Professional Documents
Culture Documents
Report
on the topic
1
NC College of Engineering
Israna, Panipat
SESSION 2008 – 2010
ACKNOWLEDGEMENT
The success behind the completion of any good job is the support and the joint
team effort of a number of people. There are many persons, whose help &
cooperation, made this project successful.
My deepest sense of gratitude, profound respect and sincere thanks to Mr. Mani
shreshtha ( Faculty member, M.B.A. Deptt., N.C. College of Engineering) my
project guide & also give special thanks to Mr. Lalit Asija ( Faculty member,
M.B.A. Deptt., N.C. College of Engineering) for his valuable assistance, keen
interest and constant motivation at each step of the project. It would not have
been possible for me to reach this stage without my faculty’s support & guidance.
I would also like to thank my parents and my friends for all their time-to-time
assistance. Last but not the least I would like to thank God because without his
divine grace nothing would have been possible.
2
ANKIT
3
Recommendation 68
Learning 69
BIBLIOGRAPHY 73
CHAPTER -1
INTRODUCTION
4
OVERVIEW OF INDUSTRY
Individuals or institutions when have surplus money, i.e. savings, would like to
invest with the common and logical motive of growing money by getting returns
on the investments. There are various avenues to park money towards fulfillment
of your objective of return on investment.
One can invest money either where you can get assured returns & hence the risk
is low but returns also are low compared to the high risk investments.
The other way is through investing in shares i.e. equity market. Generally the
returns on equity investments are higher than debt investment but risk also is
higher. To get good returns one really needs to understand the economy and
performance of companies where you are investing money. For a common man it
may be cumbersome while managing own profession, job or business.
5
Hence the concept of mutual fund has evolved to manage the funds i.e. on behalf
of the investor; fund managers will be taking decisions to maximize the investor’s
returns.
The concept of mutual funds in India dates back to the year 1963. The era
between 1963 and 1987 marked the existence of only one mutual fund company
in India with Rs. 67bn assets under management (AUM), by the end of its
monopoly era, the Unit Trust of India (UTI). By the end of the 80s decade, few
other mutual fund companies in India took their position in mutual fund market.
The new entries of mutual fund companies in India were SBI Mutual Fund,
Canbank Mutual Fund, Punjab National Bank Mutual Fund, Indian Bank Mutual
Fund, Bank of India Mutual Fund.
The succeeding decade showed a new horizon in Indian mutual fund industry. By
the end of 1993, the total AUM of the industry was Rs. 470.04 bn. The private
sector funds started penetrating the fund families. In the same year the first
Mutual Fund Regulations came into existence with re-registering all mutual funds
except UTI. The regulations were further given a revised shape in 1996.
Kothari Pioneer was the first private sector mutual fund company in India which
has now merged with Franklin Templeton. Just after ten years with private sector
player penetration, the total assets rose up to Rs. 1218.05 bn. Today there are 34
mutual fund companies in India.
6
MUTUAL FUND
Advantages of a MF
– Mutual Funds provide the benefit of cheap access to expensive
stocks
7
– Mutual funds diversify the risk of the investor by investing in a
basket of assets
The Indian mutual industry has come a long way since the inception of UTI in
1963.According to AMFI, the evolution of the industry can be classified broadly into four
phases, which mark its transition from a period when UTI ruled the roost to a period of
competition and increased awareness among investors.
8
Public sector mutual funds set up by public sector banks, Life insurance Corporation of
India (LIC) and the General insurance Corporation of India (GIC) entered in the market in
1987. The first non mutual fund was the SBI Mutual Fund established in June 1987,
followed by Canbank Mutual Fund in December 1987, Punjab National Bank Mutual
Fund in August 1989, India Bank Mutual Fund in Nov 1989, Bank of India Mutual Fund in
June 1990 and Bank of Baroda Mutual Fund in Oct 1992. LIC set up its mutual Fund in
Jun e 1989 while GIC established its Mutual Fund in Dec 1990. During this period, the
total asset of the industry grew to about Rs. 610bn with the total number of schemes
increasing to about 167 by the end of 1994.
iv) Fourth Phase (since Feb 2003)– UTI’s restructuring and beyond
In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI was
bifurcated into two separate entities. One is the Specified Undertaking of the Unit Trust
of India with assets under management of Rs.29,835 crores as at the end of January
2003, representing broadly, the assets of US 64 scheme, assured return and certain
other schemes. The Specified Undertaking of Unit Trust of India, functioning under an
administrator and under the rules framed by Government of India and does not come
under the purview of the Mutual Fund Regulations.
The second is the UTI Mutual Fund, sponsored by SBI, PNB, BOB and LIC. It is
registered with SEBI and functions under the Mutual Fund Regulations. With the
bifurcation of the erstwhile UTI which had in March 2000 more than Rs.76,000 crores of
assets under management and with the setting up of a UTI Mutual Fund, conforming to
the SEBI Mutual Fund Regulations, and with recent mergers taking place among
9
different private sector funds, the mutual fund industry has entered its current phase of
consolidation and growth.
10
Categories of mutual funds:
11
Mutual funds can be classified as follow:
• Open-ended funds: Investors can buy and sell the units from the fund, at
any point of time.
