M S RAMAIAH INSTITUTE OF MANAGEMENT PGDM (Auto) BATHCH 2011-2013

PROJECT REPORT

Group members name and registration number

SLNO REG.NO NAME 1 111119 Jitendra Singh 2 111135 Rajat Sarkar 3 111137 Ravi Singh 4 111102 Aditya Singh 5 111120 Kanchan Mahato AREA OF RESEARCH STUDY SIGNATURE Finance Finance Finance Finance Finance

NAME OF THE GUIDE: Prof. Jayashree kowtal

WORKING TITLE
A comparative analysis on equity and mutual funds in India in 2011

BACKGROUND OF THE STUDY

Issue of the shares is the most important method of raising capital. Finance raised by the issue of shares serves as a financial floor to the companys capital structure. Shares are of different nominal or face value and of different kind to attract different kind of investors. The equity literally means the stock of a company. The rate of dividend on equity shares varies according to the amount of profit available. Mutual fund industry in India started in 1964 with the formation of unit trust of India, at the initiative of the government of India. The 1993 SEBI regulations were substituted by a more comprehensive and revised mutual fund regulation in1996. A mutual fund is a trust that pools the money of many investors to invest in a variety of different securities. Investment may be in stocks, bonds, money market securities or some combination of these. For the individual investor mutual fund provides the benefit of having someone else for managing their investment. The study is limited to compare equity and mutual fund scheme in respect of their risk and return. The study covers 5 randomly selected stocks out of 30 BSE and 5 randomly selected mutual fund scheme. The study is strictly based on share price information. It focuses on every month ending closing price during the period from 1st Jan, 2011 to 31st Dec, 2011 (mutualfundsindia.com, )

AIM
To provide information to the individual investors regarding risk and return of equity and mutual funds schemes and help them in choosing the best investment option to match their goal and attitude to risk

STATEMENT OF THE PROBLEM

In the current economic scenario fluctuation in the share market has put investors in confusion. One finds it difficult to take decision on investment. This primarily because of investment is risky in nature and investor has to consider various factors before investment in investment avenues. These factors include risk, return and volatility of shares. The main objective of comparing investment in equity shares with mutual schemes is to analyze the performance of mutual funds with their benchmark and comparing them with equity by using risk, return as a parameter. So the study has been taken to evaluate the performance of equity and mutual funds. The study will guide the new investor who wants to invest in equities and mutual funds by providing knowledge about how to measure the risk and return of equity or mutual funds schemes.

RESEARCH OBJECTIVE
In the light of the above discussion the specific objectives of the study are as follows: To compare the performance of equity share and mutual fund schemes with their benchmark. To compare the mutual funds schemes with equity in respect of their risk and return To Provide information about pros and cons of investing in equity and mutual funds

RESEARCH METHODOLOGY
The whole study can be termed as comparative study. The study centers on comparing equity and mutual fund schemes in respect of their risk and return. The scope of study is based on return series of selected stocks and mutual funds. BSE being the premier exchange of India is selected for selecting stocks. Monthly share price of the selected scrips were collected from historical data.

LITERATURE REVIEW

The investment industry in India has been riding high since the last few years. India's equity market has doubled since March 2009, with ADRs like Dr. Reddy's Laboratories and Tata Motors only getting doubled and tripled. Warren Buffett has always mentioned that investment in India should always be a long-term story - as the industry has been growing from an emerging market to a developed one. The next 10 years in India will surely give good returns. India's GDP growth was around 7 percent in 2010. The sustainable growth rate of India would however hover around 7%. Before becoming a mature economy, India has another 20 to 40 years to spare. The overall contribution made by the financial services sector in India in the year 2009 was 15 per cent towards the GDP of the country. Sources:- (http://business.mapsofindia.com/investment-industry/) A mutual fund is a professionally managed investment, which pools together the resources of individuals and invests in various securities, according to the funds predetermined investment objective. There are various types of mutual funds that invest in stocks, bonds, money market instruments, Forex, and other financial instruments. It is a professionally managed fund, which is managed by experts in the industry after carrying out detailed fundamental analysis of stocks and also of the industries and economic scenario as a whole. If you are a more market savvy and risky investor you could invest directly in stocks of your choice and build your own portfolio.

