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G L O B S Y N B U S I N E S S S C H O O LPage

CUSTOMERS PERCEPTION AND

THEIR BUYING PATTERN OF

MUTUAL FUND

Raman Tripathi

Enrolment no: 0202101048

ACKNOWLEDGEMENT


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With regard to my Project with Mutual Fund I would like to thank each and every onewho offered help, guideline and support whenever required.

This project report and the learning process behind it would not have been possiblewithout guidance of Mr. Vinod Agrawal (Branch Manager N.J India invest, Ajmer). Heimparted me right approach that my training required for its successful practicalimplementation and introduced me the idea of Mutual Funds.

I was involved with N.J India Invest for three months, and I came across a lot ofpeople who put in their time and effort towards acclimatizing me to the workings of theirorganization. I express my thanks to Mr. Vinod Agrawal under whose guidance andleadership I was able to enhance my financial as well as inter-personal skills. I also express

my gratitude to Ms. Vinita Joshi for her constant support and guidance. She helped me tounderstand NJ and its services.

I am also grateful to our teacher Ms PALLAVI MITTAL for the help and guidance

provided to make me learn, and understand the concepts and complete my project work.

Without her help I would not have been able to complete my work in the present form.

I thank GBS-A and its management team, CRP for their co operation, help and

guidance and the opportunity.

I am grateful for each and every valuable interaction that brought me to a better

understanding of the workings of the Mutual Fund industry.

These three months were of utmost importance as they added value towards my pathof knowledge. I would like to end this acknowledgement by thanking the customers, clients,investors, and people at large with whom I have interacted during the course of my training.

APROVAL FROM GUIDE


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This is to certify that Ms. Jyoti Bhawnani student of GLOBSYN BUSINESSSCHOOL AHEMDABAD has completed project work on customer perception&their buying pattern of mutual fund under my guidance and supervision.

I certify that this is an original work and has not been copied from any source.

Signature of Guide

DATE:

Name of Project Guide

Mr.Vinod Agrawal

DECLARATION

I hereby declare that this Project Report entitled CUSTOMER PERCEPTION&THEIR BUYING PATTERN OF MUTUAL FUND IN N.J INDIA INVESTsubmitted in the partial fulfillment of the requirement of PGDM ofGLOBSYNBUSINESSSCHOOL AHEMDABAD is based on primary & secondary data found by me in variousdepartments, books, magazines and websites & Collected by me in under guidance of Mr.Vinod Agrawal


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DATE: JYOTI BHAWNANI

Enrollment No.020101048

EXECUTIVE SUMMARYIn last few years Mutual Fund has emerged as a tool for ensuring ones

financial well being. Mutual Funds have not only contributed to the India growth storybut have also helped families tap into the success of Indian Industry. As informationand awareness is rising more and more people are enjoying the benefits of investing inmutual funds. The main reason the number of retail mutual fund investors remainssmall is that nine in ten people with incomes in India do not know that mutual fundsexist. But once people are aware of mutual fund investment opportunities, the numberof people who will decide to invest in mutual funds will increases to as many as one infive people. The trick for converting a person with no knowledge of mutual funds to anew Mutual Fund customer is to understand which of the potential investors are morelikely to buy mutual funds and to use the right arguments in the sales process thatcustomers will accept as important and relevant to their decision.


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This Project gave me a great learning experience and at the same time itgave me enough scope to implement my analytical ability. The analysis and advice

presented in this Project Report is based on market research on the saving andinvestment practices of the investors and preferences of the investors for investment inMutual Funds. This Report will help to know about the investors Preferences in

Mutual Fund means Do they prefer any particular Asset Management Company(AMC), Which type of Product they prefer, Which Option (Growth or Dividend) theyprefer or Which Investment Strategy they follow (Systematic Investment Plan or Onetime Plan). This Project as a whole can be divided into two parts.

The first part gives an insight about Mutual Fund and its variousaspects, the Company Profile, Objectives of the study, Research Methodology. Onecan have a brief knowledge about Mutual Fund and its basics through the Project.

The second part of the Project consists of data and its analysis collectedthrough survey done on 150 people. For the collection of Primary data I made aquestionnaire and surveyed of 150 people. I have also taken interview of many Peoplethose who were coming at the NJ Ajmer Branch where I have done my Project.


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TABLE OF CONTENT

1. Introduction.09

2. Company Profile and History..25

3. Objective of research..36

4. Research Methodology38

5. Analysis and Interpretations...40

6. Conclusion..61

7. Limitations 64

8. Recommendations.65

9. Bibliography..67

10. Annexure....68


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LIST OF FIGURES

1. Concept of Mutual Funds..09

2. Working of Mutual Funds..10

3. Growth of AUM of Mutual Funds.17

4. Categories of Mutual Funds..20


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INTRODUCTION


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Introduction TO MUTUAL FUNDS AND ITSASPECTS

MUTUAL FUND

A mutual fund, as defined in the regulations is a fund established in the form

of a trust to raise money through the sale of units to the public or a selection of the public

under one or more schemes for investing in securities, including money market

instruments .The income earned through these investments and the capital appreciation

realized are shared by its unit holders in proportion to the number of units owned by them.

Thus it is clear that a mutual fund is a collection of investments. It is a pool of money, the

combined contributions of a number of individuals. The working of the mutual fund has been

shown with the help of the following diagram.

Investors have their individual preferences on how they would like their

money invested and how much risk they are willing to take. An individual investor could

choose to hire a professional manager to manage her/his money as per investment and risk

preference. Such personal treatment often referred to as Portfolio Management Scheme

(PMS) in India, entails significant demands on the time of the managers.PMS is therefore

economically feasible only for investment portfolios above a particular value.

It is possible to balance the time and cost required to manage investments by

grouping investors together based on their preferences. In this manner, the focus of the


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investment activity can be shifted from a single investor (as in the case of PMS) to group of

investors having similar expectations .This is what mutual

funds do, thus a mutual fund is a vehicle to pool money from the investors ,with a promisethat the money would be invested in a particular manner by professional managers who are

expected to honour the promise.

LEGAL STRUCTURE AND REGULATORY BODY

Mutual Funds in India have a 3 tier structure of Sponsor ,Trustee AMC and is

governed by SEBI (Mutual funds) regulations 1996 and it is mandatory for mutual funds to

have three tier structure is as follows.

SPONSOR

TRUSTEE

ASSEST MANAGEMENT COMPANY(AMC)

SEBI approved Asset Management Company (AMC) manages the funds by making

the investments in various types of securities. Custodian, registered with SEBI, holds the

securities of various schemes of the fund in its custody. The general power of

superintendence and direction over AMC is vested with the trustees.

