Mutual Fund: A Globally Proven Investment Avenue
Mutual Fund: A Globally Proven Investment Avenue
Mutual Fund: A Globally Proven Investment Avenue
REPORT
ON
I hereby declare that the Dissertation Report entitled “Mutual Fund: A Globally
Proven Investment Avenue” submitted for the Degree of Master of Business
Administration, is my original work and Dissertation Report has not formed the
basis for the award of any degree, diploma, associate ship, fellowship, or similar
other titles.
Shweta Kotnala
MBA 4th Semester
GRD-IMT, DEHRADUN
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CERTIFICATE
This is to certify that the work contained in the report entitled “Mutual Fund: A
Globally Proven Investment Avenue” submitted by Shweta Kotnala , for the
award of degree Masters of Business Administration, is a record of research works
carried out by me under the supervision and guidance of Mrs. Neetika gupta.
I considered that the report has reached the standards and fulfilled the requirements
of the rules and regulations relating to the nature of the degree. The contents
embodied in the report have not been submitted for the award of any other degree
or diploma in this or any other university.
DATE:
PLACE: Signature of Guide:
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ACKNOWLEDGEMENT
A project report is the result of not only the hard work of the student but also a
symbol of guidance, encouragement and help given by many people.
So before presenting the work I would like to serve my sincere regards and thanks
to my project guide Mrs. Neetika Gupta, whose constant support, knowledge and
experience have been a tremendous source of strength.
Last but not the Least, would like to Thank my family members and all those people
who help me for the completion and understanding of the concept. Working on the
project has proved to be an enlightening experience for me.
SHWETA KOTNALA
2021-2023
GRD-IMT, DEHRADUN
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NEED FOR THE STUDY:
The main purpose of doing this project was to know about mutual fund and
its functioning. This helps to know in details about mutual fund industry right from its
study depends upon prominent funds in India and their schemes like equity, income,
The project study was done to ascertain the asset allocation, entry load, exit
load, associated with the mutual funds. Ultimately this would help in understanding
OBJECTIVE:
To give a brief idea about the benefits available from Mutual Fund investment.
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LIMITATIONS
The lack of information sources for the analysis part.
Though I tried to collect some primary data but they were too inadequate for
The data provided by the prospects may not be 100% correct as they too
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EXECUTIVE SUMMERY
A mutual fund is a scheme in which several people invest their money for a
common financial cause. The collected money invests in the capital market and the
money, which they earned, is divided based on the number of units, which they hold.
The mutual fund industry started in India in a small way with the UTI Act
creating what was effectively a small savings division within the RBI. Over a period
of 25 years this grew fairly successfully and gave investors a good return, and
therefore in 1989, as the next logical step, public sector banks and financial
institutions were allowed to float mutual funds and their success emboldened the
superior return.
The biggest problems with mutual funds are their costs and fees it include
Purchase fee, Redemption fee, Exchange fee, Management fee, Account fee &
Transaction Costs. There are some loads which add to the cost of mutual fund.
Mutual funds are easy to buy and sell. You can either buy them directly from
the fund company or through a third party. Before investing in any funds one should
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consider some factor like objective, risk, Fund Manager’s and scheme track
There are many, many types of mutual funds. You can classify funds based
which were subsequently mandated by SEBI. In addition, this year AMFI was
framework.
The most important trend in the mutual fund industry is the aggressive
expansion of the foreign owned mutual fund companies and the decline of the
Reliance Mutual Fund, UTI Mutual Fund, ICICI Prudential Mutual Fund, HDFC
Mutual Fund and Birla Sun Life Mutual Fund are the top five mutual fund company
in India.
India. People want to invest in this institution because they know that this institution
will never dissatisfy them at any cost. You should always keep this into your mind
that if particular mutual funding scheme is on larger scale then next time, you might
not get the same results so being a careful investor you should take your major step
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INDEX
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‘ WILL ASSET MANAGEMENT INN’
Corporate Introduction
The philosophy of Will-Group has played a pivotal role in propelling its success in
the arena of financial services under the name and style of Watchdog, which was
set up in the year 1994.
With its true vision, Watchdog had grown at a steady space and presently it is been
known as WILL ASSET MANAGEMENT INN. The present company carries out
exclusively all the investment related business. Today, it offers a diverse spectrum of
integrated financial services to its customers.
The Will –Group provides a whole spectrum of financial services. WILL ASSET
MANAGEMENT INN is in continuous search for new areas of services that it can
render to its clients and believes that there are always areas to be explored.
Registered with Association of Mutual Fund in India (AMFI) offering Mutual Fund
Services.
Registered with Leading Corporate Houses and offering Fee Based Services.
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Members of the Company
Mr. Swapan Ganguly is the Advisory of the company ‘WILL ASSET
MANAGEMENT INN’. He is a qualified banker and has thirty years of banking
experience. He has over two decades of experience in International and National
Banking Business and Finance Management.