Experts View:-

Dr. Renu Pothen, Research Head, Fundsupermart.com India.

Speaking of equity investments she said, We are of the view that equities as an asset class looks promising from the long term perspective; however, this asset class will be in a volatile phase in the short term. In this context, investors need to enter the market at every dip and also continue with their SIP investments, without being worried about short-term fluctuations. Sharing her outlook on fixed income products for 2012 she said, RBI will start loosening its monetary policy once inflation shows a moderating tendency and the fiscal situation improves. In the current scenario, we advise investors to continue to look at shortterm funds and can also start taking exposure in long-term debt categories. She ended her presentation by releasing Fundsupermart.coms list of Recommended Funds across all mutual fund categories.

Mr Himanshu Pandya, Vice president, Head - Product Development and Delivery, ICICI Prudential Mutual Fund Mr. Pandya shared that volatility is an inevitable part of equity markets. Thus, rather than avoiding the equity asset class entirely, retail investors should use asset allocation strategies to protect their downside. Moreover, equity continues to remain the only asset class with potential to provide inflation-adjusted long-term returns. Ms Lakshmi Iyer, Senior Vice President, Head - Fixed Income and Products, Kotak Mutual Fund explained the tax advantage and returns potential from fixed income mutual funds. Despite the obvious advantages of fixed income funds, they account for only Rs. 611,402 crores of assets as compared to Rs. 6,195,600 crores in fixed deposits, which is almost ten times the size of mutual funds. Guaranteed returns, low or no perceived risk, peace of mind and

lack of awareness are some of the reasons which make fixed deposits the obvious choice of retail consumer base. Having said this, Ms. Iyer pointed out in her presentation that investors should consider long-term bond funds and gilt funds with a horizon of 1 year and above during a falling interest rate scenario; whereas, during a rising interest rate scenario, investors should consider accrual products such as FMP. Mr. Pankaj Sharma, Executive Vice President at DSP BlackRock Mutual Fund shed light on the INVESTMENT OPPORTUNITIES THAT EXIST GLOBALLY.

While we have seen robust growth in Indias GDP, there are other countries also that have shown strong economic growth. By ignoring investment prospects outside India, investors may miss out on market opportunities elsewhere in the world, including some businesses and sub-sectors that may not exist domestically. Mr. Sharma shared interesting insights on performance of different geographies and a globally diversified portfolio has the potential to deliver higher risk-adjusted returns in the long-run. He explained how Indian investors and their financial advisors can increase exposure to international funds which can help enhance returns while, simultaneously reducing risk through diversification.

We think most of the people invest in Mutual Funds is may be due to lack of knowledge of investing in equities directly or lack of knowledge in picking up a good stock and may be also because of lack of confidence. Investing in Equity you can make more money and even loose more money than a Mutual Fund. For an investor with a low risk bearing capacity Mutual Fund is a safer better.

Source of data Secondary data: collected through reports, magazines, newspapers and internet. (http://www.bseindia.com/about/st_key/index_ratios2011.asp,
http://www.moneycontrol.com/mutual-funds/nav/franklin-india-prima-fund/MKP002, http://money.rediff.com/companies/acc/11510001)

Types of sampling Stratified random sampling Sample design: Relative population- 30 BSE sensitivity index companies and mutual fund industry in India.

Variables: monthly calculated return and risk

Sample size: five companies and five mutual fund schemes are selected.

Equity funds: Name ACC LTD. Larson & Toubro ltd ICICI BANK ONGC LTD WIPRO BSE SENSITIVITY INDEX Return BSE SENSITIVITY BSE SENSITIVITY BSE SENSITIVITY BSE SENSITIVITY BSE SENSITIVITY BENCHMARK INDEX INDEX INDEX INDEX INDEX

Mutual funds: Name BIRLA SUN LIFE TOP 100 FUNDS ICICI PRUDENTIAL MUTUAL FUNDS SBI MAGNUM TAX GAIN SCHEEM FRANKLINE INDIA PRIMA FUNDS HDFS GROWTH FUNDS BSE 100 INDEX risk BSE 100 BSE 100 BSE 100 BSE 100 BSE 100 BENCHMARK

Statistical tool: mean and standard deviation.

