Systematic Investment Plan- SIP Project Report

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    A STUDY ON MANAGING INVESTMENT

    PORTFOLIO THROUGH SYSTEMATIC

    INVESTMENT PLAN IN MUTUAL FUNDS

    By:-

    Jyothi Acharya -122601056

    Nikita L. DSouza- 122602032

    Department of Commerce

    BBM (E-Banking and Finance)

    &

    (Financial Markets)

    DEPARTMENT OF COMMERCE,

    MANIPAL UNIVERSITY,

    MANIPAL- 576104,

    KARNATAKA, INDIA.

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    DECLARATION

    We, Jyothi Acharya (122601056), student of BBM [e-Banking & Finance], and Nikita L.

    DSouza(122602032), student of BBM [Financial Markets], Department of Commerce, Manipal

    University, declare that the Project Report entitled A Study On Managing Investment Portfolio

    Through Systematic Investment Plan In Mutual Funds, being submitted to the Department of

    Commerce, Manipal University in partial fulfillment of the requirements for the award of BBM

    [e-Banking & Finance] & [Financial Markets], is our original work and the same was not earlier

    submitted to any other Degree/Diploma/Fellowship or any other similar title or prizes.

    Name: Jyothi Acharya Name: Nikita L. DSouza

    Registration No:- 122601056 Registration No:- 122602032

    Date:- Date:-

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    ACKNOWLEDGEMENT

    A summer project is a golden opportunity for learning and self-development. We consider

    ourselves very lucky and honored to have so many wonderful people lead us through in

    completion of this project.

    We Nikita L. DSouza and Jyothi Acharya, students of Department Of Commerce, Manipal

    University, BBM (E-Banking & Finance) & (Financial Markets) take this opportunity to express

    our profound gratitude and deep regards to Mr. Sandeep Shenoy, Head of Department (HOD),

    who has kept the internship as part of our degree which has led to great experience and immense

    attained knowledge which has helped us attain corporate experience. And we would like to thank

    our guide Mr. Vikram Baliga Sir for his exemplary guidance, monitoring and constant

    encouragement throughout the course of this thesis. The blessing, help and guidance given by

    him time to time shall carry us a long way in the journey of life on which we are about to

    embark.

    We are highly indebted to Canara Robecofor their guidance and constant supervision as well as

    for providing necessary information regarding the project & also for their support in completing

    the project.

    We are obliged to the staff members of Canara Robeco, for the valuable information provided

    by them in their respective fields. We are grateful for their cooperation during the period of our

    assignment.

    We express our deepest thanks to the Mrs. Upasna Saboo, Head of Human Resource for giving

    us the opportunity to work in this company. Mr. Sharath Shetty Sir, our project guide, Mr. K.Gopi Sir and Mr. Ravi Kumar Sir for taking part in useful decision & giving us necessary

    advices and guidance and making the resources available at the right time and providing valuable

    insights leading to the successful completion of our project.

    We would also like to thank all the faculty membersof Department Of Commerce, Manipal

    Universityfor their critical advice and guidance without which this project would not have been

    possible.

    Last but not the least we place a deep sense of gratitude to our family membersand friends who

    have been constant source of inspiration during the preparation of this project work.

    With the help of all the people mentioned above we now have greater confidence in the things

    that we are capable of achieving in the near future.

    Jyothi Acharya Nikita DSouza

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    LIST OF TABLES AND CHARTS

    Sr. No. Tables and Charts Page No.