Mrs. Tanusri Das is the Vice-President of the company. She has around ten
years of experience in investment, HRD and in the field of IT industries.
COMPETETIVE ANALYSIS
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Customer’ s HNI’ S, TRUST, CORPORATE,
INDIVIDUAL
La Martine School
Marwari Hospital
Jalan college
Laxmi
Insurance,
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PRODUCT
OR
SERVICES
PORTFOLIO
STOCKS
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The first introduction of a mutual fund in India occurred in 1963, when
the Government of India launched Unit Trust of India (UTI). Until 1987, UTI enjoyed a
These included State Bank of India, Canara Bank, and Punjab National Bank. This
of Liberalization, Privatization and Globalization (LPG). The first private sector fund
to operate in India was Kothari Pioneer, which later merged with Franklin Templeton.
ownership of the fund is thus joint or “mutual”; the fund belongs to all investors. A
single investor’s ownership of the fund is in the same proportion as the amount of
the contribution made by him or her bears to the total amount of the fund.
Mutual Funds are trusts, which accept savings from investors and invest the
same in diversified financial instruments in terms of objectives set out in the trusts
deed with the view to reduce the risk and maximize the income and capital
appreciation for distribution for theembers. A Mutual Fund is a corporation and the
fees.
DEFINITION:
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Why Select Mutual Fund?
The risk return trade-off indicates that if investor is willing to take higher risk
then correspondingly he can expect higher returns and vise versa if he pertains to
lower risk instruments, which would be satisfied by lower returns. For example, if
an investors opt for bank FD, which provide moderate return with minimal risk. But
as he moves ahead to invest in capital protected funds and the profit-bonds that
give out more return which is slightly higher as compared to the bank deposits but
This is because the money that is pooled in are not invested only in debts
funds which are less riskier but are also invested in the stock markets which
involves a higher risk but can expect higher returns. Hedge fund involves a very high
risk since it is mostly traded in the derivatives market which is considered very
volatile.
Ventur Equity
Capita
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The graph indicates the growth of assets under management over the years.
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ADVANTAGES OF MUTUAL FUNDS:
of the many advantages they have over other forms and the avenues of investing,
particularly for the investor who has limited resources available in terms of capital
and the ability to carry out detailed research and market monitoring. The following
1. Portfolio Diversification:
Each investor in the fund is a part owner of all the fund’s assets, thus
enabling him to hold a diversified investment portfolio even with a small amount of
2. Professional Management:
Even if an investor has a big amount of capital available to him, he benefits
from the professional management skills brought in by the fund in the management
of the investor’s portfolio. The investment management skills, along with the
needed research into available investment options, ensure a much better return
than what an investor can manage on his own. Few investors have the skill and
resources of their own to succeed in today’s fast moving, global and sophisticated
markets.
3. Reduction/Diversification Of Risk:
When an investor invests directly, all the risk of potential loss is his own,
debenture on his own or in any other from. While investing in the pool of funds with
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investors, the potential losses are also shared with other investors. The risk
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4. Reduction Of Transaction Costs:
What is true of risk as also true of the transaction costs. The investor bears all
through a fund, he has the benefit of economies of scale; the funds pay lesser costs
5. Liquidity:
Often, investors hold shares or bonds they cannot directly, easily and quickly
sell. When they invest in the units of a fund, they can generally cash their
investments any time, by selling their units to the fund if open-ended, or selling
them in the market if the fund is close-end. Liquidity of investment is clearly a big
benefit.
direct market investor cannot get. Investors can easily transfer their holding from
one scheme to the other; get updated market information and so on.
7. Tax Benefits:
Any income distributed after March 31, 2002 will be subject to tax in the
9,000 from the Total Income will be admissible in respect of income from
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investments specified in Section 80L, including income from Units of the Mutual
Fund. Units of the schemes are not subject to Wealth-Tax and Gift-Tax.
8. Choice of Schemes:
Mutual Funds offer a family of schemes to suit your varying needs over a lifetime.
9. Well Regulated:
All Mutual Funds are registered with SEBI and they function within the provisions of
10. Transparency:
invested in each class of assets and the fund manager's investment strategy and
outlook.
FUNDS:
1. No Control Over Costs:
An investor in a mutual fund has no control of the overall costs of investing.
The investor pays investment management fees as long as he remains with the fund,
albeit in return for the professional management and research. Fees are payable
even if the value of his investments is declining. A mutual fund investor also pays
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fund distribution costs, which he would not incur in direct investing. However, this
shortcoming only means that there is a cost to obtain the mutual fund services.
2. No Tailor-Made Portfolio:
Investors who invest on their own can build their own portfolios of shares and
bonds and other securities. Investing through fund means he delegates this decision
most mutual fund managers help investors overcome this constraint by offering
the investor. He may again need advice on how to select a fund to achieve his
objectives, quite similar to the situation when he has individual shares or bonds to
select.
better at picking stocks than the average nonprofessional, but charges fees.