Hypothesis testing: Hypothesis 1 Null hypothesis: return on equity is equal to the return on mutual funds (1= 2) Alternative hypothesis: return on equity is not equal to the return on mutual funds (1 2)
Here:

= return of equity
1

2= return of mutual fund

Hypothesis 2

Null hypothesis: risk on equity is equal to the risk on mutual funds (1= 2) Alternative hypothesis: risk on equity is not equal to the risk on mutual funds (1 2) Here:

1 = risk on equity 2= risk on mutual fund

Data Analysis o Tabulation o Interpretation and o Analysis

Scope
The project primarily deals with equity and mutual funds. The scope of the mutual fund and equity is very large but our study is confined to only five mutual funds and five selected stocks. This study suggests the investor about risk and return associated with equity and mutual funds. The study considers the performance evaluation of mutual funds and equity on two measures that are risk and return.

Limitation
Information provided is limited to extent of internet and journals. We have taken only five mutual fund schemes and five selected stocks. Sample size may not be adequate to represent the whole market.

Comparison of equity and mutual funds

Equity finance
Advantages and disadvantages of equity finance
Equity finance can sometimes be more appropriate than other sources of finance, eg bank loans, but it can place different demands on you and your business. The main advantages of equity finance are:

The funding is committed to your business and your intended projects. Investors only realize their investment if the business is doing well, eg through stock market flotation or a sale to new investors.

You will not have to keep up with costs of servicing bank loans or debt finance, allowing you to use the capital for business activities.

Outside investors expect the business to deliver value, helping you explore and execute growth ideas.

The right business angels and venture capitalists can bring valuable skills, contacts and experience to your business. They can also assist with strategy and key decision making.

In common with you, investors have a vested interest in the business' success, i.e. its growth, profitability and increase in value.

Investors are often prepared to provide follow-up funding as the business grows.

The principal disadvantages of equity finance are:

Raising equity finance is demanding, costly and time consuming, and may take management focus away from the core business activities.

Potential investors will seek comprehensive background information on you and your business. They will look carefully at past results and forecasts and will probe the management team. Many businesses find this process useful, regardless of whether or not any fundraising is successful.

Depending on the investor, you will lose a certain amount of your power to make management decisions. You will have to invest management time to provide regular information for the investor to monitor.

At first you will have a smaller share in the business - both as a percentage and in absolute monetary terms. However, your reduced share may become worth a lot more in absolute monetary terms if the investment leads to your business becoming more successful.

There can be legal and regulatory issues to comply with when raising finance, eg when promoting investments.

MUTUAL FUNDS SCHEMES

What are the key advantages of mutual fund investing?

Diversification Using mutual funds can help an investor diversify their portfolio with a minimum investment. When investing in a single fund, an investor is actually investing in numerous securities. Spreading your investment across a range of securities can help to reduce risk. A stock mutual fund, for example, invests in many stocks hundreds or even thousands. This minimizes the risk attributed to a concentrated position. If a few securities in the mutual fund lose value or become worthless, the loss may be offset by other securities that appreciate in value. Further diversification can be achieved by investing in multiple funds which invest in different sectors or categories. This helps to reduce the risk associated with a specific industry or category. Diversification may help to reduce risk but will never completely eliminate it. It is possible to lose all or part of your investment. Click here to see an example on constructing a diversified portfolio.

Professional Management: Mutual funds are managed and supervised by investment professionals. As per the stated objectives set forth in the prospectus, along with prevailing market conditions and other factors, the mutual fund manager will decide when to buy or sell securities. This eliminates the investor of the difficult task of trying to time the market. Furthermore, mutual funds can eliminate the cost an investor would incur when proper due diligence is given to researching securities. This cost of managing numerous securities is dispersed among all the investors according to the amount of shares they own with a fraction of each dollar invested used to cover the expenses of the fund. What does this mean? Fund managers have more money to research more securities more in depth than the average investor.

