A

Project Report
On
‘ COMPARISON ON MUTUAL FUND SCHEMES’

Undertaken at:
Principal PNB Asset Management Company Pvt.
ltd.
At Ahmedabad Branch

Submitted by:
PUROHIT SHIRISH R.
06MBA46

Guided by:
MR. NIRAV MAJMUDAR

MBA PROGRAME
(2006-08)

SHRIMAD RAJCHANDRA INSTITUTE OF

MANAGEMENT AND COMPUTER APPLICATION

1
 DECLARATION

I here by declare that the summer project report titled

“Comparison On Mutual Fund Schemes” is an original

piece of work done by me for the fulfillment of the award of degree of
Master of Business Administration. Whatever information has been
taken from any sources had been duly acknowledge.

I further declare that the secondary data and information

received from online during survey has not been shared with any one
and is used for academic purpose only.

Purohit Shirish R.
(06MBA46)

ACKNOWLEDGEMENT

2
 Learning is a delightful experience and in the ocean of knowledge
you can acquire limitless understanding through your craving for it.
And in my craving to know more, it has been memorizing extravagance
of memorable experience. At this enlightening moment of completion
of my project, I feel obliged to record my heartfelt and deep gratitude
to those who have helped me.
I feel immense pleasure to thank Dr. Bankim Patel,
Director, Shrimad Rajchandra Institute of Management &
Computer application (SRIMCA), Gopal Vidhyanagar for
making available all facilities in fulfilling the requirements
for the research work and being there for me as and when
required.
I feel immense pleasure in expressing my deep sense of
gratitude to my project guide from the Institute, Mr. Nirav Majmudar,
(Internal Mentor) Shrimad Rajchandra Institute of Management &
Computer Application, Gopal Vidhyanagar, for his valuable guidance
throughout preparation of this report.
I wish to convey my special thanks to Mr. Nitin Zanje as Sales
Manager, Mr. Mohit as assistance sales manager and also thanks to Mr.
Ketan Shah as Sales Executive, At the same time, I am very much
thankful to all staff members of Principal PNB Asset Management
Company Pvt. Ltd., at Ahmedabad for their kind co-operation who has
been a constant source of inspiration and encouragement to me.
I would like to record my special thanks to my parents, friends,
and colleagues help me directly or indirectly in preparation of project
work. I am sincerely thankful to all the faculty member of MBA
department who directly or indirectly supported me during the project.
I am also thankful to all the non-teaching staff of SRIMCA for their kind
support.

3
 Shirish R.
Purohit
(06MBA46)

EXECUTIVE SUMMARY

As a partial fulfillment of MBA program all students are required

to undergo training for 2 months. With respect to this I have prepared a
project report on “Comparison on Mutual Fund Schemes”.

During the last three to four years Mutual Fund industry is booming
in India, which created some eagerness for my summer training. Thus
I decided to work on the Mutual Fund Industry. This would provide
me an opportunity to understand the Mutual Fund industry in better
way. Finally I got consent from Principal PNB Asset Management
Company Pvt. Ltd., Ahmedabad to conduct my project.

Through the discussion with the project mentor and literature review I came to
know that in India there is very less awareness about the Mutual Fund, and the figure of
awareness level in India is approximately 4 to 5%. The major portion of people’s savings
is not invested into the Mutual Fund, because of lack of awareness.

The project is based under the assumption that, as Mutual Fund being a new
investment avenue in the market people likes to get some information about Mutual Fund
and also about the products. I want to measure the performance of different mutual fund
schemes of different AMCs.

In the duration of 8 weeks I study various mutual fund schemes like, Large cap
fund Tax saving fund, Child benefit fund, Balance fund growth fund etc. I also studied
performance of different AMCs in particular scheme of mutual fund. In order to compare
the performance of AMCs in particular scheme, I collected daily Net Asset Values of
AMCs for the period of 2000 to 2007. Then I compare the performance using Sharpe’s
Performance index model. Then I also compare Sharpe index value with CNX
Midcap200.

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 I compared different AMCs performance in Balance scheme, Saving Scheme,
Equity Scheme & Growth scheme by using Sharpe’s model and calculated return and risk
of schemes to compare actual return with index return, thereby to measure the
performance of scheme of different AMCs.

In equity scheme 2003 and 2005 ICICI AMC, 2004 Tata AMC, 2006 and 2007
Principal AMC out performs index. In Balance scheme 2002 to 2005 HDFC AMC, 2006
Principal AMC and 2007 Tata AMC out performs index. In saving scheme 2000 to 2002
Sundarm AMC, 2003 to 2007 Principal AMC out perform index.

Apart from report I made more than 25 clients, they invested more than 2.5 lacs in
Principal Mutual fund schemes. I had done marketing of different Principal schemes at
Nationalized Banks. Altogether it was a great learning experience for me throughout
these 8 weeks of training.

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 TABLE OF CONTENTS

CH. NO. TOPIC PAGE NO.

1 INTRODUCTION 1

1.1 Company profile 1

1.2 About Mutual Fund Industry 11

2 Research Methodology 54

3 Data Analysis and Interpretation 56

4 key finding 64

5 Conclusion 66

6 Recommendation 67

7 Bibliography 68

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 CHAPTER 1

INTRODUCTION

1.1) COMPANY PROFILE

Principal PNB Asset Management Company Private Limited is the

investment manger for Principal Mutual Fund. Principal PNB Asset
Management Company Private Limited is the joint venture between
Principal Financial Group (U.S.A.), Punjab National Bank and Vijaya
Bank.

In this Joint Venture Principal has 65% holding, Punjab National

Bank has 30% holding and Vijaya Bank has 5% holdings. PPAMC has
$2600 Million assets under management and serves more than 555000
customers.

ABOUT PRINCIPAL MUTUAL FUNDS

Principal Financial Services Inc., USA, and a member of Principal

Financial Group Inc. USA sponsor Principal Mutual Fund. Principal
Financial Group entered Indian mutual fund market in September 2000
through a 50:50 joint venture with IDBI. In October 2000, IDBI Principal
Mutual Fund pioneered an Asset Allocation Program, which it
christened Future Goals — India's first life stage investment plan. In
June 2003, Principal Financial Group bought out Ibis’s 50 per cent stake
in the joint venture.

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PRINCIPAL PNB ASSET MANAGEMENT COMPANY PRIVATE
LIMITED

Principal PNB Asset Management Company Private Limited is the

investment manager for Principal Mutual Fund. It was the first private
sector company to tie-up with the Department of Postal Services to sell
mutual funds through the postal network. In June 2003, Principal PNB
Asset Management Company Private Limited acquired the right to
manage the schemes of SUN F&C Mutual Fund. In May 2004, Punjab
National Bank and Vijaya Bank bought 30% and 5 % respectively in
Principal Asset Management.

SPONSOR

Principal Financial Services Inc., USA (A member of the

Principal Financial Group Inc., USA)

The Principal Financial Group

Principal financial group was established in the year 1879 in

U.S.A. The Principal Financial Group (The Principal) is a leader in
offering businesses, individuals and institutional clients a wide range of
financial products and services, including retirement and investment
services, life and health insurance and mortgage banking through its
diverse family of financial services companies. More employees choose
the Principal Financial Group for their 401(k) plans than any other
bank, mutual fund or insurance company in the United State. A
Member of the FORTUNE 500, the Principal Financial Group has $135

8
billion in assets under management and serves some 14.8 million
customers worldwide from office in 12 countries throughout Asia,
Australia, Europe, Latin America and United States.

The Principal Financial Group, Inc. is traded on the New York

Stock Exchange under the ticker symbol PFG. More employees choose
the Principal Financial Group for their 401(k) plans than they do from
any other bank, mutual fund or insurance company in the United
States.

AMC AND TRUSTEE

Principal PNB Asset Management Company Private Limited

(PPAMC), a company incorporated on October 17, 1994, is the
Investment Manager to Principal Mutual Fund.

PPAMC was originally incorporated as a wholly owned subsidiary

of Industrial Development Bank of India (IDBI). Principal Financial
Services Inc. USA, acquired 50% stake in the paid up equity capital of
IDBI Investment Management Company Ltd., on March 31, 2000,
through its subsidiary Principal Financial Group (Mauritius) Limited
(PFGML). Subsequently, the name of the Company was changed to
IDBI-PRINCIPAL Asset Management Company Limited. On June 23,
2003, PFGML acquired 100% stake in the paid up equity capital of IDBI-
PRINCIPAL Asset Management Company Limited. Subsequently the
name of the company was changed to Principal Asset Management
Company Private Limited, to reflect the change in ownership. On May
05, 2004, Punjab National Bank and Vijaya Bank became equity
shareholders of the Asset Management Company and post this,
Principal Financial Group (Mauritius) Limited, Punjab National Bank and

9
Vijaya Bank hold 65%, 30% and 5% respectively of the paid up equity
capital of the Asset Management Company. To reflect the change in
the controlling interest, the name of the Company with effect from
January 24, 2005 has been changed to Principal PNB Asset
Management Company Private Limited.

Directors of the Asset Management Company are:

Mr. M.M. Chitale

Chairman

Mr. Rajan Ghotgalkar

Managing Director

Mr. Rustam J. Gagrat

Advocate and Solicitor
Mr.Ashok Vij
Chartered Accountant
Mr. Arun Kaul
General Manager - Punjab National Bank
Mr.J. C. Tupling
Chief Operating Officer, Principal International (Asia) Ltd - Asia

PRINCIPAL TRUSTEE COMPANY PRIVATE LTD.

