivesect
ors/
indust
ri
es.Whi
l
ethese
f
undsmaygi
vehi
gherr
etur
ns,t
heyar
eri
ski
ercompar
edt
odi
ver
sif
iedf
unds.I
nvest
ors
needt
okeepawat
chont
heper
for
manceoft
hosesect
ors/
indust
ri
esandmustexi
tan
appr
opr
iat
eti
me.

44
 4.
5Adv
ant
ages
1.Ef
fect
ivef
orsmal
l
eraccount
s:Si
nceamut
ualf
undpr
ovi
desexposur
eto
hundr
edsort
housandsofst
ocks,y
oudon'
tneedt
ogooutandbuyhundr
edsor
t
housandsofst
ocksony
ourown,whi
chcoul
dbev
erypr
ohi
bit
ivef
ory
oui
fyou
hav
easmal
l
er-
siz
edi
nvest
mentaccountandl
i
mit
edcapi
tal
toi
nvestwi
th.

2.Pr
ofessi
onalmoneymanagement
:Mut
ualf
undsar
erunbyi
nvest
ment
manager
swhowoul
dli
kel
ybeconsi
der
ed"
exper
ts"i
nthei
rfi
eld.Mut
ualf
und
compani
eshav
eresour
cest
hatar
eabov
eandbey
ondwhatonemayhav
easan
i
ndi
vi
dual
,ret
ail
inv
est
or.

3.Por
tfol
i
oDi
ver
sif
icat
ion:
Eachi
nvest
ori
nthef
undi
sapar
townerofal
lfund’
s
asset
s,t
husenabl
i
nghi
mtohol
derdi
ver
sif
iedi
nvest
mentpor
tfol
i
oev
enwi
tha
smal
lamountofi
nvest
mentt
hatwoul
dot
her
wiser
equi
rebi
gcapi
tal
.

4.Reduct
ionofTr
ansact
ioncost
s:Whati
str
ueofr
iskasal
sot
rueoft
he
t
ransact
ioncost
.Thei
nvest
orbear
sal
lthecostofi
nvest
ingsuchasbr
oker
age
ofcust
odyofsecur
it
ies.Whengoi
ngt
hroughaf
und,Hehast
hebenef
itof
economi
csofscal
e;Thef
undspayl
essercostbecauseofl
argerv
olumes,a
benef
itpassedont
oit
sinv
est
ors.

5.TaxBenef
it
s:Anyi
ncomedi
str
ibut
edaf
terMar
ch31,2002wi
l
lbesubj
ectt
o
t
axi
ntheassessmentofal
luni
thol
der
s.Howev
er,asameasur
eofconcessi
on
t
ouni
thol
der
sofopen–endedequi
tyor
ient
edf
unds,
Incomedi
str
ibut
ionf
ort
he
y
earendi
ngMar
ch31,2003,wi
l
lbet
axedataconcessi
onalr
ateof10.
5%.I
n

45
 caseofi
ndi
vi
dual
sinHi
nduUndi
vi
dedFami
l
iesadeduct
ionupt
oRs.9,
000f
rom
t
het
otali
ncomewi
l
lbeadmi
ssi
blei
nrespectofi
ncomef
rom i
nvest
ment
s
speci
fi
edi
nsect
ion80L,I
ncl
udi
ngi
ncomef
rom uni
tsoft
heMut
ualFund.Auni
t
oft
heschemesar
enotsubj
ectt
oWeal
th–TaxandGi
ft–Tax
.

6.Weal
thRegul
ated:Al
lMut
ualFundsar
eregi
ster
edwi
thSEBIandt
heyf
unct
ion
wi
thi
n pr
ovi
sions ofst
ri
ctr
egul
ati
ons desi
gned t
o pr
otectt
he i
nter
estof
i
nvest
ors.Theoper
ati
onsofMut
ual
Fundsar
eregul
arl
ymoni
tor
edbySEBI
.

7.Tr
anspar
ency
:Yougetr
egul
ari
nfor
mat
ionont
hev
alueofy
ouri
nvest
menti
n
addi
ti
ont
odi
scl
oseront
hespeci
fi
cinv
est
ment
smadebyy
ourscheme,t
he
pr
opor
ti
oni
nvest
edi
neachcl
assofasset
sandt
hef
undmanager
’si
nvest
ment
st
rat
egyandout
look.

46
 4.
6Di
sadv
ant
ages

1.Noi
ntr
aday
-tr
adi
ngonmut
ualf
unds:I
fyouwantt
omakeat
radeony
our
mut
ualf
und,y
ou'
l
lli
kel
ynotknowwhatt
he"
NAV"pr
icewi
l
lbewheny
oul
ocki
n
t
het
rade.Thati
sbecauset
heNAV(
NetAssetVal
ue)i
sset
tl
edatt
heendof
eacht
radi
ngday
.Ify
oudon'
tlocky
ourt
radei
nbef
oret
heendoft
hest
ock
mar
ketcl
ose,
you'
l
lrecei
vet
heNAVasoft
hecl
oseofbusi
nesst
hef
oll
owi
ngday
.
Thi
smakesi
tdi
ff
icul
tand/
ori
mpossi
blet
ocapi
tal
i
zeonsuddenmov
ement
sin
t
hemar
ket(
ift
hati
ssomet
hingy
ou'
ret
ryi
ngt
odo)
.

2.Nott
ax-
eff
ici
ent
:InanonI
RAaccount
,mut
ualf
undswi
l
lpr
ocesscapi
talgai
n
di
str
ibut
ionsaboutoncepery
ear
,whi
chy
ouwi
l
lthenbet
axedon,
eveni
fyoudi
d
nott
akeanycapi
talgai
nst
haty
ear
.Theendi
nvest
orhasl
i
ttl
eimpactorsayon
how muchaf
undwi
l
ldeci
det
ospi
touti
ncapi
talgai
ndi
str
ibut
ions.Thef
unds
hav
ethef
reedom t
odel
aycapi
talgai
ndi
str
ibut
ionsi
nsomey
ear
s,essent
ial
l
y
ki
cki
ngt
hecandownt
her
oadf
orl
atery
ear
s.Thi
scoul
dadv
ersel
yimpacty
ouas
t
heendi
nvest
or.