SPONSOR

Any project need to have a promoter, who initiates, establishes and promote the

project and work towards achieving the goals. In case of the mutual fund, promoter is known

as sponsor. They have to meet and satisfy SEBI requirements. Sponsor appoints the trustee,

custodian and the AMC with the prior approval of SEBI, and in accordance with SEBI

regulations.

Sponsor must have sound track record and a good reputation at businesses in financial

services for a period of minimum of five years and should have made profit in at least 3 out

of 5 years. Sponsor has to contribute at least 40% net worth of the AMC.

TRUSTEE

Trustees are people within a mutual fund organization who are responsible for

ensuring that investors interests in a scheme are properly taken care of. In return for their


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services they are paid trustee fees, which are normally charged to scheme. The appointment

of all trustees has to be done with prior approval of SEBI.

REGULATORY REQUIRMENT OF TRUSTEE

The mutual fund which is a trust is managed either by a Trust Company or a Board of

Trustee and trust companies are governed by the provisions of the Indian Trust Acts. If the

trust is a company, it is also subjected to provisions of the Indian Companies Act. It is the

responsibility of the trustees to promote the interest of investors, whose fund is managed by

AMC.

The sponsor executes and registers a trust deed in favor of the trustees. The

appointments of all trustees are to be done with prior approval of SEBI. There must be at

least 4 members in the Board of Trustees and at least 2/3 of the trustees need to be

independent.

Trustee of one mutual fund cannot be a trustee of another mutual fund unless he is an

independent trustee in both the cases, and has the approvals of both the boards.

RIGHTS OF TRUSTEES

The trustee has the right to obtain from the AMC, such information as they consider

necessary to fulfill their obligations.

A majority of trustees have the right to terminate the appointment of an AMC. Any

change in the appointment of the AMC is however, subject to prior approval of SEBI

and the unit holders.

The trustees shall not be held liable for acts done in good faith if they have exercised

adequate due diligence honestly.

OBLIGATION OF THE TRUSTEES

Trustees must ensure that the transactions of the mutual fund are in accordance with

the trust deed.

Trustees must ensure that the AMC has systems and procedures in place, and that all

the fund constituents are appointed.

Trustees must furnish to SEBI, on half-yearly basis, a report on the activities of the

AMC.

Trustees must ensure that the activities of the mutual fund are in compliance with

SEBI regulations.


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TRUST DEED

It has to contain certain clauses prescribed by SEBI and duly registered under the

provisions of the Indian Registration Act, 1908 and has to be executed by the sponsor in

favor of the trustees named in the deed. It cannot contain any clause which limits or

extinguishes the obligations and liabilities of the trust with respect to the mutual fund or its

investors

ASSEST MANAGEMENT COMPANY (AMC)

It is obligatory for every mutual fund to have an AMC to manage the mutual fund andoperate its schemes. The actual appointment could be made either by the sponsor or, if so

authorized by the trust deed, the trustees.

The AMC is usually a private limited company, in which the sponsors and their

associated or joint venture partners are shareholders.

REGULATORY REQUITREMENTS OF AMC

Only SEBI registered AMC s can be appointed as investments managers of mutual

funds

AMC must have a minimum net worth of Rs.10 crores at all times.

An AMC cannot be an AMC or trustee of another mutual fund.

AMCs cannot indulge in any other business other than that of asset management.

At least 50% of the members of an AMC have to be independent.

OBLIGATIONS OF AMC

The investments made by the AMC have to be in accordance with the investment

management agreement and SEBI regulations. The AMC shall be responsible for acts of

commission or omission of its employees and its other service providers.

It shall issue or publish offer document of a scheme, key information memorandum,

abridged half yearly results and annual results only after prior written approval of the

trustees. The AMC has to maintain proper books of accounts, records and documents for each

scheme. It shall maintain and preserve these for a period of eight years.


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OTHER FUNCTIONARIES OF MUTUAL FUNDS

Apart from Sponsor, trustee and AMC, other important functionaries include:

1. Registrars and Transfer Agents

2. Broker

3. Custodians

4. Depository Participants (DP)

5. Distributors

6. Legal Advisor and Auditor

REGISTRARS & TRANSFER AGENTS

The R&T agents are responsible for the investor servicing functions as they maintain

the record of investors in mutual funds. They process investor applications ,record details

provided by the investor on application forms, send out to investors details regarding their

investments in the mutual funds, periodical information on the performance of the mutual

fund, process dividend payout investors, incorporate changes in information as

communicated by investors and removing new investors and removing investors who havewithdrawn their fund.

BROKERS

Brokers support the investment management function of the mutual fund, by enabling

the investment managers to buy and sell securities. Brokers are registered members of the

stock exchanges. They charge a commission for their services. In many cases, brokers also

provide investment managers with research reports on the performance of various companies

and industrial sectors, and investment recommendations .Brokers also are an important

source of market information to fund managers.


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CUSTODIANS

Custodians are responsible for the securities held in the mutual funds portfolio. They

discharge important back office function by ensuring that securities that are bought are

delivered and transferred to the books of the mutual funds. They keep the investment account

of the mutual fund and also collect the dividends and interest payments due on the mutualfund investments.

Custodians also track corporate actions like bonuses issues, right offers, offer for sale,

buy back and open offers for acquisition .On the advice of the fund managers they act on

these corporate actions.

DEPOSITORY PARTICIPANT (DP)

DP holds the securities of mutual funds in dematerialized form. They work with thecustodians and handle the operational aspects of actually making/receiving delivery of

securities into the account of mutual fund. On instructions from the custodian, they deliver

/receive securities from the company /stock exchanges in dematerialized form. They also

communicate the custodians instructions on corporate actions to the company.

DISTRIBUTORS

Mutual funds products are reached to investors across the country through selling

agents called distributors. They bring in the investors fund for a commission. Distributors

are institutions that appoint agents and other mechanisms to mobilize funds from investors.

Most agents and distributors are paid commission on the funds they mobilize from

investors .These commissions are split into initial commission which is paid on mobilization

of funds, and transaction commission, which is paid depending on the length of stay of the

investor in the mutual fund. Some agents also pass on the commission they receive, to the

investors as incentive.

LEGAL ADVISORS AND AUDITORS

Legal advisors advise mutual funds on regulatory and taxation issues. Every mutual

fund has an employee designated as compliance officer, who works under the advice of the

legal advisors.


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Each mutual fund scheme created by an AMC has to maintain a separate book of

accounts and draw up its annual report. These two sets of accounts are required to be

statutorily audited. SEBI Regulations stipulate that auditors of the fund cannot be also be the

auditors of the AMC. The two sets of accounts have to be audited by two separate auditing

firms .Auditors charge a fee from the mutual fund for these services. The AMC pays the

auditors out of its incomes, for auditing its book.