Principal Trustee Company Private Limited (formerly IDBI-

PRINCIPAL Trustee Company Limited), a company incorporated under
the Companies Act, 1956 is the Trustee to the Fund with effect from
October 18, 2002. Prior to October 18, 2002 Board of Trustees
discharged the Trusteeship function of the fund.

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 On June 23, 2003, Principal Financial Services Inc. USA acquired
100% stake in IDBI-PRINCIPAL Trustee Company Limited, through its
wholly owned subsidiary Principal Financial Group (Mauritius) Limited.
Name of the Trustee Company was changed to Principal Trustee
Company Private Limited, to reflect the change in ownership. On
April 30, 2004, Punjab National Bank and Vijaya Bank became equity
shareholders of the Trustee Company and post this, Principal
Financial Group (Mauritius) Limited, Punjab National Bank and Vijaya
Bank hold 65%, 30% and 5% respectively of the paid up equity capital
of the Trustee Company.

Directors of the trustee company are:

Mr. B. G. Deshmukh
Former Cabinet Secretary, Government of India.

Mr. H.M.Singh
Former Secretary, Government of India

Mr. V.S. Mathur

Independent Director

Mr. Pramod Lele

Independent Director

Mr. Norman Sorensen

President, Principal Financial Inc., USA

Mr. Harwant Singh

General Manager - Punjab National Bank

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Key Personnel
Rajan Ghotgalkar
Managing Director

Rajan Ghotgalkar is Country Head -INDIA at Principal International and

Managing Director of Principal PNB Asset Management Company (in
association with Vijaya Bank.) He has overall responsibility of all the
Principal International business units in India. Mr. Ghotgalkar also
serves as a Director on the Board’s of PNB Principal Insurance Advisory
Company Private Limited, PNB Principal Financial Planners Co. Pvt. Ltd
and Principal Global service private ltd.

Rajan Krishnan
Business Head-Asset Management

Mr. Rajan Krishnan is the Business Head - Asset Management at

Principal PNB Asset Management Company Pvt. Ltd.

Rajat Jain
Chief Investment Officer

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Rajat Jain is the Chief Investment Officer of Principal PNB Asset
Management Company Private Limited.

CUSTODIAN

CITIBANK NA
Ramnord house, 77 Dr. Annie Besant Road, Worli, Mumbai 400018
SEBI Registration No. IN/CUS/004

REGISTRAR AND TRANSFER AGENT

KARVY COMPUTERSHARE PRIVATE LIMITED
21, Avenue 4, Banjara Hills, Street No. 1, Hyderabad 500034
SEBI Registration No. INR00000021

STATUTORY AUDITORS OF PRINCIPAL MUTUAL FUND

HARIBHAKTI AND CO.

Chartered Accountants

STATUTORY AUDITORS OF ASSET MANAGEMENT COMPANY

Deloitte Haskins and Sells

Chartered Accountant

STATUTORY AUDITORS OF TRUSTEE COMPANY

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HARIBHAKTI AND CO.
Chartered Accountants

PRODUCT DETAIL

EQUITY FUNDS

Principal Index Fund Open-ended Index Fund

Principal Growth Fund Open-ended Equity Fund
Principal Tax Savings Fund Open-ended Equity-linked Savings Fund
Principal Global Opportunities Fund An open ended Growth
Scheme
Principal Resurgent India Equity Fund Open end Equity Scheme
Principal Personal Tax Saver Fund Open end Equity Linked Saving
Scheme. Open ended ELSS under Section 80 C(2) of the Income Tax
Act, 1961
Principal Dividend Yield Fund An open ended Equity Fund
Principal Focused Advantage Fund Open Ended Equity Fund
Principal Junior Cap Fund Open ended Equity Fund
Principal Large Cap Fund Open ended Equity Fund
Infrastructure & Services Ind Fund An Open Ended Equity Scheme
Long Term Equity Fund-3 yr Plan-SI 3-year close-ended equity
scheme

DEBT FUNDS

Principal Floating Rate Fund An open-ended income fund consisting

of two funds - Fixed Maturity Plan and Short Maturity Plan

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Government Securities Fund A 100% debt oriented fund investing
primarily in government securities.
Cash Management Fund A 100% debt-based mutual fund targeted
at investors with a short-term investment horizon
Principal Income Fund Open-ended Income Fund
Principal Short Term Income Fund Open-ended Income Fund
Principal Monthly Income Plan Open-ended Income Plan with no
assured monthly returns
Principal Monthly Income Plan - MIP Plus An open ended fund.
Monthly income is not assured and is subject to the availability of
distributable surplus
Principal PNB Debt Fund Open-ended Debt Scheme
Principal Money Value Bond Fund Open end Income Scheme
Principal PNB FMP 460 Days-Series I A closed-ended Debt Scheme
offering Fixed Maturity Plan
Principal FMP 385 Days-Series I A closed-ended Debt Scheme
offering Fixed Maturity Plan
Fixed Duration Fund 3 Year Plan Series I A Closed Ended Income
Scheme offering Fixed Maturity Plan
Principal FMP 385 Days-Series II A closed-ended Debt Scheme
offering Fixed Maturity Plan
Principal FMP 91 Days-Series IV A closed-ended Debt Scheme
offering Fixed Maturity Plan
Principal PNB FMP 460 Days-Series II A closed-ended Debt Scheme
offering Fixed Maturity Plan
Principal FMP 91 Days-Series V A closed-ended Debt Scheme
offering Fixed Maturity Plan
FMP 385 Days-Series III A closed-ended Debt Scheme offering Fixed
Maturity Plan
Principal FMP 91 Days-Series VI A closed-ended Debt Scheme
offering Fixed Maturity Plan

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FMP 540 Days Series I A closed-ended Debt Scheme offering Fixed
Maturity Plan
Principal FMP 91 Days-Series VII A closed-ended Debt Scheme
offering Fixed Maturity Plan
Principal FMP 91 Days-Series VIII A closed-ended Debt Scheme
offering Fixed Maturity Plan
Principal PNB
FMP 460 Days-Series III A closed-ended Debt Scheme offering Fixed
Maturity Plan
Principal PNB FMP 385 days Series IV A closed-ended Debt
Scheme offering Fixed Maturity Plan
Principal FMP 91 Days-Series IX A closed-ended Debt Scheme
offering Fixed Maturity Plan

SPECIALTY FUNDS

Principal Trust Benefit Fund Open-ended Income Fund

Principal Child Benefit Fund Open-ended Balanced Fund

BALANCED FUNDS

Principal Balanced Fund Open-ended Balanced Fund

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1.2) HISTORY OF THE INDIAN MUTUAL FUND
INDUSTRY

The origin of mutual fund industry in India is with the introduction

of the concept of mutual fund by UTI in the year 1963. Though the
growth was slow, but it accelerated from the year 1987 when non-UTI
players entered the industry.

In the past decade, Indian mutual fund industry had seen a

dramatic improvement, both qualities wise as well as quantity wise.
Before, the monopoly of the market had seen an ending phase; the
Assets Under Management (AUM) was Rs. 67bn. The private sector
entry to the fund family raised the AUM to Rs. 470 bn in March 1993
and till April 2004; it reached the height of 1,540 bn.

Putting the AUM of the Indian Mutual Funds Industry into

comparison, the total of it is less than the deposits of SBI alone,
constitute less than 11% of the total deposits held by the Indian
banking industry.

17
 The main reason of its poor growth is that the mutual fund
industry in India is new in the country. Large sections of Indian
investors are yet to be intellectuated with the concept. Hence, it is the
prime responsibility of all mutual fund companies, to market the
product correctly abreast of selling.

The mutual fund industry can be broadly put into four phases
according to the development of the sector. Each phase is briefly
described as under.

• First Phase – 1964-87

An Act of Parliament established Unit Trust of India (UTI) on

1963. It was set up by the Reserve Bank of India and functioned under
the Regulatory and administrative control of the Reserve Bank of India.
In 1978 UTI was de-linked from the RBI and the Industrial Development
Bank of India (IDBI) took over the regulatory and administrative control
in place of RBI. The first scheme launched by UTI was Unit Scheme
1964. At the end of 1988 UTI had Rs.6700 crores of assets under
management.

• Second Phase – 1987-1993 (Entry Of Public Sector Funds)

1987 marked the entry of non- UTI, public sector mutual funds
set up by public sector banks 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 1987 followed by
Can bank Mutual Fund (Dec 87), Punjab National Bank Mutual Fund
(Aug 89), Indian Bank Mutual Fund (Nov 89), Bank of India (Jun 90),

18
Bank of Baroda Mutual Fund (Oct 92). LIC established its mutual fund
in June 1989 while GIC had set up its mutual fund in December 1990.

• Third Phase – 1993-2003 (Entry Of Private Sector Funds)

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 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.
1,21805 crores. The Unit Trust of India with Rs.44541 crores of assets
under management was way ahead of other mutual funds.

