MUTUAL FUND AND EQUITY PROJECT REPORT FOR MANAGEMENT STUDENTS

Summer training report
On
A DETAILED STUDY OF MUTUAL FUND AND EQUITY MARKET IN INDIA
Submitted in partial fulfilment of the requirement for
the award of degree of
Bachelor of Business Administration
Session 2022 – 2025
Under the supervision of:
Mr. Alok Kumar
(Manager)
Submitted by:
Kashish Narang
BBA 3rd Year
Rol No: - 220003124
Panipat institute of Engineering & Technology, Samalkha
Affiliated to Kurukshetra University, Kurukshetra

DECLARATION
This is to certify that I Kashish Narang student of Panipat Institute of Engineering & Technology studying In
BBA 5th Semester, Roll No. has prepared a project report entitled “A DETAILED STUDY OF MUTUAL
FUND AND EQUITY MARKET IN INDIA AT CONSORTIUM PRIVATE LIMITED” for the partial
fulfilment of degree of Bachelor of Business Administration from Kurukshetra University, Kurukshetra.
I hereby declare that the project report submitted to the Kurukshetra University, Kurukshetra is a record of an
original work done by me under the guidance of Mrs. Pooja Gupta (Assistant Professor in BBA
Department)
The matter presented in this project work has not been submitted by me for the award of any Degree or
diploma/associateship/fellowship and similar degree or any other institute.
Kashish Narang
University Roll No: 220003124
2

ACKNOWLEDGEMENT
Gratitude of highest order is expressed to Dr. Rohit Garg (Head & Professor) for encouragement and support
during my project. His care, endless support and trust motivate me for opportunity to achieve. This project could
not be completed without his insight and achieve.
I am neither expert nor a trend spotter. I am a management student with foundations of management principles and
theories who is keen in different industries, it's happening mainly in Consortium Private Limited
I am highly obliged to Mr. Alok Kumar my prime internal guide for his invaluable support; guidance and
knowledge that he has shared with me thereby aiding me in making this project a success along with other
employees who provided their utmost working knowledge, which has broadened my area of interest and benefited
mostly in completing the project.
I am highly grateful to my project guide Mrs. Pooja Gupta (Assistant Professor BBA Department PIET) for her
inspiring guidance and blessings for fulfilling the project report. I am very grateful to (Mrs. Pooja Gupta ) for her
research advice, knowledge and many insightful discussion and suggestions.
Lastly, I thank faculty and staff members of P.I.E.T, Panipat which gave me an opportunity regarding training
purpose and helped me in building some experience in my career.
Kashish Narang
Roll No: 21003124

INDEX
Chapter No. Topic Page No.
CHAPTER 1 INTRODUCTION 1
1.1) Introduction to the Industry 2
1.2) Introduction to the Company 7
1.3) Introduction to the Topic 11
CHAPTER 2
LITERATURE REVIEW
28
CHAPTER 3 RESEARCH METHODOLOGY 36
3.0) Research methodology 36
3.1) Statement of the problem 36
3.2) Significance of study 36
3.3) Objective of the study 37
3.4) Scope of the study 37
3.5) Research design 37
3.6) Collection of data 38
3.7) Sources of data collection 39
3.8) Sampling technique 39
3.9) Analytical tool used in study 40
3.10) Limitation of study 40
CHAPTER 4 ANALYSIS & INTERPRETATION 41
CHAPTER 5 FINDINGS, SUGGESTION & CONCLUSION 51
5.1) Findings 52
5.2) Conclusion 53
5.3) Suggestion 54
BIBLIOGRAPHY
4

1.1 INTRODUCTION TO THE INDUSTRY
6

INDIAN STOCK MARKET OVERVIEW
Indian stock Market Overview
The Bombay Stock Exchange (BSE) and the National Stock Exchange of India Limited (NSE) are the two
main exchanges in India. In addition, there are 22 Regional Stock Exchanges. However, the BSE and NSE
have recognized themselves as the two leading exchanges and account for about 80% of the equity capacity
traded in India. The NSE and BSE are equal in size in terms of daily operated volume.
The average daily turnover at the exchanges has enlarged from Rs851crore in 1997-98 to Rs1284crore in
1998-99 and further to Rs 2273 crore in 1999-2000. NSE has around 1500 shares registered with the total
market capitalization of around Rs9, 21,500crore.
The BSE has over 6000 stocks listed and has a market capitalization of around Rs9, 68,000crore. Most key
stocks are operated on both the exchanges and later the investor could buy on whichever of the exchanges.
Both exchanges have a different clearance cycle, which allows investors to shift their position on the
bourses. The primary catalogue of BSE in BSE Sensex comprises 30 stocks. NSE has the S&P NSE 50
Index (Nifty), which consists of fifty stocks. The BSE Sensex is the older and most broadly followed index.
Both these indices are calculated on the basis of market capitalization and contain the heavily traded shares
from key sectors.
The markets are closed on Saturdays and Sundays. Both the exchanges have substituted over from the open
outcry trading system to a fully automated computerized mode of exchange known as BOLT (BSE On Line
Trading) and NEAT (National Exchange Automated Trading) system. It facilitates more efficient
processing, automatic order matching, faster implementation of trades and transparency.

MUTUAL FUNDS ARE AN UNDER TAPPED IN INDIAN MARKET:
Deposit being available in the market less than 10% of Indian households have invested in mutual funds. A
recent report on Mutual Fund Investments in India published by research and analytics firm, Boston
Analytics, suggests investors are holding back from putting their money into mutual funds due to their
perceived high risk and a lack of information on how mutual funds work. There are 46 Mutual Funds as of
June 2013.
The primary reason for not investing appears to be correlated with city size. Among respondents with a high
savings rate, close to 40% of those who live in metros and Tier I cities considered such investments to be
very risky, whereas 33% of those in Tier II cities said they did not know how or where to invest in such
assets.
SERVICING:
Larger Indian Mutual Fund Industry has benefited from outsourcing the activity of servicing their investors
to two of the leading Registrar and Transfer Agents (RTAs) in India namely CAMS and Kary. While CAMS
commands close to 65% of the Assets servicing, rest is with Kary. Franklin Templeton Mutual Fund services
its investors through its own in-house RTA set up.
Both the RTAs have vibrant network of their local offices which enable the Mutual Fund Investors to transact
locally. These touch points (or) Customer Service Centres (CSCs), provide a wide range of servicing
including, financial transaction acceptance & processing, non-financial changes, KYC fulfilment
formalities, nomination registration, transmission of units apart from providing statement of accounts etc.
These two RTAs also provide most of the similar facilities in their respective websites which are very user
friendly.
EQUITY MARKET:
In accounting and finance, equity is the difference between the value of the assets and the cost of the
liabilities of something owned. For example, if someone owns a car worth $15,000 but owes $5,000 on a
loan against that car, the car represents $10,000 equity. Equity can be negative if liability exceeds assets.
In an accounting context, shareholders' equity (or stockholders' equity, shareholders' funds, shareholders'
capital or similar terms) represents the equity of a company as divided among shareholders of common or
preferred stock. Negative shareholders' equity is often referred to as a shareholders' deficit.
8