• Close-ended funds: These funds raise money from investors only once.
Therefore, after the offer period, fresh investments can not be made into the
fund. If the fund is listed on a stocks exchange the units can be traded like
stocks (E.g., Morgan Stanley Growth Fund). Recently, most of the New Fund
Offers of close-ended funds provided liquidity window on a periodic basis
such as monthly or weekly. Redemption of units can be made during specified
intervals. Therefore, such funds have relatively low liquidity.
Equity funds: These funds invest in equities and equity related instruments.
With fluctuating share prices, such funds show volatile performance, even losses.
However, short term fluctuations in the market, generally smoothens out in the
long term, thereby offering higher returns at relatively lower volatility. At the same
time, such funds can yield great capital appreciation as, historically, equities have
outperformed all asset classes in the long term. Hence, investment in equity
funds should be considered for a period of at least 3-5 years. It can be further
classified as:
i) Index funds- In this case a key stock market index, like BSE Sensex or Nifty is
tracked. Their portfolio mirrors the benchmark index both in terms of composition
and individual stock weightages.
12
ii) Equity diversified funds- 100% of the capital is invested in equities spreading
across different sectors and stocks.
iii|) Dividend yield funds- it is similar to the equity diversified funds except that
they invest in companies offering high dividend yields.
iv) Thematic funds- Invest 100% of the assets in sectors which are related
through some theme.
e.g. -An infrastructure fund invests in power, construction, cements sectors etc.
v) Sector funds- Invest 100% of the capital in a specific sector. e.g. - A banking
sector fund will invest in banking stocks.
vi) ELSS- Equity Linked Saving Scheme provides tax benefit to the investors.
Balanced fund: Their investment portfolio includes both debt and equity. As a
result, on the risk-return ladder, they fall between equity and debt funds.
Balanced funds are the ideal mutual funds vehicle for investors who prefer
spreading their risk across various instruments. Following are balanced funds
classes:
Debt funds: They invest only in debt instruments, and are a good option for
investors averse to idea of taking risk associated with equities. Therefore, they
invest exclusively in fixed-income instruments like bonds, debentures,
Government of India securities; and money market instruments such as
certificates of deposit (CD), commercial paper (CP) and call money. Put your
13
money into any of these debt funds depending on your investment horizon and
needs.
i) Liquid funds- These funds invest 100% in money market instruments, a large
portion being invested in call money market.
ii) Gilt funds ST- They invest 100% of their portfolio in government securities of
and T-bills.
iii) Floating rate funds - Invest in short-term debt papers. Floaters invest in debt
instruments which have variable coupon rate.
iv) Arbitrage fund- They generate income through arbitrage opportunities due to
mis-pricing between cash market and derivatives market. Funds are allocated to
equities, derivatives and money markets. Higher proportion (around 75%) is put
in money markets, in the absence of arbitrage opportunities.
v)Gilt funds LT- They invest 100% of their portfolio in long-term government
securities.
vi) Income funds LT- Typically, such funds invest a major portion of the portfolio
in long-term debt papers.
vii) MIPs- Monthly Income Plans have an exposure of 70%-90% to debt and an
exposure of 10%-30% to equities.
viii)FMPs- fixed monthly plans invest in debt papers whose maturity is in line with
that of the fund.
14
Investment strategies:
1. Systematic Investment Plan: Under this a fixed sum is invested each month
on a fixed date of a month. Payment is made through post dated cheques or
direct debit facilities. The investor gets fewer units when the NAV is high and
more units when the NAV is low. This is called as the benefit of Rupee Cost
Averaging (RCA)
2. Systematic Transfer Plan: Under this an investor invest in debt oriented fund
and give instructions to transfer a fixed sum, at a fixed interval, to an equity
scheme of the same mutual fund.
3. Systematic Withdrawal Plan: If someone wishes to withdraw from a mutual
fund then he can withdraw a fixed amount each month.
15
Investors have to bear expenses for availing of the services (professional
management) of the mutual fund. The first expense that an investor has to incur
is by way of Entry Load. This is charged to meet the selling and distribution
expenses of the scheme. A major portion of the Entry Load is used for paying
commissions to the distributor. The distributor (also called a mutual fund advisor)
could be an Independent Financial Advisor, a bank or a large national distributor
or a regional distributor etc. They are the intermediaries who help an investor with
choosing the right scheme, financial planning and investing in scheme s from
time to time to meet one’s requirements.
As there are Entry Loads, there exist Exit Loads as well. As Entry Loads
increase the cost of buying, similarly Exit Loads reduce the amount received
by the investor. Not all schemes have an Exit Load, and not all schemes have
similar exit loads as well. Some schemes have Contingent Deferred Sales
Charge (CDSC). This is nothing but a modified form of Exit Load, wherein the
investor has to pay different Exit Loads depending upon his investment
period.
If the investor exits early, he will have to bear more Exit Load and if he
remains invested for a longer period of time, his Exit Load will reduce. Thus
the longer the investor remains invested, lesser is the Exit Load. After some
time the Exit Load reduces to nil; i.e. if the investor exits after a specified
time period, he will not have to bear any Exit Load.