• Fourth Phase – Since February 2003

In February 2003, following the repeal of the Unit Trust of India

Act 1963 UTI was bifurcated into two separate entities. One is the
Specified Undertaking of the Unit Trust of India with assets under
management of Rs.29,835 crores as at the end of January 2003,
representing broadly, the assets of US 64 scheme, assured return and
certain other schemes. The Specified Undertaking of Unit Trust of
India, functioning under an administrator and under the rules framed

19
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 assets under
management 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 September 2004, there were 29 funds, which manage assets of
Rs.153108 crores under 421 schemes.

GROWTH IN ASSETS UNDER MANAGEMENT

Note:
Erstwhile UTI was bifurcated into UTI Mutual Fund and the Specified

20
Undertaking of the Unit Trust of India effective from February 2003.
The Assets under management of the Specified Undertaking of the Unit
Trust of India has therefore been excluded from the total assets of the
industry as a whole from February 2003 onwards.

INTRODUCTION TO MUTUAL FUND

• WHAT IS A MUTUAL FUND?

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• MUTUAL FUND - CONCEPT

A Mutual Fund is a trust that pools the savings of a number of

investor 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 the capital appreciations realized are 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.

• DEFINITION OF MUTUAL FUND

A mutual fund is a pool of assets invested on behalf of investors.

Mutual funds invest in a diversified portfolio of securities, which can
include equity securities( such as common and preferred shares), debt
securities (such as bonds and debentures) and other financial
instruments issued by corporations and governments, according to the
stated investment objectives of the funds. Individual investors own a
percentage of the value of the fund as represented by the number of
units they purchase. A collection of money invested in a group of
assets and managed by an investors company (a mutual fund company
or other). The money comes from investors who want to buy shares in
the fund. The benefits to investors in buying shares of mutual funds
come primarily from diversification, professional money management,
and capital gains and dividend reinvestment.

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• ORGANIZATION STRUCTURE OF MUTUAL FUND
INDUSTRY

Unit
Holders

Sponsors
Trustee AMC
Transfer
Mutual Fund
Agent

SEBI

Mutual fund is set up in the form of a trust, which has sponsor, trustees,
asset management company (AMC) and a custodian. The trust is established
by a sponsor or more than one sponsor who is like a promoter of a company.

23
The AMC, approved by SEBI, manages the funds by making investments in
various types of securities. The custodian, who is registered with SEBI, holds
the securities of various schemes of the fund in its custody. The trustees are
vested with the general power of superintendence and direction over AMC.
They monitor the performance and compliance of SEBI Regulations by the
mutual fund.

• ORGANISATION OF A MUTUAL FUND

Sponsor

Asset
Mgmt.
Mutual
Custodia Fund Company
n
Trustee
Company

Schem Sche
Scheme
e me

Portfolio Portfolio Portfolio

Cos. Cos. Cos

24
 MUTUAL FUND

The Mutual Fund Regulations lay down several criteria that need
to be fulfilled in order to be granted registration as a mutual fund must
be registered with SEBI and must be constituted in the form of a trust
in accordance with the provisions of the Indian Trusts Act, 1882. The
instrument of trust must be in the form of a deed between the sponsor
and the trustees of mutual fund duly registered under the provision of
the Indian Registration Act,1908.

 SPONSOR

The sponsor is required, under the provisions of the Mutual Fund

Regulations, to have a sound track record, a reputation of fairness and
integrity in all his business transactions Additionally, the sponsor
should contribute at least 40% to the net worth of the an AMC shall be
deemed to be a sponsor and will be required to fulfill the eligibility
criteria specified in the Mutual Fund Regulations. The sponsor or any of
its directors or the principal officer employed by the mutual fund
should not be guilty of fraud, not be convicted of an offence involving
moral turpitude or should have not been found guilty of any economic
offence.

 TRUSTEES

The mutual fund is required to have an independent Board of

Trustees, i.e. two thirds of the trustees should be independent persons
who are not associated with the sponsors in any manner whatsoever.
An AMC or any of its officers or employees are not eligible to act as a
trustee of any mutual fund. In case a company is appointed as trustee,
then its directors can act as trustees of any other trust provided that

25
the object of such other trust is not in conflict with the object of the
mutual fund. Additionally, no person who is appointed as a trustee of
a mutual fund can be appointed as a trustee of any other mutual fund
unless he is an independent trustee and prior approval of the mutual
fund of which he is a trustee has been obtained for such an
appointment. The trustees are responsible for-inter alia- ensuring that
the AMC has all its systems in place, all key personnel, auditors,
registrars etc. have been appointed prior to the launch of any scheme.
It is also the responsibility of the trustees to ensure that the AMC does
not act in a manner that is favorable to i9ts associates such that it has
a detrimental impact on the unit holders, or that the management of
one scheme by the AMC does not compromise the management of
another scheme.
The trustees are also required to ensure that an AMC has been
diligent in empanelling and monitoring any securities transactions with
brokers, so as to avoid any undue concentration of business with any
broker. The Mutual Fund Regulations further mandates that the
trustees should prevent any conflicts of interests between the AMC and
the unit holders in terms of deployment of net worth. The trustees are
also responsible for ensuring that there is no change carried out in the
fundamental attributes of any scheme or the trust or fees and
expenses payable or any other change that would modify the scheme
and affect the interest of unit holders, unless each unit holder is
provided with written communication thereof.
In addition, the unit holders must be given the option to exit at
the prevailing Net Asset Value (“NAV”) without any exit load. They are
obli9ged to perform a quarterly review of all transactions carried out
between the mutual funds, AMC and its associates. As far as
professional indemnity cover for the trustees or the AMC is concerned,
industry practice in India reveals that the insurance policy is taken out
by an Indian insurance company (as is required by the Insurance Act,
1938) while the risk is subsequently ceded to an overseas re-insurer

26
who underwrites the primary policy issued by the Indian insurance
company.

 ASSET MANAGEMENT COMPANY

The sponsor or the trustees are required to appoint an AMC

to manage the assets of the mutual fund. Under the Mutual Fund
Regulations, the applicant must satisfy certain eligibility criteria in
order to qualify to register with SEBI as an AMC

• The sponsor must have at least 40% stake in the AMC;

• The directors of the AMC should be persons having adequate
professional experience in finance and financial services related
field and not found guilty of moral turpitude or convicted of any
economic offence or violation of any securities laws;
• The AMC should have and must at all times maintain, a minimum
net worth of Rs.100 million;
• The board of directors of such AMC has at least 50% directors,
who are not associate of , or associated i9n any manner with, the
sponsor or any of its subsidiaries or the trustees;

The Chairman of the AMC is not a trustee of any mutual fund In

addition to the above eligibility criteria and other on going
compliance requirements laid down in the Mutual Fund Regulations,
the AMC is required to observe the following restrictions in its
normal course of business:

• Any director of the AMC cannot hold office of a director in another

AMC unless such person is an independent director and the approval
of the board of the AMC of which such person is a director, has been
obtained;

27
• The AMC shall not act as a trustee of any mutual fund;

• The AMC cannot undertaken any other business activities except

activities in the nature of portfolio management and advisory
services to offshore funds, pension funds, provident funds, venture
capital funds, and management. Of insurance funds, financial
consultancy an d exchange of research on commercial basis if any
of such activities are not in conflict with the activities of the mutual
fund;

• However, the AMC may, Itself or through its subsidiaries, undertake

such activities if it satisfies the board that the key personnel of the
asset management company, the systems, back office, bank and
securities accounts are segregated activity wise and there exist
systems to prohibit access to inside information of various activities.

• The AMC shall not invest in any of its schemes unless full disclosure
of its intention to invest has been made in the offer. However, an
AMC shall not be entitled to charge any fees on its investment in
that scheme.

 CUSTODIAN

The mutu8al fund is required, under the Mutual Fund Regulations, to

appoint a custodian to carry out the custodial services for the schemes
of the fund. Only institutions with substantial organizational strength,
service capability in terms of computerization, and other infrastructure
facilities are approved to act as custodians. The custodian must be
totally declined from the AMC and must be registered with SEBI. Under
the Securities and Exchange Board of India (Custodian of Securities)

28
Guidelines, 1996,any person proposing to carry on the business as a
custodian of securities must register with the SEBI and is required to
fulfill specified eligibility criteria. Additionally, a custodian in which the
sponsor or its associates holds 50% or more of the voting rights of the
share capital of the custodian or where 50% or more of the directors of
the custodian represent he interest of the sponsor or its associates
cannot act as custodian for a mutual fund constituted by the same
sponsor or any of its associate or subsidiary company.

 SCHEMES

Under the Mutual Fund Regulations, a mutual fund is allowed to

float different schemes. Each scheme has to be approved by the
trustees and the offer document is required to be filed with the SEBI.
The offer document should contain disclosures which are adequate
enough to enable the investors to make informed investment decision,
including the disclosure on maximum investments proposed to be
made by the scheme in the listed securities of the group companies of
the sponsor . If the SEBI does not comment on the contents of the
offering documents within 21 days from the date of filing, the AMC
would be free to issue the offer documents to public.

There is obligation on the AMC and the trustee to ensure that the
statements made in the offer documents are true and correct. The AMC
is also required to provide an option to the unit-holder to nominate a
person in whom the units held by him shall vest in the event of his
death. SEBI has also prescribed an advertising code that has to be
observed while launching a new scheme.

Close-ended schemes are required to be listed on a recognized

stock exchange within six months from the closure of the subscription.