HISTORY
The first mutual funds were established in Europe. One researcher credits a Dutch merchant with creating the
first mutual fund in 1774. Mutual funds were introduced to the United States in the 1890s, and they became
popular in the 1920s.
These early U.S. funds were generally closed-end funds with a fixed number of shares that often traded at
prices above the portfolio value. The first open-end mutual fund, called the Massachusetts Investors Trust (now
part of the MFS family of funds, with redeemable shares was established on March 21, 1924. However, closed-
end funds remained more popular than open-end funds throughout the 1920s. In 1929, open-end funds
accounted for only 5% of the industry's $27 billion in total assets.
After the stock market crash of 1929, Congress passed a series of acts regulating the securities markets in
general and mutual funds in particular. The Securities Act of 1933 requires that all investments sold to the
public, including mutual funds, be registered with the SEC and that they provide prospective investors with a
prospectus that discloses essential facts about the investment. The Securities and Exchange Act of 1934
requires that issuers of securities, including mutual funds, report regularly to their investors; this act also
created the Securities and Exchange Commission, which is the principal regulator of mutual funds. The
Revenue Act of 1936 established guidelines for the taxation of mutual funds, while the Investment Company
Act of 1940 governs their structure.
When confidence in the stock market returned in the 1950s, the mutual fund industry began to grow again. By
1970, there were approximately 360 funds with $48 billion in assets. The introduction of money market funds
in the high interest rate environment of the late 1970s boosted industry growth dramatically. The first retail
index fund, First Index Investment Trust, was formed in 1976 by The Vanguard Group, headed by John Bogle;
it is now called the "Vanguard 500 Index Fund" and is one of the world's largest mutual funds, with more than
$220 billion in assets as of November 30, 2015
Fund industry growth continued into the 1980s and 1990s. According to Pozen and Hamacher, growth was the
result of three factors: a bull market for both stocks and bonds, new product introductions (including tax-
exempt bond, sector, international and target date funds) and wider distribution of fund shares. Among the new
distribution channels were retirement plans. Mutual funds are now the preferred investment option in certain
types of fast-growing retirement plans, specifically in 401(k) and other defined contribution plans and in
individual retirement accounts (IRAs), all of which surged in popularity in the 1980s. Total mutual fund assets
fell in 2008 as a result of the financial crisis of 2007– 08.

IN 2003,
The mutual fund industry was involved in a scandal involving unequal treatment of fund shareholders. Some
fund management companies allowed favoured investors to engage in late trading, which is illegal, or market
timing, which is a practice prohibited by fund policy. The scandal was initially discovered by former New York
Attorney General Eliot Spitzer and led to a significant increase in regulation.
At the end of 2015, there were over 15,000 mutual funds in the United States with combined assets of $18.1
trillion, according to the Investment Company Institute (ICI), a trade association of U.S. investment companies.
The ICI reports that worldwide mutual fund assets were $33.4 trillion on the same date
Mutual funds play an important role in U.S. household finances; in mid-2015, 43% of U.S. households held
mutual fund. Their role in retirement planning is particularly significant. Roughly half of the assets in
individual retirement accounts and in 401(k) and other similar retirement plans were invested in mutual funds.
10

Features Of Mutual Funds:
Mutual funds are popular investment vehicles that pool money from multiple investors to invest in a diversified
portfolio of stocks, bonds, or other securities. They offer several features that make them attractive to a wide
range of investors. Here are the key features of mutual funds:
 Professional Fund Management:
One of the primary features of mutual funds is professional fund management. Experienced portfolio managers
make investment decisions on behalf of investors.
These managers conduct research, analyse market trends, and select securities that align with the fund's investment
objectives.
 Diversification:
Mutual funds invest in a diversified portfolio of assets, which helps spread risk. By holding a variety of securities,
mutual funds reduce the impact of poor performance from any single investment.
Diversification can enhance stability and reduce the potential for significant losses.
 Liquidity:
Mutual funds offer high liquidity. Investors can buy or sell fund shares on any business day at the fund's net asset
value (NAV), which is typically calculated at the end of each trading day.
This liquidity provides flexibility for investors to access their money when needed.
 Affordability:
Mutual funds make it affordable for investors to access a diversified portfolio of securities. Investors can start with
a relatively small initial investment, and subsequent contributions can be made in small increments.
This feature allows both small and large investors to participate in the market.

 Transparency:
Mutual funds provide regular updates to investors about the fund's performance and holdings. This transparency
allows investors to track their investments and understand where their money is being invested.
 Accessibility:
Mutual funds are widely available through various distribution channels, such as banks, financial advisors, online
platforms, and direct investment with the fund company.
This accessibility makes it convenient for investors to choose funds that align with their financial goals and risk
tolerance.
 Tax Benefits:
In many countries, including India, mutual funds offer tax benefits. For example, in India, equity mutual funds
enjoy favourable tax treatment in terms of capital gains taxation.
Investors may also benefit from tax deductions for investments in specific types of mutual funds, such as ELSS
(Equity-Linked Savings Schemes).
 Variety of Fund Types:
Mutual funds come in various types, including equity funds, debt funds, hybrid funds, and thematic or sector-
specific funds. This variety allows investors to tailor their investments to match their risk preferences and financial
objectives.
 Dividend and Capital Gains Distribution:
Many mutual funds distribute dividends and capital gains to their investors periodically, providing them with
potential income streams.
These distributions can be useful for retirees or investors seeking regular income.
 Automatic Investment Options:
Mutual funds often offer systematic investment plans (SIPs) that allow investors to automate regular contributions,
making it easier to stick to an investment plan and benefit from rupee cost averaging.
12

CHALLENGES:
 MARKET RISK:
Mutual funds are subject to market fluctuations. If the overall market performs poorly, it can impact the fund's
performance, potentially leading to losses for investors.
 MANAGEMENT Risk:
The performance of a mutual fund depends on the skill and expertise of the fund manager. Poor investment
decisions or changes in management can affect returns.
 LACK OF CONTROL:
Investors in mutual funds have limited control over the fund's portfolio decisions. They entrust their money to the
fund manager, which means they cannot directly choose specific investments.

 LIQUIDITY RISK:
Although mutual funds offer liquidity, certain types of funds, such as closed-end funds or funds with limited
redemption periods, may restrict investors' ability to withdraw their money at will.
 UNDERPERFORMANCE:
Not all mutual funds consistently outperform the market or their benchmark indices. Some funds may underperform
due to poor investment choices or market conditions.
 OVERDIVERSIFICATION:
While diversification is a key benefit, overdiversification can dilute returns. Some funds may hold too many
securities, making it challenging for investors to track their investments.
 MARKET TIMING RISK:
Investors who try to time the market by buying and selling mutual fund shares based on short-term predictions may
incur losses or miss out on potential gains.
 REGULATORY CHANGES:
Changes in government regulations or tax laws can impact the structure and taxation of mutual
funds, affecting investors' returns and tax liabilities.
 REDEMPTION PRESSURE:
During times of market volatility or economic uncertainty, mutual funds may experience a surge in
redemption requests. This can force fund managers to sell assets quickly, potentially at
unfavourable prices.
 STYLE DRIFT:
Some fund managers may deviate from their stated investment objectives or style, which can lead
to inconsistencies in the fund's performance.
14

COMPANY PROFILE
CONSORTIUM is one of the leading broking houses in India that provides a wide range of services nationwide
to a substantial and diversified client base that includes retail clients, high net worth individuals, corporates
and financial institutions. Founded in 1992 with just DSE trading membership, we have come a long way since
and are now members of all major exchanges in India namely NSE, BSE, MCX, NCDEX, NSE Currency &
MCX-SX. In addition to this, we are also a depository participant with NSDL.
We are committed to our distinctive culture and core values, which always place our client's interests first. Our
values emphasize integrity, transparency, commitment to excellence and teamwork. We have more than 20,000
clients and a presence in more than 100 locations through our network of longstanding franchisees and sub
brokers. All our offices are managed by qualified professionals and equipped with state-of-the-art infrastructure
(VSAT connectivity, leased lines, internet connectivity, telephones, voice loggers, etc) to serve our clients in
the best possible manner.
The passage you provided describes "CONSORTIUM," which is portrayed as a prominent brokerage India.
Let's break down and explain the key points mentioned in the passage:
 Background and History
Consortium is a well-established broking house in India, founded in 1992.
It started with trading membership on the Delhi Stock Exchange (DSE) and has expanded its operations
significantly since then.
16

 Range of Services:
Consortium offers a wide range of financial services.
These services cater to a diverse client base, including retail clients, high-net-worth individuals (HNIs),
corporates, and financial institutions.
 Exchange Memberships:
Consortium holds membership with all major stock exchanges in India, including the National Stock Exchange
(NSE), Bombay Stock Exchange (BSE), Multi Commodity Exchange (MCX), National Commodity and
Derivatives Exchange (NCDEX), NSE Currency, and MCX-SX.
MISSION OF THE COMPANY:
 Consortium aims to prioritize clients' interests by providing high-quality financial services tailored to
their needs.
 The company is committed to conducting business with integrity, transparency, excellence, and
teamwork, adhering to ethical values
 Consortium's mission includes offering a wide array of financial services to cater to a diverse clientele,
ranging from retail clients to institutional investors.
 The company seeks to expand its presence across India through a network of franchisees and sub-
brokers, ensuring accessibility to clients nationwide.
 Consortium aims to leverage advanced technology and infrastructure to deliver efficient and
competitive financial services to its clients.