5. No Control:
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Unlike picking your own individual stocks, a mutual fund puts you in the
6. Dilution:
Mutual funds generally have such small holdings of so many different stocks
that insanely great performance by a fund's top holdings still doesn't make much of
7. Buried Costs:
Many mutual funds specialize in burying their costs and in hiring salesmen
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TYPES OF MUTUAL FUNDS SCHEMES IN INDIA
Wide variety of Mutual Fund Schemes exists to cater to the needs such as
financial position, risk tolerance and return expectations etc. thus mutual funds has
Variety of flavors, Being a collection of many stocks, an investors can go for picking
a mutual fund might be easy. There are over hundreds of mutual funds scheme to
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A). BY STRUCTURE
These do not have a fixed maturity. Investors can conveniently buy and sell units at
Net Asset Value ("NAV") related prices. The key feature of open-end schemes is
liquidity.
from 3 to 15 years. The fund is open for subscription only during a specified period.
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 they 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 Mutual Fund
through periodic repurchase at NAV related prices. SEBI Regulations stipulate that at
3. Interval Schemes:
Interval Schemes are that scheme, which combines the features of
open-ended and close-ended schemes. The units may be traded on the stock
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B). BY NATURE
1. Equity Fund:
These funds invest a maximum part of their corpus into equities holdings. The
structure of the fund may vary different for different schemes and the fund
Mid-Cap Funds
Equity investments are meant for a longer time horizon, thus Equity funds
2. Debt Funds:
The objective of these Funds is to invest in debt papers. Government
authorities, private companies, banks and financial institutions are some of the
major issuers of debt papers. By investing in debt instruments, these funds ensure
low risk and provide stable income to the investors. Debt funds are further classified
as:
known as Government of India debt papers. These Funds carry zero Default
risk but are associated with Interest Rate risk. These schemes are safer as
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Income Funds: Invest a major portion into various debt instruments such as
MIPs: Invests maximum of their total corpus in debt instruments while they
take minimum exposure in equities. It gets benefit of both equity and debt
market. These scheme ranks slightly high on the risk-return matrix when
Short Term Plans (STPs): Meant for investment horizon for three to six
months. These funds primarily invest in short term papers like Certificate of
Deposits (CDs) and Commercial Papers (CPs). Some portion of the corpus is
Liquid Funds: Also known as Money Market Schemes, These funds provides
instruments like Treasury Bills, inter-bank call money market, CPs and CDs.
houses and are meant for an investment horizon of 1day to 3 months. These
schemes rank low on risk-return matrix and are considered to be the safest
3. Balanced Funds:
As the name suggest they, are a mix of both equity and debt funds. They
invest in both equities and fixed income securities, which are in line with
investors with the best of both the worlds. Equity part provides growth and the debt
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Each category of funds is backed by an investment philosophy, which is
pre-defined in the objectives of the fund. The investor can align his own investment
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C). BY INVESTMENT OBJECTIVE:
Growth Schemes:
Growth Schemes are also known as equity schemes. The aim of these
schemes normally invest a major part of their fund in equities and are willing to bear
Income Schemes:
Income Schemes are also known as debt schemes. The aim of these
generally invest in fixed income securities such as bonds and corporate debentures.
Balanced Schemes:
Balanced Schemes aim to provide both growth and income by periodically
distributing a part of the income and capital gains they earn. These schemes invest
in both shares and fixed income securities, in the proportion indicated in their offer
Load Funds:
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A Load Fund is one that charges a commission for entry or exit. That is, each
time you buy or sell units in the fund, a commission will be payable. Typically entry
and exit loads range from 1% to 2%. It could be worth paying the load, if the fund
No-Load Funds:
A No-Load Fund is one that does not charge a commission for entry or exit.
That is, no commission is payable on purchase or sale of units in the fund. The
OTHER SCHEMES
Tax Saving Schemes:
Tax-saving schemes offer tax rebates to the investors under tax laws
prescribed from time to time. Under Sec.88 of the Income Tax Act, contributions
made to any Equity Linked Savings Scheme (ELSS) are eligible for rebate.
Index Schemes:
Index schemes attempt to replicate the performance of a particular index
such as the BSE Sensex or the NSE 50. The portfolio of these schemes will consist
of only those stocks that constitute the index. The percentage of each stock to the
total holding will be identical to the stocks index weightage. And hence, the returns
from such schemes would be more or less equivalent to those of the Index.
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Moving Consumer Goods (FMCG), Petroleum stocks, etc. The returns in these
these funds may give higher returns, they are more risky compared to diversified
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NET ASSET VALUE (NAV):
Since each owner is a part owner of a mutual fund, it is necessary to
establish the value of his part. In other words, each share or unit that an investor
holds needs to be assigned a value. Since the units held by investor evidence the
ownership of the fund’s assets, the value of the total assets of the fund when
divided by the total number of units issued by the mutual fund gives us the value of
one unit. This is generally called the Net Asset Value (NAV) of one unit or one share.
