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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

EXECUTIVE

SUMMARY

Now a day, there is a tough competition in financial avenues due to increase in the investment products. People can get many investment options to invest their savings. Selecting one from the many available options considering many associated factors is a very complex process. Reliance Mutual Fund is one of India's largest brokerage and securities distribution house in India. It is new to Securities market but still among the top 5 performing company leaving far behind the oldest companies. It is considered to be one of the leading investment broking houses catering to the needs of both institutional and non-institutional investor categories with presence all over the country through franchisees and co-coordinators. In this project I studied the schemes of Reliance Mutual fund and their returns in various period of time which helped me in knowing how the various schemes are performing and the reasons behind it. I also came to know the risk associated with the various schemes and how risk and returns are related. Hence my topic of study is Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Design of the Study


Need for the Study: The study will help the organization in knowing how the Equity schemes of the companys are performing and which schemes are preferred most by the investors.

Objectives of the Study


To know the Performance of the preferred equity of Reliance Mutual Fund. To understand the concept of Mutual Fund its working, mechanism and types traded in India. To compare the risk and return associated with the Equity Schemes of Reliance Mutual Fund. To know which scheme of Equity of Reliance Mutual Fund is most preferred by the investors and what factors they consider while investing in reliance mutual fund. To evaluate the performance Sharpes and Treynors index are used

Scope of the study


For the study Equity schemes of Reliance Mutual Fund were scanned whose corpus value is more than 500 crores to compare their performance by calculating risk and return associated with these schemes. Also a survey was conducted on Reliance Investors to know the most preferred Equity scheme by the Investors and what factors make them Invest in Reliance mutual Fund

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

To evaluate the performance of the scheme and funds I have applied sharps index & Treynors index .

Limitations of the study:


The data collection was strictly confined to secondary sources. Primary data was associated with only the survey conducted on the investors. Collecting historical NAV is very difficult. Selection of schemes for study is very difficult because lot of Varieties in equity Schemes

Techniques of analysis:
1. Return: Return on a typical investment consists of two components. The basic is the periodic cash receipts (or income) on the investment, either in the form of interest or dividends. The second component is the change in the price of the assets-commonly called the capital gain or loss. This element of return is the difference between the purchase price and the price at which the assets can be or is sold; therefore, it can be again or a loss. The return has been calculated as under: NAVt NAVt-1 Portfolio return: Rit =--------------------------------NAV t-1 Where Rit is the difference between Net Asset Values for two consecutive days dividend by the NAV of the preceding day. BABASAB PATIL 3

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

M.indt M.indt-1 Market return: Rmt =-------------------------------M.indt-1 Where Rmt is the difference between market indices of two consecutive days dividend by the market index for the preceding day

2.

Risk :
Risk is neither good nor bad. Risk in holding securities is generally associated with the

possibility that realized returns will be less than expected returns. The difference between the required rate of returns on mutual fund investment and the risk free return is the risk premium. Risk can be measured in terms of Beta & standard deviations. Standard deviation It is used to measure the variation in individual returns from the average expected returns over a certain period. Standard deviation is used in the concept of risk of a portfolio of investments. Higher standard deviation means a greater fluctuation in expected return.

Standard deviation (SD) =\/ var

Where Var = variance

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Var= p (ri-E(r)) 2

Beta :
Beta measures the systematic risk and shows how prices of securities respond to the market forces. It is calculated by relating the return on a security with return for the market. By convention, market will have beta 1.0.Mutual fund is said to be volatile, more volatile or less volatile. If beta is grater than 1 the stock is said to be riskier than market. If beta is less than 1,the indication is that stock is less risky in comparison to market. If beta is zero then the risk is the same as that of the market. Negative beta is rare.

nxy-(x)( y)
2

nx2-(x)
Where n= number of days

X =rolling returns of the NSE index Y= rolling returns of the schemes

3.

Sharpe index
Sharpe index measures risk premium of a portfolio, relative to the total amount of risk in

the portfolio. Sharpe index summarizes the risk and return of a portfolio in a single measure that categorizes the performance of funds on the risk- adjusted basis. The larger the Sharpes index the portfolio over performs the market and vise versa.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Where

st = Sharpes index Rp= portfolio return Rf= Risk free rate of return (7.59%)
SD= Standard Deviation of the port folio

St= RP-Rf
SD

4.

Treynors Index
Treynors model is on the concept of the characteristics straight line. The characteristics

line has drawn a relationship between the market return and a specific portfolio without taking into consideration any direct adjustment for risk. It is also known as reward to volatility ratio and is defined as: The formula for Treynors Index is:

Portfolio avg return (Rp) risk-free rate of interest (Rf) Treynor index (Tn) = --------------------------------------------------------------------Beta coefficient of portfolio (Bp) Rp -Rf

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Tn = ------------------------Bp It measures portfolio risk in terms of beta, which is weighted average of individual security beta. The ratio is investors, for who the fund represents only a fraction of their total assets. The higher the ratio better is the performance.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

INTRODUCTION
An investment means employment of funds on assets (i.e. securities or mutual funds or any of the investment avenues) with the aim of earning of income as well as capital appreciation. There are mainly two attributes while investing to any of the means, i.e. time and risk. There are mainly four objectives, which the investments activities will carry on those are : Return Risk Liquidity Hedge against inflation Safety There are many alternatives which investment avenues are open to the investors to suit their needs and nature .The selection of investment alternatives are depends up on the required level of return and the risk tolerance level. These alternatives range from financial securities to traditional non-securities investment. Following are the various investment alternatives. Negotiable and fixed income securities Equity shares Preference share Debentures BABASAB PATIL 8

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Bonds Indira vikas patra &Kisan Vikas patra Government securities Money market securities (i.e. treasury bill, commercial paper, certificate of Deposit etc)

Non-negotiable securities
Bank deposit Post office deposit NBFC deposit Tax saving schemes Public provident fund scheme National saving scheme Life insurance Mutual funds Real estate

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Securities
Companies raise funds to finance their projects through various methods. The promoters can bring their own money or barrow from the financial institutions or mobilizes capital by issuing securities. The funds ` may be raised through issue of fresh share at per or premium. Preference shares debenture or global depository receipts. These are mainly two markets which any company can raise their funds; those are primary market and secondary market .the companies raise funds for the following purposes: To promote a new company To expand an existing company To diversify the production To meet the regular working capital requirement To capitalize the reserves. NEW ISSUE MARKET (PRIMARY MARKET) Stock available for the first time is offered through new issue market. The issuer may be a new company or an existing company. These issues may be of new type or the secure used in the past. In the new market the issuer can be consider as a manufacturers. The issuing house, investing banker and broker act as the channel of distributing for new issue. They take the responsibility of selling the stock to the public

The primary market provides a direct link between the prospective investors and

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Company. The main survives function of the primary market are: Origination Underwriting Distribution The main objectives of NSE are as follows. To establish the nation wide trading facility for Equities, Debt instruments and hybrids. To ensure equal access to investors all over the country through appropriate communication network. To enable shorter settlement cycle and book entry settlement system.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

INTRODUCTION TO THE MUTUAL FUND


Mutual Funds are dynamic financial institutions, which play a crucial role in an economy my mobilizing a link between savings and the capital market. Therefore the activities of Mutual Funds have both short and long term impact on the savings and capital markets and the national economy. Mutual Funds thus assist the process of financial deepening and intermediation. They mobilize Funds in the savings market and act as complementary to banking, at the same time they also compete with banks and other financial institutions. In the process stock market activities are also significantly influenced by Mutual Funds. The scope and efficiency of Mutual Funds are influenced by overall economic fundamentals, the interrelationship between the financial and real sector, the nature of development of the savings and capital markets, market structure, institutional arrangements and overall policy regime.