Haryana Uttaranchal
Uttar Pradesh Jharkhand
Madhya Pradesh Chhattisgarh
Orrisa Andhra Pradesh
Maharashtra Karnataka
Gujarat Rajasthan
20

MUTUAL FUND
The Mutual Funds originated in UK and thereafter they crossed the border to reach other destinations. The
concept of MF was Indianized only in the later part of the twentieth century in the year 1964 with its roots
embedded into Unit Trust of India (UTI). Now after 50 years, booming stock markets & innovative marketing
strategies of mutual fund companies in India are influencing the retail investors to invest their surplus funds
with different schemes of mutual fund companies with or without complete understanding of Mutual Funds
(MF).
There is a general notion that an investment in mutual fund is always risky. Investors should always be
conscious of the fact that Mutual Funds invest their funds in capital market instruments such as shares,
debentures, bonds etc and that all the capital market instruments have risk. Risks can be Investor Thinking
Risks, Prediction Risks, Choice Risks, and Cost Risks etc.
Although there is no one mutual fund that will be suitable to all kinds of investors. Hence, mutual fund investors
need to identify a suitable fund for them. It will be the first step towards making successful investments in
mutual funds to make Mutual Funds their "CUP OF TEA".
Identifying a suitable fund can be done in a two-step manner as follows:
Selecting a fund with investment objectives and preferences, return objectives, time horizon and risk tolerances
that meet the requirements of the investor.
Selecting a fund that has a detailed asset allocation strategy by fund type category to reflect the investment
objectives of the fund.
Mutual funds can be win-win option available to the investors who are not willing to take any exposure directly
to the security markets as well as it helps the investors to build their wealth over a period of time. But the thing
which must be remembered by the investors is
"INVESTMENT IN MUTUAL FUND IS SUBJECT TO MARKET RISK".
The Indian Equity Market has grown significantly during the last three years; Mutual Funds are not left far
behind. Both the avenues have created wealth for the investors. But for the creation of wealth through this
avenue a proper understanding of the Mutual Funds is must.
22

UNDERSTANDING MUTUAL FUNDS
A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal.
The money thus collected is then invested in capital market instruments such as shares, debentures and other
securities. The income earned through these investments and capital appreciation realized is shared by its unit
holders in proportion to the number of units owned by them.
Thus, a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest
in a diversified, professionally managed basket of securities at a relatively low cost. When we talk about all
these, one hard fact is about risks that are faced by the Mutual Fund investors. Whenever we see any Mutual
Fund offer, there are few statements inevitably found along with that, which is commonly known as
"Disclaimer Clause of the Mutual Fund".

INDIAN MUTUAL FUND INDUSTRY
The Indian mutual fund industry is dominated by the Unit Trust of India, which has a total corpus of Rs700bn
collected from more than 20 million investors. The UTI has many funds/schemes in all categories i.e., equity,
balanced, income etc with some being open-ended and some being closed ended. The Unit Scheme 1964
commonly referred to as US 64, which is a balanced fund, is the biggest scheme with a corpus of about
Rs200bn. Most of its investors believe that the UTI is government owned and controlled, which, while legally
incorrect, is true for all practical purposes.
The second largest category of mutual funds is the ones floated by nationalized banks. Can bank Asset
Management floated by Canara Bank and SBI Funds Management floated by the State Bank of India are the
largest of these. GIC AMC floated by General Insurance Corporation and Jeevan Bima Saha Yog AMC floated
by the LIC are some of the other prominent ones.
Mutual fund
Performance of mutual funds in India from the day the concept of mutual fund took birth in India in the year
was 1963. Unit Trust of India invited investors or rather to those who believed in savings, to park their money
in UTI Mutual Fund. 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 guaranteed high returns by the beginning of liberalization of the
industry in 1992. 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 from the preparedness of
risks factor after the liberalization.
The Assets under Management of UTI was Rs. 67bn. by the end of 1987. Let me concentrate about the
performance of mutual funds in India through figures. From Rs. 67bn. the Assets under Management rose to
Rs. 470 bn. in March 1993 and the figure had a three times higher performance by April 2004. It rose as high
as Rs. 1,540bn. The net asset value (NAV) of mutual funds in India declined when stock prices started falling
in the year 1992.
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 disinvested by selling
at loss in the secondary market.
24

The performance of mutual funds in India suffered qualitatively. The 1992 stock market scandal, the losses by
disinvestments and of course the lack of transparent rules in the whereabouts rocked confidence among the
investors. Partly 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 measure was taken to
make mutual funds the key instrument for long-term saving. The more the variety offered, the quantitative will
be investors. At last to mention, as long as mutual fund companies are performing with 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 and don'ts of mutual funds.
MARKET TREND
 With the entry of private sector funds in 1993, a new era started in the Indian mutual fund industry,
giving the Indian investors a wider choice of fund families. Also, 1993 was the year in which the first
Mutual Fund Regulations came into being, under which all mutual funds, except UTI were to be
registered and governed. The erstwhile Kothari Pioneer (now merged with Franklin Templeton) was
the first private sector mutual fund registered in July 1993.
 The 1993 SEBI (Mutual Fund) Regulations were substituted by a more comprehensive and revised.
 The number of mutual fund houses went on increasing, with many foreign mutual funds setting up
funds in India and also the industry has witnessed several mergers and acquisitions. As at the end of
January 2003, there were 33 mutual funds with total assets of Rs. 1,21,805 crores. The Unit Trust of
India with Rs.44,541 crores of assets under management were way ahead of other mutual funds.
 This year 2003 bought bitter experiences for UTI. It was bifurcated into two separate entities. One was
the Specified Undertaking of the Unit Trust of India with AUM of Rs.29,835 crores (as on January
2003). The Specified Undertaking of Unit Trust of India is functional 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 Ltd, 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 AUM and with the setting up of a UTI Mutual
Fund, conforming to the SEBI Mutual Fund Regulations, and with recent mergers taking place among
different private sector funds, the mutual fund industry has entered its current phase of consolidation
and growth. In the past decade, Indian mutual fund industry had seen dramatic improvements, both
qualitative as well as quantitative. Despite these improvements, the industry scenario is not as rosy as
it seems.