3.Subj
ectt
otheher
d:I
fyouar
eadi
sci
pli
nedi
nvest
orandy
ouknownott
o"buy
hi
gh"and "
sel
llow,
"then y
ou won'
tpani
c when v
olat
il
it
y occur
sint
he
mar
ket
place.Howev
er,wheni
nvest
ingi
nal
argemut
ualf
und,chancesar
ethat
manyofy
ourf
ell
owi
nvest
orswi
l
lnothav
ethesamedi
sci
pli
ne.Theywi
l
lsel
lata
l
ow poi
nt,causi
ng t
he f
und t
o sel
lposi
ti
ons i
n or
dert
o accountf
ort
he

47
 r
edempt
ionr
equest
s.I
not
herwor
ds,y
ourper
for
mancemaysuf
ferbecauseof
t
hel
ackofdi
sci
pli
neofot
heri
nvest
orst
hatal
soownt
hesamef
und.

4.I
mper
sonalconnect
ion:Wheni
nvest
ingi
namut
ualf
und,y
oudonotusual
l
y
hav
eeasyaccesst
otheonemaki
ngt
hei
nvest
mentdeci
sions.Ther
emaybe
quar
ter
lyi
nvest
orcal
l
sand updat
es,butt
her
e wi
l
lbea si
gni
fi
cantl
ackof
i
nter
per
sonal
communi
cat
ionwi
tht
hemai
nfol
ksi
nchar
geoft
hef
und.

5.Cost
s:Mut
ualf
undsal
way
scar
rysomeki
ndofcost
s.I
nal
lcases,cost
swi
l
l
decr
easey
ourov
eral
lrat
eofr
etur
n.Thati
swhyi
tisi
mpor
tantt
oli
mitt
heannual
expenses ofmut
ualf
unds,t
he pot
ent
ialf
ront
-end orback-
end l
oads,and
t
urnov
ercost
s.I
ttakesmor
ethananov
icei
nvest
ort
onav
igat
ethesei
ssues,
but
t
hisi
soneoft
hemosti
mpor
tantdownsi
dest
ousi
ngmut
ualf
undsandt
hus,
shoul
dcer
tai
nlybeev
aluat
edandaddr
essbyal
li
nvest
ors

48
 Chapt
er5:

Anal
ysi
sandI
nter
pret
ati
on

49
 5.
1Pr
imar
yDat
aInt
erpr
etat
ion&Anal
ysi
s

5.
1.1.Mostpr
efer
abl
eInv
est
mentRanki
ngsofI
nvest
ors

At
otalof150r
esponseswer
erecei
vedt
hroughonl
i
neaswel
lasspotsur
vey
.Thi
s
sect
ion gi
ves peopl
e bel
i
eve and i
nter
estt
owar
ds t
he v
ari
ous t
ypes off
inanci
al
i
nvest
ment
s.Fr
om t
hatweknew t
hatt
heypr
efer
redmost
lyt
heMut
ualFundt
hanany
ot
heri
nvest
menthav
ing53%.Af
tert
hatSav
ingsaccount43% andi
nsur
anceat39%
hav
ingi
nvest
mentbecausepeopl
ear
emuchmor
eint
erest
edi
ninsur
ancei
nvest
ment
f
rom r
eput
ed compani
es.t
he f
our
th one pr
efer
abl
einv
est
menti
s shar
es and
debent
uresat33%.

Af
tert
hatGol
dandi
nvest
menti
nSi
l
verhav
esi
mil
arper
cent
ageat30%.Fi
xeddeposi
t

50
ar
emostpr
efer
redbyel
der
sandr
eti
redpeopl
esoi
thas28%.
Ther
eispostof
fi
ce&NSCat13%,
PFat11andPPFat10%pr
efer
redbyi
nvest
ors

5.
1.2.Fact
orsconsi
der
edbyi
nvest
orswhi
l
einv
est
ment

 Her
ewesaw t
hati
nvest
orspr
efer
redmost
lyt
hef
act
orHi
gherRet
urnat65%
becauset
heywantmuchmor
eret
urnf
rom anyi
nvest
ment
s.
 Thenaf
terLow Ri
sk49% wher
esav
ingaccountandf
ixeddeposi
tty
pesof
i
nvest
ment
sar
ether
eandal
soCompany
’sReput
ati
onpl
aysmedi
um r
oleat33%.
 Li
qui
dit
ymost
lyr
elat
edt
ost
ockandMut
ualf
undsuni
quequal
i
tybecauset
her
e
hasbeent
hef
aci
l
iti
esar
ether
ewher
einv
est
orshav
ethebenef
itofl
i
qui
dit
yat
t
heywant
.
 Al
thought
her
ear
eexi
tchar
gesbuti
tis0.
75or1% t
hati
snotmuchaf
fect
edt
o
i
nit
ial
amount
.

51
  Ther
esomeFi
nanci
alPl
ansar
eli
ket
hatwher
etheycangett
hebenef
itofnoexi
t
char
ges.

5.
1.3 Pr
efer
encesf
orMut
ualFundI
nvest
ment

Thi
sanal
ysi
ssaw t
hat74% peopl
eli
ket
oinv
esti
nMut
ualFund.Theyar
eawar
eand
t
heywantt
odoi
nvest
menti
nMut
ualFund.Al
thought
her
eis26%peopl
edon’
tli
ket
o
i
nvesti
nMFbecauseoft
hev
ari
ousr
eason.

Sot
her
eisl
i
kenotpr
operawar
eness,
Lackofknowl
edge,
Afr
aidofRi
skar
ether
easons
becauseoft
hei
runwi
l
li
ngt
oinv
esti
nMut
ual
Fund.