29
However, this requirement is not mandatory if the scheme provides for
periodic repurchase facility to all the unit-holders or monthly income or
caters to special classes of persons, if the details of such repurchase
facility are clearly disclosed in the offer document or if the scheme
opens for repurchase within a period of six months from the closure of
subscription. The units of close-ended scheme may be converted into
open-ended scheme if the offer document of such scheme discloses
the option and the period of such conversion or if the unit-holders are
provided with an option and the period of such conversion or if the
unit-holders are provided with an option to redeem their units in full. A
close-ended scheme is required to be fully redeemed at the end of the
maturity period. However, a close-ended scheme may be allowed to be
rolled over if the purpose, period and other terms of the roll over and
all other material details of the scheme including the likely composition
of assets immediately before the roll over, net assets and NAV of the
scheme, are disclosed to the unit-holders and a copy of the same4 has
been filed with SEBI. Additionally, such a roll over would be permitted
only in case of those unit-holders who have expressed their consent in
writing and the unit-holders who do not opt for the roll over or have not
given written consent shall be allowed to redeem their holdings in full
at NAV based price.

 INVESTMENT CRITERIA

The Mutual Fund Regulations lay down certain investment criteria

that the mutual funds need to observe. The money collected under any
scheme of a mutual fund shall be invested only in transferable
securities in the money market or in the capital market or in privately
placed debentures or securities debts. However, in the case of
securities debts such fund may invest in asset-backed securities and
mortgaged backed securities. Furthermore, the mutual fund having

30
 aggregates of securities which are worth Rs.100 million or more shall
be required to settle their transactions through dematerialized
securities. In addition to the above, mutual fund are not permitted to
borrow money from the market except to meet temporary liquidity
needs of the mutual funds for the purpose of repurchase, redemption
of units or payment of interest or dividend to the unit holders. Even
such borrowing cannot exceed 20% of the net asset of a scheme and
the duration of such a borrowing cannot exceed a period of six months.
Similarly, a mutual fund is not permitted to advance any loans for any
purpose.

A mutual fund is permitted to lend securities in accordance with

the stock lending scheme of SEBI. The funds of a scheme are
prohibited from being used in option trading or in short selling or carry
forward transactions. However, SEBI has permitted mutual fund to
enter into derivative transactions on a recognized stock exchange for
the purpose of hedging and portfolio balancing and such investments
in derivative instruments have to be made in accordance with
SEBI guidelines issued in this regard.

 Limitation of Fees and Expenses

The mutual Fund Regulations lay down certain restrictions on the fees
that can be charged by the AMC and also caps the express that can be
loaded on to the Fund. The AMC can charge the mutual fund with
investment and advisory fees subject to the following restrictions:

• One and a quarter of one per cent of the weekly average net assets
outstanding in each accounting year for the scheme concerned, as long
as the net assets do not exceed Rs.1 billion, and

31
• One per cent of the excess amount over Rs.1 billion, where net assets
so calculated exceeds RS.1 billion.

For schemes launched on a load basis, the AMC can collect an

additional management fee not exceeding 1% of the weekly average
net assets outstanding in each financial year. In addition to the
aforesaid fees, the AMC may charge the mutual fund with the initial
expenses including agents’ commission, if any, brokerage and
transaction cost, fees and expenses of trustees, audit fees , custodian
fees etc. The Mutual Fund Regulations also lay down a cap on the initial
expense and the ongoing expense that can be borne by a scheme. In
respect of a scheme, initial expenses, they cannot exceed 6% of the
initial resources raised under that scheme and any excess over the 6%
initial issue expense shall be borne by the AMC. Ongoing expenses
(excluding issue or redemption expenses) including the investment
management and advisory fee cannot exceed the following limits:

1. The first Rs.100 cores of the average weekly net assets – 2.5%
2. On the next Rs.300 cores of the average weekly net assets –
2.25%
3. On the next Rs.300 cores of the average weekly net assets –
2.0%
4. On the balance on the assets – 1.75%

In addition to the above provisions, the Mutual Fund Regulations

lay down several compliance /filing requirements pertaining to
reporting to the SEBI , guidelines for calculation of Net Assets Value,
disclosure requirements, accounting norms, etc.

32
 MUTUAL FUND OPRTATION FLOW CHART

A Mutual Fund is a trust that pools the saving of number of

investors who shares a common financial goal. The money thus
collected is the invested in capital market instrument such as shares,

33
debentures. The income earned through these investments and the
capital appreciation realized is shares 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.

HOW DOES MUTUAL FUND WORK ?

34
TYPE OF MUTUAL FUNDS

35
  Type of Funds, as per structure….

Open-ended Daily sale/purchase,

No fixed maturity,
Fund is “secondary market”

Closed-ended Sale during IPO,

Fixed Maturity,
SE is secondary market.

Interval Periodic sale/purchase,

No fixed maturity,
SE is secondary market.

Schemes can be classified as Closed-ended or Open-ended

depending upon whether they give the investor the option to redeem
at any time (open-ended) or whether the investor has to wait till
maturity of the scheme.

 Open-ended Fund/ Scheme

An open-ended fund or scheme is one that is available for

subscription and repurchase on a continuous basis. These schemes do
not have a fixed maturity period. Investors can conveniently buy and
sell units at Net Asset Value (NAV) related prices which are declared on
a daily basis. The key feature of open-end schemes is liquidity.

 Close-ended Fund/ Scheme

36
 A close-ended fund or scheme has a stipulated maturity period
e.g. 5-7 years. The fund is open for subscription only during a specified
period at the time of launch of the scheme. Investors can invest in the
scheme at the time of the initial public issue and thereafter they can
buy or sell the units of the scheme on the stock exchanges where the
units are listed. In order to provide an exit route to the investors, some
close-ended funds give an option of selling back the units to the
mutual fund through periodic repurchase at NAV related prices. SEBI
Regulations stipulate that at least one of the two exit routes is
provided to the investor i.e. either repurchase facility or through listing
on stock exchanges. These mutual funds schemes disclose NAV
generally on weekly basis.

 Interval Fund/ Scheme

These schemes combine the features of open-ended and closed-

ended schemes. They may be traded on the stock exchange or may be
open for sale or redemption during pre-determined intervals at NAV
based prices.

 Type of Funds, as per investment objective….

37
 Equity Debt Money
Market

Fixed
Equity Fund
Income Money
Index Funds
Funds Market
Sector Funds
Mutual

Liquid Funds
Balanced Funds

A scheme can also be classified as growth scheme, income

scheme, or balanced scheme considering its investment objective.
Such schemes may be open-ended or close-ended schemes as
described earlier. Such schemes may be classified mainly as follows

 Equity Oriented Scheme

These schemes, also commonly called Growth Schemes, seek to

invest a majority of their funds in equities and a small portion in money
market instruments. Such schemes have the potential to deliver
superior returns over the long term. However, because they invest in
equities, these schemes are exposed to fluctuations in value especially
in the short term.

38
 Equity schemes are hence not suitable for investors seeking
regular income or needing to use their investments in the short-term.
They are ideal for investors who have a long-term investment horizon.
The NAV prices of equity fund fluctuates with market value of the
underlying stock which are influenced by external factors such as
social, political as well as economic.

39
General Purpose+

The investment objectives of general-purpose equity schemes do

not restrict them to invest in specific industries or sectors. They thus
have a diversified portfolio of companies across a large spectrum of
industries. While they are exposed to equity price risks, diversified
general-purpose equity funds seek to reduce the sector or stock
specific risks through diversification. They mainly have market risk
exposure.

Sector Specific

These schemes restrict their investing to one or more pre-

defined sectors, e.g. technology sector. Since they depend upon the
performance of select sectors only, these schemes are inherently more
risky than general-purpose schemes. They are suited for informed
investors who wish to take a view and risk on the concerned sector.

Special Schemes

 Index schemes

The primary purpose of an Index is to serve as a measure of the

performance of the market as a whole, or a specific sector of the
market. An Index also serves as a relevant benchmark to evaluate
the performance of mutual funds. Some investors are interested in
investing in the market in general rather than investing in any
specific fund. Such investors are happy to receive the returns
posted by the markets. As it is not practical to invest in each and
every stock in the market in proportion to its size, these investors
are comfortable investing in a fund that they believe is a good
representative of the entire market. Index Funds are launched and

40
 managed for such investors. An example to such a fund is the HDFC
Index Fund.

 Tax saving schemes

Investors (individuals and Hindu Undivided Families (“HUFs”)) are

being encouraged to invest in equity markets through Equity Linked
Savings Scheme (“ELSS”) by offering them a tax rebate. Units
purchased cannot be assigned / transferred/ pledged / redeemed /
switched – out until completion of 3 years from the date of
allotment of the respective Units.

The Scheme is subject to Securities & Exchange Board of India

(Mutual Funds) Regulations, 1996 and the notifications issued by the
Ministry of Finance (Department of Economic Affairs), Government
of India regarding ELSS.

Subject to such conditions and limitations, as prescribed under

Section 88 of the Income-tax Act, 1961, subscriptions to the Units
not exceeding Rs.10, 000 would be eligible to a deduction, from
income tax, of an amount equal to 20% of the amount subscribed.
HDFC Tax Plan 2000 is such a fund.

 Real Estate Funds

Specialized real estate funds would invest in real estates

directly, or may fund real estate developers or lend to them directly
or buy shares of housing finance companies or may even buy their
securitized assets.