REGULATORY BODY

Securities and Exchange Board of India (SEBI) is the apex regulator of capital market

instruments and the regulation of capital market intermediaries is under the purview of

SEBI.SEBI is the primary regulator of mutual funds in India.

SEBI has enacted the SEBI (Mutual funds) Regulations 1996, (hereinafter referred to

as SEBI Regulations) which provides the scope of the regulations of Mutual funds in India.

All mutual funds are required to be mandatorily registered with SEBI. The structure and

formation of Mutual funds appointment of key functionaries, operation of the Mutual funds,

accounting and disclosures norms right and obligations and functionaries of investments,

investment restrictions, compliance and penalties are all defined under the SEBI regulation.

Mutual funds have to send half-yearly compliance reports to SEBI and SEBI also is

empowered to periodically inspect mutual fund organization to ensure compliance with SEBI

Regulations.

REGULATORY JURISDICTION OF RBI over Mutual Funds

RBI is the monetary authority of the country and also the regulatory of the banking

system. Earlier bank sponsored mutual funds were under the dual regulatory control of RBI

and SEBI, and Money market mutual funds, which invested in short term instruments were

regulated by RBI. These provisions are no longer in place. Now SEBI is the regulator of all

mutual funds.

The present position is that RBI is involved with the Mutual fund industry, only to the

limited extent of being the regulator of the sponsors of bank sponsored Mutual funds. If the

sponsor has made any financial commitment to the investors of the Mutual Funds, in the form

of guaranteeing assured returns, such guarantees can no longer be made without the prior

approval of RBI.RBI will review financial condition and capital adequacy of the sponsoring

bank, before permitting it to make such guarantees


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HISTORY OF THE INDIAN MUTUAL FUNDINDUSTRY

The mutual fund industry in India started in 1963 with the formation of Unit

Trust of India, at the initiative of the Government of India and Reserve Bank. Thoughthe growth was slow, but it accelerated from the year 1987 when non-UTI playersentered the Industry.

GROWTH OF ASSET UNDER MANAGEMENT OF MUTUAL FUNDS


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PHASES OF MUTUAL FUND INDUSTRY

Mutual fund industry can be broadly put into four phases according to thedevelopment of the sector:-

First Phase 1964-87

This phase began with the inception of the Unit Trust of India (UTI). It remained theonly mutual fund player in the country till 1987. UTI started its operations in July 1964. itwas set up by the Indian Government with a view to augment small savings in the country

and to channelize these savings to the capital markets. UTI witnessed a slow and steadygrowth over the 1970s and the 1980s. In 1978 UTI was de-linked from the RBI and theIndustrial Development Bank of India (IDBI) took over the regulatory and administrativecontrol in place of RBI.

Second Phase 1987-1993 (Entry of Public Sector Funds)

1987 marked the entry of non- UTI, public sector mutual funds set up by public sectorbanks and Life Insurance Corporation of India (LIC) and General Insurance Corporation of

India (GIC). SBI Mutual Fund was the first non- UTI Mutual Fund established in June 1987followed by Canra bank Mutual Fund (Dec 87), Punjab National Bank Mutual Fund (Aug89), Indian Bank Mutual Fund (Nov 89), Bank of India (Jun 90), Bank of Baroda MutualFund (Oct 92). LIC established its mutual fund in June 1989 while GIC had set up its mutualfund in December 1990.At the end of 1993, the mutual fund industry had assets undermanagement of Rs.47,004 crores. the total number of schemes increasing to about 167 by theend of 1994.

Third Phase 1993-2003 (Entry of Private Sector Funds)


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This phase marked the entry of private sector funds. The phase also signaled the

intensification of the competition. Both domestic and foreign players entered the market,

offering a wide variety of schemes to investors. Kothari Pioneer Mutual Fund was the first

private sector fund to be established in association with a foreign fund. The opening up of the

market to private players saw international players like Morgan Stanley, Jardine Fleming, JP

Morgan, George Soros and Capital International entering the market. The 1993

SEBI (Mutual Fund) Regulations were substituted by a more comprehensive and

revised Mutual Fund Regulations in 1996. The industry now functions under the SEBI

(Mutual Fund) Regulations 1996. 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

Fourth Phase since February 2003

This phase had bitter experience for UTI. It was bifurcated into two separate entities. One is

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, functioning under an

administrator and under the rules framed by Government of India and does not come under

the purview of the Mutual Fund Regulations. The second is the UTI Mutual Fund 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. As at the end of March, 2008 there were 35 funds, which

manage assets of Rs 505152 crores.

CATEGORIES OF MUTUAL FUND:


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the units of the scheme on the stock exchange where they are listed. In the order to provide

the 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.

INTERVAL FUNDS

Interval funds combine the features of open ended and close ended schemes. They are

open for sale or redemption during pre-determined intervals at NAV related prices.

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 corpus in equity. Growth schemes are idealfor investors having a long term outlook seeking growth over a period of time.

INCOME FUNDS

The aim of the 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. Income funds are ideal for capital stability and regular income.

BALANCED FUNDS

The aim of the balanced fund is to provide both growth and regular income. Such

schemes periodically distribute a part of their earnings and invest both in equities and fixed

income securities in the proportion indicated in their offer documents. In a rising stock

market, the NAV of these schemes may not normally keep pace, or fall equally when the

market falls. These are ideal for investors looking for a combination of income and moderate

growth.

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 short term instruments such as

treasury bills, certificates of deposits, commercial papers and interbank call money. Returns

on these schemes may fluctuate depending upon the interest rates prevailing in the market.


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These are ideal for corporate and individuals investors as a means to park their surplus funds

for short periods.

INDUSTRY SPECIFIC SCHEMES

Industry specific schemes invest only in the industries specified in the offer

document. the investment of these funds is limited to specific industries like Infotech,

FMCG, Pharmaceuticals.

INDEX SCHEMES

Index funds attempt to replicate the performance of a particular index such as the BSE

Sensex or the NSE 50.Such a position can be created through either of the two methods:

It can either be done by maintaining an investment portfolio that replicates the

composition of the chosen index. Thus, the stocks in such a funds portfolio would be same

as are used in calculating the index. The proportion of each stock in the portfolio too would

be the same as the weight of the stock in the calculation of the index. This replicating style of

investment is called passive investing.

Alternatively, a mutual fund, through its research can identify a basket of securities

and /or derivatives whose movement is similar to that of the index. Schemes that invest in

such baskets can be viewed as active index funds.