 With the Indian stock markets growing at a frantic pace in 2007 (much like 2006), investors who were
willing to take on risk have been rewarded rather handsomely for their efforts. While the smart investor
has been grounded, many an ecstatic investor has lost his bearings taking on even higher dosage of risk
for that additional return.
 Nonetheless, 2007 had a lot of innovation in store for the mutual fund investor, not all of which were
positive. And there are indications that 2008 could prove to be just as innovative.
 Given that the domestic mutual fund industry has far from matured, it is only natural to expect a lot of
new products and innovation along the way. 2007 witnessed some of these innovations.
26

CLASSIFICATION OF MUTUAL FUND
Mutual fund schemes may be classified on the basis of their structure and their investment objective
 BY STRUCTURE
1. OPEN-ENDED FUNDS
2. CLOSE-ENDED FUNDS
 BY INVESTMENT OBJECTIVE
 Growth Funds:
The aim of growth funds is to provide capital appreciation over the medium to long term. Such schemes
normally invest a majority of their corpus in equities. Growth schemes are ideal for investors who have a long-
term outlook and are seeking growth over a period of time.
 Income Funds:
The aim of Income Funds is to provide regular and steady income to investors. Such schemes generally invest
in fixed income securities such as bonds, corporate debentures and Government securities.
 Balanced Funds:
The aim of Balanced Funds is to provide both growth and regular income. Such schemes periodically distribute
a part of their earning and invest both in equities and fixed income securities in the proportion indicated in
their offer documents.
 Money Market Funds:
The aim of Money Market Funds is to provide easy liquidity, preservation of capital and moderate income.
These schemes generally invest in safer short-term instruments such as Treasury Bills, Certificates of
Deposit, Commercial Paper and Inter-Bank Call Money.
DIFFERENT MUTUAL FUND PLANS:

To cater to different investment needs, Mutual Funds offer various investment options. Some of the
important investment options include:
1) GROWTH OPTION:
Dividend is not paid-out under a Growth Option and the investor realizes only the capital appreciation on the
investment (by an increase in NAV).
2) DIVIDEND PAYOUT OPTION:
Dividends are paid-out to investors under the Dividend Payout Option. However, the NAV of the mutual fund
scheme falls to the extent of the dividend payout.
3) DIVIDEND RE-INVESTMENT OPTION:
Here the dividend accrued on mutual funds is automatically re-invested in purchasing additional units in open-
ended funds. In most cases mutual funds offer the investor an option of collecting dividends or re-investing the
same.
4) RETIREMENT PENSION OPTION:
Some schemes are linked with retirement pension. Individuals participate in these options for themselves, and
corporate participate for their employees.
MUTUAL FUND ADVANTAGES
The benefits on offer are many with good post-tax returns and reasonable safety being the hallmark that we
normally associate with them. Some of the other major benefits of investing in them are:
 Number of available options:
Mutual funds invest according to the underlying investment objective as specified at the time of launching a
scheme. So, we have equity funds, debt funds, gilt funds and many others that cater to the different needs of
the investor. The availability of these options makes them a good option.
 Diversification:
Investments spread across a wide cross-section of industries and sectors and so the risk is reduced.
Diversification reduces the risk because not all stocks move in the same direction at the same time. One can
achieve this diversification through a Mutual Fund with far less money than one can on his own.
28

 Professional Management:
Mutual Funds employ the services of skilled professionals who have years of experience to back them up. They
use intensive research techniques to analyse each investment option for the potential
 Potential of Returns:
Returns in the mutual funds are generally better than any other option in any other avenue over a reasonable
period. People can pick their investment horizon and stay put in the chosen fund for the duration. Equity funds
can outperform most other investments over long periods by placing long-term calls on fundamentally good
stocks.
 Get Focused:
Investing in individual stocks can be fun because each company has a unique story. However, it is important
for people to focus on making money. Investing is not a game. Your financial future depends on where you put
your hard-earned dollars and it should not take lightly.
 Efficiency:
By pooling investors' monies together, mutual fund companies can take advantage of economies of scale. With
large sums of money to invest, they often trade commission-free and have personal contacts at the brokerage
firms.
DRAWBACKS OF MUTUAL FUNDS
Mutual funds have their drawbacks and may not be for everyone:
 NO GUARANTEES
 FEES AND COMMISSIONS
 TAXES
 MANAGEMENT RISK

TYPES OF RISK INVOLVED WITH MUTUAL FUNDS
Risk is an inherent aspect of every form of investment. For mutual fund investments, risks would include
variability, or period-by-period fluctuations in total return. The value of the scheme's investments may be
affected by factors affecting capital markets such as price and volume volatility in the stock markets, interest
rates, currency exchange rates, foreign investment, changes in government policy, political, economic or other
developments.
Market Risk:
At times, the prices or yields of all the securities in a particular market rises or falls due to broad outside
influences. When this happens, the stock prices of both an outstanding, highly profitable company and a
fledgling corporation may be affected. This change in price is due to "market risk".
Inflation Risk:
Sometimes referred to as "loss of purchasing power." Whenever the rate of inflation exceeds the earnings on
your investment, you run the risk that you'll actually be able to buy less, not more.
Credit Risk:
In short, how stable is the company or entity to which you lend your money when you invest? How certain are
you that it will be able to pay the interest you are promised, or repay your principal when the investment
matures?
Interest Rate Risk:
Changing interest rates affect both equities and bonds in many ways. Bond prices are influenced by movements
in the interest rates in the financial system. Generally, when interest rates rise, prices of the securities fall and
when interest rates drop, the prices increase. Interest rate movements in the Indian debt markets can be volatile
leading to the possibility of large price movements up or down in debt and money market securities and thereby
to possibly large movements in the NAV.
30

Investment Risks:
In the sectoral fund schemes, investments will be predominantly in equities of select companies in the
particular sectors. Accordingly, the NAV of the schemes are linked to the equity performance of such
companies and may be more volatile than a more diversified portfolio of equities.
Liquidity Risk:
Thinly traded securities carry the danger of not being easily saleable at or near their real values. The fund
manager may therefore be unable to quickly sell an illiquid bond and this might affect the price of the fund
unfavourably. Liquidity risk is characteristic of the Indian fixed income market.
RELATIONSHIP BETWEEN RETURN AND RISK:
In the above graph it shows that as the standard deviation increases, the returns from the particular type of fund
increases.

Equity Market in Comparison with Mutual fund
Capital markets are the markets for the long-term funds. It enhances capital formation, which has a very
significant role to play in the development of any economy.
o Primary Market is a place where new offerings by Companies are made either as an Initial Public
Offering (IPO) or Rights Issue.
o Secondary Market is a market where securities are traded after being initially offered to the public in
the Primary
Market and/or listed on the Stock Exchange. Majority of trading is done in this market which comprises of
equity market and debt market. As the secondary market is created for the securities raised in the primary
markets, the depth of the secondary market depends upon the primary markets.
EQUITY MARKET IN INDIA
The development of India’ s equity capital markets has taken a more progressive trajectory than the bond
market, largely reflecting the government’ s laissez faire approach in the segment. At 90% of GDP, its size is
comparable to that of other emerging countries, although it is still small relative to many developed markets
like Japan and US.
32

Of India’ s 23 stock exchanges, equity trading is most active in the National Stock Exchange (NSE) and the
Bombay Stock Exchange (BSE). Since the NSE’ s inception in 1994, it has caught up with the BSE in terms
of capitalization but exceeded it in turnover. The BSE boasts of over 4,000 listed companies, surpassing stock
exchanges in the US. This explains its slightly higher market capitalization over the NSE, although its lower
turnover implies that inefficiencies remain due to the high proportion of untraded companies. Its share of total
equity turnover is just 33% compared to 66% of its rival, the NSE. The increase in the limit for foreign direct
investment in the stock exchanges to 49% announced earlier this year is expected to lend more dynamism to
the equity capital markets. The investment limit for a single investor was set at 5%. It did not take long after
the new limit was announced that the New York Stock Exchange (NYSE), Goldman
EQUITY STOCK SELECTION APPROACHES
When the objective of the analysis is to determine what stock to buy and at what price, there are two basic
methodologies:
1. FUNDAMENTALANALYSIS
Fundamental Analysis is a technique that attempts to determine a security’ s value by focusing on underlying
factors that affect a company's actual business and its future prospects. As with most analysis, the goal is to
derive a forecast and profit from future price movements. To forecast future stock prices, fundamental analysis
combines economic, industry, and company analysis to derive a stock's current fair value and forecast future
value. If fair value is not equal to the current stock price, fundamental analysts believe that the stock is either
over or under valued and the market price will ultimately gravitate towards fair value.
2. TECHNICALANALYSIS
Technical Analysis maintains that all information is reflected already in the stock price, so fundamental
analysis is a waste of time. Trends 'are your friend' and sentiment changes predate and predict trend changes.
Investors' emotional responses to price movements lead to recognizable price chart patterns. Technical analysis
does not care what the 'value' of a stock is. Their price predictions are only extrapolations from historical price
patterns.