The value of an investor’s part ownership is thus determined by the NAV of the
Calculation of NAV:
Let us see an example. If the value of a fund’s assets stands at Rs. 100 and
it has 10 investors who have bought 10 units each, the total numbers of units issued
are 100, and the value of one unit is Rs. 10.00 (1000/100). If a single investor in fact
owns 3 units, the value of his ownership of the fund will be Rs. 30.00(1000/100*3).
Note that the value of the fund’s investments will keep fluctuating with the
market-price movements, causing the Net Asset Value also to fluctuate. For
example, if the value of our fund’s asset increased from Rs. 1000 to 1200, the
value of our investors holding of 3 units will now be (1200/100*3) Rs. 36. The
investment value can go up or down, depending on the markets value of the fund’
s assets.
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SELECTION PARAMETERS FOR MUTUAL FUND
Your objective:
The first point to note before investing in a fund is to find out whether your
objective matches with the scheme. It is necessary, as any conflict would directly
affect your prospective returns. Similarly, you should pick schemes that meet your
schemes, etc.
for debt schemes, as they are relatively safer. Aggressive investors can go for equity
investments. Investors that are even more aggressive can try schemes that invest in
imperative that he manages it well. It is also essential that the fund house you
choose has excellent track record. It also should be professional and maintain high
market benchmarks and its competitors. Look at the performance of a longer period,
as it will give you how the scheme fared in different market conditions.
Cost factor:
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Though the AMC fee is regulated, you should look at the expense ratio of the
fund before investing. This is because the money is deducted from your
investments. A higher entry load or exit load also will eat into your returns. A higher
expense ratio can be justified only by superlative returns. It is very crucial in a debt
Also, Morningstar rates mutual funds. Each year end, many financial
publications list the year's best performing mutual funds. Naturally, very eager
investors will rush out to purchase shares of last year's top performers. That's a big
mistake. Remember, changing market conditions make it rare that last year's top
performer repeats that ranking for the current year. Mutual fund investors would be
well advised to consider the fund prospectus, the fund manager, and the current
be enjoyed by investors:
pays out nearly all income it receives over the year to fund owners in the form
of a distribution.
If the fund sells securities that have increased in price, the fund has a capital
If fund holdings increase in price but are not sold by the fund manager, the fund's
shares increase in price. You can then sell your mutual fund shares for a profit.
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Funds will also usually give you a choice either to receive a check for distributions or
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MUTUAL FUNDS DISTRIBUTION CHANNELS
Investors have varied investment objectives and can be classified as aggressive,
moderate and conservative, depending on their risk profile. For each of these
categories, asset management companies (AMCs) devise different types of fund
schemes, and it is important for investors to buy those that match their investment
goals.
Funds are bought and sold through distribution channels, which play a significant
role in explaining to the investors the various schemes available, their investment
style, costs and expenses. There are two types of distribution channels-direct and
indirect. In case of the former, the investors buy units directly from the fund AMC,
whereas indirect channels include the involvement of agents. Let us consider these
distribution channels in detail.
Direct channel
This is good for investors who do not need the advisory services of agents and are
well-versed with the fundamentals of the fund industry. The channel provides the
benefit of low cost, which significantly enhances the returns in the long run.
Indirect channel
This channel is widely prevalent in the fund industry. It involves the use of agents,
who act as intermediaries between the fund and the investor. These agents are not
exclusive for mutual funds and can deal in multiple financial instruments. They have
an in-depth knowledge about the functioning of financial instruments and are in a
position to act as financial advisers. Here are some of the players in the indirect
distribution channels.
a) Independent financial advisers (IFA): These are individuals trained by AMCs for
selling their products. Some IFAs are professionally qualified CFPs (certified
financial planners). They help investors in choosing the right fund schemes and
assist them in financial planning. IFAs manage their costs through the commissions
that they earn by selling funds.
b) Organized distributors: They are the backbone of the indirect distribution channel.
They have the infrastructure and resources for managing administrative paperwork,
purchases and redemptions. These distributors cater to the diverse nature of the
investor community and the
vast geographic spread of the country by establishing offices in rural and semi
urban locations.
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c) Banks: They use their network to sell mutual funds. Their existing customer base
serves as a captive prospective investor base for marketing funds. Banks also
handle wealth management for their clients and manage portfolios where mutual
funds are one of the asset classes. The players in the indirect channel assist
investors in buying and redeeming fund units.
They try to understand the risk profile of investors and suggest fund schemes that
best suits their objectives. The indirect channel should be preferred over the direct
channel when investors want to seek expert advice on the risk-return mix or need
help in understanding the features of the financial securities in which the fund
invests as well as other important attributes of mutual funds, such as benchmarking
and tax treatment.
The most common sales and marketing strategies for mutual funds is to
sign-up companies as a preferred option for their retirement plans. This provides a
simple way to sign-up numerous accounts with one master contract. To market to
these firms, sales people target human resource professionals. Marketing occurs
through traditional business-to-business marketing techniques including
conferences, niche advertising and professional organizations. For business
accounts, fund representatives will stress ease of use and compatibility with the
company's present systems.
