PROJECT REPORT

ON mutual fund SUBMITTED BY Chetna prakash deore UNDER THE GUIDANCE OF PROF. poonam paryani

A PROJECT SUBMITTED IN PART COMPLETION OF MMS TO THE

S.A.V. acharya institute of management studies shelu 410 201. (MAy 2011)

INTRODUCTION OF MUTUAL FUND

OBJECTIVE OF MUTUAL FUND-:

To know the various factors considered by customer while going for investment in mutual fund.

Sub-Objective

To study the working of mutual fund. To study the characteristics of mutual fund which attracts the investor What an investor should consider for safe investment and better returns.

REGULATORY BODIES OF MUTUAL FUND

ASSOCIATION OF MUTUAL FUNDS IN INDIA (AMFI) SECURITY AND EXCHANE BOARD OF INDIA(SEBI)

STRUCTURE OF MUTUAL FUND

TYPES OF MUTUAL FUND SCHEME

ACCORDING TO STRUCTURE OPEN-ENDED FUND CLOSE-ENDED FUND INTERVAL FUND ACCORDING TO INVESTMENT OBJECTIVE GROWTH FUND INCOME FUND BALANCE FUND MONEY MARKET FUND SPECIAL SCHEME INDEX SCHEME SE COTOR SPECIFIC SCHEME BOND SCHEME

CHARACTERISTICS OF MUTUAL FUNDS

It is managed by a team of investment professionals and other service providers. The pool of funds is invested in a portfolio of marketable investments. The investors share is denominated by units whose value is called as Net Asset Value (NAV) which changes every day. The investment portfolio is created according to the stated investment objectives of the fund. The ownership is in the hands of the investors who have pooled in their funds.

ADVANTAGES OF MUTUAL FUNDS PORTFOLIO DIVERSIFICATION PROFESSIONAL MANAGEMEN LOW COST LIQUIDITY TRANSPARENCY FLEXIBILITY CONVENIENT ADMINISTRATION AFFORDABILITY WELL REGULATED

DISADVANTAGES OF MUTUAL FUNDS : No Guarantees

Fees and Commissions . Taxes

Management Risk

Calculating NAVs
In the market when people talk of NAV, They refer to the value of each unit of the scheme. This is equivalent to: Unit holdersFunds in the scheme / No. of Units In the above example, it can be calculated as: Rs.4 lakh / 4 i.e Rs. 1 lakh per unit.

Latest NAV
250

200

150 Latest NAV 100

50

0 HDFC TATA SBI RELIANCE DSP

FINDINGS

1. The investors give more preference to regular income funds besides the considerations of 1) Diversified Equity 2) Tax Saving Schemes. Thus if the government encourages the investment in mutual funds in the current budget, then more people will be investing in the MFs for tax saving. However people are also not compliant to risk aversion. They are willing to invest in risk equity funds. 2. Another significant finding of the project is that investors are lured by the returns MFs are showing. However at the same time they also want to minimize their risk. 3. Investors desire or opt open-ended schemes than close-ended schemes. This means that they want flexibility in the inflow and outflow of their funds.

SUGGESTIONS There is lack of awareness among people about mutual funds so there should be more advertising and other promotional campaigns to make them aware. People are more interested in investing in equity funds rather than debt funds because companies are promoting more for equity funds. Companies should equally promote debt funds also as the provide security to customers. Companies should give knowledge to its customer about its computerized operations to save their time and to make the operations more easy.

CONCLUSION The Mutual fund industry is growing at a tremendous pace. A large number of plans have come up from different financial resources. With the Stock markets soaring the investors are attracted towards these schemes. Only a small segment of the investors still invest in Mutual funds and the main sources of information still are the financial advisors followed by advertisements in different media. The Indian investor generally investors over a period of 2 to three years. Also there is a greater tendency to invest in fixed deposits due to the security attached with it.