41
 Debt Oriented Scheme

These schemes, also commonly called Income Schemes, invest in

debt securities such as corporate bonds, debentures and government
securities. The prices of these schemes tend to be more stable
compared with equity schemes and most of the returns to the
investors are generated through dividends or steady capital
appreciation. These schemes are ideal for conservative investors or

42
those not in a position to take higher equity risks, such as retired
individuals. However, as compared to the money market schemes they
do have a higher price fluctuation risk and compared to a Gilt fund
they have a higher credit risk.

Income Schemes

These schemes invest in money markets, bonds and debentures

of corporate with medium and long-term maturities. These schemes
primarily target current income instead of capital appreciation. They
therefore distribute a substantial part of their distributable surplus to
the investor by way of dividend distribution. Such schemes usually
declare quarterly dividends and are suitable for conservative investors
who have medium to long term investment horizon and are looking for
regular income through dividend or steady capital appreciation..

Liquid Income Schemes

Similar to the Income scheme but with a shorter maturity than

Income schemes. An example of this scheme is the HDFC Liquid Fund

Money Market Schemes

These schemes invest in short term instruments such as

commercial paper (“CP”), certificates of deposit (“CD”), treasury bills
(“T-Bill”) and overnight money (“Call”). The schemes are the least
volatile of all the types of schemes because of their investments in
money market instrument with short-term maturities. These schemes
have become popular with institutional investors and high net worth
individuals having short-term surplus funds.

Gilt Funds

43
 This scheme primarily invests in Government Debt. Hence the
investor usually does not have to worry about credit risk since
Government Debt is generally credit risk free.

 Hybrid Schemes

These schemes are commonly known as balanced schemes.

These schemes invest in both equities as well as debt. By investing in a
mix of this nature, balanced schemes seek to attain the objective of
income and moderate capital appreciation and are ideal for investors
with a conservative, long-term orientation.

 Fund of Funds (FoF) schemes

A scheme that invests primarily in other schemes of the same

mutual fund or other mutual funds is known as a FoF scheme. A FoF
scheme enables the investors to achieve greater diversification
through one scheme. It spreads risks across a greater universe.

 Load or no-load Fund

A Load Fund is one that charges a percentage of NAV for entry or

exit. That is, each time one buys or sells units in the fund, a charge will
be payable. This charge is used by the mutual fund for marketing and
distribution expenses. Suppose the NAV per unit is Rs.10. If the entry
as well as exit load charged is 1%, then the investors who buy would
be required to pay Rs.10.10 and those who offer their units for
repurchase to the mutual fund will get only Rs.9.90 per unit. The
investors should take the loads into consideration while making
investment as these affect their yields/returns. However, the investors
should also consider the performance track record and service
standards of the mutual fund, which are more important. Efficient
funds may give higher returns in spite of loads.

44
 Mutual funds cannot increase the load beyond the level
mentioned in the offer document. Any change in the load will be
applicable only to prospective investments and not to the original
investments. In case of imposition of fresh loads or increase in existing
loads, the mutual funds are required to amend their offer documents
so that the new investors are aware of loads at the time of
investments.

RIGHTS AND SERVICES OF UNIT HOLDERS:

Unit holders may have access to Certain Services, Such As

Automatic Reinvestment Of Dividends And Systematic Withdrawal And
Systematic investment plans, inter scheme transfers. This section of
the prospectus will describe these services and how you can take
advantage of them.

After reviewing a few prospectuses, you’ll become accustomed to

the language and be able to reduce the time it takes to find the
information you need to make a sound investment decision.
You can receive prospectuses free from mutual fund companies, their
investor service centers or registrars. Do not hesitate to ask questions
on points that you do not understand.

ADVANTAGES OF MUTUAL FUNDS

 Affordability

A mutual fund invests in a portfolio of assets, i.e. bonds, shares,

etc. depending upon the investment objective of the scheme. An
investor can buy in to a portfolio of equities, which would otherwise be
extremely expensive. Each unit holder thus gets an exposure to such
portfolios with an investment as modest as Rs.500/-. This amount
today would get you less than quarter of an Infosys share! Thus it

45
would be affordable for an investor to build a portfolio of investments
through a mutual fund rather than investing directly in the stock
market.

 Professional Management:

Qualified investment professionals who seek to maximize returns

and minimize risk monitor investor's money. When you buy in to a
mutual fund, you are handing your money to an investment
professional who has experience in making investment decisions. It is
the Fund Manager's job to (a) find the best securities for the fund,
given the fund's stated investment objectives; and (b) keep track of
investments and changes in market conditions and adjust the mix of
the portfolio, as and when required.

 Transparency

Open-ended mutual funds disclose their Net Asset Value (“NAV”)

daily and the entire portfolio monthly. This level of transparency, where
the investor himself sees the underlying assets bought with his money,
is unmatched by any other financial instrument. Thus the investor is in
the know of the quality of the portfolio and can invest further or
redeem depending on the kind of the portfolio that has been
constructed by the investment manager.

 Diversification

The nuclear weapon in your arsenal for your fight against risk. It
simply means that you must spread your investment across different
securities (stocks, bonds, money market instruments, real estate, fixed
deposits etc.) and different sectors (auto, textile, information
technology etc.). This kind of a diversification may add to the stability
of your returns, for example during one period of time equities might
under perform but bonds and money market instruments might do well

46
enough to offset the effect of a slump in the equity markets. Similarly
the information technology sector might be faring poorly but the auto
and textile sectors might do well and may protect your principal
investment as well as help you meet your return objectives.

 Spreading Risk:

An investor with a limited amount of fund might be able to invest

in only one or two stocks / bonds, thus increasing his or her risk.
However, a mutual fund will spread its risk by investing a number of
sound stocks or bonds. A fund normally invests in companies across a
wide range of industries, so the risk is diversified at the same time
taking advantage of the position it holds. Also in cases of liquidity crisis
where stocks are sold at a distress, mutual funds have the advantage
of the redemption option at the NAVs.

 Liquidity:

You are free to take your money out of open-ended mutual funds
whenever you want, no questions asked. Most open-ended funds mail
your redemption proceeds, which are linked to the fund's prevailing
NAV (net asset value), within three to five working days of your putting
in your request

 Variety

Mutual funds offer a tremendous variety of schemes. This variety

is beneficial in two ways: first, it offers different types of schemes to
investors with different needs and risk appetites; secondly, it offers an
opportunity to an investor to invest sums across a variety of schemes,
both debt and equity. For example, an investor can invest his money in
a Growth Fund (equity scheme) and Income Fund (debt scheme)
depending on his risk appetite and thus create a balanced portfolio
easily or simply just buy a Balanced Scheme

47
  Flexibility

Mutual Funds offering multiple schemes allow investors to switch

easily between various schemes. This flexibility gives the investor a
convenient way to change the mix of his portfolio over time.

 Convenience

An investor can purchase or sell fund units directly from a fund,

through a broker or a financial planner. The investor may opt for a
Systematic Investment Plan (“SIP”) or a Systematic Withdrawal
Advantage Plan (“SWAP”). In addition to this an investor receives
account statements and portfolios of the schemes

 Tax Benefits

Any income distributed after March 31, 2002 will be subject to

tax in the assessment of all Unit holders. However, as a measure of
concession to Unit holders of open-ended equity-oriented funds,
income distributions for the year ending March 31, 2003, will be taxed
at a concessional rate of 10.5%.

In case of Individuals and Hindu Undivided Families a deduction

upto Rs. 9,000 from the Total Income will be admissible in respect of
income from investments specified in Section 80L, including income
from Units of the Mutual Fund. Units of the schemes are not subject to
Wealth-Tax and Gift-Tax.

 Regulations:

Securities Exchange Board of India (“SEBI”), the mutual funds

regulator has clearly defined rules, which govern mutual funds. These
rules relate to the formation, administration and management of
mutual funds and also prescribe disclosure and accounting

48
requirements. Such a high level of regulation seeks to protect the
interest of investors.

DISADVANTAGES OF MUTUAL FUNDS

Some of the Disadvantages of investing in Mutual Funds are given

below:

 Risks Involved
 Changing market conditions can create fluctuations in the
value of a Mutual Fund investment.
 There are fees & expenses associated with investing in Mutual
Funds that do not usually occur when purchasing individual
securities directly.
 As with any type of investment, there are drawbacks
associated with Mutual Funds.
 No Guarantees

The value of your Mutual Fund investment, unlike a bank

deposit, could fall & be worth less than the principle initially
invested. And, while a money market fund seeks a stable share
price, its yield fluctuates, unlike a certificate of deposit. In
addition, Mutual Funds are not insured or guaranteed by an
agency of the U.S. government. Bond funds, unlike purchasing a
bond directly, will not re-pay the principle at a set point in time.

 Potential Loss
Unlike a bank deposit, the investment in a Mutual Fund
could fall in value, as the fund is nothing but a portfolio of
different securities. Apart from a few assured returns schemes,
the fund does not guarantee any minimum percentage of return.

49
 The Diversification Penalty
While diversification reduces the risk of loss from holding a
single security, it also limits the larger gains if a single security
increases dramatically in value. Also, diversification does not
protect the unit holders totally from an overall decline in the
market.