Framework for Fundamental Analysis:
Even though there is no one clear-cut method, the general approach being used is the Top-Down approach.
With the top-down approach of forecasting after undergoing Fundamental Analysis, analysts are primarily
involved in making prediction and assessment for the economy of the country, the state, the area and then for
the industries and finally for the companies. The industry’ s forecast is always based on the overall assessment
of the economy and company’ s forecast on the industry itself and the economy as a whole.
Economic Analysis
 A study of economic trends as indicated by the rate of growth in GDP, inflation, money supply,
aggregate corporate profits etc.
 A study of economic policies of the government including plan priorities, monetary policies, fiscal
policies etc.
 An analysis of the relationship between economic trends and economic policies and the stability of
such relationships.
 A study of world economic trends and their impact on Indian economy.
Industry Analysis
 Implications of projected growth in Gross National Product for various industries.
 Implications of plan priorities and plan expenditures for various industries
 Vulnerability of an industry under government regulation and control of prices and production
 Implications of industrial and fiscal policies of the government for an industry
 Degree of dependence on scarce non-renewable or imported raw materials.
 Vulnerability of industry to business cycle
 Life Cycle position of the industry
Company Analysis
 A trend analysis of company’ s market share and its cost structure
 An analysis of turnover of assets, operating and production efficiencies through Ratio Analysis
 Leverage and coverage ratio analysis
34

 Funds flow and Profitability analysis
FACTORS TO BE CONSIDERED WHILE SELECTING A STOCK
Qualitative Factors
The principal objective of qualitative analysis is to identify sustainable competitive advantages of each
company and to determine the level of confidence and conviction in corporate management. The analysis
includes evaluating both internal and external factors that may have an impact on a company's ability to sell
its product. It also involves having regular open dialogue with management and regular conference calls to
discuss recent developments. The intent is to be long-term holders of the company one purchases. Strong belief
in management is required in order to maintain conviction during the short-term adversities that virtually all
companies experience.
THE VARIOUS QUALITATIVE FACTORS TO BE CONSIDERED ARE:
Industry
Industry is a grouping used to describe a company's main business activity. It is generally determined by the
major source of a company's income. A hot sector is a sector of the economy experiencing a higher than regular
growth rate. If companies across an industry show solid earnings and revenue figures, that industry may be
showing signs that it is in its growth phase. Our goal is to select securities that area in a hot industry.
Scale of Opportunity:
The trick lies in identifying Sectors which present huge scope of opportunities. This involves finding sectors
whose market cap are way beyond that of the total industry.
For example, when Mobile Telephony was in growing stage in India in 2004, Bharti Airtel was trading at a
market cap of $ US 1.5 billion against a total market size of US $ 100 billion. Three years down the line and
we can see the remarkable returns given by the stock.

Company Market Capitalization
Pantaloon Retail US $ 1 billion
Titan US $ 756 million
Shopper Stop US $ 358 million
Trent US $ 263 million
Total market cap of listed Retail players US $ 2.37 billion
Total size of the Retail market US $ 300 billion
Percentage to the total Retail Market 0.79%
Industry Leader:
o The top two or three stocks in a strong industry group can have incredible growth, while others in
the group may barely move. One should buy the best companies, the ones that lead their sectors and
are number one in their particular field. The number one market leader is not the biggest one.
o It is the one with the highest annual growth, earning per share, and price relative strength. It’ s a
company that has competitive advantage over its competitors. A company that is offering the best
product
Management:
Great management can make a difference between an average business and an extraordinary one. Our goal as
an investor is to find management teams that think like shareholders; executives who treat the company as if
they own a piece of it. One way to find out about the management and how much they really care about
shareholders is to check the top executive’ s compensation plans. We review the compensation detail in a
document called proxy statement. Big bonuses are always better than big base salaries. Bonuses mean a chunk
of the income is always at risk and depends on the performance of the management.
Competitive Advantage:
I. Creating a real different product
II. Creating a strong brand
III. Keeping costs down
IV. Locking in customers by creating high switching cost
V. Locking out competitors
36

Technical Factors
Determining Market Trend
Detecting the current trend of the market is the first and most important part of our stock pick system. More
than 75% of your trades will end up in a loss if you fight the trend. As part of our stock pick strategy, we
constantly review the conditions of the market averages.
Support Resistance
 The price action of a stock over a period of time will create strength at certain price levels. These levels
are recognized as resistance at the top and support at the bottom end of the trading range. This trading
range may develop different time frames; it can take from weeks to years or a support and resistance
level to develop.
 As the price of a stock breaks through the resistance level and moves to a higher level, the level of
resistance now becomes the level of support. A new level of resistance will then be formed at some
point in the future. On the other hand, as the price range falls below the support level, that level then
becomes the new resistance level.

CHAPTER 2
LITERATURE REVIEW
38

Literature on mutual fund performance evaluation is enormous. A few research studies that have influenced
the preparation of this paper substantially are discussed in this section.
ZHI DA, PEGGIE GAO, AND RAVI JAGANNATHAN (2021)
“Impatient Trading, Liquidity Provision, and Stock Selection by Mutual Funds”
Showed that a mutual fund's stock selection skill can be decomposed into additional components that include
liquidity-absorbing impatient trading and liquidity provision. The study proved that past performance predicts
future performance better among funds trading in stocks affected more by information events Past winners
earn a risk adjusted after-fee excess return of 35 basis points per month in the future. Most of that superior
performance comes from impatient trading. The paper also states that impatient trading is more important for
growth-oriented funds, and liquidity provision is more important for younger income funds.
DEEPAK AGRAWAL (2021)
“Measuring Performance of Indian Mutual Funds”
In his study he touched the development of Indian capital market and deregulations of the economy in 1992.
Since the development of the Indian Capital Market and deregulations of the economy in 1992 there have been
structural changes in both primary and secondary markets. Mutual funds are key contributors to the
globalization of financial markets and one of the main sources of capital flows to emerging economies. Despite
their importance in emerging markets, little is known about their investment allocation and strategies. This
article provided an overview of mutual fund activity in emerging markets. It described about their size and
asset allocation. The paper is a process to analyse the Indian Mutual Fund Industry pricing mechanism with
empirical studies on its valuation. The data is also analysed at both the fund-manager and fund-investor levels.
The study revealed that the performance is affected by the saving and investment 50habits of the people and
the second side the confidence and loyalty of the fund Manager and rewards affects the performance of the MF
industry in India.