MEANING A MUTUAL FUND IS A COMMON POOL OF MONEY INTO WHICH THE INVESTORS PLACE THEIR CONTRIBUTIONS THAT ARE TO BE INVESTED IN ACCORDANCE WITH A STATED OBJECTIVE. Mutual fund is a mechanism for pooling the resources by issuing units to the investors And investing funds in securities in accordance with objectives as disclosed in offer document Investments in securities are spread across a wide cross-section of industries and sectors and thus the risk is reduced. Diversification reduces the risk because all stocks may not move in the same direction in the same proportion at the same time. Mutual fund issues units to the investors in BABASAB PATIL 12

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

accordance with quantum of money invested by them. Investors of mutual funds are known as unit holders. The investors in proportion to their investments share the profits or losses. The mutual funds normally come out with a number of schemes with different investment objectives, which are launches from time to time. A mutual fund is required to be registered with Securities and Exchange Board of India (SEBI), which regulates securities markets before it can collect funds from the public.

About

Reliance

Capital

Asset

Management

Ltd.

Reliance Capital Asset Management Limited (RCAM), a company registered under the Companies Act, 1956 was appointed to act as the Investment Manager of Reliance Mutual Fund. Reliance Capital Asset Management Limited is a wholly owned subsidiary of Reliance Capital Limited, the sponsor. The entire paid-up capital (100%) of Reliance Capital Asset Management Limited is held by Reliance Capital Limited.

Reliance Capital Asset Management Limited was approved as the Asset Management Company for the Mutual Fund by SEBI vide their letter no IIMARP/1264/95 dated June 30, 1995. The Mutual Fund has entered into an Investment Management Agreement (IMA) with RCAM dated May 12, 1995 and was amended on August 12, 1997 in line with SEBI (Mutual Funds) Regulations, 1996. Pursuant to this IMA, RCAM is authorised to act as Investment Manager of Reliance Mutual Fund. The networth of the Asset Management Company including preference shares as on March 31, 2005 is Rs.30.13 crores. Reliance Mutual Fund has launched twenty five

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Schemes till date, namely: Reliance Vision Fund (September 1995), Reliance Growth Fund (September 1995) Reliance Income Fund (December 1997), Reliance Liquid Fund (March 1998), Reliance Medium Term Fund (August 2000), Reliance Short Term Fund (December 2002), Reliance Fixed Term Scheme (March 2003), Reliance Banking Fund (May 2003), Reliance Gilt Securities Fund (July 2003), Reliance Monthly Income Plan (December 2003), Reliance Diversified Power Sector Fund (March 2004) Reliance Pharma Fund ( May 2004), Reliance Floating Rate Fund (August 2004), Reliance Media & Entertainment Fund (September 2004), Reliance NRI Equity Fund (October 2004), Reliance NRI Income Fund (October 2004), Reliance Index Fund (January 2005), Reliance Equity Opportunities Fund (February 2005), Reliance Fixed Maturity Fund - Series I (March 2005), Reliance Fixed Maturity Fund - Series II (April 2005), Reliance Regular Saving Fund (May 2005), Reliance Liquidity Fund (June 2005), Reliance Tax Saver (ELSS) Fund (July 2005), Reliance Fixed Tenor Fund (November 2005) and Reliance Equity Fund (Feb 2006).

RCAM has been registered as a portfolio manager vide SEBI Registration No. INP000000423 and renewed effective 1st August, 2003.RCAM has commenced these activities. It has been ensured that key personnel of the AMC, the systems, back office, bank and securities accounts are segregated activity wise and there exists systems to prohibit access to inside information of various activities. As per SEBI Regulations, it will further ensure that AMC meets the capital adequacy requirements, if any, separately for each such activity.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

TRUSTEES: Trustees are like internal regulators in a mutual fund, and their job is to protect the interest of unitholders. Sponsors appoint trustees. Trustees appoint the AMC, which, subsequently seek their approval for the work it does, and reports periodically to them on how the business is being run. Trustees float and market schemes, and secure necessary approvals. They check if the AMCs investments are within defined limits and whether the funds assets are protected. Trustees can be held accountable for financial irregularities in the mutual fund. CUSTODIAN: A custodian handles the investment back office of a mutual fund. Its

responsibilities include receipt and delivery of securities, collection of income, distribution of dividends, and segregation of assets between schemes. The sponsor of a mutual fund mutual fund cannot act as a custodian to the fund. This condition, formulated in the interest of investors, ensures that the assets of mutual fund are not in the hands of its sponsor. REGISTRAR : Registrars, also known as transfer agents, handle all investor-related services. This includes issuing and redeeming units, sending fact sheet and annual reports. Some fund houses handle such functions in-house.

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STRUCTURE OF MUTUAL FUND IN INDIA:

Trustees Operations

SEBI AMC

Sponsor

Fund Manager

Market / Sales

Mutual Fund Schemes Investor

GROWTH OF MUTUAL FUNDS: The Indian mutual fund as passed through three phases. The first phase was between 1964 and 1987 and only player was the trust of India, which had a total asset of Rs. 6700/- crores and the end of 1988.the second phase is between 1987 and 1993 during which period 8 funds were established (6 by banks and one each by LIC and GIC). The total asset under management had grown to Rs.61, 028/- crores at and of 1994 and the numbers of schemes were 167.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

The third began with the entry of private and foreign sectors in the mutual fund industry in 1993. Kothari pioneer mutual fund was the first fund to be established by the private sector in association with a foreign fund. As at the end of financial year 2000 (31 march) 32 funds were functioning with Rs. 1,13,005 crores as total asset under management. As on august end 2000, there were 33 with 391 schemes and assets under management with Rs. 1,02,849 crores. The securities and exchange board of India (SEBI) came out with comprehensive regulation in 1993, which defined the structure of mutual fund and asset management companies for the first time. Currently there are 34 of mutual fund organizations in India managing over Rs.1, 02,000/crore First investors pool their money in Mutual fund through franchisee or agents or himself in particular scheme. Fund manager collect that money and diversify that money in different securities. Then that securities generate return. That returns will passed back to the investors.

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THE DIFFERENT TYPES OF MUTUAL FUNDS: Schemes according to Maturity Period: A mutual fund scheme can be classified into open-ended scheme or close-ended scheme depending on its maturity period. Open-ended Fund/ Scheme An open-ended fund or scheme is one that is available for subscription and repurchase on a continuous basis. These schemes do not have a fixed maturity period. Investors can conveniently buy and sell units at Net Asset Value (NAV) related prices, which are declared on a daily basis. The key feature of open-end schemes is liquidity. Close-ended Fund/ Scheme A close-ended fund or scheme has a stipulated maturity period e.g. 5-7 years. The fund is open for subscription only during a specified period at the time of launch of the scheme. Investors can invest in the scheme at the time of the initial public issue and thereafter they can buy or sell the units of the scheme on the stock exchanges where the units are listed. In order to provide an exit route to the investors, some close-ended funds give an option of selling back the units to the BABASAB PATIL 18

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

mutual fund through periodic repurchase at NAV related prices. SEBI Regulations stipulate that at least one of the two exit routes is provided to the investor i.e. either repurchase facility or through listing on stock exchanges. These mutual funds schemes disclose NAV generally on weekly basis. Schemes according to Investment Objective: A scheme can also be classified as growth scheme, income scheme, or balanced scheme considering its investment objective. Such schemes may be open-ended or close-ended schemes as described earlier. Such schemes may be classified mainly as follows: Growth / Equity Oriented Scheme The aim of growth funds is to provide capital appreciation over the medium to long- term. Such schemes normally invest a major part of their corpus in equities. Such funds have comparatively high risks. These schemes provide different options to the investors like dividend option, capital appreciation, etc. and the investors may choose an option depending on their preferences. The investors must indicate the option in the application form. The mutual funds also allow the investors to change the options at a later date. Growth schemes are good for investors having a long-term outlook seeking appreciation over a period of time. Income / Debt Oriented Scheme The aim of income funds is to provide regular and steady income to investors. Such schemes generally invest in fixed income securities such as bonds, corporate debentures, Government BABASAB PATIL 19