16
Risk v/s. return:
17
Working of a Mutual fund:
18
ORGANIZATIONAL STRUCTURE OF MF’S:
There are
many entities
involved
and the diagram
below
ADVANTAGES OF INVESTING IN A
MUTUAL FUND
19
another share. By participating in a mutual fund you become an owner of just
one security, but at the same time enjoy the positive effects of diversification.
• Liquidity: With most funds, you can easily sell your fund shares for cash.
Some mutual fund shares are traded only once a day at a fixed price, while
stocks and bonds can be bought or sold any time the markets are open at
whatever price is then available. It's easy to get your money out of a mutual
fund. Write a check, make a call, and you've got the cash.
• Economies of Scale: The easiest way to understand economic of scale is
by thinking about volume discounts: in many stores the more of one product
you buy, the cheaper that product becomes. For example, when you buy a
dozen donuts, the price per donut is usually cheaper than buying a single
one. This occurs also in the purchase and sale of securities. If you buy only
one security at a time, the transaction fees will be relatively large. Mutual
funds are able to take advantage of their buying and selling size and thereby
reduce transaction cost for investors.
20
• Regulatory oversight: Mutual funds are subject to many government
regulations that protect investors from fraud.
• Convenience: You can usually buy mutual fund shares by mail, phone, or
over the Internet.
21
DISADVANTAGES OF MUTUAL FUNDS
• No Control: Unlike picking your own individual stocks, a mutual fund puts
you in the passenger seat of somebody else's car.
22
better than you or I at picking stocks. Management is by no means infallible,
and, even if the fund loses money, the manager still takes his/her cut. We'll
talk about this in detail in a later section.
• Costs: Mutual funds don't exist solely to make your life easier--all funds
are in it for a profit. The mutual fund industry is masterful at burying costs
under layers of jargon. These costs are so complicated that in this tutorial we
have devoted an entire section to the subject.
• Taxes: When making decisions about your money, fund managers don't
consider your personal tax situation. For example, when a fund manager sells
a security, a capital-gain tax is triggered, which affects how profitable the
individual is from the sale. It might have been more advantageous for the
individual to defer the capital gains liability.
23
RISKS ASSOCIATED WITH MUTUAL FUNDS
MARKET RISK
24
Sometimes prices and yields of all securities rise and fall. Broad outside
influences affecting the market in general lead to this. This is true, may it be big
corporations or smaller mid-sized companies. This is known as Market Risk. A
Systematic Investment Plan (“SIP”) that works on the concept of Rupee Cost
Averaging (“RCA”) might help mitigate this risk.
CREDIT RISK
INFLATION RISK
Things you hear people talk about: “Rs. 100 today is worth more than Rs. 100
tomorrow.” “Remember the time when a bus ride costed 50 paisa?” “Mehangai
Ka Jamana Hai.”
The root cause , Inflation. Inflation is the loss of purchasing power over time. A lot
of times people make conservative investment decisions to protect their capital
but end up with a sum of money that can buy less than what the principal could at
the time of the investment. This happens when inflation grows faster than the
return on your investment. A well-diversified portfolio with some investment in
equities might help mitigate this risk.
In a free market economy interest rates are difficult if not impossible to predict.
Changes in interest rates affect the prices of bonds as well as equities. If interest
25
rates rise the prices of bonds fall and vice versa. Equity might be negatively
affected as well in a rising interest rate environment. A well-diversified portfolio
might help mitigate this risk.
POLITICAL RISK
Changes in government policy and political decision can change the investment
environment. They can create a favorable environment for investment or vice
versa.
LIQUIDITY RISK
Liquidity risk arises when it becomes difficult to sell the securities that one has
purchased. Liquidity Risk can be partly mitigated by diversification, staggering of
maturities as well as internal risk controls that lean towards purchase of liquid
securities. You have been reading about diversification above, but what is it?
Diversification The nuclear weapon in your arsenal for your fight against Risk. It
simply means that you must spread your investment across different securities
(stocks, bonds, money market instruments, real estate, fixed deposits etc.) and
different sectors (auto, textile, information technology etc.). This kind of a
diversification may add to the stability of your returns,
26
Major Mutual Fund Companies in India:
27
The mutual fund of ICICI is a joint venture with Prudential
Plc. of America, one of the largest life insurance companies in the US of A.
Prudential ICICI Mutual Fund was setup on 13th of October, 1993 with two
sponsors, Prudential Plc. and ICICI Ltd. The Trustee Company formed is
Prudential ICICI Trust Ltd. and the AMC is Prudential ICICI Asset Management
Company Limited incorporated on 22nd of June, 1993.
ABN AMRO Mutual Fund was setup on April 15, 2004 with ABN
AMRO Trustee (India) Pvt. Ltd. as the Trustee Company. The AMC, ABN AMRO
Asset Management (India) Ltd. was incorporated on November 4, 2003.
Deutsche Bank AG is the custodian of ABN AMRO Mutual Fund.
Birla Sun Life Mutual Fund is the joint venture of Aditya Birla
Group and Sun Life Financial. Sun Life Financial is a global organization evolved
28
in 1871 and is being represented in Canada, the US, the Philippines, Japan,
Indonesia and Bermuda apart from India. Birla Sun Life Mutual Fund follows a
conservative long-term approach to investment. Recently it crossed AUM of Rs.