52
5.
1.4.
Knowl
edgeaboutMut
ualFund
Thi
sinf
ormat
ionshowst
hatt
her
eis44% peopl
ear
eful
l
yawar
ethatwhati
sMut
ual
Fundsoi
tisgoodf
ort
heanal
ysi
s.27%peopl
eispar
ti
alawar
eandonl
y5%peopl
ear
e
notawar
ethatwhati
sMut
ual
Fund.
Sot
hisi
sgoodt
hat44%peopl
ear
eful
l
yawar
erestofpeopl
eneedmor
eawar
enessl
i
ke
i
tsconcept
ualknowl
edge,di
ver
sif
ied Ri
skand Por
tfol
i
o managementt
hatki
nd of
awar
enesswi
l
lbei
mpr
oveunwar
epeopl
eint
oawar
eness.

53
5.
1.5.Peopl
e’
sawar
enessaboutMut
ualFundf
rom Sour
ces

54
Here34%peopl
eawar
ef r
om f
inanci
aladvi
sor
.23%investorknowfr
om peergr
oup,
22%
ar
eawarefr
om adv
ert
isement
.21%cov er
edbythesourceofbank.

5.
1.6 SchemesusedbyI
nvest
ors

55
Ther
ear
emanyi
nvest
orswhobel
i
evei
ninv
est
mentt
otheequi
typor
tfol
i
oinv
est
ment
becauset
her
eisbi
gchancesofmar
ketwi
l
lber
iseaswel
lasdown.Sot
her
eishi
ghest
i
nvest
menti
nGr
owt
hFund48%t
henopenendedwi
th18%.

Theni
nvest
orswhobel
i
evet
hatl
ongcapFundi
smor
ebenef
ici
alsot
heyar
egoi
ngwi
th
3y
earor6-
yearpl
anni
ng.Mi
dcapFundhas9%oft
otalSchemei
nvest
edbyi
nvest
ors.
Regul
ari
ncome wher
eret
ir
ed peopl
e ar
e mosti
nvest
ing hav
ing 8 % The l
owest
i
nvest
menti
nLi
qui
dFundPeopl
edomuchmor
ewi
th3%.

Cl
oseendedhas3.
6% andi
nvest
ingi
nli
qui
dfundwher
emost
lyi
nvest
menti
nver
y
shor
tter
m mar
keti
nst
rument
sli
ket
reasur
ybi
l
ls,
gov
ernmentsecur
it
yandcal
l
edmoney
t
hatl
eadl
eastamountofr
iskwhi
chknownasl
i
qui
dfundwhi
chhas3% oft
otal
i
nvest
mentscheme

56
 5.
1.7 Per
iodofI
nvest
ment

ManyMut
ualFundi
nvest
orsar
egoi
ngwi
tht
he5y
earpl
anni
ngt
hemostbecausei
tis
compar
ati
vel
yef
fect
ivet
han3y
earor1y
ear
spl
anni
ng.Ther
eist
axandmar
ketgr
owt
h
f
act
orsar
eaf
fect
edt
othel
ongt
erm pl
anni
ngi
nmaxi
mum per
iod.

Mi
nimum Pl
anni
ngshoul
dbeav
oidedmost
lybyt
hei
nvest
orsbecauset
her
eist
he
l
i
qui
dit
yfaci
l
ityt
her
e.

57
 5.
1.8 SI
Pamountspendbyi
nvest
ors

Ther
eis42% oft
heamount2000–5000Rs.I
nvest
edbyt
hei
nvest
orsi
nsy
stemat
ic
i
nvest
mentpl
anni
ng.Becausei
tismont
hlyi
nvest
mentsomanypeopl
ehav
eli
mit
ed
i
ncomecr
it
eri
afort
heSI
Pinv
est
ment
.
Al
thought
her
eisot
herf
inanci
alpl
anni
ngl
i
kedi
recti
nvest
menti
nst
ock,gol
d,r
eal
est
ate,
insur
anceandmanyot
heri
nvest
mentpl
an.

Somepeopl
ear
emor
epr
eferi
nvest
menti
nlumpsum amountt
hanSI
Pinv
est
ment
.

58
 5.
1.9 LumpSum amount
sspendi
ngbyI
nvest
ors

Her
eforl
ongt
erm pl
anni
ngwi
tht
hel
umpsum amounthi
ghestpar
tinv
est
mentdone
wi
tht
heamountbet
ween25000t
o50000Rs.And31%peopl
ear
egoi
ngt
oinv
estmor
e
t
han10000t
o25000bRs.Forl
ongt
erm.
Ther
e15%at50000t
o100000andmor
ethan100000i
nvest
ment
s.

59
 5.
1.10Expect
edRet
urnofMut
ualFund

Fr
om abov
est
udywecansayt
hati
nvest
orsal
way
sneedhi
gherr
etur
nsot
heyexpect
ed
20%t
o30%r
etur
nfr
om Mut
ual
Fundi
nvest
ment
.40%peopl
eexpect
s15%t
o20%r
etur
n.
Andt
hemi
nimum expect
ati
oni
s3%f
ort
hehi
gherr
etur
n.

60
 5.
1.11Feat
uresofMut
ualFund
Di
ver
sif
icat
ioni
nvar
iousPor
tfol
i
osi
sthemai
nanduni
quef
eat
ureofMut
ualFund
i
nvest
mentSot
hati
smostpr
efer
abl
ebyi
nvest
ors.Ther
ear
eot
herf
eat
uresar
eli
ke
bet
terr
etur
n,gr
owt
hfund,r
egul
ari
ncomef
undhasal
sopr
efer
redal
mostsamei
n
por
ti
on.

61
 5.
1.12AMCpr
efer
encesofcust
omer
s

Thi
sst
udyshowst
her
eput
ati
onoft
hecompani
eswher
eICI
CIpr
udent
ialmut
ualf
undi
s
mostl
i
kel
ybyt
hei
nvest
orswi
tht
he30%.Ther
eisal
soot
hergi
antcompani
esand
banksl
i
keSBI
,HDFCandBi
rl
ahadahugemar
keti
nMut
ual
Fundi
ndust
ry.