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securities and money market instruments. Such funds are less risky compared to equity schemes. These funds are not affected because of fluctuations in equity markets. However, opportunities of capital appreciation are also limited in such funds. The NAVs of such funds are affected because of change in interest rates in the country. If the interest rates fall, NAVs of such funds are likely to increase in the short run and vice versa. However, long-term investors may not bother about these fluctuations. Balanced Fund The aim of balanced funds is to provide both growth and regular income as such schemes invest both in equities and fixed income securities in the proportion indicated in their offer documents. These are appropriate for investors looking for moderate growth. They generally invest 40-60% in equity and debt instruments. These funds are also affected because of fluctuations in share prices in the stock markets. However, NAVs of such funds are likely to be less volatile compared to pure equity funds. Money Market or Liquid Fund These funds are also income funds and their aim is to provide easy liquidity, preservation of capital and moderate income. These schemes invest exclusively in safer short-term instruments such as treasury bills, certificates of deposit, commercial paper and inter-bank call money, government securities, etc. Returns on these schemes fluctuate much less compared to other funds. These funds

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

are appropriate for corporate and individual investors as a means to park their surplus funds for short periods. Gilt Fund These funds invest exclusively in government securities. Government securities have no default risk. NAVs of these schemes also fluctuate due to change in interest rates and other economic factor as is the case with income or debt oriented schemes. Index Funds Index Funds replicate the portfolio of a particular index such as the BSE Sensitive index, S&P NSE 50 index (Nifty), etc These schemes invest in the securities in the same weight age comprising of an index. NAVs of such schemes would rise or fall in accordance with the rise or fall in the index, though not exactly by the same percentage due to some factors known as "tracking error" in technical terms. Necessary disclosures in this regard are made in the offer document of the mutual fund scheme. There are also exchange traded index funds launched by the mutual funds, which are traded on the stock exchanges. Sector specific funds/schemes These are the funds/schemes, which invest in the securities of only those sectors or industries as specified in the offer documents. E.g. Pharmaceuticals, Software, Fast Moving Consumer Goods (FMCG), Petroleum stocks, etc. The returns in these funds are dependent on the performance of BABASAB PATIL 21

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the respective sectors/industries. While these funds may give higher returns, they are more risky compared to diversified funds. Investors need to keep a watch on the performance of those sectors/industries and must exit at an appropriate time. They may also seek advice of an expert. Tax Saving Schemes These schemes offer tax rebates to the investors under specific provisions of the Income Tax Act, 1961 as the Government offers tax incentives for investment in specified avenues. e.g. Equity Linked Savings Schemes (ELSS). Pension schemes launched by the mutual funds also offer tax benefits. These schemes are growth oriented and invest pre-dominantly in equities. Their growth opportunities and risks associated are like any equity-oriented scheme. Load or no-load Fund A Load Fund is one that charges a percentage of NAV for entry or exit. That is, each time one buys or sells units in the fund, a charge will be payable. This charge is used by the mutual fund for marketing and distribution expenses. Suppose the NAV per unit is Rs.10. If the entry as well as exit load charged is 1%, then the investors who buy would be required to pay Rs.10.10 and those who offer their units for repurchase to the mutual fund will get only Rs.9.90 per unit. The investors should take the loads into consideration while making investment as these affect their yields/returns. However, the investors should also consider the performance track record and service standards of the mutual fund, which are more important. Efficient funds may give higher returns in spite of loads. A no-load fund is one that does not charge for entry or exit. It means the BABASAB PATIL 22

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investors can enter the fund/scheme at NAV and no additional charges are payable on purchase or sale of units.

Advantages of Mutual Fund;


Professional Management: Qualified professionals manage your money but they are not alone. They have a research team that continuously analyses the performance and prospects of companies. They also select suitable investment to achieve the objective of the scheme, so you see that it is a continues process that takes time and expertise that will add value to your investment. These fund managers are in a better position to manage investments and get a higher return. Diversification: the Clich, Dont put all your eggs in one basket. Really applies to the concept of intelligent investing. Diversification lowers the risk of loss by spreading your money across various industries it is a rare occasion when all stocks decline at the same time and in the same proportion. Choice of schemes: Mutual Fund offers a variety of schemes that will suit individuals needs over a lifetime. When you enter a new stage in your life, all you need to do is sit down with your investments advisers who will help you to re-arrange your portfolio to suit your altered life style. Affordability: As small investors, we may find that it is not possible to buy shares of larger corporations. Mutual funds generally buy and sell securities in large volumes, which allow investors to benefit from lower trading costs. The smallest investor can get started on BABASAB PATIL 23

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

mutual funds because of the minimal investment requirements. We can invest with a minimum of Rs. 500 in Systematic Investment Plan (SIP) on a regular basis. Tax benefits: Investments held by investors for a period of 12 months or more qualify for capital gains and will be taxed accordingly. These investments also get the benefit of indexation. And also the dividend received by an investor is tax free in the hands of investors. Liquidity: with open-end funds, we can redeem all or part of investment any time when we wish and receive the current value of the shares or the NAV related price. Funds are more liquid than most investments in shares, deposits and bonds and the process is standardize, making it quick and efficient so that we can get your cash in hand as soon as possible. Rupees Cost Averaging: Through using this concept of investing the same amount regularly, mutual funds give you the advantage of getting the average unit price over the long-term. This reduces your risk and also allows you to discipline yourself by actually investing every month or quarterly and not making sporadic investments. The Transparency of Mutual Funds: The performance of a mutual fund is reviewed by various publications and rating agencies, making it easy for investors to compare one to the other. Once we became part of mutual fund scheme, we were provided with regular updates, for example daily NAVs, as well as information on the specific investments made and the fund managers strategy and out look of the scheme.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Regulations of Mutual Funds: All mutual funds are required to register with SEBI. They are obliged to follow strict regulations designed to protect investors. All operations are also regularly monitored by the SEBI. Disadvantages Of Mutual Fund Mutual funds have their drawbacks and may not be for everyone:

No Guarantees: No investment is risk free. If the entire stock market declines in value, the value of mutual fund shares will go down as well, no matter how balanced the portfolio. Investors encounter fewer risks when they invest in mutual funds than when they buy and sell stocks on their own. However, anyone who invests through a mutual fund runs the risk of losing money.

Fees and commissions: All funds charge administrative fees to cover their day-to-day expenses. Some funds also charge sales commissions or "loads" to compensate brokers, financial consultants, or financial planners. Even if you don't use a broker or other financial adviser, you will pay a sales commission if you buy shares in a Load Fund.

Taxes: During a typical year, most actively managed mutual funds sell anywhere from 20 to 70 percent of the securities in their portfolios. If your fund makes a profit on its sales, you will pay taxes on the income you receive, even if you reinvest the money you made.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

CONTENTS - Organization Profile - Sampling - Date Collection Methods - Measuring Tools

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

RELIANCE MONEY
The Mutual Fund

About

Reliance

Mutual

Fund

Reliance Mutual Fund (RMF) has been established as a trust under the Indian Trusts Act, 1882 with Reliance Capital Limited (RCL), as the Settlor/Sponsor and Reliance Capital Trustee Co. Limited (RCTCL), as the Trustee.