10,000 crores.
HSBC Mutual Fund was setup on May 27, 2002 with HSBC
Securities and Capital Markets (India) Private Limited as the
sponsor.
29
State Bank of India Mutual Fund is the first Bank
sponsored Mutual Fund to launch offshore fund, the India Magnum Fund with a
corpus of Rs. 225 cr. approximately. Today it is the largest Bank sponsored
Mutual Fund in India. They have already launched 35 Schemes out of which 15
have already yielded handsome returns to investors. State Bank of India Mutual
Fund has more than Rs. 5,500 Crores as AUM. Now it has an investor base of
over 8 Lakhs spread over 18 schemes.
Tata Mutual Fund (TMF) is a Trust under the Indian Trust Act,
1882. The sponsors for Tata Mutual Fund are Tata Sons Ltd., and Tata
Investment Corporation Ltd. The investment manager is Tata Asset Management
Limited and Tata Trustee Company Pvt. Ltd. Tata Asset Management Limited's is
one of the fastest in the country with more than Rs. 7,703 Crores (on April 30,
2005).
Escorts Mutual Fund was setup on April 15, 1996 with Escorts
Finance Limited as its sponsor. The Trustee Company is Escorts Investment
Trust Limited. Its AMC was incorporated on December 1, 1995 with the name
Escorts Asset Management Limited.
Alliance Capital Mutual Fund was setup on December 30, 1994 with
Alliance Capital Management Corp. of Delaware (USA) as sponsor. The Trustee
is ACAM Trust Company Pvt. Ltd. and AMC, the Alliance Capital Asset
Management India Private Ltd. with the corporate office in Mumbai.
31
Chola Mutual Fund under the sponsorship of Cholamandalam
Investment & Finance Company Ltd. was setup on January 3,
1997. Cholamandalam Trustee Co. Ltd. is the Trustee Company and AMC is
Cholamandalam AMC Limited.
32
The Players in the Mutual Fund Industry
The players in the Indian Mutual Funds Industry are similar to some extent to the players
in other financial services industry. The players are as follows:
SEBI
The Securities Exchange Board of India (SEBI) is the regulatory authority for all the
mutual funds sponsored by the public/private sector banks, financial institutions, private
sector companies, non- banking finance companies and foreign institutional investors.
SEBI has laid down the rules and regulations regarding the obligations of the entities
involves in a mutual fund, its establishment and launch of different schemes, investments
and valuation, financial reporting, conduct and operations of mutual funds.
Intermediaries
They act as a link between the mutual fund companies and the investors. The
intermediaries include brokers, sub- brokers, and investment houses. The other
intermediary- registrar and transfer agents perform activities, which are associated with
maintaining records concerning units already issued or to be issued by the company.
The registrar also performs other activities such as dividend payment, investor
grievance, etc.
Investors
Investors subscribe to the units issued by the mutual funds in the hope of getting a return
commensurate with the risk involved. SEBI protects the interest of the investors through
the guidelines laid down under SEBI (Disclosure and Investor Protection) Guidelines,
2000. The mutual fund investor mainly includes individual, HUF, corporate and trusts.
AnandRathi (AR) is a leading full service securities firm providing the entire
gamut of financial services. The firm, founded in 1994 by Mr. AnandRathi, today
has a pan India presence as well as an international presence through offices in
Dubai and Bangkok. AR provides a breadth of financial and advisory services
including wealth management, investment banking, corporate advisory,
brokerage & distribution of equities, commodities, mutual funds and insurance,
structured products - all of which are supported by powerful research teams.
The firm's philosophy is entirely client centric, with a clear focus on providing long
term value addition to clients, while maintaining the highest standards of
excellence, ethics and professionalism. The entire firm activities are divided
across distinct client groups: Individuals, Private Clients, Corporate and
Institutions and was recently ranked by Asia Money 2006 poll amongst South
Asia's top 5 wealth managers for the ultra-rich.
AR VISION
34
Milestones
AR CORE STRENGTHS
• 1994:
Started activities in consulting and Institutional equity sales with staff of 15
• 1995:
Set up a research desk and empanelled with major institutional investors
• 1997:
Introduced investment banking businesses
Retail brokerage services launched
• 1999:
Lead managed first IPO and executed first M & A deal
• 2003:
Wealth Management assets cross Rs1500 crores
Insurance broking launched
Launch of Wealth Management services in Dubai
Retail Branch network exceeds 50
• 2004:
Commodities brokerage and real estate services introduced
Wealth Management assets cross Rs3000crores
Retail Branch network expands across 100 locations within India
• 2005:
Real Estate Private Equity Fund Launched
Retail Branch network expands across 200 locations within India
• 2006:
Ranked amongst South Asia's top 5 wealth managers for the ultra-rich by Asia
Ranked 6th in FY2006 for All India Broker Performance in equity distribution in the
Ranked 9th in the Retail Category having more than 5% market share
Completes its presence in all States across the country with offices at 300+
locations within India
• 2007:
Citigroup Venture Capital International picks up 19.9% equity stake
Retail customer base crosses 200 thousand
Establishes presence in over 450 locations
35
Breadth of Services
In line with its client-centric philosophy, the firm offers to its clients the entire
spectrum of financial services ranging from brokerage services in equities and
commodities, distribution of mutual funds, IPOs and insurance products, real
estate, investment banking, merger and acquisitions, corporate finance and
corporate advisory.