SECTORAL SCHEMES

Sect oral Schemes are those, which invest exclusively in a specified industry or a

group of industries or a various segments such as A Group shares or initial public offerings

Mutual funds in order to cater to a range of investors have various investment

plans. Some of the important plans include:

GROWTH PLAN


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Under the growth plan, the investor realizes only the capital appreciation on the

investment (by an increase in NAV) and doesnt get any income in the form of dividend.

INCOME PLAN

Under the Income plan, the investor realizes income in the form of dividend. However

his NAV will fall to the extent of the dividend.

DIVIDEND REINVESTMENT PLAN

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 reinvesting the same.

SYSTEMATIC INVESTMENT PLAN (SIP)

SIP involves investing a fixed sum of money in a specific investment scheme, on a

regular basis, for a pre-determined number of periods. It is very similar to regular saving

schemes like a recurring deposit.

SYSTEMATIC WITHDRAWAL PLAN

As opposed to the Systematic Investment Plan, the Systematic Withdrawal plan

allows the investor the facility to withdraw predetermined amount/units from his fund at a

pre-determined interval. The investors units will be redeemed at the existing NAV as on that

day.

SYSTEMATIC TRANSFER PLAN


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Investors exposure to different types of securities, whether debt or equity should

flow from their risk profile or risk appetite. For instance, an investor may start with a 40:60

mix of debt and equity, as determined by her risk profile. But if equity markets boom and

debt securities lose value, then the 40:60 mix could get significantly distorted towards equity.

In such a situation, it would be prudent to sell some equity and re-invest the redeemed

amount in debt to re-balance the mix of debt and equity. In mutual funds such re-balancing

can be achieved by systematically moving moneys between schemes. This can be achieved

by systematic transfer plan.

COMPANY PROFILE AND HISTORY

NJ India Invest is one of the leading advisors and distributors of financial products

and services in India. It was established in year 1994, by Mr. Neeraj and Mr. Jignesh. NJ

has over a decade of rich exposure in financial investments space and portfolio advisory

services. From the beginning NJ over the years has evolved out to be a professionally

managed, quality conscious and costumer focused financial/investment advisory &

distribution firm.


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The strength of NJ lies in the strong domain knowledge in

investment consultancy and the delivery of sustainable value to clients with support

from cutting-edge technology platform, developed in-house by NJ.

NJ believes and practice successful wealth creation for customers, SUCCESSFUL

WEALTH CREATION is the mission of NJ. With such a mission NJ is evolved in making

right product accessions and services in all offerings. NJ provide a 360 degree comprehensive

business platform with unmatched IT solutions to its partners, empowering them to set the

best practice standards so as they deliver real value to their customers. With this passion NJ

has grown and expanded rapidly, setting new benchmarks. NJ works only for betterment of

people and believes in transforming their lives by providing right kind of information

regarding their investments.

NJ had over INR 5,050* crores of mutual fund assets under advice with a wide

presence in over 130 locations in 22 states in India.

These numbers reflects the trust, commitment and value that NJ shares with its clients.

PHILOSOPHY

At NJ whatinspire and shape the thoughts, beliefs, attitude, actions

and decisions of employees is NJs service and investing

philosophy

SERVICE PHILOSOPHY:

NJ believes that success of a company lies in customer satisfaction.

NJ is committed to provide its customers with continuous, long term improvements and value-

additions to meet their needs. The company aims to deliver the best service possible to

customers.

INVESTING PHILOSOPHY

At NJ providing need based solution is first and foremost aim for long-term wealth creation ofcustomers. NJ believes in providing customers with true, unbiased; need based solutions and

advice that best meets their stated and unstated needs.


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Mission and Vision

DIVISIONS

DIVISIONS

VISION

Like all NJs vision is off course to be leader in the field and

this they want and are achieving through:

Total customer satisfaction

Commitment to excellence

Successful wealth creation of customers.

MISION

To ensure creation of the desired value for customers, employees and associates,

through constant improvement, innovation and commitment to service & quality.

To provide solutions which meet expectations and maintain high professional &

ethical standards along with the adherence to the service commitments.

NJ India Invest has distinct divisions of business as follows of which 2 are

major i.e. fundz network and wealth advisors


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NJ Fundz Network, started in 2003, it is a dedicated channel for providing independent financial advisors or IFA's with a completebusiness platform for the strengthening and development of their advisory practice. NJoffers advisors under its network with all the products; support and services thatenables them to add considerable value to their business emerge as a 'new age

professional financial advisor' and compete confidently in the industry.

NJ Wealth Advisors Pvt. Ltd. established as a distinct entity, it seeks to offercomprehensive financial planning and portfolio advisory services to premium clients.

With NJ Wealth Advisors, NJ seeks to leverage the strong financial advisory andportfolio management skills gained in over a decade of experience in the industry. NJWealth Advisors offers its clients with quality, unbiased, need-based advisory services& investment solutions.

This sporadic growth in terms of need of performers in financial advisoryservices has lead to the crunch of available performers. Though lots of youngsters aregetting into financial advisory services, but the greatest challenge is of RIGHTSELLING, for which adequate Training is a prerequisite. Advisory function demandsupdated knowledge, backed up by honed skills to fetch effective business. Buildinglong term relationship with clients depends upon possessing clear edge over others inthe field. Hence continuous people development has an important role in building thisfraternity.
http://www.njgurukul.com/http://www.njgurukul.com/


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Technology has traditionally been NJ's key strength. NJs offering on thetechnological front is unmatched, vibrant, and comprehensive in nature. The focus &commitment on technology can be gauged from the fact that NJ have set-up distinctentity with a very strong, talented work-force for the sole purpose of providing the bestto NJ in terms of technology and support. Finlogic Technologies (India) Pvt. Ltd. doesall the development & support work in-house on a continuous basis. It has successfullydeveloped & implemented a powerful support system for the mutual fund distribution

business at NJ with a provision for integrating the same with other investment productsas well as the financial accounting system.

PRODUCTS

RECOGNITIONS

NJ offers advisory and distribution services on the followingproducts.