RMF has been registered with the Securities & Exchange Board of India (SEBI) vide registration number MF/022/95/1 dated June 30, 1995. The name of Reliance Capital Mutual Fund has been changed to Reliance Mutual Fund effective 11th. March 2004 vide SEBI's letter no. IMD/PSP/4958/2004 date 11th. March 2004. Reliance Mutual Fund was formed to launch various schemes under which units are issued to the Public with a view to contribute to the capital market and to provide investors the opportunities to make investments in diversified securities.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

The main objectives of the Trust are : To carry on the activity of a Mutual Fund as may be permitted at law and formulate and devise various collective Schemes of savings and investments for people in India and abroad and also ensure liquidity of investments for the Unit holders; To deploy Funds thus raised so as to help the Unit holders earn reasonable returns on their savings To take such steps as may be necessary from time to time to realize the effects without any limitation

Vision, Mission & Market Strategy


Vision statement Empowering everyone to live their dream Mission statementTo offer unparalleled value by providing the customer transparent, convenient and

effective anytime-anywhere integrated financial transaction capability Marketing strategy- to provide Simple, easy-to-understand, safe and secure trading platform/software Uncomplicated, easy-to-understand brokerage/trading cost structure without any riders Easy access to the financial market through convenient modes of distribution

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Sound, genuine, unbiased advise individual investments. Detail Study about the company The easiest, fastest and most convenient way to carry out your financial transactions is now at your fingertips! Reliance Money offers you the widest range of asset classes to trade in: Equity, Derivatives, Commodities and Forex. Also invest on-line in Mutual Funds, IPOs and Insurance products (Life & General). All this through one single window. Reliance Money is a state-of-theart financial transaction platform, which enables you to conduct your financial transactions in cost effective, convenient and secure manner. Reliance Money has introduced several never . before features and thereby changed the way you will invest: 1. Flat Fees instead of Brokerage - Put your money into investments, not into brokerage. Pay a flat fee of Rs. 500/- and transact as much you want upto Rs. 1crore or for 2 months (whichever is earlier). It.s never happened before anywhere in the world! 2. Trading Kiosks - No matter if you don.t have access to a computer or the Internet. You will find exclusive Reliance Money Trading Kiosks at convenient locations throughout your city. These internet-enabled Kiosks bring the market to you, wherever you are. 3. Security Token - The Reliance Money security token is so hi-tech, it almost defies belief. This small, portable plastic device flashes a unique number that changes every 36 seconds, ensuring that the number used for an earlier transaction is discarded. This number works over and above your normal login and password, serving as a third level of protection that guarantees your account total safety.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

4. Call N Trade - You don.t have to access your computer to trade or invest.With our Call N Trade facility, you can place orders over the phone. 5. Multiple Offerings - Along with equity, you can also trade / invest in Commodities (gold, silver, base metals and other agri commodities to name a few), Derivatives, Forex (RBI allows you to remit US$25,000 per calendar year), Mutual Funds, IPOs and Insurance products (Life & General). 6. Widest Network: Reliance Money has a network of branches all over the country with associates who will assist you with your financial investment requirements. 7. Other value - added Services: -Reliance Money provides: Research, market views and stock views from independent experts, with an enviable track record LIVE news from Dow Jones, Capital Market and Commodities Control CEOs. / experts. views on economy and the financial market Personal Finance planning tools that help you plan your investments, retirement, tax etc. Portfolio Tracker that will help you track your investments from one single screen Risk Analyzer to analyz e your risk profile and get a suitable investment portfolio plan using our Asset Allocator. Knowledge Centre will help you understand investing and trading basics and also delve into advanced concepts like trading strategies Market Watch, a unique tool that will help you track your favorite companies. Just

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

configure it and get real time quotes, news, views, result etc. Our technology allows you to detach it from the main screen and place it on your desktop. Products and Services A product for every need: Reliance Money is the most comprehensive platform which allows you to invest in Shares, Mutual Funds, Derivatives (Futures & Options), Commodities, Forex, IPOs, Insurance and other financial products. Simply put, we offer you a product for almost every investment need. Investing in Mutual Funds: Reliance Money brings you a unique, hassle-free and paperless way to invest in Mutual Funds. You can now invest on-line in Mutual Funds through Reliance Money No more filling application forms manually or any going through other paperwork. You need no signatures or proof of identity for investing. Once you place a request for investing in a particular fund, there are no manual processes involved. Your bank funds are automatically debited or credited while simultaneously crediting or debiting your unit holdings.You also get control over your investments with on-line order confirmations and order status tracking. You get to know the performance of your investments through online updation of your portfolio with current NAVs. Reliance Money offers you various options while investing in Mutual Funds: Purchase: Buying of Mutual Fund units is very convenient without the hassles of filling in the applications manually. Redemption: As with Purchases, redemptions too can be done online. Switch: You can shift money from one scheme to another in the same mutual fund house, with the click of a button.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Reliance Mutual Funds Equity Schemes : Reliance Equity Fund : (An open-ended diversified Equity Scheme.) The primary investment objective of the scheme is to seek to generate capital appreciation & provide long-term growth opportunities by investing in a portfolio constituted of equity & equity related securities of top 100 companies by market capitalization & of companies which are available in the derivatives segment from time to time and the secondary objective is to generate consistent returns by investing in debt and money market securities. Reliance Tax Saver (ELSS) Fund : (An Open-ended Equity Linked Savings Scheme.) The primary objective of the scheme is to generate long-term capital appreciation from a portfolio that is invested predominantly in equity and equity related instruments. Reliance Equity Opportunities Fund : (An Open-Ended Diversified Equity Scheme.) The primary investment objective of the scheme is to seek to generate capital appreciation & provide long-term growth opportunities by investing in a portfolio constituted of equity securities &equity related securities and the secondary objective is to generate consistent returns by investing in debt and money market securities.

BABASAB PATIL 32

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Reliance Vision Fund : (An Open-ended Equity Growth Scheme.) The primary investment objective of the Scheme is to achieve long term growth of capital by investment in equity and equity related securities through a research based investment approach. Reliance Growth Fund : (An Open-ended Equity Growth Scheme.) The primary investment objective of the Scheme is to achieve long term growth of capital by investment in equity and equity related securities through a research based investment approach. Reliance Index Fund : (An Open Ended Index Linked Scheme.) The Investment Objective under the Nifty Plan is to replicate the composition of the Nifty, with a view to endeavor to generate returns, which could approximately be the same as that of Nifty. The Investment Objective under the Sensex plan is to replicate the composition of the Sensex, with a view to endeavor to generate returns, which could approximately be the same as that of Sensex. Reliance NRI Equity Fund : (An open-ended Diversified Equity Scheme.) The Primary investment objective of the scheme is to generate optimal returns by investing in equity or equity related instruments primarily drawn from the Companies in the BSE 200 Index. Debt/Income Schemes

BABASAB PATIL 33

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

The aim of income funds is to provide regular and steady income to investors. Such schemes generally invest in fixed income securities such as bonds, corporate debentures,

Government securities and money market instruments. Such funds are less risky compared to equity schemes. These funds are not affected because of fluctuations in equity markets. However, opportunities of capital appreciation are also limited in such funds. The NAVs of such funds are affected because of change in interest rates in the country. If the interest rates fall, NAVs of such funds are likely to increase in the short run and vice versa. However, long term investors may not bother about these fluctuations. Debt Schemes : Reliance Monthly Income Plan : (An Open Ended Fund. Monthly Income is not assured & is subject to the availability of distributable surplus ) The Primary investment objective of the Scheme is to generate regular income in order to make regular dividend payments to unitholders and the secondary objective is growth of capital.Primarily the investment shall be made in debt and money market securities (i.e. 80%) with a small exposure (i.e. upto 20%) in equity. Reliance Gilt Securities Fund - Short Term Gilt Plan & Long Term Gilt Plan: Open-ended Government Securities Scheme) The primary objective of the Scheme is to generate Optimal credit risk-free returns by investing in a portfolio of securities issued and guaranteed by the central Government and State Government