62
 5.
1.13Sour
cesofPur
chasi
ngMut
ualFund

56%peopl
ehav
eat
rustonAgent
sthen25%i
nvest
orsi
nvest
ingbyt
hev
ari
ousbr
oker
s
onl
y.Ther
ear
epeopl
ewhoar
einv
est
ingi
nMut
ualFundbydi
rectAMC compani
es
wher
etheygetbenef
itofexpenser
ati
o.Ther
eis9%peopl
ear
einv
est
ingt
hei
rmoney
f
rom t
heot
hersour
ces.

63
5.
1.14Reasonsf
ornoti
nvest
ingi
nMut
ualFund

Fornoti
nvest
ingi
nMut
ualFundt
her
eis35% peopl
enoti
nvest
edi
nMut
ualFund
becauseofHi
ghRi
sk.33%peopl
ear
enotawar
eaboutMut
ualFundmaybet
heyj
ust
hear
dthename.Sot
hisst
udyshowst
hatt
her
eisneedt
opr
ovi
dedeepi
nfor
mat
ion
abouti
nvest
menti
nMut
ual
Fund.

64
 5.
2 TwoVar
iabl
eTest

5.
2.1Pr
efer
redt
imeper
iodf
ori
nvest
mentbyy
oungst
ers

Fr
om t
heabov
egr
aphwecansayt
hatf
or1y
eart
her
eis10y
oungst
ersagecr
it
eri
aof
15–25y
ear
sar
einv
est
edi
nMut
ual
Fund.
For2y
eari
nvest
mentt
her
eis9y
oungst
ersar
einv
est
ed.
For3y
eart
her
eis20y
oungst
ersar
ehi
ghl
yinv
est
edwhi
chnumberi
smuchmor
e.
12Youngst
ersar
egoi
ngt
oinv
estf
or4y
ear
s
Ther
eisequal
inv
est
edwi
tht
hev
ari
ousagegr
ouppeopl
efor5y
ear
sbyt
hey
oungst
ers.

Soweconcl
udet
haty
oungst
ersar
emor
eawar
ethanot
herpeopl
ebecausenowaday
s

65
t
heyar
egoi
ngf
orgr
owt
hinv
est
menti
nMut
ual
Fund

5.
2.2 Pr
efer
abl
esour
cef
orv
ari
ousoccupi
edpeopl
e

Thi
sanal
ysi
sshowst
hatmaxi
mum i
nvest
orsar
einv
est
ingt
hei
rmoneyf
rom t
heagent
s.
Af
tert
hatbr
oker
sar
emor
epr
efer
abl
efori
nvest
ment
.
Manypeopl
ewhoawar
eaboutMut
ualFundSchemef
rom out
side,t
heyar
egoi
ngt
o
AMCf
ori
nvest
mentdi
rect
ly.
Restofpeopl
ear
einv
est
edf
rom ot
hersour
ces.

66
 5.
2.3I
nvest
orspr
efer
encesf
orSI
Pinv
est
mentf
rom t
hev
ari
oussour
ces

For500–2000r
sinv
est
orsusedAgent
swhi
char
ehi
ghersour
cef
ort
hati
nvest
ment
.
Fort
hei
nvest
menti
nmut
ualf
undi
nvest
orsmost
lypr
efert
he3par
amet
ersofpr
ice
r
angeshowsasabov
efr
om br
oker
sandsubbr
oker
s.Ther
eishi
gheri
nvest
mentdone
byi
nvest
ors.
Thenaf
ter
,fr
om t
hebr
oker
ssour
cet
heyi
nvest
ed.
Restoft
hei
nvest
orsi
nvest
ingt
hei
rmoneyf
rom AMCandot
hersour
ces.
I
nlastpar
amet
er10000r
sabov
e,br
oker
sandot
hersour
cesar
ethemostusedsour
ce
t
her
eisot
hersour
cei
snouseofAMCcompani
es.

67
 5.
3 Hy
pot
hesi
sAnal
ysi
sandI
nter
pret
ati
on

5.
3.1
H0:Ther
eisnosi
gni
fi
cantr
elat
ionshi
pbet
weeni
ncomeandt
ypeofmut
ualf
und
i
nvest
or.
H1:t
her
eissi
gni
fi
cantr
elat
ionshi
pbet
weeni
ncomeandt
ypeofmut
ualf
undi
nvest
or.

Chi
-Squar
eTest
s
Val
ue df Asy
mp.Si
g.(
2-
si
ded)
a
Pear
sonChi
-Squar
e 45.
416 24 .
005
Li
kel
i
hoodRat
io 43.
012 24 .
010

Li
near
-by
-Li
nearAssoci
ati
on .
658 1

.
417

NofVal
i
dCases 109

a.30cel
l
s(85.
7%)hav
eexpect
edcountl
esst
han5.Themi
nimum
expect
edcounti
s.06.

68
Chi
squar
e=0.
005
0.
05>0.
005
Nul
lHy
pot
hesi
sRej
ect
ed
Al
ter
nat
eHy
pot
hesi
sAccept
ed
Soher
eweconcl
udet
hatTher
eissi
gni
fi
cantr
elat
ionshi
pbet
weeni
ncomeandTy
peof
Mut
ual
FundI
nvest
or.

69
5.
3.2

H0:Ther
eisnosi
gni
fi
cantr
elat
ionshi
pbet
weenmut
ual
fundi
nvest
mentandgender
.
H1:Ther
eissi
gni
fi
cantr
elat
ionshi
pbet
weenmut
ualf
undi
nvest
mentandgender
.

Chi
-Squar
eTest
s
Val
ue df Asy
mp.Si
g.(
2- ExactSi
g.(
2- ExactSi
g.(
1-
si
ded) si
ded) si
ded)

Pear
sonChi
-Squar
e 404a
4. 1 .
036

Cont
inui
tyCor
rect
ionb 3.
503 1 .
061

Li
kel
i
hoodRat
io 4.
132 1 .
042

Fi
sher
'sExactTest .
043 .
033

Li
near
-by
-Li
nearAssoci
ati
on 4.
374 1 .
036

NofVal
i
dCases 149

a.0cel
l
s(0.
0%)hav
eexpect
edcountl
esst
han5.Themi
nimum expect
edcounti
s8.
38.
b.Comput
edonl
yfora2x2t
abl
e

70
Chi
squar
e=0.
036
0.
05>0.
036
Nul
lHy
pot
hesi
sisRej
ect
ed
TheAl
ter
nat
eonei
sAccept
ed
Sot
her
eissi
gni
fi
cantRel
ati
onshi
pbet
weenMut
ual
Fundi
nvest
mentandGender
.
Al
thoughMal
ear
emor
eawar
eandpr
efer
redi
nvest
menti
nMut
ual
FundWher
eFemal
e
ar
elesseri
nter
est
ed.