Convenience: With most mutual funds, buying and selling shares, changing distribution options, and obtaining information can be accomplished conveniently by telephone, by mail, or online. Although a fund's shareholder is relieved of the day-to-day tasks involved in researching, buying, and selling securities, an investor will still need to evaluate a mutual fund based on investment goals and risk tolerance before making a purchase decision. Investors should always read the prospectus carefully before investing in any mutual fund.

Liquidity: Mutual fund shares are liquid and orders to buy or sell are placed during market hours. However, orders are not executed until the close of business when the NAV (Net Average Value) of the fund can be determined. Fees or commissions may or may not be applicable. Fees and commissions are determined by the specific fund and the institution that executes the order.

Minimum Initial Investment: Most funds have a minimum initial purchase of $2,500 but some are as low as $1,000. If you purchase a mutual fund in an IRA, the minimum initial purchase requirement tends to be lower. You can buy some funds for as little as $50 per month if you agree to dollar-cost average, or invest a certain dollar amount each month or quarter.

Disadvantages

Risks and Costs: Changing market conditions can create fluctuations in the value of a mutual fund investment. There are fees and 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 and 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.

The Diversification "Penalty." Diversification can help to reduce your risk of loss from holding a single security, but it limits your potential for a "home run" if a single security increases dramatically in value. Remember, too, that diversification does not protect you from an overall decline in the market.

Costs. In some cases, the efficiencies of fund ownership are offset by a combination of sales commissions, 12b-1 fees, redemption fees, and 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 and 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.

COMPANYS PROFILE

ACC LIMITED: ACC Limited is Indias foremost cement manufacturer with a countrywide network of factories and marketing offices. Established in 1936, ACC has been a pioneer and trend-setter in cement and concrete technology. Among the first companies in India to include commitment to environment protection as a corporate objective, ACC has won accolades for environment friendly measures taken at its plants and mines, and has also been felicitated for its acts of good corporate citizenship. ACC is the most preferred cement brand name in India. ACC is now part of the worldwide Holcim Group

Larson & Toubro ltd: Larsen & Toubro Limited (L&T) is a technology, engineering, construction and manufacturing company. It is one of the largest and most respected companies in

India's private sector. More than seven decades of a strong, customer-focused approach and the continuous quest for world-class quality have enabled it to attain and sustain leadership in all its major lines of business. L&T has an international presence, with a global spread of offices. A thrust on international business has seen overseas earnings grow significantly. It continues to grow its overseas manufacturing footprint, with facilities in China and the Gulf region. The company's businesses are supported by a wide marketing and distribution network, and have established a reputation for strong customer support. L&T believes that progress must be achieved in harmony with the environment. A commitment to community welfare and environmental protection are an integral part of the corporate vision.

ICICI BANK: ICICI Bank is India's second-largest bank with total assets of Rs.
4,062.34 billion (US$ 91 billion) at March 31, 2011 and profit after tax Rs. 51.51 billion (US$ 1,155 million) for the year ended March 31, 2011. The Bank has a network of 2,700 branches and 8,003 ATMs in India, and has a presence in 19 countries, including India. ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and through its specialized subsidiaries in the areas of investment banking, life and non-life insurance, venture capital and asset management. The Bank currently has subsidiaries in the United Kingdom, Russia and Canada, branches in United States, Singapore, Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International Finance Centre and representative offices in United Arab Emirates, China, South Africa, Bangladesh, Thailand, Malaysia and Indonesia. Our UK subsidiary has established branches in Belgium and Germany.

WIPRO: In the year of 1945, in preindependent India, a vision was born, which would eventually stand out as a brand name synonymous with innovation and integrity. Starting off with consumer products business, Wipro then diversified into newer areas including IT hardware and IT services. Such has been the dynamic power of the organization that over the past 50 years, Wipro has evolved into a leading global IT company, a company which has pioneered many an innovation in the IT services, BPO and R&D services space.