BABASAB PATIL 34

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Reliance Income Fund : (An Open-ended Income Scheme) The primary objective of the scheme is to generate optimal returns consistent with moderate levels of risk. This income may be complemented by capital appreciation of the portfolio. Accordingly, investments shall predominantly be made in Debt & Money Instruments. Reliance Medium Term Fund : (An Open End Income Scheme with no assured returns.) The primary investment objective of the Scheme is to generate regular income in order to make regular dividend payments to unitholders and the secondary objective is growth of capital Reliance Short Term Fund : (An Open End Income Scheme) The primary investment objective of the scheme is to generate stable returns for investors with a short investment horizon by investing in Fixed Income Securities of short term maturity. Reliance Liquid Fund : (Open-ended Liquid Scheme). The primary investment objective of the Scheme is to generate optimal returns consistent with moderate levels of risk and high liquidity. Accordingly, investments shall predominantly be made in Debt and Money Market Instruments. Reliance Fixed Term Scheme :

BABASAB PATIL 35

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

(Close-ended Income Scheme) The primary objective of the Scheme is to seek to achieve regular returns / growth of capital by investing in a portfolio of fixed income securities normally maturing in line with the time profile of the plan with the objective of limiting interest rate volatility. Reliance Floating Rate Fund : (An Open End Income Scheme) The primary objective of the scheme is to generate regular income through investment in a portfolio comprising substantially of Floating Rate Debt Securities (including floating rate securitized debt and Money Market Instruments and Fixed Rate Debt Instruments swapped for floating rate returns). The scheme shall also invest in Fixed rate debt Securities (including fixed rate securitised debt, Money Market Instruments and Floating Rate Debt Instruments swapped for fixed returns Reliance NRI Income Fund : (An Open-ended Income scheme) The primary investment objective of the Scheme is to generate optimal returns consistent with moderate levels of risks. This income may be complimented by capital appreciation of the portfolio. Accordingly, investments shall predominantly be made in debt Instruments. Reliance Fixed Maturity Fund - Series I : (A Close Ended Income Scheme) The primary investment objective of the Scheme is to seek to achieve regular returns / growth of capital by investing in a portfolio of fixed income securities normally maturing in line with the time profile of the Plan with the objective of limiting interest rate volatility.

BABASAB PATIL 36

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Reliance Fixed Maturity Fund - Series II : (A closed ended Income Scheme) The primary investment objective of the Scheme is to seek to achieve growth of capital by investing in a portfolio of fixed income securities normally maturing in line with the time profile of the respective plans. Reliance Liquidity Fund : (An Open - ended Liquid Scheme) The investment objective of the Scheme is to generate optimal returns consistent with moderate levels of risk and high liquidity. Accordingly, investments shall predominantly be made in Debt and Money Market Instruments. Debt Option : The primary investment objective of this plan is to generate optimal returns consistent with moderate level of risk. This income may be complemented by capital appreciation of the portfolio. Accordingly investments shall predominantly be made in Debt & Money Market Instruments. Equity Option : The primary investment objective is to seek capital appreciation and or consistent returns by actively investing in equity / equity related securities. Sector Specific Schemes These are the funds/schemes which invest in the securities of only those sectors or industries as specified in the offer documents. e.g. Pharmaceuticals, Software, Fast Moving Consumer Goods (FMCG), Petroleum stocks, etc. The returns in these funds are dependent on the performance of the respective sectors/industries. While these funds may give higher returns, they are

BABASAB PATIL 37

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

more risky compared to diversified funds. Investors need to keep a watch on the performance of those sectors/industries and must exit at an appropriate time. Sector Specific Schemes Sector Funds are specialty funds that invest in stocks falling into a certain sector of the economy. Here the portfolio is dispersed or spread across the stocks in that particular sector. This type of scheme is ideal for investors who have already made up their mind to confine risk and return to a particular sector Reliance Banking Fund Reliance Mutual Fund has an Open-Ended Banking Sector Scheme which has the primary investment objective to generate continuous returns by actively investing in equity / equity related or fixed income securities of banks. Reliance Diversified Power Sector Fund Reliance Diversified Power Sector Scheme is an Open-ended Power Sector Scheme. The primary investment objective of the Scheme is to seek to generate consistent returns by actively investing in equity / equity related or fixed income securities of Power and other associated companies. Reliance Pharma Fund Reliance Pharma Fund is an Open-ended Pharma Sector Scheme. The primary investment objective of the Scheme is to generate consistent returns by investing in equity / equity related or fixed income securities of Pharma and other associated companies. Reliance Media & Entertainment Fund Reliance Media & Entertainment Fund is an Open-ended Media & Entertainment sector scheme.

BABASAB PATIL 38

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

The The primary investment objective of the Scheme is to generate consistent returns by investing in equity / equity related or fixed income securities of media & entertainment and other associated companies. NAV or Net Asset Value of the fund is the cumulative market value of the assets of the fund net of its liabilities. NAV per unit is simply the net value of assets divided by the number of units outstanding. Buying and selling into funds is done on the basis of NAV-related prices. NAV is calculated as follows: NAV= Market value of the funds investments+Receivables+Accrued Income. Liabilities-Accrued Expenses

BABASAB PATIL 39

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Methodology Data sources :


Primary Data: Primary data was collected by administering questionnaire. It is systematic collection of information directly from the Reliance Mutual Fund Investors . The basic purpose of collecting primary data is to know the preferred Equity Schemes of Reliance Mutual funds Secondary data: Secondary datas are collected from Reliance website, financial journals, recent Fact sheet of Reliance mutual fund relating to mutual funds

Sampling
Sample size: 50 Reliance Mutual fund Investors Area of research: Belgaum City. Research approach: Survey method. Research Instrument: Questionnaire.

BABASAB PATIL 40

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

CONTENTS

Results & Discussion with Charts & Graphs


Summary, Conclusion & a Proposed Action Plan with Resource Requirements & Projected Benefits to the Organization

BABASAB PATIL 41

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

PERFORMANCE COMPARISM OF MUTUAL FUND SCHEMES

BABASAB PATIL 42

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Equity diversified schemes There is lot of variety schemes offered by AMCs. Equity diversified is one of the scheme offered by the AMC .the selection criteria of schemes is totally depend on the fund size and age of the fund. The scheme, which has the corpus value, is more than 500Crs . The following are the equity-diversified schemes in the selected funds. at the current date as 06/03/07

Tables for fund size Reliance Mutual Fund Equity schemes


Scheme name Reliance Equity Fund (G) 4359.6 Reliance Equity Opportunities Fund (G) 2385.65 Reliance Growth Fund (G) 3263.71 Reliance Vision Fund (G) 2473.68 Reliance Tax Saver (ELSS) Fund (G) 1501.78 08/23/05 ETS 09/07/95 ED 09/08/95 ED 03/07/05 ED 03/07/06 ED Fund size DOI FUND CLASS

1. Return:
BABASAB PATIL 43

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Name of Scheme Reliance Growth Fund (G)

DOI (30/03/07) 199.52

Returns (annualized) 1 yr 48.21 50.45 47.48 2yr 93.23 62.62 106.91 3yr 80.40 60.56 53.02 4yr 27.21 34.41 29.77 5yr 53.64 81.42 18.07

5yrs Avg return 60.54 57.89 51.05

Reliance Vision Fund (G) 137.65 Reliance Tax Saver (ELLS) Fund(G) 115.193 Reliance Equity 45.4206 Reliance Equity Fund (G) 26.52 32.47 39.03 28.00 9.97 0.00 27.37 48.24 63.85 70.46 32.17 -2.24 42.50 Opportunities Fund (G)

NAVt NAVt-1 Portfolio return: Rit =--------------------------------NAV t-1


Where Rit is the difference between Net Asset Values for two consecutive days dividend by the NAV of the preceding day.