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Mutual funds must be very careful about how they market their performance,
as this is heavily regulated. Mutual funds must market their short, medium and
long-term average returns to give the prospective investor a good idea of the actual
performance. For example, most funds did very well during the housing boom.
However, if the bear market that followed is included, performance looks much
more average. Funds may also have had different managers with different
performance records working on the same funds, making it hard to judge them.
Mutual funds must be very clear about their fees and report them in all of their
marketing materials. The main types of fees include the sales fee (load) and the
management fee. The load is an upfront charge that a mutual fund charges as soon
as the investment is made. The management fee is a percentage of assets each
year, usually 1 to 2 percent.
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WORKING OF MUTUAL FUNDS
The mutual fund collects money directly or through brokers from investors.
scheme. The investments are divided into units and the value of the units will be
reflected in Net Asset Value or NAV of the unit. NAV is the market value of the
assets of the scheme minus its liabilities. The per unit NAV is the net asset value of
the scheme divided by the number of units outstanding on the valuation date.
Mutual fund companies provide daily net asset value of their schemes to their
investors. NAV is important, as it will determine the price at which you buy or
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redeem the units of a scheme. Depending on the load structure of the scheme, you
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STRUCTURE OF A MUTUAL FUND:
India has a legal framework within which Mutual Fund have to be constituted.
In India open and close-end funds operate under the same regulatory structure i.e.
as unit Trusts. A Mutual Fund in India is allowed to issue open-end and close-end
followed by any Mutual Fund in India is laid down under SEBI (Mutual Fund)
Regulations, 1996.
of the fund is akin to the promoter of a company as he gets the fund registered with
SEBI. The sponsor forms a trust and appoints a Board of Trustees. The sponsor also
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appoints the Asset Management Company as fund managers. The sponsor either
directly or acting through the trustees will also appoint a custodian to hold funds
assets. All these are made in accordance with the regulation and guidelines of SEBI.
As per the SEBI regulations, for the person to qualify as a sponsor, he must
contribute at least 40% of the net worth of the Asset Management Company and
Fund sponsor acts as a settlor of the Trust, contributing to its initial capital and
appoints a trustee to hold the assets of the trust for the benefit of the unit-holders,
who are the beneficiaries of the trust. The fund then invites investors to contribute
vehicle. Under the Indian Trusts Act, the trust of the fund has no independent legal
capacity itself, rather it is the Trustee or the Trustees who have the legal capacity
and therefore all acts in relation to the trusts are taken on its behalf by the Trustees.
In legal parlance the investors or the unit-holders are the beneficial owners of the
investment held by the Trusts, even as these investments are held in the name of
the Trustees on a day-to-day basis. Being public trusts, Mutual Fund can invite any
Trustees:
A Trust is created through a document called the Trust Deed that is executed
by the fund sponsor in favour of the trustees. The Trust- the Mutual Fund – may be
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managed by a board of trustees- a body of individuals, or a trust company- a
corporate body. Most of the funds in India are managed by Boards of Trustees.
While the boards of trustees are governed by the Indian Trusts Act, where the trusts
are a corporate body, it would also require to comply with the Companies Act, 1956.
The Board or the Trust company as an independent body, acts as a protector of the
of the unit-holders interests. The Trustees do not directly manage the portfolio of
securities. For this specialist function, the appoint an Asset Management Company.
They ensure that the Fund is managed by ht AMC as per the defined objectives and
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The Asset Management Companies:
The role of an Asset Management Company (AMC) is to act as the
investment manager of the Trust under the board supervision and the guidance of
the Trustees. The AMC is required to be approved and registered with SEBI as an
AMC. The AMC of a Mutual Fund must have a net worth of at least Rs. 10 Crores at
all times. Directors of the AMC, both independent and non-independent, should
of high morale standing, a condition also applicable to other key personnel of the
AMC. The AMC cannot act as a Trustee of any other Mutual Fund. Besides its role
and financial consulting, provided these activities are run independent of one
another and the AMC’s resources (such as personnel, systems etc.) are properly
segregated by the activity. The AMC must always act in the interest of the
through approved depository companies on behalf of the Mutual Fund and it must
fulfill its responsibilities in accordance with its agreement with the Mutual Fund. The
shares the dematerialized shares are kept with the Depository participant while the
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custodian holds the physical securities. Thus, deliveries of a fund’s securities are
the AMC, although under the overall direction and responsibilities of the Trustees.
Bankers:
A Fund’s activities involve dealing in money on a continuous basis primarily
with respect to buying and selling units, paying for investment made, receiving the
proceeds from sale of the investments and discharging its obligations towards
operating expenses. Thus the Fund’s banker plays an important role to determine
quality of service that the fund gives in timely delivery of remittances etc.