ONGC LTD: Oil and Natural Gas Corporation Limited (ONGC) (NSE: ONGC, BSE: 500312) is an Indian state-owned oil and gas company headquartered in New Delhi, India. It is one of the largest Asia-based oil and gas exploration and production companies, and produces around 77% of India's total crude oil production (and around 30% of total demand) and around 81% of natural gas production. ONGC is one of the largest publicly traded companies by market capitalization in India and the largest India-based company measured by profits.[4] ONGC was founded on 14 August 1956 by the Indian state, which currently holds a 74.14% equity stake. It is involved in exploring for and exploiting hydrocarbons in 26 sedimentary basins of India, and owns and operates over 11,000 kilometers of pipelines in the country. In 2010, it was ranked 18th in the Plats Top 250 Global Energy Company Rankings and 413th in the Fortune Global 500.

MUTUAL FUND SCHEMES:

BIRLA SUN LIFE TOP 100 FUNDS: Birla Sun Life Asset Management Company Ltd. (BSLAMC), the investment managers of Birla Sun Life Mutual Fund, is a joint venture between the Aditya Birla Group and the Sun Life Financial Services Inc. of Canada. The joint venture brings together the Aditya Birla Group's experience in the Indian market and Sun Life's global experience. Established in 1994, Birla Sun Life Mutual fund has emerged as one of India's leading flagships of Mutual Funds business managing assets of a large investor base. Our solutions offer a range of investment options, including diversified and

sector specific equity schemes, fund of fund schemes, hybrid and monthly income funds, a wide range of debt and treasury products and offshore funds. Birla Sun Life Asset Management Company has one of the largest team of research analysts in the industry, dedicated to tracking down the best companies to invest in. BSLAMC strives to provide transparent, ethical and research-based investments and wealth management services

ICICI PRUDENTIAL MUTUAL FUNDS: ICICI Prudential Asset Management Company Ltd. is a joint venture between ICICI Bank, Indias second largest commercial bank & a well-known and trusted name in the financial services in India, & Prudential Plc, one of the United Kingdoms largest players in the financial services sectors. In a span of over 18 years since inception and just over 13 years of the Joint Venture, the company has forged a position of preeminence as one of the largest Asset Management Companys in the country, contributing significantly towards the growth of the Indian mutual fund industry. The company manages significant Mutual Fund Assets under Management (AUM), in addition to our Portfolio Management Services (PMS) and International Advisory Mandates for clients across international markets in asset classes like Debt, Equity and Real Estate with primary focus on risk adjusted returns. As an Asset Management Company, we have over 18 years of experience and are currently managing a comprehensive range of schemes of more than 46 Mutual fund schemes and a wide range of PMS Products for our investors spread across the country. We service this investor base with our own branch network of around 168 branches and a distribution reach of over 42,000 channel partners.

SBI MAGNUM TAX GAIN SCHEEM: With over 24 years of rich experience in fund management, we at SBI Funds Management Pvt. Ltd. bring forward our expertise by consistently delivering value to our investors. We have a strong and proud lineage that traces back to the State Bank of India (SBI) - India's largest

bank. We are a Joint Venture between SBI and AMUNDI (France), one of the world's leading fund management companies. With our network of over 222 points of acceptance across India, we deliver value and nurture the trust of our vast and varied family of investors. Excellence has no substitute. And to ensure excellence right from the first stage of product development to the post-investment stage, we are ably guided by our philosophy of growth through innovation and our stable investment policies. This dedication is what helps our customers achieve their financial objectives.

FRANKLINE INDIA PRIMA FUNDS: Franklin Resources, Inc., is a global investment management organization known as Franklin Templeton Investments. Our headquarters are located just south of San Francisco, in San Mateo, California. We have offices in 29 countries around the world. We offer investment products under the Franklin, Templeton, Mutual Series and Fiduciary brand names.

HDFS GROWTH FUNDS: HDFC Asset Management Company Ltd (AMC) was incorporated under the Companies Act, 1956, on December 10, 1999, and was approved to act as an Asset Management Company for the HDFC Mutual Fund by SEBI vide its letter dated July3,2000. The registered office of the AMC is situated at Ramon House, 3rd Floor, H.T. Parekh Marg, 169, Backbay Reclamation, Church gate, Mumbai - 400 020. In terms of the Investment Management Agreement, the Trustee has appointed the HDFC Asset Management Company Limited to manage the Mutual Fund. The paid up capital of the AMC is Rs. 25.169 crore.