2. Risk

BABASAB PATIL 44

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Beta
5 years avg return* Beta 60.54 57.89 51.05 42.50 27.37 0.91 0.98 0.93 0.96 0.94

Scheme name Reliance Growth Fund (G) Reliance Vision Fund (G) Reliance Tax Saver (ELLS) Fund(G) Reliance Equity Opportunities Fund (G) Reliance Equity Fund (G) * Returns are annualized

nxy-(x)( y)
2

nx2-(x)
Where n= number of days

X =rolling returns of the NSE index Y= rolling returns of the schemes Beta describes the relationship between the stocks return and the index returns. it describes the risk in the portfolio with comparing market risk as 1 . If beta =1 One percent changes in market index return causes exactly one percent change in the stock returns. it indicates that the stock moves in tandem with the market . If Beta <1 BABASAB PATIL 45

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Then the stock is less volatile compared to the market. If Beta >1 Then the stock is more volatile compared to the market. The stock value With more then 1 beta value is considered to be risky. If Beta ve: native Beta indicates that the stock returns moves in the opposite direction to the market return.

Standard deviation

BABASAB PATIL 46

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

It is used to measure the variation in individual returns from the average expected returns over a certain period. Standard deviation is used in the concept of risk of a portfolio of investments. Higher standard deviation means a greater fluctuation in expected return. Returns (annualized) Name of Scheme Reliance Growth Fund (G) 199.52 Reliance Vision Fund (G) 137.65 Reliance Tax (ELLS) Fund(G) Reliance Saver 115.193 Equity 45.4206 Reliance Equity Fund (G) 26.52 32.47 39.03 28.00 9.97 0.00 27.37 14.59 48.24 63.85 70.46 32.17 -2.24 42.50 26.00 Opportunities Fund (G) 47.48 106.91 53.02 29.77 18.07 51.05 30.59 50.45 62.62 60.56 34.41 81.42 57.89 15.43 48.21 93.23 80.40 27.21 53.64 60.54 23.55 DOI (30/03/07) 1 yr 2yr 3yr 4yr 5yr 5yrs Avg return SD

Standard deviation (SD) =\/ var

Where Var = variance

Var= p (ri-E(r)) 2
Return & Risk

BABASAB PATIL 47

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Name of Scheme Reliance Growth Fund (G) Reliance Vision Fund (G) Reliance Tax Saver (ELLS) Fund(G)

5 yrs avg DOI(30/03/07) returns sd 3263.71 2473.68 1501.78 60.54 57.89 51.05 42.50 27.37 23.55 15.43 30.59 26.00 14.59

beta 0.91 0.98 0.93 0.96 0.94

Reliance Equity Opportunities Fund (G) 2385.65 Reliance Equity Fund (G) 4359.6

Sharpes

BABASAB PATIL 48

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Sharpes index measures the risk premium of the portfolio relative to the total amt of risk in the portfolio. This risk premium is the difference between the portfolios average rate of return and the risk less rate of return. The index assigns the highest values to assets that have best riskadjusted average rate of returns.

Name of Scheme Reliance Growth Fund (G) Reliance Vision Fund (G) Reliance Tax Saver (ELLS) Fund(G) Reliance Equity Opportunities Fund (G) Reliance Equity Fund (G)

DOI(30/03/07) 3263.71 2473.68 1501.78 2385.65 4359.6

5 yrs avg returns rp rf 60.54 57.89 51.05 42.50 27.37 8 8 8 8 8

sd 23.55 15.43 30.59 26.00 14.59

st 2.23 3.23 1.40 1.33 1.32

Where st =Sharpes index Rp=portfolio return Rf=Risk free rate of return (8 %) SD= standard deviation of the port folio

St= RP-Rf
SD

BABASAB PATIL 49

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Sharpe's Ranking to Reliance Equity Diversified Schem es


3.5 3 Performance 2.5 2 1.5 1 0.5 0 Sharpes Schemes
Interpretation: Reliance Vision Fund (G) is performing well and is ranked No 1 according to Sharpes as it is giving higher returns compared to other Schemes.

Reliance Growth Fund (G) Reliance Vision Fund (G) Reliance Tax Saver (ELLS) Fund(G) Reliance Equity Opportunities Fund (G) Reliance Equity Fund (G)

Treynors Index:
Name of Scheme Reliance Growth Fund (G) DOI(30/03/07) 3263.71 5 yrs avg returns rp rf 60.54 57.89 51.05 42.50 27.37 8 8 8 8 8 Beta 0.91 0.98 0.93 0.96 0.94 tn 57.74 50.91 46.29 50 35.94 20.61

BABASAB PATIL Reliance Vision Fund (G) 2473.68 Reliance Tax Saver (ELLS) Fund(G) 1501.78 Reliance Equity Opportunities Fund (G) 2385.65 Reliance Equity Fund (G) 4359.6

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

In Treynors higher the ratio higher the performance. Tn =Treynors index Rp=portfolio return Rf=Risk free rate of return (8 %) Formula

Tn= RP-Rf
Beta

BABASAB PATIL 51

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Treynors Ranking on Reliance Equity Diversified Fund


70 60 50 40 30 20 10 0 Treynors Schem es Reliance Tax Saver (ELLS) Fund(G) Reliance Equity Opportunities Fund (G) Reliance Equity Fund (G) Reliance Growth Fund (G) Reliance Vision Fund (G)

Interpretation: Reliance Growth Fund (G) is performing well and is ranked No 1 according to Treynors index as it is giving higher returns compared to other Schemes according to him and also the risk involved is less

BABASAB PATIL 52

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Performance Evaluation Tables

Name of the scheme


Reliance Growth Fund (G) Reliance Vision Fund (G)

DOI (30/06/06) Rp 3263.71 2473.68

Beta

SD

Sharpes Treynors 57.74 50.91 46.29 35.94 20.61

60.54 0.91 57.89 0.98 51.05 0.93 42.50 0.96 27.37 0.94

23.55 2.23 15.43 3.23 30.59 1.40 26.00 1.33 14.59 1.32

Reliance Tax Saver (ELLS) Fund(G) 1501.78 Reliance Equity Opportunities Fund (G) Reliance Equity Fund (G) 2385.65 4359.6

Analysis of Survey
BABASAB PATIL 53

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

1.Sources from Investors came to know about Reliance Mutual fund Frequency Valid Friends/Relatives Newspapers/ Televisions Brokers/Agents Financial Consultants Total 12 7 16 15 50 Percent 24.0 14.0 32.0 30.0 100.0 Valid Percent 24.0 14.0 32.0 30.0 100.0 Cumulative Percent 24.0 38.0 70.0 100.0

Sources from Investors came to know about Relaince Mutual fund


20

10

Frequency

0 Friends/Relatives Brokers/Agents Financial Consultant New spapers/Televisio

Sources from Investors came to know about Relaince Mutual fund

Interpretation: For the popularity of the mutual funds all the means contributed all most equally but the dominated factor in these factors is advice from the Brokers/Agents, which contributed around 32% followed by the financial agents at 30%.