Clients deal with a relationship manager who leverages and brings together the
product specialists from across the firm to create an optimum solution to the
client needs.
Management Team
In-Depth Research
Our research expertise is at the core of the value proposition that we offer to our
clients. Research teams across the firm continuously track various markets and
products. The aim is however common - to go far deeper than others, to deliver
incisive insights and ideas and be accountable for results.
MANAGEMENT TEAM
36
Board Of Directors
SERVICES
Call N Trade
Mutual Fund
Depository Services
Commodities
Insurance
IPOs
Online Reports
37
In India where ANANDRATHI is present in 21 STATES:
Mutual fund
AR is one of India's top mutual fund distribution houses. Our success lies in our
philosophy of providing consistently superior, independent and unbiased advice
to our clients backed by in-depth research. We firmly believe in the importance of
selecting appropriate asset allocations based on the client's risk profile.
Depository Services
AR Depository Services provides you with a secure and convenient way for
holding your securities on both CDSL and NSDL. Our depository services include
settlement, clearing and custody of securities, registration of shares and
dematerialization. We offer you daily updated internet access to your holding
statement and transaction summary.
CDSL Depository
NSDL Depository
38
Commodities
Services provided :
Risk Management
Due diligence and research on policies available
Maintain proper records of client policies
Assist client in paying premiums
Continuous monitoring of client account
IPOS
We are a leading primary market distributor across the country. Our strong
performance in IPOs has been a result of our vast experience in the Primary
Market, a wide network of branches across India, strong distribution capabilities
and a dedicated research team. We have been consistently ranked among the
top 10 distributors of IPOs on all major offerings. Our IPO research team provides
clients with indepth overview of forthcoming IPOs as well as investment
recommendations. Online filling of forms is also available
• Communication gap
• No clear polices, rules and regulation
Lack of motivation factors d depository services through CDSL. Commodities
broking is supported by a dedicated research cell that provides both technical as
well as fundamental research. Our research covers a broad range of traded
39
commodities including precious and base metals, Oils and Oilseeds, agri-
commodities such as wheat, chana, guar, guar gum and spices such as sugar,
jeera and cotton.
Insurance Broking
List of Competitors
Karvy
Smc
India Bulls
Unicon
Parasram
Arihant
40
Annagram
Religare
Kotak Securities
R.K Global
Angel Broking
Reliance money
ICICI Direct
SWOT ANALYSIS
STRENGTH
WEAKNESS
• Customer dose not try to understand that what actually mutual fund is?
• Through-cut competition.
• Skillful labor is required.
• Need efficient persons to work
• High level of competition.
OPPORTUNITIES
• Target customers are large in number
• Customer is ready to purchase the product if right approach is taken
• Good Financial Position.
• It is taken as investment source
41
• It is a way to save the taxes.
THREATS
• Growing Market with lots of competitors.
• Promotion Scheme of Competitors.
• Less publicity may decrease its market share.
• Changing government policies will affect whole mutual fund plans.
42
CHAPTER-2
OBJECTIVE
&
METHDOLOGY
43
SIGNIFICANCE:
Significance of the project is to find out prospect investors of Mutual Funds and
also to provide key information about the investor’s perception and preferences
by Mutual Fund industry. The study will help in getting information about their
performance at distributors as well as at their own investment center or why
people go for Mutual Fund for investments. Study will also helps in finding out the
problems related to distribution.
The study will also give information about prospective investors both
individual as well as institutional clients in areas of surrey where they can
get lead.
The study provides the complete information about all close competitors in
Mutual Fund investment.
44
OBJECTIVES:
RETURN.
In current scenario, the bank rates have been cut down rapidly due to severe
competition, so people are not going for contemporary deposits because that
cannot provide them the better returns or the desired interest rates. So, they can
look for some other investment options like Mutual Funds, which can provide
them higher returns in medium to long term and can easily meet their financial
goals.
To look out for new prospective customers who are willing to invest in Mutual
Funds.
45
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.
.
I surveyed on my Project Topic “INTER FIRM COMPARISON BETWEEN
MUTUAL FUND INDUSTRY (2005-09)”
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.