71
5.
3.3

H0:Ther
eisno si
gni
fi
cantr
elat
ionshi
p bet
ween i
nvest
ors’i
ncome and spendi
ng
capaci
tyofmut
ualf
undi
nvest
ment
.
H1:Ther
eissi
gni
fi
cantr
elat
ionshi
pbet
weeni
nvest
or’
sincomeandspendi
ngcapaci
tyof
mut
ualf
undi
nvest
ment
.

Chi
-Squar
eTest
s

Val
ue df Asy
mp.Si
g.(
2-si
ded)

Pear
sonChi
-Squar
e 157a
14. 12 .
291

Li
kel
i
hoodRat
io 15.
738 12 .
204

Li
near
-by
-Li
nearAssoci
ati
on .
941 1 .
332

NofVal
i
dCases 109

a.13cel
l
s(65.
0%)hav
eexpect
edcountl
esst
han5.Themi
nimum expect
edcounti
s.29.

72
Chi
Squar
e=0.
291
0.
05<0.
291
Nul
lHy
pot
hesi
sisaccept
ed
TheAl
ter
nat
eHy
pot
hesi
sisRej
ect
ed
Thi
sanal
ysi
sshowst
her
eisnotsi
gni
fi
cantr
elat
ionshi
pbet
weeni
nvest
or’
sincomeand
spendi
ngcapaci
tyf
ormut
ual
fundi
nvest
mentbecausei
tsdependsUponI
nvest
ors
per
cept
ionanddeci
si
onf
ori
nvest
ingi
nMut
ual
Fund.

73
5.
3.4

H0:Ther
eisnosi
gni
fi
cantr
elat
ionshi
pbet
weeni
nvest
ors’agegr
oupandper
iodof
i
nvest
ment
.
H1:Ther
eis si
gni
fi
cantr
elat
ionshi
p bet
ween i
nvest
or’
s age gr
oup and per
iod of
i
nvest
ment
.

Chi
-Squar
eTest
s

Val
ue df Asy
mp.Si
g.(
2-si
ded)

Pear
sonChi
-Squar
e 245a
8. 8 .
410

Li
kel
i
hoodRat
io 10.
408 8 .
238

Li
near
-by
-Li
nearAssoci
ati
on 4.
394 1 .
036

NofVal
i
dCases 109

a.6cel
l
s(40.
0%)hav
eexpect
edcountl
esst
han5.Themi
nimum expect
edcounti
s.96.

74
Chi
squar
e=0.
410
0.
05<0.
410
Nul
lHy
pot
hesi
sisaccept
ed
TheAl
ter
nat
eHy
pot
hesi
sisRej
ect
ed
Thusr
espondent
’sagesar
enothav
ingr
elat
ionshi
pwi
thper
iodofi
nvest
ment
.

75
5.
3.5

H0:Ther
eisnosi
gni
fi
cantr
elat
ionshi
pbet
weenper
iodofi
nvest
mentandgr
ofund
scheme.
H1:Ther
eissi
gni
fi
cantr
elat
ionshi
pbet
weenper
iodofi
nvest
mentandgr
owt
hfund
scheme.

Chi
-Squar
eTest
s

Val
ue df Asy
mp.Si
g.(
2-si
ded)

Pear
sonChi
-Squar
e 318a
33. 24 .
098

Li
kel
i
hoodRat
io 37.
264 24 .
041

Li
near
-by
-Li
nearAssoci
ati
on .
041 1 .
839

NofVal
i
dCases 110

a.29cel
l
s(82.
9%)hav
eexpect
edcountl
esst
han5.Themi
nimum expect
edcounti
s.16.

76
Chi
squar
e=0.
098
0.
05<0.
098
Nul
lHy
pot
hesi
sisaccept
ed
TheAl
ter
nat
eHy
pot
hesi
sisr
eject
ed
Sowecansayt
hatMut
ual
Fundschemeshav
enotsi
gni
fi
cantr
elat
ionshi
pwi
thper
iod
ofi
nvest
ment
.
I
tisdependsaponcust
omer
’swi
l
li
ng,
abi
l
ityandmi
ndsetf
orsel
ect
ingt
heMut
ual
Fund
i
nvest
mentpl
an.

77
5.
3.6

H0:Peopl
ewoul
dli
ket
oinv
esti
nmut
ualf
und.
H1:Peopl
ewoul
dnotl
i
ket
oinv
esti
nmut
ualf
und.

Bi
nomi
alTest

Cat
egor
y N Obser
vedPr
op. TestPr
op. ExactSi
g.(
2-
t
ail
ed)

Gr
oup1 y
es 111 .
74 .
50 .
000

Q3woul
dyoul
i
ket
oinv
esti
n Gr
oup2 no 39 .
26
mut
ualf
und
Tot
al 150 1.
00

0.
000<0.
05
Thi
sbi
nomi
alanal
ysi
sshowst
hatpeopl
ewoul
dli
ket
oinv
esti
nMut
ual
Fund.
Todaymanypeopl
ewanthi
gherr
etur
nsbyget
ti
ngl
i
ttl
ebi
tri
sksot
heyhav
etr
uston
Mut
ual
Fundt
hananyot
heri
nvest
ment
.