1. Mutual funds covering all AMCs & all schemes,

2. Life insurance Prudential ICICI

3. Fixed deposits of companies,

4. Government/RBI bonds,

5. Infrastructure Bonds,

6. Approved securities for charitable trusts, etc

Year 2003:

For Outstanding Performance presented by Group Chief Executive,

Prudential Plc. at London

Year 2004:

Among Most Valued Business Associates presented by HDFC StandardLife at Edinburgh, Scotland


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MANAGMENT

The key members of the management are:Mr. Neeraj Choksi Jt. Managing Director Mr. Jignesh Desai Jt. Managing Director

Key Sales Team:Mr. Misbah Baxamusa National HeadMr. Naveen Rathod V.P. (Sales)Mr.Kulbhushan Nandwani A.V.P. (Marketing)Mr. Prashant Kakkad A.V.P. (Sales)

Key Executive Team :Mr. Shirish Patel Information TechnologyMr. Abhishek Dubey Business ProcessMr. Vinayak Rajput OperationsMr. Dhaval Desai Human ResourcesMr. Col. Dixit AdministrationMr. Tejas Soni FinanceMr. Viral Shah Research

Year 2004:

For Outstanding Performance by Deputy CEO, Prudential Singapore at Malaysia

Year 2006:

Award for mobilizing the Highest Number of SIPs at National Level by Fidelity Mutual

Fund Plc at Mumbai

Year 2006:Award Vietnam

The management at NJ brings together a team of peoplewith wide experience and knowledge in the financial servicesdomain. The management provides direction and guidance to the

whole organization. The management has strong visions for NJ as aglobally respected company providing comprehensive services infinancial sector.

The 'Customer First' philosophy is deeply ingrained in themanagement at NJ. The aim of the management is to bring the bestto the customers in terms of

Range of products and services offered

Quality Customer Service


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Mr. Rakesh Tokarkar Compliance

SERVICE STANDARDS

But quality service also involves quality people in addition to processes. NJ givessignificant focus to the proper training and development of the people involved in the servicedelivery chain.

Further NJ

Have well-defined "Privacy Policy" to keep clients information confidential &

internal audits done on the same at regular intervals

Receive various statistics which are analyzed on an ongoing basis to improve the

service standards

Service Commitments The service commitments are to guide the actions of the people at NJ. Clearly stated,customers can freely communicate any such actions/events wherein they feel that any of thefollowing commitments have been breached / compromised. NJ desire to honourcommitments at all points of time and to all customers without any bias.

To provide customer-focused need-based valued services To provide reliable, accurate and timely information To maintain all records in privacy To optimize services/benefits at least justifiable cost

Service is the key to unlocking customersatisfaction, which again is key for sustainability of any

business. NJ has set strict processes in place to deliverquality services to customers. At NJ strict quality servicestandards are set and a well-defined process is establishedand followed religiously by all quality customer serviceteams. Performance is evaluated on a frequent basis andglitches are ironed out.


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To develop and grow the customers business To provide constructive after sales service

COMPETITORS OF NJ

Anand Rathi-

Anand Rathi is one of the major competitors of NJ India Invest. The firm, founded in1994 by Mr. Anand Rathi, today has a pan India presence as well as an international presencethrough offices in Dubai and Bangkok. AR provides a breadth of financial and advisoryservices including wealth management, investment banking, corporate advisory, brokerage &

distribution of equities, commodities, mutual funds and insurance, structured products - all ofwhich are supported by powerful research teams.

Karvy-

The karvy group was formed in 1983 at Hyderabad, India, karvy ranks among the topplayer fields in almost all the fields it operates. Karvy computer share limited is Indiaslargest registrar and transfer agent with a client base of nearly 500 blue chip corporate,managing over 2 crores accounts, Karvy stock brokers limited. Karvy also works asdistribution house of some AMCs.

India Infoline

The India Infoline group, comprising the holding company, India Infoline Limitedand its wholly-owned subsidiaries, straddle the entire financial services space with offeringsranging from Equity research, Equities and derivatives trading, Commodities tradingPortfolio management services, Mutual Funds, Life Insurance, Fixed deposits, Gov. Bondsand other small savings instruments to loan products and investment banking. The companyhas a network of 758 business locations (branches and sub-brokers) spread across 346 citiesand towns. It has more than 800,00 customers.

Bajaj capital


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The Bajaj Capital Group is one of Indias leadingInvestment Advisory and Financial Planning companies. Bajaj Capital is also SEBI-approvedCategory I Merchant Bankers. Bajaj Capital offers Personalized investment Advisory andFinancial Planning services to individual investors, corporate houses, institutional investors,

Non-Residents Indians (NRIs) and High Net worth Clients, among others. Bajaj Capital

offers a wide range of investment products such as mutual funds, life and general insurance,bonds, post office schemes, etc. offered by public and private and government organizations.

BONANZA-

Bonanza is a leading Financial Services & Brokerage House. It also distributes mutualfunds of various AMCs.

ALL BANKS AND OTHER FINANCIAL INSTITUTIONS-

In India many banks also distributes Mutual funds of various AMCs such asKarnataka bank distributes mutual funds of Franklin Templeton. So these banks and otherfinancial institutions are also major competitor of NJ India invest. Though theseorganizations are engaged in distribution of mutual funds bud most of them have a differentconcept from NJ India invest they are selling Mutual funds directly to the investors whereas

NJ India invest distributes Mutual funds of all the AMCs indirectly (through its channelpartners) except of four cities

S.W.O.T. Analysis of NJ INDIA INVEST


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STRENGTHS

The biggest strength of the organization is the;

Money power, which makes them ignorant about gestation period.

Brand image, business experience and innovative products.

The agents are very selectively chosen have excellent communicationskills.

Service quality which is the crux of their mission.

WEAKNESS

High target for financial advisor and sales departments.

Many competitors in market offer same products by the little difference in

the offering.

Sustainable to risk associated with investments in money market.

OPPORTUNITY

Huge market is literally untapped; out of estimated 320 million only 20%of population has investment in mutual fund industry.

Equity and ELSS schemes, contribute an estimated market potential ofapproximately $15 billion.

THREATS

Entry of many other private player companies with equally strong experienceand financial strength of foreign partners making the competition difficult andsaturating the urban market.

Current govt. policies which do not encourage gross domestic saving. If thetax liability of service class rises the customer will have little money to invest.

OBJECTIVE OF STUDY1. To find out the Preferences of the investors for Asset Management Company.

2. To know the Preferences for the portfolios.

3. To find out the most preferred channel.

4. To find out preferred option for getting returns.


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5. To find out investments objective.

SCOPE OF STUDY

A big boom has been witnessed in Mutual Fund Industry in recent times. Alarge number of new players have entered the market and trying to gain market share inthis rapidly improving market.

The research was carried on in Ajmer. I had been sent at one of the branch of NJ

INDIA INVEST in Ajmer where I completed my Project work. I surveyed on myProject Topic A study of preferences of the Investors for investment in Mutual Fundon the visiting customers of NJ INDIA and advisors office.

The study will help to know the preferences of the customers, which company,portfolio, mode of investment, and option for getting return and so on they prefer. Thisproject report may help the company to make further planning and strategy.


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RESARCH METHODOLOGY

This report is based on primary as well secondary data, however primary datacollection was given more importance since it is overhearing factor in attitude studies.One of the most important users of research methodology is that it helps in identifyingthe problem, collecting, analyzing the required information data and providing an

alternative solution to the problem .It also helps in collecting the vital information thatis required by the top management to assist them for the better decision making bothday to day decision and critical ones.