Transfer Agents:
Transfer agents are responsible for issuing and redeeming units of the Mutual
Fund and provide other related services such as preparation of transfer documents
and updating investor records. A fund may choose to carry out its activity in-house
and charge the scheme for the service at a competitive market rate. Where an
outside Transfer agent is used, the fund investor will find the agent to be an
important interface to deal with, since all of the investor services that a fund
The structure of mutual funds in India is guided by the SEBI. Regulations, 1996.
These regulations make it mandatory for mutual fund to have three structures of
sponsor trustee and asset Management Company. The sponsor of the mutual fund
and appoints the trustees. The trustees are responsible to the investors in mutual
fund and appoint the AMC for managing the investment portfolio. The AMC is the
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business face of the mutual fund, as it manages all the affairs of the mutual fund.
The AMC and the mutual fund have to be registered with SEBI.
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MUTUAL FUNDS IN INDIA
In 1963, the day the concept of Mutual Fund took birth in India. Unit Trust of
India invited investors or rather to those who believed in savings, to park their
For 30 years it goaled without a single second player. Though the 1988 year
saw some new mutual fund companies, but UTI remained in a monopoly position.
The performance of mutual funds in India in the initial phase was not even
closer to satisfactory level. People rarely understood, and of course investing was
out of question. But yes, some 24 million shareholders were accustomed with
This good record of UTI became marketing tool for new entrants. The expectations
of investors touched the sky in profitability factor. However, people were miles away
The net asset value (NAV) of mutual funds in India declined when stock
prices started falling in the year 1992. Those days, the market regulations did not
allow portfolio shifts into alternative investments. There was rather no choice apart
from holding the cash or to further continue investing in shares. One more thing to
be noted, since only closed-end funds were floated in the market, the investors
stock market scandal, the losses by disinvestments and of course the lack of
transparent rules in the whereabouts rocked confidence among the investors. Partly
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owing to a relatively weak stock market performance, mutual funds have not yet
recovered, with funds trading at an average discount of 1020 percent of their net
asset value.
The securities and Exchange Board of India (SEBI) came out with
comprehensive regulation in 1993 which defined the structure of Mutual Fund and
and competitive environment in mutual funds. Some of them were like relaxing
The measure was taken to make mutual funds the key instrument for
long-term saving. The more the variety offered, the quantitative will be investors.
Several private sectors Mutual Funds were launched in 1993 and 1994. The
share of the private players has risen rapidly since then. Currently there are 34
lower risks and higher profitability within a short span of time, more and more
people will be inclined to invest until and unless they are fully educated with the dos
Mutual fund industry has seen a lot of changes in past few years with
expertise in managing funds worldwide. In the past few months there has been a
consolidation phase going on in the mutual fund industry in India. Now investors
profiles.
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MUTUAL FUND COMPANIES IN INDIA:
The concept of mutual funds in India dates back to the year 1963. The era between
1963 and 1987 marked the existance 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
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,
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 existance with re-registering all mutual funds except
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 players penetration, the total assets rose up to Rs. 1218.05 bn. Today there
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Major Mutual Fund Companies in India
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FUTURE PROSPECT OF MUTUAL FUNDS IN INDIA
Financial experts believe that the future of Mutual Funds in India will be very bright. It has
been estimated that by March-end of 2010, the mutual fund industry of India will reach Rs
40,90,000 crore, taking into account the total assets of the Indian commercial banks. In the
Number of foreign AMC's are in the queue to enter the Indian markets like Fidelity
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Our saving rate is over 23%, highest in the world. Only channelizing these savings in
We have approximately 29 mutual funds which is much less than US having more than
'B' and 'C' class cities are growing rapidly. Today most of the mutual funds are
concentrating on the 'A' class cities. Soon they will find scope in the growing cities.
Mutual fund can penetrate rurals like the Indian insurance industry with simple and limited
products.
Looking at the past developments and combining it with the current trends it can be
concluded that the future of Mutual Funds in India has lot of positive things to offer to its investors.
RESEARCH METHODOLOGY
This Report is based on primary as well as secondary data, however primary data collection was
given more important since it is overhearing factor in attitude studies.
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One of the most important users of Research Methodology is that it helps in identifying the
problem, collecting, analyzing the required information or 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 decisions and critical
ones.
c) Universe: Kolkata
d) Sampling Method: The sample was collected through personal visits, formally and informal
talks and through filling up the Questionnaire prepared. The data has been analyzed by using
mathematical or statistical tools.
i) Sample Design: Data has been presented with the help of Bar Graph, Pie Chart, and Line
Graph etc.
j) Duration Of The Study: The study was carried out for a period of two months, from 18th Oct to
30th Nov ‘12.