78
Chapt
er6:
Findi
ngs

79
 6.
1Pr
imar
yfi
ndi
ng

 Maj
ori
tyofr
espondent
spr
eferi
nvest
ingi
nmut
ual
fund

 Maj
ori
tyofr
espondent
stookf
orhi
ghr
etur
nasapr
imar
yobj
ect
ivef
ort
he
i
nvest
ment

 74%oft
her
espondent
shav
einv
est
edi
nmut
ual
fund

 44%oft
her
espondent
sar
eful
l
yawar
eaboutt
hemut
ualf
undand,27%peopl
e
ar
epar
ti
alawar
e,24%ar
eawar
eaboutspeci
fi
cschemesand5%ar
edon’
tknow
aboutMut
ual
Fund.

 Maj
ori
tyofpeopl
ear
esel
ect
edGr
owt
hFundSchemef
ori
nvest
ment
.

 I
nvest
orsar
ebel
i
evedf
orl
ongt
erm andmi
dter
minv
est
mentpl
anni
ng.

 Maj
ori
tyofr
espondent
spr
efermut
ualf
undbecauseofbet
terr
etur
nov
eral
ong
per
iodoft
imeandi
tst
axef
fi
ciency
.

 56%ofr
espondent
spr
eferpur
chaseofmut
ual
fundf
rom br
oker
s&subbr
oker
s.

 Her
e34%peopl
eawar
efr
om f
inanci
aladv
isor
.Fi
nanci
aladv
isor
spl
ayav
italr
ole
i
ninf
luenci
ngt
her
espondent
stoi
nvesti
nmut
ual
funds

 Ar
ound45% ofr
espondent
sexpectmor
ethan20% t
o30% r
etur
nonmut
ual
f
unds

80
 6.
2TwoVar
iabl
eTestf
indi
ngs

 Ther
ear
eyoungst
erswhobel
i
evei
n3y
eari
nvest
mentpl
anni
ngsowecansay
t
hatt
heyar
egoi
ngt
omi
dter
m andshor
tter
m pl
anni
ng.

 Hi
ghestpeopl
ear
einv
est
edt
hei
rmoneyf
rom br
oker
sandsubbr
oker
smanyof
t
hem ar
esal
ari
edandpr
ofessi
onalpeopl
e.Housewi
fear
elesseri
nter
est
ed
i
nvest
ingi
nMut
ual
Fund.

 ForSI
Pther
eis2000–5000r
sar
ethemaxi
mum pr
efer
enceofi
nvest
orand
t
her
eist
hesour
cei
sbr
oker
sandsubbr
oker
s.Thenaf
teri
nvest
orar
eint
erest
ed
i
n500–2000r
sformont
hlyi
nvest .
ment

 AsaExt
rar
esear
chwef
indt
hatt
her
ear
epeopl
eint
erest
edf
ormut
ualFund
i
nvest
mentbutt
her
eisawar
enessi
slow sot
heydon’
tgetact
ualknowl
edge
aboutt
hataswel
lasi
tsf
eat
uresl
i
keDi
ver
sif
icat
ion,
Riskal
l
ocat
ion,
Liqui
dit
y.So
wef
oundt
hatt
her
eisneedf
orf
ull
yawar
enesssoi
twi
l
lbei
ncr
easet
hei
rint
erest
t
owar
dszmut
ual
Fundi
nvest
mentdi
rect
ly.

81
 6.
3Hy
pot
hesi
sFi
ndi
ngs

Sr
. Ho Cal Tabul
ate <or Resul
t
no Si
gma dSi
g >

1. H0:
Incomeandt
ypesof 0.
005 0.
05 < I
ncomeandt
ypeof
i
nvest
orsar
enotr
elat
ed i
nvest
orsar
erel
ated
wi
theachot
her
.

2. H0:
Mut
ual
Fund 0.
036 0.
05 < Mut
ual
FundI
nvest
ment
i
nvest
mentandGenderar
e andGenderar
erel
ated
notr
elat
ed

3 H0:
Incomeandcapaci
tyi
n 0.
291 0.
05 > I
ncomeandcapaci
tyi
n
Mut
ual
Fundi
nvest
menti
s Mut
ual
Fundi
nvest
ment
notr
elat
ed i
snotRel
ated

4 H0:
Agegr
oupandper
iod 0.
410 0.
05 > Agegr
oupandper
iodof
ofi
nvest
mentar
enot i
nvest
mentar
enot
r
elat
ed r
elat
ed
5 H0:
AgeGr
oupandMut
ual 0.
598 0.
05 > Agegr
oupandMut
ual
Fundschemear
enot Fundschemear
enot
r
elat
ed r
elat
ed

6 H0:
peopl
ewoul
dnotl
i
ke 0.
000 0.
05 < Peopl
ewoul
dli
ket
o
t
oinv
esti
nMut
ual
Fund i
nvesti
nMut
ual
Fund

82
 Chapt
er7:
Recommendat
ions

83
 7.
1Recommendat
iont
ocompany

 Asmostpr
efer
redchannelofi
nvest
menti
nagent
s,mostpr
efer
redt
imeper
iodi
s
upt
o3-y
earandmostpr
efer
redi
nvest
mentschemesar
eei
therofgr
owt
hequi
ty
ki
ndort
axbenef
it
ski
nd.Thusi
ntr
oduci
ngf
ort
hcomi
ngschemeswoul
dmake
mor
einv
est
menti
nmut
ual
fund

 Asperourpr
imar
yresear
chwecangi
vesuggest
iont
othemut
ualf
undi
ndust
ry
t
hatt
heyshoul
dtr
yto makepeopl
eunder
stand r
egar
ding t
her
iskel
ement
associ
atedwi
tht
hei
nst
rumentsot
hati
twi
l
lincr
easepr
efer
enceofmut
ual
fund.

 Mut
ualf
undpr
ovi
dingcompanyshoul
dtr
ytopr
omot
emut
ualf
undawar
enessby
mor
eandmor
ecampai
gni
ngandof
fer
s.

 Mut
ualf
undpr
ovi
dingcompani
esshoul
dal
sot
argetonf
emal
einv
est
orsas
unt
appedmar
ket

 Mut
ualf
undcompani
esshoul
dtr
ytot
argetl
ow i
ncomegr
oupbyi
ntr
oduci
ng
mor
eschemeswhi
chr
equi
rel
essamountofi
nvest
ment
.