 Hidden Costs
In some cases, the efficiencies of fund ownership are offset
by a combination of sales commissions, 12b-1 fees, redemption
fees, & operating expenses. If the fund is purchased in a taxable
account, taxes may have to be paid on capital gains. Keep track
of the cost basis of your initial purchase & new shares that are
acquired by reinvesting distributions. It's important to compare
the costs of funds you are considering. Always look at "net"
returns when comparing fund performances. Net return is the
bottom line; an investment's true return after all costs is
deducted.

Prospectuses will not contain all the costs that affect the
net return on your investment. This is why it is important to
compare net returns whether or not the fund in a no-load or load
fund.

 Expenses

Because Mutual Funds are professionally managed

investments, there are management fees & operating expenses
associated with investing in a fund. These fees & expenses
charged by the fund are passed onto shareholders & deducted
from the fund's return.

50
 These expenses are typically expressed as the expense
ratio - the percent of fund assets spent (annually) on day-to-day
operations. Expense ratios can vary widely among funds.
Expense ratios for Mutual Funds commonly range from 0.2% to
2.0%, depending on the fund. Consult the fund's prospectus to
determine the expense ratio for a specific fund.

ASSOCIATION OF MUTUAL FUND IN INDIA

(AMFI)
With the increase in mutual fund players in India, a need for mutual
fund association in India was generated to function as a non-profit
organization. Association of Mutual Funds in India (AMFI) was
incorporated on 22nd August, 1995.

AMFI is an apex body of all Asset Management Companies (AMC)

which has been registered with SEBI. Till date all the AMCs are that
have launched mutual fund schemes are its members. It functions
under the supervision and guidelines of its Board of Directors.

Association of Mutual Funds India has brought down the Indian

Mutual Fund Industry to a professional and healthy market with ethical
lines enhancing and maintaining standards. It follows the principle of
both protecting and promoting the interests of mutual funds as well as
their unit holders.

The objectives of Association of Mutual Funds in India

The Association of Mutual Funds of India works with 38 registered AMCs

of the country. It has certain defined objectives which juxtaposes the
guidelines of its Board of Directors. The objectives are as follows:

51
 • This mutual fund association of India maintains a high
professional and ethical standards in all areas of operation of the
industry.

• It also recommends and promotes the top class business

practices and code of conduct which is followed by members and
related people engaged in the activities of mutual fund and asset
management. The agencies who are by any means connected or
involved in the field of capital markets and financial services also
involved in this code of conduct of the association.

• AMFI interacts with SEBI and works according to SEBIs guidelines

in the mutual fund industry.

• Association of Mutual Fund of India do represent the Government

of India, the Reserve Bank of India and other related bodies on
matters relating to the Mutual Fund Industry.

• It develops a team of well qualified and trained Agent

distributors. It implements a programme of training and
certification for all intermediaries and other engaged in the
mutual fund industry.

• AMFI undertakes all India awarness programme for investors in

order to promote proper understanding of the concept and
working of mutual funds.

• At last but not the least association of mutual fund of India also
disseminate information’s on Mutual Fund Industry and
undertakes studies and research either directly or in association
with other bodies.

SEBI Regulations Regarding Mutual Fund

The SEBI regulations for the establishment and issue by mutual funds
are s follows;

52
 Mutual Funds shall be established in the form of trusts under the
Indian Trust Act and managed separately formed asset
Management Company.

 Money Market mutual Fund would be regulated by the RBI and

Other Mutual Funds Would be regulated by SEBI.

 Fifty percent (50%) members of the board of AMC must be

independent directors and must have no connection with
sponsoring organization.

 The directors should have at least 10 years experience in the

field of Portfolio management, Financial Administration.

 The AMC should have minimum Net Worth of RS 10 crores

 An AMC can not act as the AMC for another Mutual Fund

 AMCS are also allowed to do other fund based businesses such as

providing investment management services to offshore funds,
other mutual funds, venture capital funds, and insurance
companies.

 The minimum amount to be raised with each Closed-End scheme

should be Rs. 20 crores and for the Open-Ended scheme Rs 50
crores.

 Each Scheme of the Mutual Fund is registered with SEBI before it

is floated in the market.
 Closed end schemes should not be kept open for subscription for
more than 45 days. For open ended schemes, the first 45 days
should be considered for determining the target figure.
 The initial issue expenses should not exceed 6% of the funds
raised under each scheme.
 For each scheme there should be a separate and responsible
Fund Manager.

53
  All Mutual Funds mu8st distribute a minimum of 90% of their
profits in any given year.

Frequently used term in mutual fund

Net Asset Value (NAV)

NAV of unit for the scheme is calculated by dividing the market

value of the assets of the scheme by no of unit outstanding for that
scheme. The formula for the calculation of NAV is given below:

NAV = Net Assets of the Scheme / Number of Outstanding Unit.

Where,
Net assets of the scheme = Market Value of the Scheme +
Receivables + Other Accrued Income + Other Assets – Accrued
Expenses – Other Payables – Other liabilities

Number of outstanding unit = Outstanding unit on valuation date.

Entry Load

Entry load are the charges levied by the mutual fund scheme to
meet their routine expenses of the scheme and initial expenses and
distribution expenses of the mutual fund. Generally entry load is taken
on the open ended scheme of the mutual fund where any one can
withdraw their money at any time. One some one invests in the open

54
ended scheme the entry load is added to its current NAV. Generally
entry load of the mutual fund is varies between 1.5% to 3%.

Exit Load

Exit load are the charges levied by the mutual fund when some
one redeemed the fund from the mutual fund. This load is levied to
maintain the investor to remain invested in the mutual fund for the
longer term. The exit load is generally taken on the closed ended
scheme of mutual fund.

PLAYERS IN INDIAN MUTUAL FUND INDUSTRY

As on Jun, 2007

Mutual Fund Name No. Assets Under

Scheme Management
ABN Amro Mutual Fund 156 6874.43
AIG Global Investment 4 1100.69
Group Mutual Fund
Benchmark Mutual Fund 9 7200
Birla Mutual Fund 225 19525
BOB Mutual Fund 22 97
Canbank Mutual Fund 46 2796
DBS Chola Mutual Fund 70 3018
Deutsche Mutual Fund 130 6910
DSP Merrill Lynch Fund 129 12753
Escorts Mutual Fund 24 136
Fidelity Mutual Fund 27 8593
Franklin Templeton 196 26469
Investments
HDFC Mutual Fund 212 35630
HSBC Mutual Fund 133 14314
ICICI Prudential Mutual Fund 270 43614

55
ING Mutual Fund 157 5346
JM Financial Mutual Fund 128 3758
JP Morgan Mutual Fund 3 825
Kotak Mahindra Mutual Fund 144 16722
LIC Mutual Fund 81 9222
Lotus India Mutual Fund 108 4165
Morgan Stanley Mutual Fund 1 3291
Principal Mutual Fund 129 11551
Quantum Mutual Fund 5 69
Reliance Mutual Fund 236 59857
Sahara Mutual Fund 29 187
SBI Mutual Fund 178 20273
Standard Chartered Mutual 203 12946
Fund
Sundaram Mutual Fund 147 9400
Tata Mutual Fund 265 14837
Taurus Mutual Fund 14 308
UTI Mutual Fund 216 39032

Reliance
Asset Under Management
ICICI

UTI
59144
86070 HDFC

Franklin
11551 50703 Birla

SBI
14586
16170 Kotak

16723 40070 Satandard Charted

19661
23719 26276 36147
HSBC

Principal Pnb 56
Others
Bank V/S Mutual Fund
PARTICULARS BANKS MUTUAL FUNDS

Returns Low Better

Administrative exp. High Low

Risk Low Moderate to High
Investment options Less More
Network High penetration Low but improving
Liquidity At a cost Better
Quality of assets Not transparent Transparent

Interest calculation Minimum balanceEveryday

between 10th.
& 30th. Of every
month
Guarantee Maximum Rs.1 lakh onNone
deposits
FEASTA 2007

 Feasta 2007 is the sales promotion program of Principal Mutual

Fund for the PSU Banks
 In Feasta 2007 PPMF has included Four Product

 Principal Large Cap Fund

57
 The Investment Objective of the scheme would be to provide
capital appreciation and /or dividend distribution by predominantly
investing in companies having a large market capitalization. Principal
Large cap fund that seeks to invest in fundamentally strong companies
with Large Market Capitalization.

What is the investment strategy of the fund?

The fund will predominantly invest in stocks having a market

capitalization equal to or greater than Rs.3500 Crores, representing the
truly large cap stocks. A small part of the Portfolio Could be invested in
stocks having a lower market capitalization but not lower than Rs.2000
Crores.
Large Caps are an ideal investment choice on account
of the following characteristics

• Access to raise resources: Copanies with large

capitalization have strong Balance Sheets along with the ability to
raise/borrow large capital
• Economies of scale: These companies benefit from
cost efficiency due to their economies of scale and hence competitive
pricing leads to both higher top line & Geographic Locations.

58
• Risk Taking Ability: On the operational side, they
have access to sophisticated information systems and use superior risk
management systems.
• Preference given by Institutional Investors:
Large Cap companies are the preferred stocks for long-term
investments for large institutional investors like insurance companies,
Provident funds, Foreign Institutional Investors (FIIs), etc.

 Principal Tax Savings Fund

To build a high quality growth-oriented portfolio and provide

long-term capital gains to the investor. The fund aims at providing
returns through capital appreciation.