2.Reliance Schemes most preferred by investors

BABASAB PATIL 54

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Frequency Percent Valid Equity Debt Total 30 20 50 60.0 40.0 100.0

Valid Percent 60.0 40.0 100.0

Cumulative Percent 60.0 100.0

R elian S em m preferred by in ce ch es ost vestors


40

30

20

Frequency

10

0 E quity D ebt

R eliance Schem m preferred by investors es ost

Interpretation: 60% of the respondents prefer equity schemes as investors now days are ready to risk because they are getting good returns, whereas 40% of the respondents prefer debt schemes.

. 3a.Reliance equity fund

BABASAB PATIL 55

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Frequency Percent Valid 1 2 4 5 Total 9 1 30 10 50 18.0 2.0 60.0 20.0 100.0

Valid Percent 18.0 2.0 60.0 20.0 100.0

Cumulative Percent 18.0 20.0 80.0 100.0

R eliance equity fund


70 60 50 40 30 20

Percent

10 0 1 2 4 5

R eliance equity fund

Interpretation: Reliance equity fund is ranked 4th by majority of the Investors as the returns are not so high compared to the other Schemes of Equity.

BABASAB PATIL 56

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

3b.Reliance equity Opportunity fund Frequency Percent Valid 1 2 4 5 Total 1 9 10 30 50 2.0 18.0 20.0 60.0 100.0 Valid Percent 2.0 18.0 20.0 60.0 100.0 Cumulative Percent 2.0 20.0 40.0 100.0

Reliance equity Oppurtunity fund


70 60 50 40 30 20

Percent

10 0 1 2 4 5

Reliance equity Oppurtunity fund

Interpretation: Reliance Equity opportunity fund is ranked 5th by 60% of the Investors investing in Reliance mutual fund as the returns are low and also riskier compared to other 4 schemes.

BABASAB PATIL 57

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

3c.Reliance Growth fund Frequency Valid 1 2 3 4 Total 26 3 18 3 50 Percent 52.0 6.0 36.0 6.0 100.0 Valid PercentCumulative Percent 52.0 6.0 36.0 6.0 100.0 52.0 58.0 94.0 100.0

Reliance Growth fund


60

50

40

30

20

Percent

10 0 1 2 3 4

Reliance Growth fund

BABASAB PATIL 58

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

3d. Reliance Vision fund

Frequency Valid 1 2 3 4 5 Total 2 24 16 7 1 50

Percent 4.0 48.0 32.0 14.0 2.0 100.0

Valid Percent Cumulative Percent 4.0 4.0 48.0 52.0 32.0 84.0 14.0 98.0 2.0 100.0 100.0

Reliance Vision fund


60

50

40

30

20

Percent

10 0 1 2 3 4 5

Reliance Vision fund

3e.Reliance Tax Saver-ELSS

BABASAB PATIL 59

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Frequency Valid 1 2 3 5 Total 12 14 15 9 50

Percent 24.0 28.0 30.0 18.0 100.0

Valid PercentCumulative Percent 24.0 24.0 28.0 52.0 30.0 82.0 18.0 100.0 100.0

Reliance Tax Saver-ELSS


40

30

20

4a. Safety
10

Frequency Per Valid 1 2 5 6 Total 10 33 2 5 50

Percent

0 1 2 3 5

Reliance Tax Saver-ELSS

20. 66. 4.0 10. 100

BABASAB PATIL 60

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Safety
70 60 50 40 30 20

Percent

10 0 1 2 5 6

Safety

Interpretation: Out of the 50 respondents 66 % of them have rated 2 to safety because every investors needs safety in his investment made but also some of them have given least preference to safety because as we know higher the risk higher the return.

4b. Rate of Return


Frequency Percent Valid 1 2 3 4 5 Total 33 9 1 2 5 50 66.0 18.0 2.0 4.0 10.0 100.0 Valid Percent 66.0 18.0 2.0 4.0 10.0 100.0 Cumulative Percent 66.0 84.0 86.0 90.0 100.0

BABASAB PATIL 61

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Rate of Return
70 60 50 40 30 20

Percent

10 0 1 2 3 4 5

Rate of Return

Interpretation: 66% of the respondents have ranked rate of return as No 1 ranking this is because of the changing trend where people are ready to take risk but they expect good returns and higher return each time.

4c. Liquidity
Frequency Valid 1 2 3 4 5 Total 2 1 9 26 12 50 Percent 4.0 2.0 18.0 52.0 24.0 100.0 Valid PercentCumulative Percent 4.0 4.0 2.0 6.0 18.0 24.0 52.0 76.0 24.0 100.0 100.0

BABASAB PATIL 62

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

L u ity iq id
6 0

5 0

Interpretation: Out of the 50 respondents 52% of them


1 2 3 4 5

4 0

3 0

2 0

Percent

1 0

have as

ranked 4th ,

liquidity
L u ity iq id

whereas only 10% of

them have ranked 3rd which shows liquidity is given least preference when compared to other factors.

4d. Tax Benefit


Frequency Percent Valid 2 3 4 5 6 Total 2 26 9 1 12 50 4.0 52.0 18.0 2.0 24.0 100.0 Valid Percent 4.0 52.0 18.0 2.0 24.0 100.0 Cumulative Percent 4.0 56.0 74.0 76.0 100.0

BABASAB PATIL 63

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

T xB n fit a ee
6 0

5 0

4 0

3 0

2 0

Percent

1 0

0 2 3 4 5 6

T xB n fit a ee

Interpretation: 52% of the respondents have ranked 3 rd for tax benefit which shows people give importance for tax benefit as it saves the investors money.

4e. Brand name Frequency Percent Valid 2 3 4 5 6 Total 5 2 13 18 12 50 10.0 4.0 26.0 36.0 24.0 100.0 Valid Percent 10.0 4.0 26.0 36.0 24.0 100.0 Cumulative Percent 10.0 14.0 40.0 76.0 100.0

BABASAB PATIL 64

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Brand nam e
40

30

20

10

Percent

0 2 3 4 5 6

Brand nam e

Interpretation: 36% of the respondents have ranked 5th to Brand which shows importance is given to brand name of the company in which investors are investing as it is shows the credit worthiness of the company.

4f. Flexibility
Frequency Percent Valid 1 3 5 6 Total 5 12 12 21 50 10.0 24.0 24.0 42.0 100.0 Valid Percent 10.0 24.0 24.0 42.0 100.0 Cumulative Percent 10.0 34.0 58.0 100.0

BABASAB PATIL 65

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Flexibility
50

40

30

20

10

Percent

0 1 3 5 6

Flexibility

Interpretation: 42% of the respondents have ranked 6th to Flexibility which shows not much importance is given to flexibility as far as investors are getting good return from the schemes.

5a. Reliance Mutual Fund


Frequency Percent Valid 1 2 4 Total 14 34 2 50 28.0 68.0 4.0 100.0 Valid Percent 28.0 68.0 4.0 100.0 Cumulative Percent 28.0 96.0 100.0

BABASAB PATIL 66

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Reliance Mutual Fund


80

60

40

20

Percent

0 1 2 4

Reliance Mutual Fund

Interpretation: Majority of the respondents have ranked Reliance mutual funds as 2 nd when compared to the other 4 companies so this shows that in a short span of time Reliance has made a good image in the eyes of the investors.

5b. HDFC Mutual Fund


Frequency Percent Valid 1 2 3 4 5 2 1 35 9 3 4.0 2.0 70.0 18.0 6.0 Valid Percent 4.0 2.0 70.0 18.0 6.0 Cumulative Percent 4.0 6.0 76.0 94.0 100.0

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Total

50

100.0

100.0

H DFC Mutual Fund


80

60

40

20

Percent

0 1 2 3 4 5

H DFC M utual Fund

Interpretation: Majority of the investors have ranked HDFC mutual fund as 3 rd when compared to other mutual fund so comparatively it is doing well.