 Mut
ual
fundcompani
esshoul
dpr
omot
etheconceptofonl
i
net
radi
ng.

 Mut
ualf
undcompani
esshoul
dtar
gethi
gheri
ncomegr
oupwhoar
ereadyt
otake
mor
eri
sk

84
 7.
2Recommendat
iont
oinv
est
or

I
nvest
orshoul
dex
plor
eopt
ionr
egar
dingmut
ual
fundschemes.

 Asi
t,wasobser
veddur
ingt
hisst
udyt
hati
nvest
orswhopar
ti
cipat
edi
nthe
sur
veyhad av
erageorl
essawar
enessonmut
ualf
und aswel
lasbehav
ior
f
inance.Thesei
nvest
orsar
erequi
redt
obeawar
eaboutmar
ketmechani
sm
gener
all
y and behav
ior
albi
ases speci
fi
cal
l
y.So mai
nrecommendat
ion f
or
i
nvest
orsi
stomakeconst
antat
tempt
stoi
ncr
easet
hei
rawar
enessonmut
ual
f
unds’
inv
est
ment
s.

 St
udy
ingaboutt
hebi
asesandr
efl
ect
ingont
hei
rdeci
sionsar
eli
kel
ytohel
pthem
i
nbet
tersel
f-under
standi
ng.

 Tounder
standt
heobj
ect
ivesofi
nvest
mentbef
oret
heychooseanyi
nvest
ment
av
enuei
nfi
nanci
almar
ket
.

I
nvest
orsshoul
dgetei
therf
inanci
all
i
ter
acyordeci
sionsuppor
tfr
om exper
t,

whi
l
einv
est
ingt
hei .
rmoney

85
Chapt
er8:
Concl
usi
on

86
 Concl
usi
on

Mut
ualFundsar
ever
yknownr
esour
cef
orf
inanci
ali
nvest
ment
.Butt
her
eissome
peopl
ewhoar
enotawar
eabouti
tsot
her
eisneedofawar
enessf
ori
t.Thi
sanal
ysi
s
say
sthatt
her
ear
epeopl
ear
emuchmor
eint
erest
edt
hananyot
heri
nvest
ment
s.
BecauseofMut
ualFund’
sfeat
uresandqual
i
ties.Weseet
haty
oungerpeopl
ear
emost
i
nter
est
edandmaj
ori
tyoft
hepeopl
ear
egoi
ngorwantt
ogowi
thGROWTH FUND
mut
ual
fundi
nvest
ment
.

Ther
eshoul
dber
iski
sver
yhi
ghbuti
thasdi
ver
sif
iedpor
tfol
i
ossot
her
eisr
etur
nisal
so
hi
gherasi
t.“
THEHI
GHER THERI
SK,RETURN I
SALSO HI
GHER”
.Manypeopl
ear
e
i
nvest
ed i
nlump sum amountbutnow peopl
e hav
eint
ereston sy
stemat
ic pl
an
i
nvest
ment
.

Peopl
ear
esat
isf
iedwi
thMut
ualFundi
nvest
mentandt
hei
rnextpr
efer
encei
sal
so
samesowecansayt
hatMut
ualFundI
nvest
mentMar
keti
ncr
easi
ngdaybyday
.Ther
e
ar
e some peopl
e ar
e af
rai
dtoi
nvest
menti
n Mut
ualFund because ofRi
sk and
uncer
tai
nty
.Her
eint
hisr
esear
chwef
oundt
hatpeopl
epr
efer
sMut
ualFundasa
i
nvest
ment
.Soi
tisgoodf
ort
heMut
ual
Fundmar
ketandi
tsFut
ureGr
owt
h.

87
Chapt
er9:
Bi
bli
ogr
aphy

88
Bi
bli
ogr
aphy
DRBI MALANJUM,S.D.( 2012) .PERFORMANCEEVALUATI ON OFSELECTED OPEN ENDED
MUTUALFUNDS I NI NDI A.I NTERNATI ONALJOURNALOFMARKETI NG,FI NANCI AL
SERVI CES&MANAGEMENTRESEARCH, 29- 38.
D.M.( 2012) .ACOMPARATI VEANALYSI SOFMUTUALFUNDSCHEMESI NINDI A.Internati
onal
Jour nalofMar ket ing, Financi alSer vices&ManagementResear ch, 67-79.
D.M.( 2015) .Fact orAf fect ingSel ectionofMut ualFund.I NDI ANJOURNALOFRESEARCH,307-
309.
D.M.( 2016) .ASTUDYON TOPPERFORMEDEQUI TY–FMCG MUTUALFUNDSCHEMESI N
INDI A.I NTERNATI ONALJOURNALOFMANAGEMENT( IJL),555- 560.
Dhirendra Kumar . ( 2013) . Mut ualf unds:A sel ective sav i
ng gr ace. Ret rieved f r
om
www. busi ness- standar d.com.
Dr.K.Mal l
ikar j
unaRao.( 2015) .Gr owt handDev elopmentofMut ualFundI ndust ryinI ndia.
Internat i
onalJour nalofManagementandSoci alSci encesResear ch( I
JMSSR) ,92-99.
Dr.Mamt aShah.( 2012) .Changi ngmar ketingaspect sofmar keterst owar dpr oduct sandi ts
serv ces.I
i nt er
nat ionalJour nalofMul ti
discipl inar yManagementSt udies, 220- 227.
Dr.Nai l
aI qbal .(2013) .MARKET PENETRATI ON AND I NVESTMENT PATTERN OFMUTUAL
FUNDI NDUSTRYI NI NDI A.I nternat ionalJour nalofAdv ancedResear chi nManagement
andSoci alSciences, 101- 110.
Mr.JayR.Joshi .( 2013) .Mut ualFunds:Ani nv estmentopt ionf r
om i nvestors.I BMRD' sJournal
ofManagementandResear ch, 124- 134.
PreetiKhitoliya.( 2014) .Inv est orsAwar enessandPer ceivedRi skAt ti
tudeI nv estorsAwar eness
andPer ceiv edRi skAt ti
tude.I RACST–I nter nat i
onalJour nalofCommer ce,Busi ness
andManagement( IJCBM) ,450- 456.
RAJI V.G.SHARMA.( 2013) .ACompar at i
v eSt udyonPubl icandPr ivateSect orMut ualFundsi n
India.I nternati
onalJour nalofResear chi nHumani t
iesandSoci alSciences, 23- 25.
Vi
jay al
akshmiSundar .( 2014) .Gr owt handDev elopmentofMut ualFundI ndust rywi threference
toBanki ngSect orFunds.TheSt andar dInter nat ionalJour nals( TheSI J),21-25.

