A study and analysis of mutual funds as an investment decision. (w.r.

t State Bank of India)

Final Synopsis Submitted to the Padmashree Dr. D.Y. Patil University In partial fulfillment of the requirements for the award of the Degree of

MASTERS IN BUSINESS ADMINISTRATION

Submitted by: Mr. AjayJayakumar (Roll No.09106)

Research Guide:

Ms. Shaheda Sheikh

Department of Business Management
Padmashree Dr. D.Y. Patil University CBD Belapur, Navi Mumbai

March 2011

CHAPTERIZATION Chapter No.

A 1 2 3 4 4.1 4.1.1 4.1.2 4.2 4.3 5 6 7 8 9 10 10. 1 10.1. 1 10. 2 10. 3

Index
List of Abbreviations Executive Summary. Problems of definitions. Objective of the study. Research Methodology. Sources of Data Collection. Primary Data. Secondary Data. Sampling Techniques. Literature Review. Introduction of Mutual Funds. Introduction of SBI. Data Analysis and Interpretation. Conclusion and Recommendations. Limitations of the study. Reference Section. Annexure. Questionnaire. Bibliography. Webliography.
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Page No.

5 6 7 8 8 9 10 11 12 13 13 13 14 14 14 17 17

Chapter No. 1 Executive Summary

In few years Mutual Fund has emerged as a tool for ensuring ones financial well being. Mutual Funds have not only contributed to the India growth story but have also helped families tap into the success of Indian Industry. As information and awareness is rising more and more people are enjoying the benefits of investing in mutual funds. The main reason the number of retail mutual fund investors remains small is that nine in ten people with incomes in India do not know that mutual funds exist. But once people are aware of mutual fund investment opportunities, the number who decide to invest in mutual funds increases to as many as one in five people. The trick for converting a person with no knowledge of mutual funds to a new Mutual Fund customer is to understand which of the potential investors are more likely to buy mutual funds and to use the right arguments in the sales process that customers will accept as important and relevant to their decision

This Project gave me a great learning experience and at the same time it gave me enough scope to implement my analytical ability. The analysis and advice presented in this Project Report is based on market research on the saving and investment practices of the investors and preferences of the investors for investment in Mutual Funds. This Report will help to know about the investors Preferences in Mutual Fund means Are they prefer any particular Asset Management Company (AMC), Which type of Product they prefer, Which Option (Growth or Dividend) they prefer or Which Investment Strategy they follow (Systematic Investment Plan or One time Plan). This Project as a whole can be divided into two parts. The first part gives an insight about Mutual Fund and its various aspects, the Company Profile, Objectives of the study, Research Methodology. One can have a brief knowledge about Mutual Fund and its basics through the Project. The second part of the Project consists of data and its analysis collected through survey done on 200 people. For the collection of Primary data I made a questionnaire and surveyed of 200 people. I also taken interview of many People those who were coming at the SBI Branch where I done my Project. This Project covers the topic THE MUTUAL FUND IS BETTER INVESTMENT PLAN. The data collected has been well organized and presented. I hope the research findings and conclusion will be of use.

Chapter No. 2
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Objective of the Study

1. To find out the Asset Management Company which is more pre-

ferred by customers?
2. To know portfolio of mutual funds in which customer like to in-

vest. 3. To know why one has invested or not invested in SBI Mutual fund
4. To find out the most preferred channel of investment of cus-

tomers..
5. To find out what should be done to boost the Mutual Fund Indus-

try.

Chapter No. 3 Problem of Definition

A big boom has been witnessed in Mutual Fund Industry in resent times. A large number of new players have entered the market and trying to gain market share in this rapidly improving market. The study will help to know the preferences of the customers, which company, portfolio, mode of investment, option for getting return and so on they prefer. This project report may help the company to make further planning and strategy.

Chapter No. 4 Research Methodology

A research methodology is a logical and systematic plan prepared for directing a research study. It is the program that guides the investigator in the process of collecting, analyzing and interpreting observations.