DATA SOURCES:

Research is totally based on primary data. Secondary data can be used only forthe reference. Research has been done by primary data collection, and primary data has

been collected by interacting with various people. The secondary data has beencollected through various journals and websites.

DURATION OF STUDY:

The study was carried out for a period of three months, from 2nd April to 2ndJuly 2009.


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SAMPLING:

SAMPLING PROCEDURE:

The sample was selected from people who are the customers/visitors ofNJ India invest Ajmer branch, irrespective of them being investors or not oravailing the services or not. It was also collected through personal visits toAjmer railway office and to some govt. schools, by formal and informal talksand through filling up the questionnaire prepared. The data has been analyzed

by using mathematical/Statistical tool.

SAMPLE SIZE:

The sample size of my project is limited to 150 people only. Out ofwhich only 140 people had invested in Mutual Fund. Other 10 people did nothave invested in Mutual Fund.

SAMPLE DESIGN:

Data has been presented with the help of bar graph, pie charts, linegraphs etc.


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DATA ANALYSIS AND INTERPRETATION

a) AGE DISTRIBUTION OF INVESTORS OFNJ INDIA:

AGE GROUPNO. OFINVESTORS

20-30 38

30-40 55

40-50 43

above 50 14

INTERPRETATION

According to this chart out of 150 respondents who visited NJ office maximum55 respondents are in age group of 30-40 that is they constitute approx 37 %,the second

most investors i.e. 43 respondents are in age group of 40-50 and this constitute 29 %and people above 50 yrs of age are the one who invest least.

b) EDUCATIONAL QUALIFICATION OFINVESTORS

EDUCATIONAL QUALIFICATION NO. OF INVESTORS

Graduate 76

Undergraduate 25

post graduate and above 49

INTERPRETATION


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Out of 150 investors 51% of investors are graduate and 32% are post graduate and

above rest constitute undergraduates.

c) OCCUPATION OF INVESTORS

OCCUPATION NO.OF INVESTORS

government job 35

private job 43entrepreneur 17

Others 10

INTERPRETATION

From the chart above out of 150 respondents maximum no. of investors for NJIndia are in private job i.e. 41%. After that 33% people are entrepreneur 16% in

government job rest constitute students, house wives and others.

d) YEARLY FAMILY INCOME OFINVESTORS

INCOME GROUP NO.OF INVESTORS

60000-1lakh 9

1lakh-2lakh 39

2lakh-3lakh 53

above 3lakh 49


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INTERPRETATION

According to income group of investors maximum no. of investors are inincome group of 2lakh-3lakh i.e. they constitute approx 38% after that investors of

income group more than 3lakh invest which constitute around 32% and rest 26% are inincome group of 1lakh-2lakh and remaining are in age group of 60000-1lakh

e) PERCENTAGE OF INCOME INVESTORSINVEST

%AGE OF INCOMEINVESTED NO. OF INVESTORS

5%-10% 55

10%-20% 52

20% and above 43

INTERPRETATION:

From the graph it is seen that investors invest maximum of 5-10% of theirincome and this group constitute around 37% of investors after that it is 34% of people

who invest 10-20% of their income rest 29% people invest more than 20% of theirincome.

f)MODES OF DIFFERENT INVESTMENTPREFERRED BY INVESTORS

MODE OF INVESTMENTNO. OFINVESTORS

FD 29

RD 13

Insurance 93


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Share market 42

Real estate 11

Mutual Funds 140

FD + RD 13

FD +insurance 2

FD+ share market 0

FD+ MF 14

RD+insurance 2

RD+share market 7

RD+real estate 1

RD+MF 4

Insurance+share market 2

insurance+real estate 49

insurance+MF 26

Share market+real estate 31

share market+MF 110

real estate+MF 3

INTERPRETATION

Out of 150 investors 140 of them invest in MF in NJ India invest, after which

there are investors who invest in MF as well as share market, after that there areinvestors who invest in insurance, and then in insurance as well as real estate.


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Out of 150 investors 140 i.e. 93% of investors do invest in mutual funds andrest 7% dont invest in mutual funds.

i) Reason for not investing in mutualfunds

REASON FOR NOTINVESTING NO. OF INVESTORS

not aware 3

high risk 4

not any specific reason 3

INTERPRETATION

Out of 10 investors who dont invest in mutual funds 4 of them consider MF asrisky mode for investment, other 3 are not aware about MF and rest 3 have no specificreason for not investing in MF.

j) AWARENESS ABOUT Mf and itsoperations

AWARNESS ABOT MF NO. OF INVESTORS

Bank AMC 29Television/newspaperadvertisement 35

Peer group 15

MF advisor 61


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INTERPRETATION

Out of 140 respondents maximum of investors i.e.43% were made aware aboutMF through their financial advisors. Rest 25% came to know about MF through TVand newspaper advertisement and 20% through bank AMC.

k)TIME PERIOD from now INVESTING INMUTUAL FUNDS

FOR HOW MANY YEARSINVESTING IN MF NO. OF INVESTORS

less than 6 months 39last 1 year 36

last 2 year 36

more than 2 years 29

INTERPRETATION

Out of 140 respondents it is 28% of investors who have invested in MF sincelast 6 months, rest 25% investors are already in MF since last 2 or 1 years and there areonly 17% investors who are in MF for more than 2 years.

L) INVESTORS OBJECCTIVE BEHINDINVESTING IN MUTUAL FUNDS

OBJECTIVE FOR INVESTMENTNO. OF

INVESTORS

only retirement 86

retirement + future commitments 97

future commitments 113

regular income 65regular income + retirement + future 84


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REASON NO. OF INVESTORS

Brand 20

company product 28advisors

recommendation 64market trend 28

INTERPRETATION

From the graph it is seen that out of 140 investors 64 of them that is 46% ofinvestors select that AMC which their advisor recommend them rest either see themarket trend or company product

o) MODE OF INVESTMENT PREFERREDBY INVESTOR

MODE OFINVESTMENT

NO. OFINVESTOR

S

lump sump 51

SIP 89

INTERPRETATION

Most of the investors prefer to invest in SIP mode which constitute of 64%while only 36% investors prefer to invest in a lump sum mode.


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p) OPTION FOR GETTING RETURNSPREFERRED BY INVESTORS

OPTION PREFERED NO. OF INVESTORS

growth 73

dividend reinvest 24

dividend-payout 38

INTERPRETATION

Out of 140 investors 73 of them i.e.53% of investors prefer to get growth optionwhile rest of them i.e. 27% prefer dividend payout and remaining prefer dividendreinvest.

q) TENURE PREFERRED BY INVESTORS

FOR INVESTMENT

TENURE PREFERED NO. OF INVESTORS

short term 40

medium term 47

long term 53

INTERPRETATION

Out of 140 people 53 people prefer to invest for long term and rest 33% preferfor medium term and 28% prefer to invest for short duration.