RESEARCH METHODOLOGY
3. Sample Size: 8
46
CHAPTER-3
DATA ANALYSIS
&
INTERPRETATION
47
(A)EQUITY DIVERSIFIED
48
10/6/2008 29.809 33.55
10/7/2008 27.823 35.94
11/8/2008 30.312 32.99
10/9/2008 28.513 35.07
10/10/2008 20.631 48.47
10/11/2008 20.371 49.09
10/12/2008 18.031 55.46
12/1/2009 17.514 57.09
10/2/2009 17.857 56
12/3/2009 15.857 63.06
13/04/2009 19.971 50.07
11/5/2009 21.014 47.58
TOTAL 2314.14
49
10/5/2006 26.36 37.93
12/6/2006 18.58 53.82
10/7/2006 20.36 49.11
10/8/2006 21.6 46.29
11/9/2006 22.63 44.19
10/10/2006 24.73 40.43
10/11/2006 26.54 37.68
11/12/2006 27.58 36.26
10/1/2007 27.97 35.75
12/2/2007 28.13 35.55
12/3/2007 25.39 39.38
10/4/2007 26.34 37.96
10/5/2007 28.34 35.28
11/6/2007 29.68 33.69
10/7/2007 32.69 30.59
10/8/2007 32.72 30.56
10/9/2007 34.76 28.77
10/10/2007 41.63 24.02
12/11/2007 44.47 22.48
10/12/2007 48.04 20.81
10/1/2008 48.69 20.54
11/2/2008 37.86 26.41
10/3/2008 36.27 27.57
10/4/2008 34.42 29.05
12/5/2008 35.39 28.25
10/6/2008 31.53 31.71
10/7/2008 29.79 33.57
11/8/2008 32.14 31.11
10/9/2008 30.52 32.76
10/10/2008 23.03 43.42
10/11/2008 22.73 43.99
10/12/2008 20.97 47.68
12/1/2009 20.5 48.78
10/2/2009 21.07 47.46
12/3/2009 19.31 51.78
13/04/2009 23.21 43.08
11/5/2009 24.25 41.23
TOTAL 1999.09
50
“PLAN-1” Vs. “PLAN-2”
PLAN-1 PLAN-2
CONCLUSION: In SIP, plan-1 exceeds from plan-2 with the amount of Rs 151.41
CORRELATION
β(Beta) of PLAN-1=6.01
β(Beta) of PLAN-2=5.06
51
RESULT:
AS ABOVE STATED, WE CAN SEE THAT TATA INFRASTRUCTURE
FUND HAVE GOT MORE RETURNS WITH THEIR MORE RISK AS
COMPARABLE TO UTI INFRASTRUCTURE FUND
52
10/9/2007 16.068 62.23
10/10/2007 18.38 54.4
12/11/2007 19.781 50.55
10/12/2007 20.811 48.05
10/1/2008 21.646 46.19
11/2/2008 19.98 50.05
10/3/2008 16.245 61.56
10/4/2008 15.6 64.1
12/5/2008 16.77 59.63
10/6/2008 14.82 67.47
10/7/2008 13.85 72.2
11/8/2008 14.93 66.98
10/9/2008 14.32 69.83
10/10/2008 10.96 91.24
10/11/2008 11.35 88.1
10/12/2008 10.84 92.25
12/1/2009 11.03 90.66
10/2/2009 10.91 91.66
12/3/2009 9.27 107.87
13/04/2009 12.24 81.7
11/5/2009 13.32 75.07
TOTAL 3943.7
53
11/7/2005 15.014 66.6
10/8/2005 16.373 61.07
12/9/2005 17.786 56.22
10/10/2005 18.298 54.65
11/11/2005 17.923 55.79
12/12/2005 19.754 50.62
10/1/2006 21.818 45.83
10/2/2006 23.137 43.22
10/3/2006 23.781 42.05
10/4/2006 26.123 38.28
10/5/2006 28.1 35.59
12/6/2006 19.298 51.82
10/7/2006 20.79 48.1
10/8/2006 21.494 46.52
11/9/2006 22.528 44.39
10/10/2006 24.388 41
10/11/2006 25.995 38.47
11/12/2006 26.542 37.67
10/1/2007 28.269 35.37
12/2/2007 27.66 36.15
12/3/2007 25.419 39.34
10/4/2007 26.334 37.97
10/5/2007 27.281 36.65
11/6/2007 27.707 36.09
10/7/2007 29.884 33.46
10/8/2007 29.521 33.87
10/9/2007 31.482 31.76
10/10/2007 37.132 26.93
12/11/2007 40.196 24.88
10/12/2007 44.947 22.25
10/1/2008 45.54 21.95
11/2/2008 36.482 27.41
10/3/2008 34.323 29.13
10/4/2008 33.573 29.78
12/5/2008 35.37 28.27
10/6/2008 32.092 31.16
10/7/2008 30.582 32.7
11/8/2008 32.329 30.93
10/9/2008 31.751 31.49
10/10/2008 26.146 38.24
10/11/2008 25.146 39.76
10/12/2008 23.653 42.27
12/1/2009 23.587 42.39
10/2/2009 23.477 42.59
12/3/2009 20.653 48.42
13/04/2009 25.208 39.67
11/5/2009 26.926 37.14
TOTAL 1915.07
54
= 1915.07 X 26.926
=Rs. 51565.17
55
10/7/2008 130.304 7.67
11/8/2008 146.634 6.82
10/9/2008 145.154 6.89
10/10/2008 109.499 9.13
10/11/2008 106.985 9.34
10/12/2008 94.449 10.58
12/1/2009 95.425 10.48
10/2/2009 96.25 10.39
12/3/2009 85.204 11.73
13/04/2009 106.932 9.35
11/5/2009 115.32 8.67
TOTAL 386.8
Amt. Invested -Rs 48000 Amt. Invested- Rs 48000 Amt. Invested -Rs 48000
Amt. received -Rs 52530.08 Amt. received- Rs 51565.17 Amt. received-Rs 44605.77
CONCLUSION: In SIP, plan-1 exceeds from plan-2 & plan-3 with the amount of
Rs 964.9 & Rs.7924.3
56
CORRELATION
RESULT:
AS ABOVE STATED, WE CAN SEE THAT CANARA ROBECO
EQUITY TAX SAVER HAVE GOT MORE RETURNS WITH THEIR
57
MODERATE RISK AS COMPARABLE TO SUNDARAM BNP PARIBAS
TAX SAVER (OE) & HDFC TAX SAVER.