Formula

Return (R1) = (P1/P0 *100)-100 Where P1= current month price P0= previous month price Mean = R1= R/n, where n= number of month

Standard deviation =

(R-R1)2/n

EQUITY FUNDS
ACC LTD. Stock Price From January 2011 - December 2011 Month price january february march april may june july august september october november december return -1.7206 10.7106 3.06977 -7.4007 -7.5049 6.63857 -0.9881 9.58084 8.83424 -4.1841 -0.786 1.47723 (R-R1) -3.1979 9.23338 1.59254 -8.878 -8.9821 5.16134 -2.4654 8.10361 7.35702 -5.6613 -2.2633 (R-R1)2 10.22641 85.25529 2.536181 78.818 80.67815 26.63942 6.078053 65.66849 54.12568 32.05064 5.122321 447.1986

988 971 1075 1108 1026 949 1012 1002 1098 1195 1145 1136

SD 6.11827

Return
15 10 5 ACCLtd. 0 1 -5 -10 2 3 4 5 6 7 8 9 10 11 12

Larsen & toubro Ltd. Stock Price From January 2011 - December 2011 Month price january february march april may june july august september october november december 1641 1528 1653 1597 1644 1822 1725 1609 1358 1413 1268 995 return -6.886 8.18063 -3.3878 2.94302 10.8273 -5.3238 -6.7246 -15.6 4.05007 -10.262 -21.53 -3.9739 (R-R1) -2.9121 12.1545 0.58612 6.91692 14.8011 -1.3499 -2.7507 -11.626 8.02397 -6.288 -17.556 (R-R1)2 8.480596 147.7325 0.343535 47.84374 219.074 1.822287 7.566565 135.1605 64.38413 39.53838 308.2156 980.1618

SD 9.1042

Return
15 10 5 0 -5 -10 -15 -20 -25 1 2 3 4 5 6 7 8 9 10 11 12 L & T Ltd.

ICICI BANK Stock Price From January 2011 - December 2011 Month price january february march april may june july august september october november december 1021 970 1116 1114 1086 1094 1036 873 886 876 712 684 return -4.9951 15.0515 -0.1792 -2.5135 0.73665 -5.3016 -15.734 1.48912 -1.1287 -18.721 -3.9326 -3.2026 (R-R1) -1.7925 18.2541 3.02337 0.68912 3.93923 -2.0991 -12.531 4.6917 2.07392 -15.519 -0.73 (R-R1)2 3.213126 333.2133 9.140777 0.474884 15.51755 4.406061 157.0261 22.01206 4.301124 240.8356 0.532901 790.6734

SD 8.47817

Return
20 15 10 5 0 -5 -10 -15 -20 -25 1 2 3 4 5 6 7 8 9 10 11 12 ICICI Bank

ONGC LTD. Stock Price From January 2011 - December 2011 Month price january february march april may june july august september october november december return -8.1633 7.77778 5.49828 -8.4691 -2.4911 -1.8248 -2.2305 -1.5209 6.94981 -3.9711 -3.7594 -1.1095 (R-R1) -7.0538 8.88726 6.60776 -7.3596 -1.3816 -0.7153 -1.121 -0.4114 8.05929 -2.8616 -2.6499 (R-R1)2 49.75588 78.98336 43.66253 54.16334 1.908881 0.511707 1.256647 0.169276 64.95212 8.188974 7.022064 310.5748

294 270 291 307 281 274 269 263 259 277 266 256

SD 5.31357

Return
10 8 6 4 2 0 -2 -4 -6 -8 -10 1 2 3 4 5 6 7 8 9 10 11 12 ONGC LTD.