DEEPAK AGRAWAL (2021)
“Measuring Performance of Indian Mutual Funds”
In his study he touched the development of Indian capital market and deregulations of the economy in 1992.
Since the development of the Indian Capital Market and deregulations of the economy in 1992 there have been
structural changes in both primary and secondary markets. Mutual funds are key contributors to the
globalization of financial markets and one of the main sources of capital flows to emerging economies. Despite
their importance in emerging markets, little is known about their investment allocation and strategies. This
article provided an overview of mutual fund activity in emerging markets. It described about their size and
asset allocation. The paper is a process to analyses the Indian Mutual Fund Industry pricing mechanism with
empirical studies on its valuation. The data is also analysed at both the fund-manager and fund-investor levels.
The study revealed that the performance is affected by the saving and investment 50habits of the people and
the second side the confidence and loyalty of the fund Manager and rewards affects the performance of the MF
industry in India.
RONAYAND KIM (2018)
In his study he pointed out that there is no difference in risk attitude between individuals of different gender,
but between the groups, males indicate a stronger inclination to risk tolerance. Gender difference was found at
an individual level, but in groups, males expressed a stronger pro-risk position than females.
ZAKRI BELLO (2013)
He matched a sample of socially responsible stock mutual funds matched to randomly selected conventional
funds of similar net assets to investigate differences i characteristics of assets held, degree of portfolio
diversification and variable effects of diversification on investment performance. The studies found that
socially responsible funds do not differ significantly from conventional funds in terms of any of these attributes.
Moreover, the effect of diversification on investment performance is not different between the two groups.
Both groups underperformed the Domini 400 Social Index and S & P 500 during the study period.
40

MISHRA, ET AL., (2011)
He measured mutual fund performance using lower partial moment. In this paper, measures of evaluating
portfolio performance based on lower partial moment are developed. Risk from the lower partial moment is
measured by taking into account only those states in which return is below a pre-specified “target rate” like
risk-free rate.
KSHAMA FERNANDEZ (2003)
He evaluated index fund implementation in India. In this paper, tracking error of index funds in India is
measured. The consistency and level of tracking errors obtained by some well-run index fund suggests that it is
possible to attain low levels of tracking error under Indian conditions. At the same time, there do seem to be
periods where certain index funds appear to depart from the discipline of indexation. K. Pend Araki et al.
studied construction of mutual fund portfolios, developed a
multicriteria methodology and applied it to the Greek market of equity mutual funds. The method ology is
based on the combination of discrete and continuous multi-criteria decision aid methods for mutual fund
selection and composition. UTADIS multi-criteria decision aid methods employed in order to develop mutual
fund’ s performance models. Goal programming model is employed to determine proportion of selected mutual
funds in the final portfolios.
BORNSTEIN, E. AND GELSO, G. (2001)
He explores the behaviour of emerging market mutual funds using a novel database covering the holdings of
individual funds over the period January 1996 to March 1999. An examination of individual crises shows that,
on an average, funds withdrew money one month prior to the events. The degree of herding among funds is
statistically significant, but moderate. Herding is more widespread among open-ended funds than among
closed-end funds, but 31not more prevalent during crisis than during tranquil times. Funds tend to follow
momentum strategies, selling past losers and buying past winners, but their overall behaviour is more complex
than often suggested.

GAVIN QUILL (2001)
He examined the evidence that investor behaviour is frequently detrimental to the achievement of investors’
long-term goals. The picture that emerges from this analysis is one of investors who have lost a good portion
of their potential returns because of the excessive frequency and poor timing of their trading activities. They
established that investors trade much more than they realize and much more than is conducive to the
achievement of their financial plans. Investors think long-term in theory, but act according to short-term
influences in practice.
GUPTAAMITABH (2001)
Evaluated the performance of 73 selected schemes with different investment objectives, both from the public
and private sector using Market Index and Fundex. NAV of both close-end and open-end schemes from April
1994 to March 1999 were tested. They found that sample schemes were not adequately diversified, risk and
return of schemes were not in conformity with their objectives, and there was no evidence of market timing
abilities of mutual fund industry in India.
KARTHIKEYAN (2001)
Conducted research on Small Investors Perception on Post office Saving Schemes and found that there was
significant difference among the four age groups, in the level of awareness for Kisan Vikas Patra (KVP),
National Savings Scheme (NSS), and Deposit Scheme for Retired Employees (DSRE). The Overall Score
confirmed 32that the level of awareness among investors in the old age group was higher than in those of
young age group. No differences were observed among male and female investors.
VIJAYALAKSHMI S (2001)
He analysed the top holding of 76 mutual fund schemes from January 1998 to March 1999. The study showed
that, 62 stocks were held in portfolio of several schemes, of which only 26 companies provided positive gains.
The top holdings represented more than 90 percent of the total corpus in the case of 11 funds. The top holdings
showed higher risk levels compared to the return. The correlation between portfolio stocks and diversification
benefits was significant at one percent level for 30 pairs and at five
42

BLOCK, STANLEY B. AND FRENCH, DAN W. (2000)
Conducted a study on Portfolios of equity mutual funds. They proposed two-index model using both the value-
weighted and an equally weighted index. Estimated models using a sample of 506 mutual funds show that the
two-index model provides a better fit than the single-index model and identifies a larger set of funds with
abnormal performance.
RAMESH CHANDER (2000)
Examined 34 mutual fund schemes with reference to the three fund characteristics with 91-days treasury bills
rated as risk-free investment from January 1994 to December 1997. Returns based on NAV of many sample
schemes were superior and highly volatile compared to BSE SENSEX. Open-end schemes outperformed close-
end schemes in term of return. Income funds outsmarted growth and balanced funds. Banks and UTI sponsored
schemes performed fairly well in relation to sponsorship. Average annual return of sample schemes was 7.34
percent due to diversification and 4.1 percent due to stock selectivity. The study revealed the poor market
timing ability of mutual fund investment. The researcher also identified that 12 factors explained majority of
total variance in portfolio management practices.
MICHAEL C. JENSEN (1967)
Derived a risk-adjusted measure of portfolio performance (Jensen’s alpha) that estimates how much a manager’
s forecasting ability contributes to fund’ s returns.
WILLIAM F. (1966)
Suggested a measure for the evaluation of portfolio performance. Drawing on results obtained in the field of
portfolio analysis, economist Jack L. Treynor has suggested a new predictor of mutual fund performance, one
that differs from virtually all those used previously by incorporating the volatility of a fund's return in a simple
yet meaningful manner. Sharpe,

IRWIN, BROWN, FE (1965)
Analysed issues relating to investment policy, portfolio turnover rate, performance of mutual funds and its
impact on the stock markets. They identified that mutual funds had a significant impact on the price movement
in the stock market. They concluded that, on an average, funds did not perform better than the composite
markets and there was no persistent relationship between portfolio turnover and fund performance.
TREYNOR (1965)
Used ‘characteristic line’ for relating expected rate of return of a fund to the rate of return of a suitable market
average. He coined a fund performance measure taking investment risk into account. Further, to deal with a
portfolio, ‘portfolio-possibility line’was used to relate expected return to the portfolio owner’s risk preference.
FRIEND, ET AL., (1962)
Made an extensive and systematic study of 152 mutual funds found that mutual fund schemes earned an average
annual return of 12.4 percent, while their composite benchmark earned a return of 12.6 percent. Their alpha
was negative with 20 basis points. Overall results did not suggest widespread inefficiency in the industry.
Comparison of fund returns with turnover and expense categories did not reveal a strong relationship.
44

CHAPTER 3
RESEARCH METHODOLOGY

3.0 RESEARCH METHODOLOGY
"Research methodology is a structured way of gathering and studying information to gain more knowledge. In
simpler terms, it's a set of methods used to accomplish a specific task. When we put these two ideas together, we
get 'research methodology,' which is the process of finding and identifying information using scientific methods
and procedures."
3.1 STATEMENT OF THE PROBLEM
"The study aims to investigate the key challenges and opportunities in the Indian mutual fund industry,
providing insights to guide our company's strategic decisions in this market."
3.2 SIGNIFICANCE OF THE STUDY:
"Mutual funds are a way to lower risk when you invest. They do this by gathering money from different people and
investing it in various stocks. This helps investors spread their money across different investments, reducing the
risk. Mutual funds are managed by experts, which can help maximize the return on your investments. They also let
you reinvest the money you make.
Equity share capital, on the other hand, stays with the company. It doesn't require the company to pay a fixed
dividend. Plus, it can be issued without using the company's assets as collateral."
3.3 OBJECTIVES OF THE STUDY
I. PRIMARY OBJECTIVE:
To comprehend the various types of mutual funds.
II. SECONDARY OBJECTIVES:
 Investigate investor opinions about mutual funds.
 Analyse the factors influencing investors' decisions when investing in mutual funds.
46

