(44-54) A Study of Mutual Fund Awareness in Gandhinagar City
(44-54) A Study of Mutual Fund Awareness in Gandhinagar City
(44-54) A Study of Mutual Fund Awareness in Gandhinagar City
Abstract
This paper attempts to study the outlook of citizens towards awareness with special reference to mutual
funds. The population of the study is selected from the Gandhinagar city of Gujarat state of the country. The
sample size is 60 and the researcher has used a convenient sampling method for the study. The findings of
this study are that people are aware of mutual funds and people are also investing in mutual funds.
Researcher also found that the majority of investors are considering mutual fund as a risk-free Instrument. It
is expected that this study will help in Gujarat to plan successful strategies for increasing investment in
mutual funds and they can spread more awareness about mutual funds.
Keywords: Mutual funds Awareness, Gandhinagar, Risk-free Instrument, Systematic Investment Plan
1. INTRODUCTION
A mutual fund is an open-end professionally managed investment fund that pools money from many investors
to purchase securities. These investors may be retail or institutional. The term is typically used in the United
States, Canada, and India, while similar structures across the globe include the SICAV in Europe ('investment
company with variable capital') and open-ended investment company (OEIC) in the UK.
Mutual funds have advantages and disadvantages compared to direct investing in individual securities. The
advantages of mutual funds include economies of scale, diversification, liquidity, and professional management.
However, these come with mutual fund fees and expenses.
Primary structures of mutual funds are open-end funds, unit investment trusts, closed-end funds, and
exchange-traded funds (ETFs).
Mutual funds are often classified by their principal investments as money market funds, bonds or fixed-income
funds, stock or equity funds, hybrid funds, or other. Funds may also be categorized as index funds, which are
passively managed funds that match the performance of an index or actively managed funds. Hedge funds are
not mutual funds as hedge funds cannot be sold to the general public. 1
To many people, Mutual Funds can seem complicated or intimidating. We are going to try and simplify it
for you at its very basic level. Essentially, the money pooled in by a large number of people (or investors)
is what makes up a Mutual Fund. This fund is managed by a professional fund manager.
It is a trust that collects money from a number of investors who share a common investment objective.
Then, it invests the money in equities, bonds, money market instruments and/or other securities. Each
investor owns units, which represent a portion of the holdings of the fund. The income/gains generated
from this collective investment is distributed proportionately amongst the investors after deducting
certain expenses, by calculating a scheme’s “Net Asset Value or NAV. Simply put, a Mutual Fund is one of
the most viable investment options for the common man as it offers an opportunity to invest in a
diversified, professionally managed basket of securities at a relatively low cost. 2
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2. LITERATURE REVIEW
Tripathi & Japee (2020) found that most of the mutual funds are performing well. The researcher
selected 15 different mutual fund schemes and separated them by large-cap, midcap, and small-cap. They
used financial ratios for the study. The study was conducted at very crucial duration but still mutual funds
are performing well.
1
https://en.wikipedia.org/wiki/Mutual_fund
2 https://www.mutualfundssahihai.com/en/what-is-a-mutual-
fund?utm_source=google_web&utm_medium=search_google_AMFI&utm_campaign=Sok_Mutua_Funds_Top_Geos_Mobile_14_May_19&gclid=EAIaIQobC
hMIus2gwfOV6wIVgTgrCh2m-wq4EAAYASAAEgLFm_D_BwE
3. OBJECTIVES OF STUDY
• To study the perception of investors towards investment with special reference to Mutual
funds.
• To know the relationship between the risk and return activities of the investor.
• To find out the reasons why investors are choosing mutual funds as an investing
opportunity.
4. RESEARCH METHODOLOGY
The present research study is based on primary data. Google form is used as a data collection tool to
collect the response from the respondents.
For the case of understanding and making meaningful inferences, the data has been compiled in tables &
graphs.
1. Profession of Respondents
Table 1
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Profession
7% 8%
7%
50%
28%
2. Annual Income
Table 2
OPTION RESPONSE (OUT OF 60)
Below ₹ 1 Lakh 23
Between ₹ 1 Lakh to ₹ 2 Lakh 14
Between ₹ 2 Lakh to ₹ 3 Lakh 12
Between ₹ 3 Lakh to ₹ 4 Lakh 6
Between ₹ 4 Lakh to ₹ 5 Lakh 3
Above ₹ 5 Lakh 2
Graph 2
Annual Income
5% 3%
10% 39%
20%
23%
Below ₹ 1 Lakh Between ₹ 1 Lakh to ₹ 2 Lakh Between ₹ 2 Lakh to ₹ 3 Lakh
Between ₹ 3 Lakh to ₹ 4 Lakh Between ₹ 4 Lakh to ₹ 5 Lakh Above ₹ 5 Lakh
Table 3
OPTION RESPONSE (OUT OF 60)
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Saving Banks 55
Fix Deposits 33
Postal Savings 8
Insurance 12
Gold/Silver 11
Real Estate 2
Money Market Instruments 3
Shares/Debentures 23
Mutual Fund 33
Not Investing 4
Investment Options
Not Investing 4
Mutual Fund 33
Shares/Debentures 23
Money Market Instruments 3
Real Estate 2
Gold/Silver 11
Insurance 12
Postal Savings 8
Fix Deposits 33
Saving Banks 55
0 10 20 30 40 50 60
Table 4
OPTION RESPONSE (OUT OF 60)