5c. Franklin Templeton Mutual Fund


Frequency Valid 2 3 4 Total 1 32 15 2 1 50 Percent 64.0 30.0 4.0 2.0 100.0 Valid Percent Cumulative Percent 64.0 64.0 30.0 94.0 4.0 98.0 2.0 100.0 100.0

BABASAB PATIL 68

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Fran tem klin pleton M tu Fu d u al n


70 60 50 40 30 20

Percent

10 0 1 2 3 4

Franklin tem pleton M utual Fund

Interpretation: Franklin has been ranked NO 1 mutual fund company by the respondents when compared to the other mutual funds as it has maintained its returns over a long period of time.

5d. UTI mutual Fund


Frequency Valid 1 3 4 5 Total 1 10 5 34 50 Percent 2.0 20.0 10.0 68.0 100.0 Valid PercentCumulative Percent 2.0 20.0 10.0 68.0 100.0 2.0 22.0 32.0 100.0

BABASAB PATIL 69

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

U I m tu l F n T u a ud
8 0

6 0

4 0

Percent

2 0

0 1 3 4 5

U I m tu l F n T u a ud

Interpretation: Majority of the investors are not preferring UTI mutual funds as their returns are very low when compared to their previous records and so it is been ranked 4th by the investors.

5e. ICICI mutual fund

Frequency Pe Valid 1 3 4 5 Total 1 3 33 13 50

IC I m tu fu d IC u al n
70 60 50 40 30 20

2.0 6.0 66. 26. 100

Interpretation:

Percent

BABASAB PATIL
10 0 1 3 4 5

70
IC I m IC utual fund

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Majority of the investors are not preferring UTI mutual funds as their returns are very low when compared to other 3 companies but it is ranked 4th that shows it is performing good than UTI mutual fund.

Findings
32% of the Investors have come to know about Reliance mutual fund through Brokers/Agents followed by 30% who have come to know through Financial Consultants 60% of the Investors are giving more preference to Equity schemes as they are giving higher return whereas 40% of them prefer Debt Schemes because of the Safety they provide 52% of the investors prefer Reliance Growth Fund followed by Reliance Vision Fund and other Schemes. 66% of the investors give most importance to Rate of return as they expect higher and higher returns followed by Safety as it is also important aspect of investors. Reliance Mutual Fund is Ranked 2nd by the Investors i.e. 68% of them have ranked Reliance as 2nd and Franklin Templeton is Ranked 1st.

BABASAB PATIL 71

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

SUGGESTIONS Holding a seminar and presentations or Investors meet in the stock broking firm help the investors to remove any misconception regarding the Mutual Fund and this will create awareness of Mutual fund. Agents are the main person who influences the investment decision. Company can hire fresh graduates train them and sponsor for the AMFI exam just like insurance companies who conduct IRDA training. This will increase the feet on street for the mutual fund companies. Company has to provide timely services to its customers so that it can compete with its competitors like Franklin Templeton and HDFC.

CONCLUSION
After the analysis made on the performance of Equity Schemes of Reliance Mutual Fund I can conclude that Equity schemes are most preferred by Investors and overall BABASAB PATIL 72

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Reliance Vision Fund and Reliance Growth scheme are doing extremely well in the market satisfying the customer wants of high returns and also through survey conducted it is clear that Reliance is performing quite well so it has been ranked 2nd among the selected companies. From the study we also came to know that according to Sharpe s Reliance Vision fund is ranked First but according to Treynors Reliance growth fund is ranked First.

CONTENTS

QUESTIONAREE BABASAB PATIL 73

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

ANNEXURE BIBLOGRAPHY

QUESTIONNAIRE Dear Sir/Madam:

Personal Details:
Name Address Occupation Contact No : _____________________________________________ : _____________________________________________ : _____________________________________________ : _____________________________________________

BABASAB PATIL 74

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

1. How did you come to know about Reliance mutual Fund? Friends /Relatives Brokers/Agents Other_________________________ 2. Which Schemes of Reliance Mutual fund would you prefer the most? Equity Schemes Debt Scheme News papers / magazines Financial consultants.

3. Which Equity Scheme you prefer the most in Reliance Mutual Fund? (Rank them from 1 to 5, 1 being the most preferred and 5 being the least) Reliance Growth Reliance Vision Fund Reliance Equity Opportunity Fund Reliance Tax Saver (ELSS) Fund Reliance Equity Fund [ ] [ ] [ ] [ ] [ ]

4. What factors do you consider while investing in mutual fund? (Rank them from 1 to 6. No1 for preferred and No 6 for least preferred) Safety Liquidity Flexibility Rate of return Tax benefit Brand Name

5. How would you rate Reliance mutual fund when compared to the other mutual Fund? (Rank them from 1 to 5, 1 being the Highest & 5 being the lowest). BABASAB PATIL 75

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Reliance HDFC Franklin Templeton UTI Pru ICICI

[ ] [ ] [ ] [ ] [ ]

THANK YOU

Annexure
Details about top schemes
RELIANCE VISION FUND
Structure Inception Date Corpus Minimum Invst Fund Manager Entry Load Exit Load Investment Objective Open ended Equity Growth Scheme 08/10/1995 2473.68 crore 5000 Ashwini Kumar 2.25% Nil The primary investment objective of the scheme is to achieve long-term growth of capital by investment in equity and equityrelated securities through a research-based investment approach. BABASAB PATIL 76

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

RELIANCE GROWTH FUND


Structure Inception Date Corpus Minimum Invst Fund Manager Entry Load Exit Load Investment Objective Open ended Equity Growth Scheme 08/10/1995 3263.71 5000 Sunil Singhania 2.25% Nil The primary investment objective of the scheme is to achieve long-term growth of capital by investing in equity and equity related securities through a research-based investment approach.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

RELIANCE TAX SAVER FUND


Structure Inception Date Corpus Minimum Invst Fund Manager Entry Load Exit Load Investment Objective Open ended Equity Growth Scheme 22/09/2005 1501.78 500 Ashwani Kumar 2.25% Nil The primary objective of the scheme is to generate long-term capital appreciation from a portfolio that is invested predominantly in equity and equity-related instruments.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

RELIANCE EQUITY OPPURTUNITY FUND


Structure Inception Date Corpus Minimum Invst Fund Manager Entry Load Exit Load Investment Objective Open ended Equity Growth Scheme 31/03/2005 Rs 2,385.65 crore 5000
.

Sailesh Raj Bhan

2.25% Nil The primary investment objective of the scheme is to seek to generate capital appreciation and provide long-term growth opportunities by investing in a portfolio constituted of equity securities & equity-related securities and the secondary objective is to generate consistent returns by investing in Debt and Money Market securities.

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Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

RELIANCE EQUITY FUND


Structure Inception Date Corpus Minimum Invst Fund Manager Entry Load Exit Load Investment Objective Open ended Equity Growth Scheme 30/03/2006 Rs 4359.6 crore 5000
.

Sailesh Raj Bhan

2.25% Nil The primary investment objective of the scheme is to seek to generate capital appreciation and provide long-term growth opportunities by investing in a portfolio constituted opportunities by investing in a portfolio constituted of equity and equity related securities of top 100 companies by market capitalization and of companies which are available in the derivatives segment from time to time and the secondary objective is to generate consistent returns by investing in debt and money market securities.

BABASAB PATIL 80

Comparative study on performance of Equity Schemes of Reliance Mutual Fund.

Bibliography
Reliance Fact Sheets Invest smart financial Journal Websites - www.myris.com - www.reliancemf.com - www.equitymaster.com

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