58
10/3/2008 13.956 71.65
10/4/2008 13.533 73.89
12/5/2008 14.194 70.45
10/6/2008 13.333 75
10/7/2008 12.774 78.28
11/8/2008 13.826 72.32
10/9/2008 13.344 74.94
10/10/2008 10.407 96.09
10/11/2008 11.0871 90.19
10/12/2008 10.38 96.34
12/1/2009 10.551 94.77
10/2/2009 10.478 95.44
12/3/2009 9.463 105.67
13/04/2009 12.054 82.96
11/5/2009 13.021 76.8
TOTAL 4139.377
59
10/1/2007 31.961 31.29
12/2/2007 31.298 31.95
12/3/2007 28.675 34.87
10/4/2007 29.59 33.79
10/5/2007 30.714 32.56
11/6/2007 31.41 31.84
10/7/2007 32.97 30.33
10/8/2007 32.594 30.68
10/9/2007 33.292 30.04
10/10/2007 35.968 27.8
12/11/2007 37.146 26.92
10/12/2007 39.281 25.46
10/1/2008 41.002 24.39
11/2/2008 36.655 27.28
10/3/2008 34.839 28.7
10/4/2008 34.362 29.1
12/5/2008 35.593 28.09
10/6/2008 33.257 30.07
10/7/2008 31.771 31.47
11/8/2008 34.63 28.88
10/9/2008 34.541 28.95
10/10/2008 27.49 36.38
10/11/2008 26.95 37.11
10/12/2008 24.951 40.07
12/1/2009 25.443 39.3
10/2/2009 25.84 38.7
12/3/2009 23.525 42.51
13/04/2009 28.242 35.41
11/5/2009 30.008 33.32
TOTAL 1646.64
60
10/8/2005 23.07 43.35
12/9/2005 24.65 40.57
10/10/2005 24.81 40.31
11/11/2005 24.8 40.32
12/12/2005 26.11 38.3
10/1/2006 27.55 36.3
10/2/2006 28.86 34.65
10/3/2006 29.82 33.53
10/4/2006 31.75 31.5
10/5/2006 33.72 29.66
12/6/2006 26.85 37.24
10/7/2006 28.62 34.94
10/8/2006 29.65 33.73
11/9/2006 30.36 32.94
10/10/2006 31.87 31.38
10/11/2006 33.53 29.82
11/12/2006 33.57 29.79
10/1/2007 34.28 29.17
12/2/2007 35.24 28.38
12/3/2007 32.93 30.37
10/4/2007 33.64 29.73
10/5/2007 34.64 28.87
11/6/2007 35.63 28.07
10/7/2007 37.02 27.01
10/8/2007 36.15 27.66
10/9/2007 37.43 26.72
10/10/2007 41.77 23.94
12/11/2007 42.85 23.34
10/12/2007 45.57 21.94
10/1/2008 46.66 21.43
11/2/2008 39.11 25.57
10/3/2008 38.34 26.08
10/4/2008 36.93 27.08
12/5/2008 38.45 26.01
10/6/2008 35.08 30.07
10/7/2008 33.26 30.07
11/8/2008 35.64 28.06
10/9/2008 33.94 29.46
10/10/2008 24.84 40.26
10/11/2008 25.69 38.92
10/12/2008 25.64 39
12/1/2009 25.71 38.9
10/2/2009 26.15 38.24
12/3/2009 24.32 41.12
13/04/2009 27.98 35.74
11/5/2009 29.15 34.3
TOTAL 1568.41
61
AMOUNT = TOTAL UNITS X LAST NAV WHEN THE VALUE TO BE REDEEM
=1568.41 X 29.15
=Rs. 45719.15
Amt. Invested -Rs 48000 Amt. Invested- Rs 48000 Amt. Invested -Rs 48000
Amt. received -Rs 53898.83 Amt. received- Rs 49412.37 Amt. received-Rs 45719.15
CONCLUSION: In SIP, plan-1 exceeds from plan-2 & plan-3 with the amount of
Rs 4486.46 & Rs.8179.68
CORRELATION
19839.55
CORRELATION 0.660852 0.979078 0.807867
62
CORRELATION BETWEEN NIFTY & PLAN-2= 0.979078
β(Beta) of PLAN-1=2.74
β(Beta) of PLAN-2=4.61
β(Beta) of PLAN-3=0.56
RESULT:
AS ABOVE STATED, WE CAN SEE THAT RELIANCE RSF- EQUITY
OPTION HAVE GOT MORE RETURNS WITH THEIR MODERATE
RISK AS COMPARABLE TO OTHER SCHEMES .