3.4 SCOPE OF THE STUDY
In India, the mutual fund industry has been rapidly growing since the government's policy liberalization. There are
a total of 46 mutual fund houses, with 38 being private sector asset management companies (AMCs) and the rest
being public sector and UTI AMCs. The competition has intensified due to private sector mutual funds, along with
joint ventures, both Indian and foreign. Additionally, banks and insurance companies have entered the mutual funds
industry, further increasing the competition.
Private sector mutual funds offer a variety of schemes with different risk levels and returns. This presents an
opportunity to assess mutual fund performance from various angles, including risk-return, risk-adjusted return, and
comparison with alternative investments."
3.5 RESEARCH DESIGN:
The research design is a plan for our study, showing how we'll do it. We'll start with exploratory research to
understand the situation better and define the problem. This involves methods like reviewing existing
literature and surveying investors' opinions. Our research is both exploratory and descriptive, meaning we'll
gather both qualitative and quantitative information.
 Sample design:
After creating the research plan, the next step is to plan how we'll select a sample. Sampling means using a
small number of items to represent the entire population for studying its characteristics. For instance, one
way to do this is through simple random sampling.
 Sampling Size:
The numbers of investors were 101 with the help of convenient sampling in Karnal.
 Sampling Area:
Area assigned for investors behaviour: KARNAL

3.6 COLLECTION OF DATA
Data collection means gathering and measuring information about specific things we're interested in, following
a systematic approach. This helps us answer research questions, test ideas, and assess outcomes. Data collection
is a fundamental part of research in various fields like science, social studies, humanities, and business.
Even though the methods can differ between fields, the main goal is always the same: to collect accurate and
honest information. The aim of data collection is to gather high-quality evidence, which is then used for in-
depth analysis. This analysis helps us provide convincing and credible answers to our research questions.
Having a structured data collection process is essential. It ensures that the data we gather is well-defined and
valid. It also guarantees that any decisions we make based on the data are trustworthy. This process sets a
baseline for evaluation and, in some cases, provides a target for improvement.
3.7 METHODS OF DATA COLLECTION
 Primary Data:
Primary data is information collected for the first time. We used a questionnaire as a tool to gather this data. The
questionnaire had closed-ended questions, which means respondents had to choose an answer from a list of options.
If anyone had questions, we clarified them to ensure we got the right answers from the distributors. Closed-ended
questions were easy to organize and analyses.
 Secondary Data:
Secondary data refers to information that has already been collected and analysed by someone else. Researchers
can access this existing data, which can save both time and money in comparison to collecting new data.
 Newspapers
 Websites
 Journals
 Books
 Magazines
48

Benefits of Secondary Data:
 Cost-Efficient
 Time-Saving
 Historical Perspective
 Diverse Sources
3.8 SAMPLING TECHNIQUE
Convenience sampling is a non-probability sampling method used in research, and it relies on gathering data
from individuals who are conveniently available to participate in the study. This approach often involves
selecting participants based on their accessibility and willingness to participate, rather than using random or
structured selection methods. A popular example of convenience sampling can be observed on social media
platforms like Facebook, where researchers may collect data from users who are easily reachable online. It's a
quick and cost-effective way to gather information, making it suitable for preliminary or exploratory research.
However, convenience sampling has its limitations. Since it doesn't employ randomization, it can introduce
selection bias and may not provide findings that can be easily generalized to the broader population.
Additionally, because no specific inclusion criteria are established in convenience sampling, researchers have
less control over the characteristics of the sample, which can affect the validity of the results.
3.9 ANALYTICAL TOOLS USED IN STUDY:
• Tables:
Tables will be used to represent the response in a precise term so that it become easy to evaluate the data
collected.
• Bar graphs:
Graphs are nothing more than a graphical representation of the data collected in tabular form and shall be used
to interpret results.

3.10 LIMITATIONS OF THE STUDY
Although the studywas carried out with extremes enthusiasm and careful planning there are several limitations,
which handicapped the research viz.
 Time Constraints:
In the given timeframe for the project, there's a possibility of missing some information, but we've made every
effort to ensure all pertinent details are included.
 Sample size:
The limited time available resulted in a relatively small sample size, and the study would have been more
representative with a larger number of respondents.
 Accuracy:
It is difficult to know if all the respondents gave precise information; some respondents tend to give deceptive
information.
50

CHAPTER 4
ANALYSIS
AND
INTERPRETATION

YES NO
4.1. Do you invest in equity market?
Table no: 4.1
Responses No of responses Percentage %
Yes 81 80.19
No 20 19.8
TOTAL 101 100%
Interpretation:
The data collected from the respondents strongly suggests a high level of awareness and engagement in investment
activities. This conclusion is drawn from the fact that each respondent has demonstrated active participation by
investing in various securities. This not only indicates their awareness of investment opportunities but also
underscores their proactive approach toward financial planning and wealth management.
52

NO
10%
YES
90%
4.2. Do you invest in the mutual fund?
Table no. 4.2
Yes 91 90.09
No 10 9.99
Interpretation:
Based on the data analysis, it becomes apparent that a significant majority, approximately 90.09% of the
respondents, exhibit awareness of mutual funds. In contrast, a smaller percentage, around 9.99%, of the respondents
indicate a lack of awareness regarding mutual funds. These findings highlight the relatively widespread recognition
of mutual funds among the surveyed individuals, albeit with a notable minority who are not familiar with this
investment option.

50
45
40
35
30
25
20
15
10
5
0
Tax reduction Retirement benefit Hedging risk Regular income
4.3. What is the objective of the investment in the mutual fund?
Table No. 4.3
Tax reduction 47 46.5
Retirement benefit 19 18.88
Hedging risk 9 8.91
Regular income 26 25.7
TOTAL 101 100%
Interpretation:
Through these data we can say that 46.5 % of the respondent’s main motive for investment is their tan
reduction, 18.88 % respondents invest for retirement benefit
54

4.4. In which schemes in mutual fund, you prefer most?
Table No. 4.4
Responds No. Of responds Percentage%
Equity scheme 17 16.8
Debt scheme 26 25.7
Fixed scheme 43 42.5
Liquidity scheme 15 14.8
TOTAL 101 100
45
40
35
30
25
20
15
10
5
0
EQUITY DEBT FIXED LIQUIDITY
Interpretation:
Through these data we can say that 42.5 % are mainly invest in the fix margin scheme,16.8% respondents
invested in the equity scheme, remaining invested in the debt/income scheme and liquid scheme respectively.

PUBLIC COMPANY PRIVATE COMPANY
4.5. In which mutual fund companies, you prefer to invest?
Table No. 4.5
Responses No of responses Percentage
Public Company 19 18.88
Private Company 82 81.18
Total 101 100%
Interpretation:
From the data analysis, it becomes evident that 18.88% of the respondents express a preference for investing in
public companies, while the majority indicate an interest in investing in private companies. These findings suggest
that a significant portion of the respondents leans towards private company investments, possibly influenced by
factors such as perceived opportunities, risk preferences, or investment goals.
56

9 8.2
18
27
NEWSPAPER MAGZINES INTERNET OTHERS
4.6. How do you normally get the information about various mutual fund scheme?
Table No. 4.6
Newspaper 47 46.53
Magazines 18 17.8
Internet 27 26.7
Other 9 8.9
TOTAL 101 100%
Interpretation:
These data are helpful for analysing 46.53 % respondents get the information from the newspaper, 17.8 %
respondents from the magazines and remaining from the internet and from other sources.