<=25 % 38
<=50 % 8
<=75 % 5
Not Saving 9
Graph 4
13% 64%
5. What is the factor to which you give the most priority when you invest?
Table 5
OPTION RESPONSE (OUT OF 60)
Safety 26
High return 19
Liquidity 5
Marketability 7
Less risk 3
8%
32%
Table 6
OPTION RESPONSE (OUT OF 60)
High Risk / High Return 33
Low Risk /Low return 12
Low Risk/ High Return 15
Graph 6
55%
20%
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High Risk / High Return Low Risk /Low return Low Risk/ High Return
Table 7
OPTION RESPONSE (OUT OF 60)
Yes 46
No 14
23%
77%
Yes No
Table 8
OPTION RESPONSE (OUT OF 46)
Yes 33
No 13
Graph 8
28%
72%
Yes No
Table 9
OPTION RESPONSE
(OUT OF 13)
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No / Less Liquidity 7
0 2 4 6 8 10 12 14
Table 10
OPTION RESPONSE (OUT OF 33)
Monthly (SIP) 20
Once in Six Months 2
Once in a year 7
Very Rare 4
Graph 10
Invest Pattern ?
12%
21%
61%
6%
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Table 11
OPTION RESPONSE (OUT OF 33)
Equity Funds 16
Debt Funds 7
Hybrid Funds 10
49%
21%
Table 12
OPTION RESPONSE (OUT OF 33)
Yes 25
No 8
Graph 12
24%
76%
Yes No
13. What advantages do you find when you invest in Mutual Funds?
Table 13
OPTION RESPONSE (OUT OF 33)
Professional Management 28
Diversification 22
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Return Potential 16
Low cost 9
Liquidity 13
Transparency 10
Flexibility 5
Choice of schemes 15
Tax benefits 19
Well regulated 8
Economies of scale 7
Simplicity 24
14. What do you look before investing in a particular mutual fund scheme?
Table 14
OPTION RESPONSE (OUT OF 33)
Past Performance (NAV) 26
Ratings (by CRISIL, ICRA, etc.) 21
Asset Management Companies(AMC) 14
Expert Advice 18
Graph 14
0 5 10 15 20 25 30
15. Since how many years you are investing in Mutual Fund Schemes?
Table 15
OPTION RESPONSE (OUT OF 33)
One year 7
Two years 4
Three years 9
Four years 3
Five years 4
More than five years 6
12%
12%
9%
28%
One year Two years Three years Four years Five years More than five years
Table 16
OPTION RESPONSE (OUT OF 33)
Yes 27
No 6
Graph 16
82%
Yes No
17. Have you ever redeemed your Mutual Funds because of the below-mentioned reasons?
Table 17
OPTION RESPONSE (OUT OF 33)
Non-Performance of Funds 6
Non-Availability of good service from Mutual Fund company 9
Never Redeemed 18
Graph 17
55%
27%
18. According to you, which one do you rate as the best investment instrument?
Table 18
OPTION RESPONSE (OUT OF 33)
Saving Banks 3
Fix Deposits 2
Postal Savings 1
Insurance 1
Real Estate 2
Shares/Debentures 6
Mutual Fund 18
Graph 18
55%
18%
Saving Banks Fix Deposits Postal Savings Insurance Real Estate Shares/Debentures Mutual Fund
6. CONCLUSION
An attempt was made by the researcher to study awareness about mutual funds in Gandhinagar city. The
study is conducted on data received from 60 respondents from Gandhinagar. Opinion from these
respondents was collected with the help of a questionnaire. With the help of Data analysis and
interpretation, findings were drawn by researchers. With the help of findings following conclusion was
drawn by researchers. People are aware of a mutual fund and peoples are investing in mutual funds.
Respondents are preferring equity, hybrid & debt respectively. 61% of respondents are preferring a
Systematic Investment Plan(SIP). Respondents are also aware of share market functioning. Investors are
investing in mutual funds because of these advantages’ professional management, diversification,
liquidity, return potential, low cost, tax benefits, and others. 82% of Investors are preferring mutual fund
schemes as risk-free investment opportunity therefore they are investing in it.
7. REFERENCES
[1] TRIPATHI, S., & JAPEE, D. G. P. (2020). PERFORMANCE EVALUATION OF SELECTED EQUITY MUTUAL
FUNDS IN INDIA.
[2] Bobade, P., Nakhate, V., Malkar, V., & Bhayani, M. An empirical study on awareness & acceptability of
mutual fund in Pune City.
https://www.gapgyan.org/
[3] Tripathi, S. (2020). AN EMPIRICAL STUDY OF MUTUAL FUND AWARENESS AMONG THE PEOPLE OF
AHMEDABAD.
[4] Rao, K. C. N. A Study on Mutual Funds in India with respect to Perception of Indian Investor towards
Investment in Mutual fund Market.
[5] Sharma, K. B. (2020). PERFORMANCE ANALYSIS OF MUTUAL FUND: A COMPARATIVE STUDY OF THE
SELECTED DEBT MUTUAL FUND SCHEME IN INDIA.
[6] Saxena, K., & Sheikh, R. (2019). Impact of Demographic Variables on Mutual Fund Investment Behaviour:
An Empirical Study. Journal of the Gujarat Research Society, 21(16), 957-969.