RESEARCH DESIGN
This report is based on primary as well secondary data, however primary data collection was given more importance since it is overhearing factor in attitude studies. One of the most important users of research methodology is that it helps in identifying the problem, collecting, analyzing the required information data and providing an alternative solution to the problem .It also helps in collecting the vital information that is required by the top management to assist them for the better decision making both day to day decision and critical ones.

444Sources of Data Collection: Research is totally based on primary data. Secondary data can be used only for the reference. Research has been done by primary data collection, and primary data has been collected by interacting with various people. The secondary data has been collected through various journals and websites.

4.1.1 Primary Data The present study has used survey method for collecting the primary data by directly interviewing customers with questionnaire.

Questionnaire. Interviews with Customers.

4.1.2 Secondary Data Secondary data for the study were collected from the library reference, technical and subject based books, journals and magazines, websites and other previous studies Tool for Data collection A well structured questionnaire was used to collect the primary data from the customers. The customers were given multiple choices to select their particular answers. A copy of the questionnaire is enclosed in the annexure Internet

 www.google.com www.mutualfunds.com www.sbi.com WWW.SBIMF.COM WWW.MONEYCONTROL.COM WWW.AMFIINDIA.COM WWW.ONLINERESEARCHONLINE.COM

Books

4.2Sampling Techniques: 4.2.1 Sample size:200 The researcher has to select a relevant fraction of the population, which is a representative of the entire population. The sampling size will be small in the case of the descriptive study where less than 1 percent is sufficient to provide reliable results. Here the sample size is 200 samples and it is limited to the area of Mumbai. 4.2.2 Sampling Method: Convenience Sampling.

A part of the population is known as sample. The process of drawing sample from a population is known as a sampling. Non probability sampling It is not based on the theory of probability. It does not provide a chance of selection each population element. The merit of this type sampling is simplicity, convenience and low 9

cost. Convenience sampling is the sampling technique used here. In this sampling we select whatever sampling unit is conveniently available. It lays groundwork for subsequent probability sampling.

4.3 Literature review

A literature review is a body of text that aims to review the critical points of current knowledge including substantive findings as well as theoretical and methodological contributions to a particular topic. Literature reviews are secondary sources, and as such, do not report any new or original experimental work. A literature review usually precedes a research proposal and results section. Its ultimate goal is to bring the reader up to date with current literature on a topic and forms the basis for another goal, such as future research that may be needed in the area.

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Chapter No. 5 Introduction of Mutual funds

Mutual fund is a trust that pools the savings of a number of investors who share a common financial goal. This pool of money is invested in accordance with a stated objective. The joint ownership of the fund is thus Mutual, i.e. the fund belongs to all investors. The money thus collected is then invested in capital market instruments such as shares, debentures and other securities. The income earned through these investments and the capital appreciations realized are shared by its unit holders in proportion the number of units owned by them. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost. A Mutual Fund is an investment tool that allows small investors access to a well-diversified portfolio of equities, bonds and other securities. Each shareholder participates in the gain or loss of the fund. Units are issued and can be redeemed as needed. The funds Net Asset value (NAV) is determined each day. 11

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 accordance with quantum of money invested by them. Investors of mutual funds are known as unit holders.

Chapter No. 6 Introduction of SBI

SBI Funds Management Pvt. Ltd. is one of the leading fund houses in the country with an investor base of over 4.6 million and over 20 years of rich experience in fund management consistently delivering value to its investors. SBI Funds Management Pvt. Ltd. is a joint venture between 'The State Bank of India' one of India's largest banking enterprises, and Socit Gnrale Asset Management (France), one of the world's leading fund management companies that manages over US$ 500 Billion worldwide. Today the fund house manages over Rs 28500 crores of assets and has a diverse profile of investors actively parking their investments across 36 active schemes. In 20 years of operation, the fund has launched 38 schemes and successfully redeemed 15 of them, and in the process, has rewarded our investors with consistent returns. Schemes of the Mutual Fund have time after time outperformed benchmark indices, honored us with 15 awards of performance and have emerged as the preferred investment for millions of in-

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vestors. The trust reposed on us by over 4.6 million investors is a genuine tribute to our expertise in fund management. SBI Funds Management Pvt. Ltd. serves its vast family of investors through a network of over 130 points of acceptance, 28 Investor Service Centres, 46 Investor Service Desks and 56 Distri

Chapter No. 7 Data Analysis and Data Interpretation

Data analysis and Data interpretation will be done on the basis of questionnaire once which is filled by customers.