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r) PREFERE PORTFOLIO FORINVESTMENT BY INVESTORS

PREFERREDPORTFOLIO NO. OF INVESTORS

DEBT 24

EQUITY 47

BALANCED 69

INTERPRETATION

Out of 140 investors 49% investors prefer to invest in balanced portfolio, 33%prefer equity and remaining 17% prefer debt funds.

s) INVESTORS PREFERENCE FORSECTORAL FUNDS

PREFRENCEFOR SECTORALFUND

NO. OFINVESTORS

No 123Yes 17

INTERPRETATION


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72% of investors dont prefer to invest in sectoral funds while only 28% ofinvestors prefer sectoral funds.

t) INVESTORS REACTION IF MARKETCRASHES

INVESTORS REACTIONON MARKET CRASH

NO. OFINVESTORS

Withdraw money 46Invest more money 23

Take advisors advice 52

wait for market to recover 19

INERPRETATION

If market crash out of 140 investors maximum of them i.e.37% will take theirfinancial advisors advice, 33% of investors will withdraw their money, 16% will stillinvest in such situation and rest investors will wait for market to recover.

FINDINGS AND CONCLUSIONS

Investors who invested in NJ Ajmer branch are maximum in age group of 30-40and least in age group of above 50. According to educational qualification maximum investors in NJ are graduate

and very few of them are undergraduate According to occupation maximum no. of investors are in private job and very

few of them are others i.e. either students or house wives. According to yearly family income of investors majority of investors are in

income group of 2lakh-3lakh and very few of investors are in income group of60000-1lakh


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According to %age of income which investors invest maximum no. of investorsinvest 5-10% of their income while very few of them invest 20% and more oftheir income

When investors invest maximum of them prefer to have good returns on theirinvestments.

Out of 150 respondents taken into consideration of NJ India 140 of them investin Mutual Funds

Respondents who dont invest in mutual fund consider it risky or are not awareabout it.

Investors who invest in mutual funds maximum of them got information aboutmutual fund through their advisors and very few of them came to know aboutmutual funds through their friends.

Maximum no. of Investors who are associated with mutual funds are investingin MF since last 6 months and very few of them are investing since last 2 yearsor more.

In preference for AMC investors prefer SBI as most preferred and least

preferred AMC are kotak, shara and others. Reason behind preferring a particular AMC given by maximum investors is that

their advisors advice for that particular AMC while very few of investorsconsider a particular AMC due to its brand name.

According to mode of investment majority of investors prefer to investsystematically through SIP while very few prefer to invest as a lump sum.

In preference to get a return on their investment majority of investors prefer tochoose growth option for their returns while very few of them prefer dividendreinvest.

According to tenure for which investors prefer to invest in a particular fundmaximum investor prefer to invest for long term i.e. for more than 3 years andvery few of investors prefer to invest for short duration.

According to investment portfolio maximum of investors prefer to havebalanced portfolio and very few prefer debt funds.

For a investment option in sectoral funds maximum of investors dont prefer toinvest in sectoral funds

When there is a market crash situation majority of investors prefer to take theirfinancial advisors advice. And very few of investors prefer to wait for market torecover

According to investors objective for investment maximum no. of investors

prefer to invest for their future commitments of life i.e. childs marriage andchilds education while very few consider investments as mode of gettingregular income.


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ConclusionRunning a successful Mutual Fund requires complete understanding of the

peculiarities of the Indian Stock Market and also the psyche of the small investors.This study has made an attempt to understand the financial behavior of Mutual Fund

investors in connection with the preferences of Brand (AMC), Products, Channels etc.I observed that many of people have fear of Mutual Fund. They think their money willnot be secure in Mutual Fund. They need the knowledge of Mutual Fund and itsrelated terms. Many of people do not have invested in mutual fund due to lack ofawareness although they have money to invest. As the awareness and income isgrowing the number of mutual fund investors are also growing.

Brand plays important role for the investment. People invest in thoseCompanies where they have faith or they are well known with them. There are manyAMCs in Ajmer but only some are performing well due to Brand awareness. SomeAMCs are not performing well although some of the schemes of them are giving goodreturn because of not awareness about Brand. Reliance, HDFC, SBIMF, ICICIPrudential etc. they are well known Brand, they are performing well and their AssetsUnder Management is larger than others whose Brand name are not well known likePrinciple, Sundaram, etc.

Distribution channels are also important for the investment in mutual fund.Financial Advisors are the most preferred channel for the investment in mutual fund.They can change investors mind from one investment option to others.


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Limitation

Some of the persons were not so responsive. Possibility of error in data collection because many of investors may have not given

actual answers of my questionnaire Sample size is limited to 150 visitors of N J India invest Ajmer branch out of these

only 140 had invested in Mutual Fund. The sample size may not adequately representthe whole market.

Some respondents were reluctant to divulge personal information

which can affect the validity of all responses. The research is confined to a certain part of Ajmer


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Suggestions and Recommendations

The most vital problem spotted is of ignorance. Investors should bemade aware of the benefits. Nobody will invest until and unless he is fullyconvinced. Investors should be made to realize that ignorance is no longer blissand what they are losing by not investing.

Mutual funds offer a lot of benefit which no other single option couldoffer. But most of the people are not even aware of what actually a mutual fund is?They only see it as just another investment option. So the advisors should try tochange their mindsets. The advisors should target for more and more younginvestors. Young investors as well as persons at the height of their career wouldlike to go for advisors due to lack of expertise and time.

Mutual Fund Company needs to give the training of the IndividualFinancial Advisors about the Fund/Scheme and its objective, because they are themain source to influence the investors.

Before making any investment Financial Advisors should first enquireabout the risk tolerance of the investors/customers, their need and time (how longthey want to invest). By considering these three things they can take the customersinto consideration.

Younger people under 35 age group will be a key new customer groupinto the future, so making greater efforts with younger customers who show someinterest in investing should pay off.

Customers with graduate level education are easier to sell to and there isa large untapped market there. To succeed however, advisors must provide soundadvice and high quality.

Systematic Investment Plan (SIP) is one the innovative productslaunched by Assets Management companies very recently in the industry. SIP iseasy for monthly salaried person as it provides the facility of do the investment in


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EMI. Though most of the prospects and potential investors are not aware about theSIP. There is a large scope for the companies to tap the salaried persons.