60
50
40
30
20
10
0
LUMP UP SYSTEMATIC INVESTMENT PLAN BOTH
4.7 Which type of investment persuades do you normally follows?
Table No. 4.7
Lump-sum 38 37.62
Systematic investment plan 54 53.4
Both 9 8.9
TOTAL 101 100%
Interpretation:
Through this chart we can say that 37.62 % of the respondents persuade normally lump-sum investment and
53.4 % of the respondents persuade for the systematic investment plan and remaining persuade both the
investment plan.
58

IN NEW YEAR FUND YEAR ENDING ANYTIME
4.8 At what time do you normally invest in the mutual fund?
Table No. 4.8
Respondents No of respondents Percentage
In new year fund 18 17.82
Year ending 20 19.8
Anytime 63 62.3
TOTAL 101 100%
Interpretation:
Through these data we can say that 62.3 % of respondents think that they should invest anytime whenever they
have fund, 17.82 % respondents thick that they have to invest in the new year fund.

YES NO
4.9 Are you satisfied with the return getting from it?
Table No. 4.9
Respondents No of respondents Percentage
Yes 73 72.2
No 28 27.77
Interpretation:
Through these data we can say that 72.2 % respondents are satisfy by the return getting from it and remaining
are unsatisfied.
60

CHAPTER 5
FINDINGS,
SUGGESTIONS
&
CONCLUSION

5.1 FINDINGS
The key findings of the following study have been highlighted below:
 Investor Satisfaction:
A significant majority of respondents express satisfaction with the returns they are receiving from their
investments in both equity and mutual funds, indicating overall positive sentiment among investors.
 Investment Timing:
Most respondents prefer a flexible approach to investing, indicating a preference for investing whenever they
have funds available rather than adhering to specific timing, such as the new year.
 Investment Preference
A clear preference for systematic investment plans (SIPs) emerges from the data, suggesting that investors
Favor a disciplined and regular investment approach over lump-sum investments
 Investor Awareness:
All respondents are found to be well-informed about investments, as they have diversified their portfolios by
investing in various securities.
 Company Preference:
The majority of respondents express a preference for investing in private companies over public companies,
possibly due to perceived opportunities and risk considerations.
 Investment Behaviour:
Most investors display a tendency to invest based on their available funds, reflecting a practical approach to
wealth management.
 Investment Amount:
Data analysis indicates that a significant number of respondents invest a portion of their savings in mutual
funds, with very few choosing to invest half or one-third of their savings.
62

5.2 SUGGESTIONS
From the above study the following recommendations can be given to an investor.
In the report, a comparative analysis has been conducted between various sectors, different investment
avenues, and various investment schemes. This analysis allows for a comprehensive assessment of the
performance and characteristics of these different options, helping investors make informed decisions.
Looking ahead, the future work outlined involves a more in-depth study of each fund's portfolio. This will
include an examination of the proportion of investments allocated to different sectors and types of stocks, such
as large-cap, mid-cap, and small-cap stocks. Through this analysis, researchers aim to provide a holistic view
of the risks and returns associated with the selected funds over the past year. Additionally, this portfolio
analysis will shed light on the variability of returns during the same period, contributing to a more
comprehensive understanding of fund performance and its underlying factors. This future work aims to
provide investors with valuable insights for making investment decisions based on a thorough understanding
of the funds' strategies and outcomes.
 For investors willing to take high risks, equity and sector funds are suitable options. These funds
primarily invest in stocks, offering the potential for significant long-term growth, though they come with
higher volatility.
 If you're looking to balance risk, consider balanced funds. They provide a middle-ground approach,
allocating investments to both stocks and bonds. This offers moderate growth potential while reducing
overall portfolio volatility compared to pure equity investments.
 In scenarios where safety and stability are a priority over high returns, debt funds and bond funds are
recommended. These funds predominantly invest in fixed-income securities like government or
corporate bonds, providing lower risk and relatively stable returns.
 4For individuals with a steady income, such as salaried employees, Systematic Investment Plans (SIPs)
can be an effective strategy. SIPs involve regular, fixed-amount investments at defined intervals, typically
monthly. This disciplined approach can help build wealth steadily over time, regardless of market
fluctuations.

5.3) CONCLUSION
In conclusion, my internship experience at Consortium Private Limited, a prominent financial company, has
been both insightful and enriching. Throughout my tenure, I have had the opportunity to delve into the dynamic
world of financial services and gain a comprehensive understanding of the industry's intricacies."
The study's findings lead to several key conclusions regarding the mutual fund industry in India. Firstly, it is
evident that the industry is experiencing substantial growth, primarily attributed to the rapid expansion of the
capital market. Many Asset Management Companies (AMCs) are channelling a significant portion of the funds
they mobilize into the capital market, and the performance of mutual funds is closely linked to the overall
performance of the stock market.
While recent data indicates impressive mutual fund performance, it's crucial to recognize that the future growth
of these funds remains contingent upon the behaviour of the capital market. Mutual fund investments inherently
carry an element of risk, as they do not guarantee assured returns. However, investors can find comfort in the
expertise of fund managers and the cost-efficiency of investments made by fund houses on a larger scale.
An intriguing finding is that the top-performing schemes, often among the top 10%, are predominantly equity
diversified schemes. This underscores the significant impact of equity investments on returns. It's noteworthy
that returns tend to decrease during periods of stock market downturns.
One of the key success factors for AMCs in India has been diversification of investments. This strategy has
allowed them to spread risk effectively and achieve consistent results. In conclusion, the Indian mutual fund
industry is poised for growth, closely tied to the performance of the capital market, and it thrives on
diversification strategies that manage risk and enhance returns.
64

WEBLINKS:
 https://consortiumsecurities.com/about-us/
 https://economictimes.indiatimes.com/mf/analysis/bandhan-consortium-buys-idfc-mutual-fundwhat-
should-investors-do/articleshow/90702102.cms?from=mdr
 https://www.motilaloswal.com/markets/equity-market-overview/Consortium-Finance-
Ltd(Merged)/511345/2797/nse
 https://www.bseindia.com/stock-share-price/consolidated-construction-consortiumltd/cccl/532902/
JOURNALS:
 Jaidev M, “Investment policy and performance of Mutual Fund”
 Sadak H. “Mutual Funds in India” Pandey
I.M, “Financial Management”
 Damodaran Aswath “Corporate Finance”
 Tripathy Nalini Prava “Mutual Funds in India. Emerging Issues”
 Panwar Sharad and Madhumathi R “Characteristics and Performance of selected mutual funds in
India.”
 Riter, Jay, R1998, the buying and selling behaviour of individual investors at the turn of the year,
journal of finance 43, 701-717.
 Frazzini Andrea, “Dumb Money: Mutual Fund flows as the cross-section of stock returns”,
 NCFM’ s AMFI Material on mutual funds(workbook)
 Sankaran Sundar, “Mutual fund Handbook, A guide for distributors and intelligent investors
WEBSITES:
 www.valueresearchonline.com
 www.bseindia.com
 www.myiris.com
 www.mutualfundindia.com www.capitaline.com
66

MUTUAL FUND AND EQUITY PROJECT REPORT FOR MANAGEMENT STUDENTS

MUTUAL FUND AND EQUITY PROJECT REPORT FOR MANAGEMENT STUDENTS

More Related Content

Similar to MUTUAL FUND AND EQUITY PROJECT REPORT FOR MANAGEMENT STUDENTS

More from POOJAGUPTA585103

Recently uploaded

MUTUAL FUND AND EQUITY PROJECT REPORT FOR MANAGEMENT STUDENTS