This fund is suitable for investors who are interested in long-term

growth through investments in fundamentally strong companies with
large market capitalization. It is appropriate for investors seeking
equity returns but with the stability that comes through investing in
companies having the propensity to deliver higher returns with limited
volatility irrespective of market cycles.

Investment Objective

59
 The Investment Objective of the scheme would be to provide
capital appreciation and /or dividend distribution by predominantly
investing in companies having a large market capitalization.

Investment Strategy

The fund will predominantly invest in stocks having a market

capitalization equal to or greater than Rs.3500 crore (to be reviewed
periodically in line with the market levels), representing the truly large
cap stocks. A small part of the portfolio could be invested in stocks
having a lower market capitalization but not lower than Rs.2000 crores.

Plans for Investment

The Scheme will offer Growth Option and Dividend Option.

Dividend Option will have the facility of Pay-out and Re-investment.

Dividend Frequency

Dividend will be declared based on the distributable surplus as

decided by the Trustees.
Minimum Application Amount

Minimum application amount will be Rs. 5000 for Dividend Option

and Growth Option and any amount thereafter under each option.
Subsequent investment amount shall be Rs 500 and any amount
thereafter under each option.

Load Structure

60
 Entry Load – For applications below Rs. 3 crore – 2.25%. For
applications of Rs.3 crore and above - Nil
Exit Load – For applications below Rs.3 crore – Nil.
For applications of Rs.3 crore upto Rs.5 crore – 0.50% if redeemed
within 3 months. For applications of Rs.5 crore and above - Nil

 Principal Child Benefit Fund

The investment objective of the fund is to generate regular returns

and/or capital appreciation/accretion with the aim of giving lump-sum
capital growth at the end of the chosen target period or otherwise to
the beneficiary. It is balance fund scheme. Principal launch this scheme
as fix.

 Principal Global Opportunity Fund

The objective of the scheme is to build a high quality

international equity portfolio out of the permissible investments as
defined and permitted under the regulations from time to time and
provide returns and/or capital appreciation along with regular liquidity
to the investors.

CHAPTER 2
RESEARCH METHODOLOGY

Objective

61
To understand the various schemes of Mutual Fund.
To compare the various schemes.

Research Design:

Descriptive Research Design

Data Collection Method

Secondary Data Collection

•Population- Mutual Fund Schemes

•Sample frame – 157 schemes

•Sample Size
 4 Schemes (Principal Large Cap Fund, Principal Global
Opportunity Fund, Principal Tax Saving Funds, Principal
Child Benefit Fund)

• Sampling Technique

 Judgmental sampling
 Data collection sources
 –Web site
 Data analysis Package - MS office

62
 LIMITATION

 The project is based on the Beta calculation, but the dates of the
index and NAV does not match to get reliable calculated Beta.

 The performance of the various schemes is based on comparison

between their respective return and Index return, here the index
considered is CNX Midcap 200, but there can be difference
between various Indexes.

63
 CHAPTER – 3
DATA ANALYSIS AND INTREPRETATION

Sharpe’s Performance Index

Sharpe’s performance index gives a single value to be used for

the performance common ranking of various funds. Sharpe’s
performance index measures the risk premium of funds relative to the
total amount of risk in the funds. This risk premium is the difference
between the portfolio average rates of return the risk-less rate of
return. The standard deviation of the portfolio indicates the risk the
index assigns the highest values to assets that have best risk adjusted
average rate of return

Rp-Rf
St =
σ Ρ

St = Sharpe’s Performance Index

Rp = Portfolio average Return

Rf = Risk free rate of interest (Rf = 7.46% per annum T-Bills rate)

σ Ρ =Standard deviation of Portfolio return

Portfolio average return- Risk free rate of interest

Sharpe Index =
Standard deviation of the portfolio return

64
 (%)
Balance scheme

HDFC MUTUAL FUND

Children's Gift Fund Children's Gift Savings
Growth FUND
YEAR Invt Growth
RETURN Risk RETURN Risk RETURN Risk
2002 0.090509 0.01898 0.057478 0.006154 0.05784 0.001401
2003 0.262408 0.008532 0.173788 0.00738 0.076135 0.002815
2004 0.085842 0.011752 -0.05858 0.01883 -0.07839 0.016597
2005 0.155096 0.007502 0.11508 0.006696 0.04945 0.002456
2006 0.116953 0.010646 0.040907 0.011808 0.005122 0.003052
2007 0.093405 0.007903 0.075771 0.008838 0.026301 0.002

The above table shows the unsystematic risk and return of the HDFC
AMC in the balance scheme.

PRINCIPAL PNB CHILD BENEFIT FUND

ICICI Prud Child Care-Study
CBP FGP
YEAR RETURN Risk RETURN Risk YEAR RETURN Risk
2002 0.055561 0.006936 0.000555 0.006925 2002 0.04612 0.002477
2003 0.164744 0.007097 0.001648 0.007095 2003 0.081076 0.004392
2004 0.059164 0.009686 0.000594 0.009676 2004 0.022919 0.002486
2005 0.110658 0.006593 0.001106 0.006593 2005 0.056181 0.002191
2006 0.136264 0.010908 0.00136 0.010916 2006 0.051171 0.004235
2007 0.129972 0.007355 0.001299 0.007353 2007 0.054176 0.002296

The above table shows the unsystematic risk and return of the Principal
AMC & ICICI AMC in the Balance Scheme.

Reliance Regular
SBI Magnum
Tata Balanced Fund Savings Fund- Birla Sun Life 95
Balanced Fund -
YEA - Growth HYBRID PLAN- Fund-PlanB Growth
Growth
R Growth Option
RETURN S.D. RETURN S.D. RETURN S.D. RETURN Risk
0.11885 0.01220 0.11846 0.05155 0.00328 0.10257 0.01031
2006 0.01137
5 2 1 2 3 1 3
0.15309 0.07897 0.00837 0.00798 0.12381 0.00787
2007 0.00854 0.0902
7 2 3 5 8 4

65
The above table shows the unsystematic risk and return of the Tata
AMC, SBI Magnum AMC, Reliance AMC & Birla Sun Life AMC in the
Balance Scheme.

Following is the findings by using Sharpe’s Performance index model

Sharpe's Performance Index - CNX

Midcap200

YEA
Sm
R
2000 -8.58366
2001 -8.76248
2002 -5.68094
2003 11.10953
2004 -2.34097
2005 3.851475
2006 3.636869
2007 2.147195

The above table shows the Sharpe Performance Index of CNX

Midcap200 for the year 2000 to 2007.

Sharpe's Performance Index

PRINCIPAL Birla
HDFC TATA SBI RELIANCE
YEA PNB sun
R child's
Growth CBP FGP
invt
0.83819 -
2002 -2.78226 -2.74495
8 10.6924
22.0121 -
2003 13.44011 12.7017
9 10.2822
0.95660 -
2004 -7.07276 -1.59364
3 7.64841
10.7299 -
2005 6.0454 5.469134
4 11.1473
- 2.71220 3.85760
2006 3.978302 -2.8534 5.653099 3.626864 -7.02041
6.70942 8 8

66
 - 9.19168 6.25069 0.52215
2007 2.379476 0.132496 7.528484 1.953663
9.96886 6 9 5

The above table shows the Sharpe's Performance Index of various

Balanced Fund Schemes from the year 2002 to 2007. In the above
table underline figures shows the higher performance than index and
bold figures shows the highest performance than others.

Intrepretation:

The above tables shows the From the above calculation we can
say that in the Balance fund scheme in the year 2002 to 2005 HDFC
AMC, 2006 Principal AMC, 2007 TATA AMC out perform index - which
means that this Mutual Fund scheme is able to give more return than
the benchmark Index used for comparison.

Equity Scheme

Kotak
ICICI Prud Growth Tata Pure Equity- Sahara Growth Mahindra_kotak30-
Plan-Growth Growth Fund-Growth Growth
YEAR RETURN S.D RETURN S.D. RETURN S.D. RETURN S.D.
0.02562
2000 -0.19239 7
0.03485 0.02214
2001 4 3
0.01237 0.02425 0.01180
2002 0.05097 4 2 9
0.26775 0.01389 0.01582 0.01337 0.29682 0.07784
2003 3 4 1 2 2 5
0.45335 0.36317 0.01574 0.07199 0.02619 0.08132
2004 9 0.67122 1 9 7 5 8 0.013728
0.16096 0.01078 0.14642 0.01554 0.13307 0.03447 0.11145
2005 5 6 3 4 1 9 8 0.008363
0.14475 0.01640 0.14366 0.15487 0.01564 0.09944
2006 1 6 1 0.01718 7 6 8 0.012709
0.08195 0.01276 0.07575 0.01384 0.08482 0.01114 0.07783
2007 6 8 5 1 1 7 9 0.011268

67
The above table shows the unsystematic risk and return of the ICICI
AMC, Tata AMC, Sahara AMC & Kotak Mahindra AMC in the Equity
scheme.