WIPRO Stock Price From January 2011 - December 2011 Month price january february march april may june july august september october november december return 432 432 0 480 11.1111 450 -6.25 446 -0.8889 417 -6.5022 389 -6.7146 335 -13.882 348 3.8806 370 6.32184 377 1.89189 398 5.57029 -0.4965 (R-R1) 0.49653 11.6076 -5.7535 -0.3924 -6.0057 -6.2181 -13.385 4.37712 6.81836 2.38842 6.06682 (R-R1)2 0.246537 134.7372 33.10247 0.153949 36.06864 38.66481 179.1642 19.1592 46.49009 5.704536 36.80627 530.2979

SD 6.94326

Return
15 10 5 0 1 -5 -10 -15 -20 2 3 4 5 6 7 8 9 10 11 12 Wipro

BSE Sensitivity Index (BENCHMARK) Month price january february march april may june july august september october november december return (R-R1) (R-R1)2

18327 17823 -2.75 -1.4702 2.161412 19445 9.1006 10.3805 107.7541 19135 -1.5942 -0.3144 0.098831 16944 -11.45 -10.17 103.4361 18845 11.2193 12.4992 156.2294 18197 -3.4386 -2.1587 4.660034 16663 -8.43 -7.1501 51.12385 16453 -1.2603 0.01959 0.000384 17705 7.60955 8.88942 79.02181 16123 -8.9353 -7.6555 58.6061 15454 -4.1494 -2.8695 8.233945 -1.2799

SD 7.20685

Return
15 10 5 0 1 -5 -10 -15 2 3 4 5 6 7 8 9 10 11 12 BSE Benchmark

20 15 10 5 Axis Title 0 -5 -10 -15 -20 -25 ACC Ltd. L & T Ltd. ICICI BANK ONGC Wipro BSE Benchmark 1 0 0 0 0 0 0 2 3

Return Comparision

10

11

12

-1.72064810.7106083.0697674-7.400722 -7.5048736.6385669-0.9881429.58083838.8342441 -4.1841 -0.786026

-6.8860458.1806283 -3.38778 2.943018210.827251 -5.32382 -6.724638 -15.599754.0500736-10.26185 -21.52997

-4.99510315.051546-0.179211 -2.5134650.7366483-5.301645 -15.73359 1.489118 -1.128668 -18.72146 -3.932584 0 11.111111 -6.25

-8.1632657.77777785.4982818-8.469055 -2.491103 -1.824818 -2.230483 -1.5209136.9498069-3.971119 -3.759398

-0.888889 -6.502242 -6.714628 -13.88175 3.880597 6.32183911.89189195.5702918

-2.7500419.1006003 -1.59424 -11.4502211.219311-3.438578 -8.429961 -1.2602777.6095545-8.935329 -4.149352

Analysis of risk factor:

Name ACC LTD. Larson & Toubro ltd ICICI BANK ONGC LTD WIPRO BSE SENSITIVITY INDEX

Risk 6.11 9.10 8.47 5.31 6.94 7.20

1. 2. 3. 4.

LARSON &TOUBRO has highest risk factor of 9.10. ONGC LTD has lowest risk factor of 5.31. BENCHMARK risk is 7.20 Average risk of equity is 7.18.

Interpretation Risk is a major factor influence of all type of investors. In above selected equity share average risk factor is 7.18. Risk factor of benchmark is 7.20. It is very close to average risk.

Analysis of return Name ACC LTD. Larson & Toubro ltd ICICI BANK ONGC LTD WIPRO BSE SENSITIVITY INDEX Return 1.47 -3.97 -3.20 -1.10 -0.49 -1.27

1. 2. 3. 4.

ACC LTD has maximum return. LARSON & TOUBRO has minimum return. Benchmark return is -1.27 Average return of selected equity is -1.45

Interpretation Return is a major factor influencing factor to all type of investor. In above selected equity average return is -1.45 which is below than the benchmark return of -1.27.

MUTUAL FUND SCHEMES

Birla Sun Life Top 100 Fund Stock Price From January 2011 - December 2011

Month
january february march april may june july august september october november december

price
22.12 21.27 23.13 23.35 22.65 23.09 22.79 20.89 20.82 21.7 19.96 19.03

return
-3.84268 8.744711 0.951146 -2.99786 1.942605 -1.29926 -8.33699 -0.33509 4.226705 -8.01843 -4.65932 -1.23859