BIBLIOGRAPHY

NEWS PAPERS

OUTLOOK MONEY

TELEVISION CHANNEL (CNBC AAWAJ)


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MUTUAL FUND HAND BOOK

FACT SHEET AND STATEMENT

WWW.MONEYCONTROL.COM

WWW.AMFIINDIA.COM

WWW.ONLINERESEARCHONLINE.COM

WWW. MUTUALFUNDSINDIA.COM

Questionnaire

1. Name----------

2. Age group

a) 25-35 b) 35-45 c) 45-55 d) Above 55

3. Occupation

a) Business b) Private Job c) Government Job d) student

4. Education qualification

a) Graduate b) post graduate and above c) under graduate
http://www.moneycontrol.com/http://www.amfiindia.com/http://www.onlineresearch.com/http://www.moneycontrol.com/http://www.amfiindia.com/http://www.onlineresearch.com/


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5. Income level (yearly)

a) 60,000 1, 00,000 b) 2, 00,000 3, 00,000 c) 1, 00,000 2, 00,000

d) Above 3, 00,000

6. What percentage of your income do you invest?

a) 5% to 10% b) 10% to 20% c) 20% and above

7. Which is your mode of investment?

a) Bank b) FD c) stock market d) mutual funds

e) Real estate f) RD g) insurance

8. Which factor you see while investing in that mode?

a) Security b) trust c) good returns d) other

9. Do you prefer to invest in Mutual funds?

a) Yes b) no

If no

10. Why you have not invested in mutual fund?

a) Not aware b) high risk c) not any specific reasons

If yes

11. From where did you get awareness about MF?

a) News paper/TV advertisement b) peer group c)MF advisor

d) Through bank of that AMC

12. From how many years you are investing in MF?

a) Less than 6 months b) From last 1 yr c) Last 2 yr

d) More than 2 yr

13. While investing what are your investment objectives?

a) To receive regular income b) To plan for future commitment (child education,marriage etc.) c) To have safe retirement period


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14. In which AMC you invest?

a) Reliance b) SBI c) HDFC d) sundaram e) ICICI

f) UTI g) others

15. What affects your decision while selecting AMC for investment?

a) Brand name b) company product c) advisors recommendation

d) Market trend

16. What is your mode of investment?

a) One time investment (lump sum) b) SIP

17. What is your preferred portfolio of investment?

a) Equity b) Debt c) Balanced

18. What tenure of investments do you prefer?

a) Short term (up to 1 year) b) Medium term (1 to 3 years)

c) Long term (above 3 years)

19. What is your preferred option for getting returns?

a) Growth b) dividend reinvests c) dividend payout

20. Do you prefer to invest in sectoral funds?

a) Yes b) no

21. How will you react if market goes down?

a) Take advisors advice b) withdraw c) will wait for market to recover

d) Invest

GLOSSARY

Asset Allocation

Diversifying investments in different assets such as stocks, bonds, real estate, and cash inorder to optimize risk.

Fund Manager

The individual responsible for making portfolio decision for a mutual fund, in line withfunds objective.

Fund Offer Document

Document with investment objectives, risk factors, expenses summary, how to invest etc.


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Dividend

Profits given to the investor from time to time.

Growth

Profits ploughed back into scheme. This causes the NAV to rise.

NAV

Market value of assets of scheme minus its liabilities.

Per unit NAV = Net Asset Value

No. of Units Outstanding on Valuation date

Entry Load/Front-End Load (0-2.25%)

The commission charged at the time of buying the fund.

To cover costs for selling, processing

Exit Load/Back- End Load (0.25-2.25%)

The commission or charge paid when an investor exits from a mutual fund. Imposed todiscourage withdrawals

May reduce to zero as holding period increases.

Sale Price/ Offer Price

Price you pay to invest in a scheme. May include a sales load. (In this case, sale price ishigher than NAV)

Re-Purchase Price/ Bid Price

Price at which close-ended scheme repurchases its units

Redemption Price

Price at which open-ended scheme sales its units.


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MUTUAL FUND IN NEWS SINCE JUNE 1ST

Fidelity MF announces merger of two of its schemes Reliance MF first to cross Rs 1lakh average AUM in MAY Equity funds gain 31% in May; best in 17 years

MF industrys assets zoom, cross 6 lakh crores mark; an all time high

The combined average assets under management of mutual funds crossed the Rs 6

trillion-mark (Rs 6 lakh crores) in May

Average AUM of 34 out of 35 mutual funds rose 16% to Rs 6, 37,609 crores in May.

Kotak Mahindra MF ties up with BoB

Corporate, banks and foreign institutional investors collectively control more thanhalf the assets of Indian mutual fund industry, data compiled by the Association ofMutual Funds in India (AMFI) show

After launching an infrastructure fund in collaboration with Macquaire and IFC, StateBank of India is in the process of setting up 'several' other funds to cash in on thearea, which is gaining importance as an alternate asset class


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Shinsei to enter AMC space in India

Baroda Pioneer AMC on Wednesday launched Baroda Pioneer Treasury AdvantageFund, an open-ended debt fund, which aims to provide optimal returns and liquidity

by investing in a portfolio comprising of debt securities and money marketinstruments.

Buoyed by the pickup in insurance venture with Daiichi, Union Bank of India willsoon foray into mutual funds business by setting up an asset management companyalong with its Belgium partner-KBC Group.

The capital market regulator, the Securities and Exchange Board of India (SEBI) willshortly revise its rules to introduce variable entry loads for mutual funds (MFs) andmake disclosure of commissions mandatory for fund houses.

Birla Sun Life Mutual fund (BSLMF) on Tuesday launched iSIP or internet basedsystematic investment plan, a mode of transaction facility that will enable investors tostart their SIP investments online

The government is set to exempt an annual investment of Rs 50,000 or less byinvestors in MFs from the requirement of submitting details of their PAN at the timeof investment

Union Bank of India would make a foray into the mutual fund business by December,a top bank official said Union Bank of India would make a foray into the mutual fund

business by December, a top bank official said

SEBI removes entry load on MF schemes

There may be no signs of the monsoon as yet, but it is raining dividends in the mutualfund (MF) arena. And investors are really pleased with it.

SEBI's move to ban entry fees for investments into MFs will lead to a jump in long-

term inflows Birla Sun Life Mutual Fund has declared 50 per cent dividend in the Birla Sun Life

Basic Industries Fund-dividend option.

The new regulations will hurt MF distributors badly, and to some extent, the industrytoo, says expert.

NEW RULES OF SEBI REGARDING MUTUALFUND

The government is set to exempt an annual investment of Rs 50,000 or less byinvestors in MFs from the requirement of submitting details of their PAN at the timeof investment

SEBI removes entry load on MF schemes

18645919 customers buying pattern of mutual funds

Documents