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Sample Questionnaire
Name: ................... Age: …………….. Mob. ……………
(a) Advertisement (b) Peer Group (c) Banks (d) Financial Advisors
(a) Savings (b) FD (c) Insurance (d) Mutual Fund (e)PO (f) Shares (g) Gold (h) Real Estate
(a) Low Return (b) High Risk (c) Liquidity (d) Trust
(a) Reliance (b) SBI (c) UTI (d) HDFC (e) Others
(a) Preservation (b) Current Income (c) Conservative Growth (d) Aggressive Growth
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Data Analysis & Interpretation
Interpretation - Here, it is been found that most of the investors i.e,35% of the investors who invest in
Mutual Fund lies in between the age group of 36-40, they are more reluctant as well as experienced in this field of
Mutual Fund.
Then the Second highest age group lies in between the age group of 41-45 (22%), they are also aware of the benefits
in investing in mutual fund.
Interpretation - Out of my survey of 100 people, 71% of the investors are Graduates and Post Graduates and
16.67% are Under Graduates and Others, around 12.5%, which may include persons who have passed their 10th
standard or 12th standard invests in Mutual Funds.
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3. Analyzing according to Occupation
Interpretation - Here it is amazed to see that around 46% of the investment is been invested by the
persons working in Private sectors, according to them investing in Mutual Funds is more safer as well as
more gainer.
Then we find that the businessmen of around 25%gives more preference in investing in mutual funds, they
think that investing in mutual fund is better than investing in shares as well as Post office.
Next we see that the persons working in Government sectors of around 24% only invests in Mutual Fund.
Interpretation - Here , we find that investors of around 43% with the monthly income of Rs. >30000
are the most likely to invest in Mutual fund , than any other income group.
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5. Analyzing data according to factors seen before investing
Interpretation - As it can be clearly Stated from the above Diagram that investors before investing,
the main criteria that they used to give more Preference is Low Risk. According to them, if a scheme is low
risk, it may or may not give a very good return , but still 56% of the investors choose low risk as the option
while investing in Mutual Funds.
Then we see that 27% of the investors take High return as one of their most important criteria. According
to them, if there is no high return then we should opt for Post office and not mutual fund.
Interpretation - It can be clearly stated from the above Figure that 82% of the investors like to invest
in SIP, as the investor feels that they are more comfortable to save via SIP than the Long term.
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While 18% of the investors find SIP as very burdensome, and they are more reluctant to save in Long term
investment.
Interpretation - Here we see that 36% of the investor’s objectives are to preserve the principal
amount, so that it can be used as a savings for the future period.
While 22% investors invest to get derive their current income through investing in Mutual Funds.
While 15% and 17% of the investors invest to get a conservative as well as aggressive growth.
Interpretation -. From The total lot of 100 people, 96 people are actually aware of the fact of Mutual
fund and are regular investors of Mutual Funds.
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4 People were there who have just heard the name or rather are just aware of the fact of existence of the
word called Mutual Fund, but doesn’t know anything else about Mutual Funds.
9. Analyzing data according to from where they came to know about Mutual
Fund.
Interpretation - Here from the Line Graph it can be clearly stated that around 46% of the investors
came to know the benefits of Mutual Fund from Financial Advisors. According to the suggestions given by
the financial advisors, people use to choose Mutual Funds Scheme.
Then Secondly,24% and 21% of the people used to know from Advertisement and Peer group respectively.
Lastly 9% of the investors do invests after being intimated by the Banks about the benefits of Mutual Funds.
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Interpretation - From this above Pie Chart it can be clearly stated that 45% , 17%of the people like to
invest in large cap companies where return is comparatively less but risk is low thus they invest in Reliance,
SBI respectively.
15%, 10% of the people like to invest in Mutual Fund Companies like HDFC, UTI, etc. where risk is slightly
higher than the above two mentioned companies as well as return is also slightly high
13% of the investors like to invest in the Small Cap’s and Mid Cap’s companies.
FINDINGS
Through this Project the results that was derived are-
People who lie under the age group of 36-40 have more experience and are more
interested in investing in Mutual Funds.
There was a lot of lack of awareness or ignorance, that’s why out of 200 people, 120
people have invested in Mutual Fund and 80 people is unaware of investing in Mutual
Funds.
Generally, People employed in Private sectors and Businessman are more likely to
invest in Mutual Funds, than other people working in other professions.
Generally investors whose monthly income is above Rs. 20001-30000 are more likely
to invest their income in Mutual Fund, to preserve their savings of at least more than
20%.
People generally like to save their savings in Mutual Fund, Fixed Deposits and Savings
Account.
Many people came to know about Mutual Fund from Financial Advisors, Advertisement
as well as from their Peer group , and they generally invest in the Mutual Fund by taking
advices from their Legal Advisors.
Investors generally like to invest in Large Cap Companies like Reliance, SBI, etc. to
minimize their risk.
The most popular medium of investing in Mutual Fund is through SIP and moreover
people like to invest in Equity Fund though it is a risky game.
The main Objective of most of the Investors is to preserve their Income.
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CONCLUSION
Mutual Funds now represent perhaps most appropriate investment opportunity for most
investors. As financial markets become more sophisticated and complex, investors need a
financial intermediary who provides the required knowledge and professional expertise on
successful investing. As the investor always try to maximize the returns and minimize the risk.