Sundaram BNP
Paribas select Morgan Stanley Principal Large HSBC Equity Fund
focus Growth Fund Cap-Growth - Growth
AVERAG
YEAR RETURN S.D RETURN E RETURN S.D RETURN
2000
2001
2002
2003
2004
0.14349
2005 5 0.02645
0.16323 0.03029 0.10985 0.16444 0.01645 0.12944 0.01720
2006 3 7 2 0.016262 7 1 8 4
0.08528 0.01276 0.09016 0.13636 0.01273 0.07935 0.01226
2007 8 3 9 0.01237 6 3 6 5

The above table shows the unsystematic risk and return of the
Sundaram BNP AMC, Morgan Stanley AMC, Principal AMC & HSBC AMC
in the Equity scheme.

Sharpe's Performance Index in Equity scheme

ICICI TATA Sahara Kotak Sundaram Morgan Pri. PNB

YEAR
Growth Equity Growth Kotak30 Select Growth Large Cap
2000 -10.418
2001 -1.79496
2002 -1.90955 -4.26353
2003 13.90209 -4.39568 2.854673
2004 0.564284 18.32313 -0.09937 0.490093
2005 8.007321 4.620625 1.695844 4.40727 2.604726
2006 4.275971 4.019849 5.130832 1.95515 2.925471 2.167753 5.461492

68
2007 0.576084 0.083448 0.916928 0.287451 0.837421 1.25861 4.85086

Intrepretation:

From the above calculations in the Equity Scheme in the year

2003 and 2005 ICICI AMC, 2004 TATA AMC and 2006 and 2007
Principal AMC out perform index. In the above table underline figures
show the higher performance than index and bold figures show the
highest performance than others.

Saving Scheme

Sundarm MBNP Principal PNB Mutual Fund

Pribas Tax Saver- ICICI Prud. Tax
Growth Plan-Growth Personal Tax Tax Saver
YEA AVERAG
R RETURN E RETURN S.D RETURN S.D. RETURN S.D
0.02789
2000 -0.08296 0.016488 8 0.02105 -0.86672 0.072512
0.06426 0.01077 0.02718
2001 9 5 7 0.017875 -0.04827 0.013107 -0.08482 0.01866
0.31998 0.01214 0.05860
2002 3 5 -0.05629 0.01381 2 0.011515 0.110554 0.032006
0.26894 0.01131
2003 0.001373 0.013603 -0.36793 0.013405 0.2621 0.013685 4 4
0.08100 0.01610 0.11988
2004 0.04554 0.020746 -0.12459 0.017962 3 2 8 0.016343
0.14903 0.00991
2005 0.114349 0.018322 -0.20926 0.010954 -0.04397 0.026141 3 7
0.09468 0.14525 0.01650
2006 0.115571 0.026447 -0.08568 0.017825 5 0.018658 6 6
0.00951 0.19446
2007 0.060783 0.011532 -0.03002 9 5 0.01183 0.105982 0.012451

The above table shows the unsystematic risk and return of the
Sundaram BNP AMC, ICICI AMC and Principal AMC in the tax saving
scheme.

YEAR Birla Sun Life Relief Franklin Templeton Kotak Tax Saver Reliance Tax
96 Mutual Fund- scheme-Growth saver-Growth
Growth

69
 AVERAG AVERAG
E S.D E S.D. RETURN S.D. RETURN S.D
2000
2001
2002
2003
2004
2005
0.02746 0.01496 0.12086 0.01720
2006 -0.01234 2 0.096578 3 5 1.61349 0.10498 6
0.32889 0.04332 0.01187 0.14011 0.01112 0.04914 0.01135
2007 6 4 0.103634 7 3 1 9 9

The above table shows the unsystematic risk and return of the Birla
Sun Life AMC, Franklin Temp. AMC, Kotak AMC and Reliance AMC in the
tax saving scheme.

Sharpe's Performance Index in Tax Saver scheme

Sundar Birla
ICICI Principal Franklin Kotak Reliance
m Sun
YEAR
Tax
Personal
Saver
2000 -9.55604 -2.21862 -12.9816
-
2001 -0.95879 -9.37438 -8.54341
2.65248
20.2036 -
2002 -1.38932 1.123352
9 9.47791
-
2003 -5.38315 13.70113 17.1773
33.0119
- 2.77109
2004 -1.40075 0.397652
11.0893 5
- 7.50559
2005 2.169468 -4.53579
25.9142 6
- 4.28062 1.46884 0.02867
2006 1.549174 1.076482 -3.16583 1.765663
8.99192 5 3 4
- 10.1322 2.44454 5.89093
2007 -1.19814 2.52044 5.869633 -2.2406
10.9905 9 8 3

Intrepretation:

From the above calculation in the saving scheme in the year

2000 to 2002 Sundarm AMC and 2003 to 2007 Principal AMC out
perform index. In the above table underline figures show the higher

70
performance than index and bold figures show the highest
performance than others.

Growth scheme

Returns*(%) as on April 04,2007

MSCI World
Period PGOF MSCI-EM Index S&P Nifty
Index
1 year 14.48 13.41 19.68 6.33
2year 17.51 15.56 34.63 34.43
Since incep. 14.36 13.4 29.5 28.26

Intrepretation:

The PGOF is providing less risk it is give nominal returns

to the investors. Because in India only Principal AMC provide
this type of fund in the Mutual fund industry

CHAPTER -4
FINDINGS

By comparing risk and return of fund schemes with index return

and return I found that,

• Balance Scheme:

In the year 2002 to 2005 HDFC AMC having highest rank with
highest return than other AMCs, 2006 Principal AMC highest rank with
highest return but HDFC AMC having low risk than other AMCs, 2007

71
TATA AMC having highest rank but Principal AMC having highest return
and low risk then other AMCs.

• Equity Scheme:

Growth fund that years 2000 to 2002 ICICI growth fund is

available only and but it give negative return. In year 2003 and 2005
ICICI Growth fund having high rank. In the 2004 Tata Equity fund
having highest rank than other but ICICI growth give high return than
other and Kotak Mahindra kotak30 having low unsystematic risk in this
type of fund. In the year 2006 Principal large cap fund with high return
than other AMC but Kotak 30 having low unsystematic risk than other.
In the year 2007 again Principal Large cap fund having high rank with
high return but Sahara growth fund having low unsystematic risk than
other AMCs.

• Saving Scheme:

In the saving scheme mean that tax saving scheme in the year
2002 that is Sunarm tax saving having highest rank with high return
but low unsystematic risk was available in the principal personal tax
saving fund. In the year 2003 principal tax saver having high rank with
high return and low unsystematic risk. In the year 2004 principal
personal tax saver having high rank with low unsystematic risk and
high return is available in the principal tax saving fund. In the year
2005 Principal tax saver having high rank with high return and low
unsystematic risk. In the year 2006 Principal tax saver having high rank
with high return and Frankline Templeton mutual fund having low
unsystematic risk. The year 2007 principal personal tax saver having

72
high rank with high return and Kotak tax saver having low
unsystematic risk than other AMCs.

• Growth scheme:

In the Principal Global Opportunity fund providing less risk with it

give nominal returns to the investors. In India this time only one AMC
providing this type of scheme. Because of in this scheme they are •The
objective of the scheme is to build a high quality international equity
portfolio out of the permissible investments as defined and permitted
under the regulations from time to time and provide returns and/or
capital appreciation along with regular liquidity to the investors.

Selecting a particular scheme largely depends on the needs of

the client; no scheme is the best for all.

CONCLUSION

The determination of the best scheme out of the 4 does not have
a yes-no answer. It depends on the objective of the investor along with
the risk return appetite. Thus we cannot make inter scheme
comparison. Rather we would have to make comparison of various
companies providing the same scheme, which is mentioned below:

In the Balance fund schemes the years from 2000 to 2005 HDFC
AMC is well performing (good return) among other in the same scheme,
after that Principal Child benefit scheme is performing good in year

73
 2006, now in current year 2007 TATA AMC has given good performance
under this Balanced Fund scheme.

In the Equity Scheme year 2003 ICICI AMC performed well among
this scheme, in 2004 TATA AMC is performing well than any other
scheme but 2006 to 2007 the Principal AMC gives better.
In the Tax Saving scheme the years 2000 to 2002 Sundarm BNP
AMC well performing [good Return] among this scheme but from the
year 2003 to 2007 Principal AMC having well Position in the among this
scheme.

Particularly in Principal Global Opportunity fund providing less

risk with it gives nominal returns to the investors. Across India Principal
PNB is the only AMC providing this scheme. The objective of the
scheme is to build a high quality international equity portfolio out of
the permissible investments as defined and permitted under the
regulations from time to time and provide returns and/or capital
appreciation along with regular liquidity to the investors.

CHAPTER - 5
Recommendation

• Selecting a particular scheme largely depends on the needs of

the client; no scheme is the best for all.
• Investor must see the objective of the fund

• Investor should measure the performance of a fund.

• A good historical record could be a better horse to be on than

new funds.

74
• The prospective investor should scrutinize the expense ratio of
the fund and compare it with others.

• A prudent investor must keep his eyes on the stock market

index, interest rate and the inflation rate.

• MFs cannot simply attract savings by mere small investors who

have become very discerning in selecting mutual funds.

Bibliography

• http://www.principalindia.com/presentation/view/funds.aspx
• http://www.amfiindia.com/navhistoryreport.asp
• www.hdfcfund.com/fundschool/sebi1Show.jsp
• www.sbimf.com/portal/static/inv-faq1.html
• Punithvanthy Pandian, “Security Analysis And Portfolio
Management”,
3rd Edition, Vikas Publishing House Pvt. Ltd.

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76