89
Chapter10:
Annexure

90
 QUESTI
ONNAI
RE

DearRespondent ,
Thequestionnairei
sapar toff i
rstyearproj
ectofMast ersofBusinessAdmi ni
str
ation
(MBA)ofN. R.Insti
tut
eofBusi nessManagement ,AhmedabadonAst udyof
pref
erencesoft heinvest
or sforinvest
mentinmutual fundswhi chrequir
esnotmor e
than10mi nutestocompl ete.Kindlyprov
ideyourvaluableresponsef ort
hestudy.The
datacoll
ectedfrom thisstudywi l
lbeusedonlyfortheacademi cpur pose.

1.Whatki
ndofi
nvest
menty
oupr
efermost
?Pl
easet
ick(
√).Al
l
appl
i
cabl
e.

a.Savi
ng
Account e.PostOffi
ce– h. Real
Est
ate
NSC,et
c
b.Fi
xedDeposi
t i
. PPF
f
. Shares/
c.I
nsur
ance Debentur
es

d.Mut
ual
fund g.Gol
d/Si
l
ver

2.Whi
l
einv
est
ingy
ourmoney
,whi
chf
act
ory
ouconsi
dert
hemost
?

a.Li
qui
dit
y c.Hi
ghRet
urn

b.LowRi
sk d.CompanyReput
ati
on

3.Woul
dyoul
i
ket
oinv
esti
nmut
ual
fund?

Yes No
91
I
fYes,
a)
.Wher
edoy
ouf
indy
our
sel
fasamut
ual
fundi
nvest
or?Anyone

a.Tot
all
yignor
ant c.Awareonlyofmyspeci
fi
c
schemeinwhichy
ou
b.Par
tial
knowledgeof i
nvested
mutualfunds
d.Ful
l
yawar
e

b)
.howdoy
oucomet
oknowaboutMut
ual
Fund?

a)Adv
ert
isement c)Banks

b)PeerGr
oup d)Fi
nanci
aladv
isor

d)
.Whi
chmut
ual
fundschemehav
eyouused?

a)Open-ended
e)Gr
owt
hFund
b)Cl
ose–ended
f
)Regul
arI
ncomeFund
c) Li
qui
dFund
g)Long-cap
d) Mi
d–cap

e)
.Forwhatper
ioddoy
oui
nvesti
nMut
ual
Fund?

a) 1Year c) 5Year e)10Yearabov

e

b) 3Year d)10Year

f
).Howmuchamountwoul
dyoul
i
ket
oinv
est
?
ForSI
P,

a)500–2000Rs c) 5000-10,
000Rs

b)2000–5000Rs d)
10,
000Rs.
Abov
e

ForMut
ual
Fund,

a)10,
000–25,
000Rs c) 50,
000-1,
00,
000Rs

b)25,
000–50,
000Rs d)
1,00,
000Rs.
Abov
e

g)
.Howmuchy
ourexpect
edr
etur
nfr
om t
heMut
ual
fundorSI
P?

92
 Howmuchav
erager
etur
ndouear
n?

a)8%t
o15% c)20%t
o30%

b)15%t
o20% d)30%andabov
e

h)
.Whi
chf
eat
ureofmut
ual
fundsal
l
urey
oumost
?

a)Di
ver
sif
icat
ion

b)Bet
terRet
urnandSaf
ety d)Gr
owt
hFund

c)Reduct
ioni
nRi
sk&r
eli
abl
ecost e)Regul
arI
ncomeFund

i
).I
nwhichMutualFundofthi
sAMCcompani esy
ouhav
einv
est
edorwoul
d
y
ouliket
oinv
est?Pleaset
ick(
√).Al
lappl
i
cabl
e.

a)SBI
MF f
)BI
RLASLMF
d)RELI
ANCE
b)UTI g)Ot
her
s
e)I
CICIPRU.MF
c) HDFC

j
).Wher
efr
om y
oupur
chasemut
ual
fund?

a)Di
rect
lyf
rom AMC’
s c)Agent
s

b)Br
oker
sonl
y d)Ot
herSour
ce

I
fNo,
4)Ifnoti
nvest
edornoti
nter
est
edi
nMut
ual
Fundt
henWhy
?

a)Hi
ghRi
sk

b)Notawar
eaboutMut
ual
Fund

c)NotanySpeci
fi
cat
ion

93
 5.Per
sonal
Det
ail
s:

(
a).Name:
-__
___
___
___
___
___
___
___
___
¬¬¬¬¬¬¬¬¬¬¬¬¬¬_
___
___
___
___
___
___
___
___
__

(
b).Gender
: (
c). Educat
ional
Qual
i
ficat
ions

Mal
e Under
graduat
e

Femal
e Post
graduat
e

(
d).Age: Doct
orat
e

18-
25y
ear
s Ot
her
s

26-
35y
ear
s

Abov
e35y
ear
s

(
e).Occupat
ion.Pl
easet
ick(
√)

a)Sel
fEmpl
oyed d)Pensi
on

b)Pr
ofessi
onal e)HouseWi
fe

c) Sal
ari
ed 0f
ff f
) ot
her
s

(
f).Whati
syourmont
hlyf
ami
l
yincomeappr
oxi
mat
ely
?Pl
easet
ick(
√).

a)Upt
o10,
000Rs. c)30,
000t
o50,
000Rs.

b)10,
000t
o30,
000Rs. d)50,
000t
o1,
00,
000Rs.

94
e)Mor
ethan1,
00,
000Rs.

95
THANKYOU

96