63
INTERPRETATION
64
YES 135
NO 65
Options Percentage
Yes 65
65
No 35
% OF RESPONDENT
35
Yes
No
65
65%of the people know about the mutual fund, so they want to
invest their money into mutual fund and other 35% don’t know
about mutual fund.
66
Bank 15
Insurance 22
Mutual Fund 55
Stock Market 8
60 55
50
40 Bank
Percentage
Insurance
30
22 Mutual Fund
20 Stock Market
15
10 8
0
Investment Option
The result is that more than 50% people want to invest their money in
mutual fund and other chooses the bank, insurance and stock market.
67
B. Moderately inexperienced 05%
20
very inexperienced
moderately inexperienced
moderately experienced
5 very experienced
70
Interpretation
The above table and chart reveals that the investors are experienced
at investing in individual stocks. Majority of the i.e. 70% investors very
inexperience at investing in individual stocks. While others are 20%
moderately experienced and 5% moderately inexperienced and 5% of
the investors are very experienced
68
Do you think that mutual fund can give more return then bank
deposit?
Respondent Percentage
Answer
Yes 65
No 35
% OF RESPONDENT
35
Yes
No
65
65% of the respondent said that they think that mutual funds give
more return than other investment like bank deposit.
According to you what is a systematic Investment Plan?
69
invested for a continuous period
SIP allows the investor to buy 15
units on a given date
% OF RESPONDENT
SIP is similar to a
15 regular saving scheme
35
A specific amount
should be invested for a
continuous period
SIP allows the investor
50 to buy units on a given
date
After going through a two months summer training and survey, I have come to
know about different aspects of mutual funds and mutual funds industry. India is
an emerging market
This study and survey on mutual funds is a small eye hole to see the picture of
mutual funds industry in India. This provides almost clear view to the readers.
70
Mutual funds industry is enlarging its size in India. Number of investors is rising,
and number of AMCs is going up. These changes are likely to happen. Indian
monetary policy is supporting new business. Private sector is aggressively
participating in mutual funds business. Numbers of schemes are much more than
earlier.
With such shining sides, inflation rate, bearish stock market, squeezing liquidity
and other dark sides putting pressure on consumers saving. This situation
pushes investors back from investment. They wait and hold cash rather than
investing. This study found that investors are willing to invest with high rate of
return. They know high return always adhere to high risk but market still is not in
correction mode. It will take time.
\
Recommendations:
The most vital problem spotted is of ignorance. Investors should be made aware
of the benefits. Nobody will invest until and unless he is fully convinced. Investors
should be made to realize that ignorance is no longer bliss and what they are
losing by not investing.
Mutual funds offer a lot of benefit which no other single option could offer. But
most of the people are not even aware of what actually a mutual fund is? They
71
only see it as just another investment option. So the advisors should try to
change their mindsets. The advisors should target for more and more young
investors. Young investors as well as persons at the height of their career would
like to go for advisors due to lack of expertise and time.
The advisors may try to highlight some of the value added benefits of MFs such
as tax benefit, rupee cost averaging, and systematic transfer plan, rebalancing
etc. these benefits are not offered by other options singlehandedly. So these are
enough to drive the investors towards mutual funds. Investors could also try to
increase the spectrum of services offered.
One should diversify the investments between a few funds (the actual number
depends entirely on the amount of investment). This strategy ensures that the
portfolio is not dependent on the performance of one single fund. However, one
needs to avoid over-diversification as that would achieve nothing.
Investor can also plan like one mutual fund of diversified equity plan, second
mutual fund of balanced type and third one you can plan of debt type etc. In this
manner the money will get diversified, risk is reduced and the investor will get
excellent profit.
LEARNING
1. Summer Training and this project have enabled me to get Knowledge about
mutual Funds, their operations, schemes and their risk profile.
72
2. Got the opportunity to give presentation which helped me to improve my
communication skill and increase my confidence.
5. I learned that real world scenario is all together different from those in
theories, but theories help in guiding you in tough situations.
QUESTIONNAIRE
1. Personal Details:
73
(a). Name:-
(c). Age:-
(d). Qualification:-
2. What kind of investments you have made so far? Pl tick (√). All applicable.
74
4.Are you aware about Mutual Funds and their operations? Pl tick (√).
Yes No
(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.
75
d. HDFC
e. Kotak
f. ICICI
12. Which Channel will you prefer while investing in Mutual Fund?
13. When you invest in Mutual Funds which mode of investment will you prefer?
Pl. tick (√).
14. When you want to invest which type of funds would you choose?
a. Having only debt b. Having debt & equity c. Only equity portfolio.
portfolio portfolio.
15. How would you like to receive the returns every year? Pl. tick (√).
16. Instead of general Mutual Funds, would you like to invest in sectorial funds?
Please tick (√).
76
Yes No
BIBILOGRAPHY:
Websites:
www.rathi.com
77
www.mutualfundsindia.com
www.moneycontrol.com
www.bseindia.com
www.nseindia.com
www.google.com
www.amfiindia.com
78