Mutual fund satisfies these requirements by providing attractive returns with affordable risks. The
fund industry has already overtaken the banking industry, more funds being under mutual fund
management than deposited with banks. With the emergence of tough competition in this sector
mutual funds are launching a variety of schemes which caters to the requirement of the
particular class of investors. Risk takers for getting capital appreciation should invest in growth,
equity schemes. Investors who are in need of regular income should invest in income plans.
The stock market has been rising for over three years now. This in turn has not only
protected the money invested in funds but has also to helped grow these investments.
This has also instilled greater confidence among fund investors who are investing more
Reliance India mutual funds provide major benefits to a common man who wants to make
The mutual fund industry as a whole gets less than 2 per cent of household savings
against the 46 per cent that go into bank deposits. Some fund managers say this only indicates
the sector's potential. "If mutual funds succeed in chipping away at bank deposits, even a triple
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Leadership style of Top Management
The qualities that I like most about him are his sincerity and total devotion. He is a workaholic.
He is normally quite reserved and these moments of free expression were out of the ordinary.
The chairmanship did not change him or his manner of arriving at the most appropriate course of
action. He evoked support from his team and he still does. Suvendu Das is not the type of boss
who is given to thumping the table. He softly mandates, and those to whom the message is
addressed get the point very clearly. He thinks big and encourages others to do likewise. He
does not discourage those who occasionally fail to deliver.
When dealing with a difference of opinion, he will convincingly present his views but at the same
time listen attentively to other points of views and arrive at a consensus. He has always listened
to all points of view before evolving a decision in his own quiet but firm way.
He encourages people to open their eyes to look at an opportunity and gets them to think
differently about issues. But he will never tell them what to do. Often, he communicates by
asking questions. "Why can’t you" or "have you thought about this"—those are common
phrases he employs.
When employees work on projects at Will Asset Management Ltd, they often rely on their
co-workers to provide them with feedback. Feedback can range from advice about formatting a
report, proofreading a document for grammatical errors, advice on handling a difficult customer
or tips on how to get a process done faster or more efficiently.
From time-time, companies schedule brainstorming meetings to get creative ideas flowing. By
working as a team, everyone gets to add input, there are a wide range of creative solutions to try
and participants feel united, as they work toward a common goal.
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Mentoring is especially important for new employees, as it helps them get adjusted to their new
work environments and become familiarized with the company's processes and procedures.
Seasoned employees work closely with new employees to answer their questions about the
company, the products and services the company sells, the target market, goal setting and
employee relations. The support and motivation mentors provide demonstrates the importance in
teaming up with employees to achieve success at a company.
Responsibilities outside of the office sometimes force employees to take time off , which pulls
them away from their normal work responsibilities. If an employee cannot be in the office, his
colleague work with his clients until he returns or finish up a project that is on a tight deadline. If
employees work in shifts, a fellow employee may switch shifts to give an employee the time he
needs away from the office.
Culture
Wills Asset Management Inn. view their corporate culture as the basis of their long-term success.
It should be given the utmost consideration and must be put into practice by each and every one
of them. They are proud of what they have already achieved in this regard and are convinced
that as long as they remain true to their principles, they will greatly increase the success of their
business in the future.
Their corporate culture stands and falls with the mutual respect of the people who make up their
team. This respect requires each of them to consider the views and beliefs of their colleagues
and to integrate these into development.
The views and possibilities can be suitably incorporated provided that communication with one
another functions smoothly. Everyone therefore has not only the right but also the obligation to
contribute his or her viewpoint, for diversity is what underlies the potential and strength of a team.
The abilities and potential of all involved can be optimally brought to bear when all members of
the team are fully informed and act on a basis of shared knowledge. Transparency is thus
another indispensable factor for long-term success. The consequence is that we are all informed
about everything that occurs in and around the company. And this is meant literally: Everyone
knows everything!
This foundation encourages the growth of trust , which forges all of the employees into a team
and gives rise to a spirit and motivation that can move mountains. In difficult times as well as in
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very good times (which can be even more dangerous), a well-functioning team does not stray
from its course. And that means quite a lot. This is ultimately the source of the continuity that
represents one of the key components for above-average success over the long term in the
investment business.
Wills Asset Management Inn. corporate culture is put into practice not only internally but also
externally. Respect, communication and transparency also apply to relations with the outside
world . It is on this basis that they strive to build up successful, gratifying and lasting relationships
with existing and future clients.
Organizational Structure
PRESIDENT
VICE-PRESIDENT
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MARKETING ACCOUNTANT
EXECUTIVE
SALES
REPRESENTATIVES
SWOT ANALYSIS
STRENGTH WEAKNESS
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OPPORTUNITY THREATS
BIBLIOGRAPHY
www.google.com
http://www.slideshare.net/hemanthcrpatna/a-project-report-on-comparative-stud
y-of-mutual-funds-in-india
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