FINAL RESEARCH PROJECT

FACTORS INFLUENCING THE INVESTMENT CHOICE OF MUTUAL FUNDS

Submitted in partial fulfillment of PGDM program 2011-13

Submitted by Name: Shalini Sharma 19/073

Apeejay School of Management New Delhi

Certificate by Guide

This is to certify that Final Research Project work done on Factors influencing the investment choice of Mutual Funds submitted to Apeejay School of Management, Dwarka by Shalini Sharma in partial fulfillment of the requirement for the award of Post Graduate Diploma in Management, is a work carried out by her under my supervision and guidance. This work has not been submitted anywhere else for any other degree/diploma. The original work was carried out in Apeejay School of Management.

Date: Apeejay School of Management Dwarka, New Delhi

Guide Name: Prof. Divya Jindal Designation: Asst. Professor

DECLARATION

I hereby declare that the research project work entitled Factors influencing the investment choice of Mutual Funds is submitted to Apeejay School of Management, Dwarka is a record of original work done by me under the guidance of Prof. Divya Jindal, faculty member Apeejay School of Management, Dwarka and this research project work has not been performed on the basis for the award of any degree or diploma and similar project if any.

Name: Shalini Sharma Roll number: 19/073

ACKNOWLEDGEMENT

This comprehensive work owes credit to multitude of people. Certainly I acknowledge the contribution of the pioneers in the finance field, especially those whose teachings has become a part of my thinking. I thank Prof. Divya Jindal my Faculty Mentor for her variety of inputs in the completion of the project also I thank those hundred individual investors who has helped me in carrying out the survey successfully. Finally, on my respective home front I thank my family and friends who have provided love and inspiration over the years. Without the support of all these dear people this project would not exist.

INDEX
S.NO.
CH.1 1.1 1.2 1.3 1.4 1.5 1.6 1.7 1.8 1.9

CHAPTER
Executive summary Introduction Mutual fund Other different modes of investment Regulatory authority Association of Mutual Funds in India Asset Management Company Diversification in mutual funds Disclosure in mutual fund investment Types of Mutual Funds Schemes in India Overview of existing schemes in mutual fund category

PAGE NO.
1 18 2 12 3 4 5 8 8 9 10 11 14

1.10 1.11 1.12 1.13 1.14 CH.2 CH.3

Advantages of Investing in Mutual Funds Disadvantages of Investing in Mutual Funds Entry and Exit load ULIPS Expense ratio Indian Mutual fund industry Literature review Objective of the study

15 16 17 18 18 19 22 23- 28 29 30 35 31 31 31 36-33

CH.4 4.1 4.2 4.3 CH.5

Research design and methodology Research design Framework of analysis Description of factors Data analysis and findings

Table 5.1.1 Profile of participants in the survey on 37 the basis of demographic factors Pie diagram 1 distribution of male and female in the survey 5.1 5.2 Attitude of investors towards investment Investors Opinion on Objective of Selecting Mutual Fund Schemes Table 5.2.1 Features of mutual fund 5.3 Importance of Rating of the Asset Management Company Table 5.3.1 5.4 39 39 39 38 38 38

Sources of Information gathered about a mutual fund 40 are different for the investor Table 5.4.1 Pie chart 2 Sources of information of a mutual fund 40 40 42 42 43 43 43

5.5

Disclosure of mutual fund Table 5.5.1

5.6

Past performance of the scheme Table 5.6.1 Pie chart 3 Preference for the Past performance of the scheme

5.7

Behavior of investors towards Withdrawal/Exit 44 Facility of Mutual Fund Table 5.7.1 44 44

5.8

Importance of infrastructure like agency network, research wing, expertise in money management to the investors Table 5.8.1

44 45

5.9

Relationship between income of the investor and

number of mutual fund purchased by them. Table 5.9.1 Pearsons coefficient correlation 5.10 Relationship between income of investor and the feature of mutual fund selected Table 5.10.1 codes for annual income Table 5.10.2 5.11 Relationship between gender of the investor and tax benefit Table 5.11.1 Table 5.11.2 T-test for gender and number of mutual fund purchased by the investor. CH.6 6.1 6.2 CH.7 Conclusion and suggestions Conclusion Suggestions Limitations Bibliography Appendix Data of the survey Sample questionnaire The list of mutual fund name and asset under management by the AMCs 48-51 49 51 52 54-57 58 64 59 60 61 47 47 46 46 47 45 46