    1 Structure of Mutual Funds 11

    2 Concept of Mutual Funds 16

    3 Classification of Mutual Funds on the basis of its structure 21

    4 Classification on types of Mutual Funds 26

    5 Assets Under Management- Growth Chart 36

    6 Table 1: AUM of Indian Mutual Fund Industry 37

    7 AUM of Indian Mutual Fund Industry Chart 38

    8 Net inflow/outflow of AUM 40

    9 Table 2: Resource mobilization by private and public sector by Mutual Fund 41

    10 Growth in Mutual Fund 41

    11 Market share of leading Mutual Funds 42

    12 AUM composition by product category 43

    13 AUM composition by investor segment 44

    14 Industry AUM comparison 45

    15 Mutual Fund Industry 46-47

    16 Business module 53

    17 Canara Robeco Schemes 59-77

    18 Benefit of SIP over Lumpsum 83

    19 Canara RobecoEmerging Equities 84-87

    20 SIPBuilding wealth 87

    21 Comparing SIP with other investment 87

    22 Comparing SIP with Lumpsum 88-89

    23 Steps in SIP 91-92

    24 Case study of SIP 95-97

    25 SIP Calculator 97-98

    26 Auto Debit Form 99-100

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    TABLE OF CONTENTS

    Chapters Topics Pages

    Chapter 1 Introduction 7

    Introduction to Mutual Funds 8

    Characteristics of Mutual Funds 10

    Structure of Mutual Funds 11

    Advantages of Mutual Funds 14

    Disadvantages of Mutual Funds 15

    Concept of Mutual Funds 16

    History of Mutual Funds 17

    Chapter 2 Classification of Mutual Fund 20

    Classification on the basis of structure 22

    Classification on the basis of types of Mutual Funds 26

    Classification according to investment objective 27

    How investors choose between funds 30

    Chapter 3 Mutual Fund Industry trends 34

    Mutual Fund Industry trends 35

    AUM growth 36

    Mutual Fund industry crosses Rs 10 lakh crores in May 39

    Market share of leading Mutual Funds 42

    AUM distributions by AMCs 45

    Chapter 4 Review of Literature 48

    Chapter 5 Company Profile 51

    Canara Robeco 52

    Business Module 53

    Performance measure 56Products of Canara Robeco 58

    Schemes of Canara Robeco 59

    Facilities provided by Canara Robeco 78

    Chapter 6 Systematic Investment Plan 81

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    Systematic Investment Plan- Introduction 82

    Canara Robeco- NAV Emerging Equities 84

    Comparing SIP 87

    Comparison between sip and Lumpsum investment 88

    Why SIP 90

    Steps in SIP 91

    Benefits of SIP 93

    Disadvantages of SIP 94

    Case studySIP 95

    Sip calculator 97

    SIP Auto Debit Form 98

    Conditions under which sip would yield /no0t yield positive results 101

    Common misconception of SIP 103

    Findings from the study 104

    Conclusion 105

    Bibliography 106

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    NEED FOR THE STUDY

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    OBJECTIVE OF THE STUDY

    To study and understand the workings of Systematic Investment Planning in Mutual

    Funds with special reference to Canara Robeco.

    To make a comparison of Systematic Investment Planning and Lumpsum investments in

    the Portfolio of customers.

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    Chapter 1Introduction

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    Introduction to Mutual Funds

    Mutual fund is a pool of funds which is divided into units of equal value and sold to investing

    public and the funds so collected are utilized for collective investments in various capitals and

    money market instrument. In todays market people invest money to gain more. So when they

    take into account, they mostly look out for Investment Company where they can get more

    income.

    Investment companies can be classified into closed-end and open-end investment companies.

    Closed-end is when it is readily transferable in the market. Open-end funds sell their own shares

    to investors and ready to buy back their old shares. If we talk about the investment options today,

    in India we have so many investment companies like UTI, LIC etc., all have their own special

    ways of servicing the customers. The investors also feel that they are worth to be the part of that

    company. These days people mainly look for avoiding tax so normally they look out for some

    investments which can help them in doing so. When it comes to this point of view, people

    mainly look out for mutual fund.

    Mutual fund is a trust at law; it is a special type of managed, pooled portfolio financial company

    or financial service organization that sells shares/units/stocks in itself, to the public to obtain its

    resources and it invests the savings so mobilized or pooled in a large, diversified, & sound

    portfolio of equity shares, bonds, money market instruments etc., Redeemable trust certificates

    are sold to investors at net asset value (NAV) plus a small commission. All interest/dividend and

    principal repayments are distributed to the holders of the certificates.

    Mutual Funds are a vehicle for retail and institutional investors to benefit from the capital

    markets. They offer different kinds of schemes to cater to various types o

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