Chapter No. 8 Recommendation and Conclusion

Tentative recommendation is to be done on the basis of questionnaire and tentative conclusion is to be done on the basis of primary and secondary data obtained.

Chapter No. 9 Limitation of the Study

1. The study confined to only Mumbai. Therefore the results cannot be generalized. 2. Customers might reluctant to answer certain questions dependent on the nature of the response given by them. 13

3. Limited time available for interviewing the respondents.

Chapter No. 10 Reference Section

10.1 Annexure

QUESTIONNAIRE
A study of preferences of the investors for investment in mutual funds.
1. Personal Details: (a). Name:(b). Add: (c). Age:(d). Qualification:Graduation/PG Under Graduate Others Phone:-

(e). Occupation. Pl tick () Govt. Ser Pvt. Ser Business Agriculture Others

(g). What is your monthly family income approximately? Pl tick ().

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Up to Rs.10,000

Rs. 10,001 to 15000

Rs. 15,001 to 20,000

Rs. 20,001 to 30,000

Rs. 30,001 and above

2. What kind of investments you have made so far? Pl tick (). All applicable. a. Saving account e. Post Office-NSC, etc b. Fixed deposits f. Shares/Debentures c. Insurance g. Gold/ Silver d. Mutual Fund h. Real Estate

3. While investing your money, which factor will you prefer? . (a) Liquidity (b) Low Risk (c) High Return

(d) Trust

4. Are you aware about Mutual Funds and their operations? Pl tick ().

Yes

No

5. If yes, how did you know about Mutual Fund? a. Advertisement b. Peer Group c. Banks d. Financial Advisors Yes No

6. Have you ever invested in Mutual Fund? Pl tick (). 7. If not invested in Mutual Fund then why? (a) Not aware of MF (b) Higher risk (c) Not any specific reason

8. If yes, in which Mutual Fund you have invested? Pl. tick (). All applicable. a. SBIMF b. UTI c. HDFC d. Reliance e. Kotak f. Other. specify

9. If invested in SBIMF, you do so because (Pl. tick (), all applicable). a. SBIMF is associated with State Bank of India. b. They have a record of giving good returns year after year. c. Agent Advice 10. If NOT invested in SBIMF, you do so because (Pl. tick () all applicable).

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a. You are not aware of SBIMF. b. SBIMF gives less return compared to the others. c. Agent Advice

11. When you plan to invest your money in asset management co. which AMC will you prefer? Assets Management Co. a. SBIMF b. UTI c. Reliance d. HDFC e. Kotak f. ICICI

12. Which Channel will you prefer while investing in Mutual Fund? (a) Financial Advisor (b) Bank (c) AMC

13. When you invest in Mutual Funds which mode of investment will you prefer? Pl. tick (). a. One Time Investment b. Systematic Investment Plan (SIP)

14. When you want to invest which type of funds would you choose? a. Having only debt portfolio b. Having debt & equity portfolio. c. Only equity portfolio.

15. How would you like to receive the returns every year? Pl. tick (). a. Dividend payout b. Dividend re-investment c. Growth in NAV

16. Instead of general Mutual Funds, would you like to invest in sectorial funds? Please tick (). Yes No

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10.2 BIBLIOGRAPHY
10.3 Webliography www.google.com www.mutualfunds.com www.sbi.com WWW.SBIMF.COM WWW.MONEYCONTROL.COM WWW.AMFIINDIA.COM WWW.ONLINERESEARCHONLINE.COM

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