(R-R1)
-3.84268 8.744711 0.951146 -2.99786 1.942605 -1.29926 -8.33699 -0.33509 4.226705 -8.01843 -4.65932

(R-R1)2
14.76616 76.46997 0.904678 8.987157 3.773714 1.688086 69.5054 0.112284 17.86504 64.29527 21.70925 280.077

SD 4.891569

Return
10 8 6 4 2 0 -2 -4 -6 -8 -10 1 2 3 4 5 6 7 8 9 10 11 12 Birla Sunlife

ICICI prudential mutual funds month price JANUARY 15.89 FEBRUARY 15.42 MARCH 16.92 APRIL 16.81 MAY 16.33 JUNE 16.68 JULY 16.54 AUGUST 15.13 SEPTEMBER 15.12 OCTOBER 16.11 NOVEMBER 14.97 DECEMBER 14.52 return -2.95784 9.727626 -0.65012 -2.85544 2.143295 -0.83933 -8.52479 -0.06609 6.547619 -7.07635 -3.00601 -0.68704 R-R1 (R-R1)2 -2.2708 5.156515 10.41467 108.4653 0.036921 0.001363 -2.1684 4.701977 2.830334 8.010788 -0.15229 0.023192 -7.83775 61.43032 0.620945 0.385573 7.234658 52.34028 -6.38931 40.8233 -2.31897 5.377636

SD 5.1054

Return
15 10 5 ICICI Prudential 0 1 -5 -10 2 3 4 5 6 7 8 9 10 11 12

SBI MAGNUM TAX GAIN SCHEME MONTH price JANUARY 40.01 FEBRUARY 38.8 MARCH 36.67 APRIL 37.08 MAY 35.91 JUNE 36.17 JULY 36.03 AUGUST 33.28 SEPTEMBER 33.46 OCTOBER 34.5 NOVEMBER 32.07 DECEMBER 30.48 return -3.02424 -5.48969 1.11808 -3.15534 0.724032 -0.38706 -7.63253 0.540865 3.108189 -7.04348 -4.9579 -2.38173 R-R1 (R-R1)2 -0.64251 0.412818 -3.10796 9.659392 3.499815 12.2487 -0.77361 0.598465 3.105767 9.645788 1.994673 3.978722 -5.25079 27.57084 2.9226 8.54159 5.489923 30.13926 -4.66174 21.73185 -2.57617 6.636652

SD 3.453116

Return
4 2 0 1 -2 SBI magnun -4 -6 -8 -10 2 3 4 5 6 7 8 9 10 11 12

FRANKLIN INDIA PRIMA FUND

MONTH PRICE JANUARY 259 FEBRUARY 245 MARCH 267 APRIL 272 MAY 274 JUNE 273 JULY 272 AUGUST 255 SEPTEMBER 251 OCTOBER 257 NOVEMBER 242 DECEMBER 228

RETURN (R-R1) -5.40541 -4.35095 8.979592 10.03405 1.872659 2.927115 0.735294 1.78975 -0.36496 0.689492 -0.3663 0.688155 -6.25 -5.19554 -1.56863 -0.51417 2.390438 3.444894 -5.83658 -4.78212 -5.78512 -4.73067 -1.05446

(R-R1)2 18.93076 100.6821 8.568002 3.203205 0.4754 0.473558 26.99368 0.264373 11.86729 22.86867 22.37922

SD 4.438533

Return
10 8 6 4 2 0 -2 -4 -6 -8 1 2 3 4 5 6 7 8 9 10 11 12 Franklin India

HDFC GROWTH FUND

month JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

price 84.48 81.42 87.95 88.46 85.24 87.83 85.93 78.95 79.42 83.59 76.67 73.42

(R-R1) return R-R1 -3.62216 -2.47839 6.14242 8.020142 9.163911 83.97727 0.579875 1.723644 2.970947 -3.64006 -2.49629 6.231487 3.03848 4.182248 17.4912 -2.16327 -1.0195 1.039383 -8.12289 -6.97912 48.70815 0.595313 1.739082 3.024406 5.250567 6.394335 40.88752 -8.2785 -7.13473 50.90442 -4.23895 -3.09518 9.580124 -1.14377

SD 4.762322

Return
10 8 6 4 2 0 -2 -4 -6 -8 -10 1 2 3 4 5 6 7 8 9 10 11 12 HDFC Groth fund

BSE 100 INDEX

month JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

price 9569.01 9259.48 10095.74 9991.88 9041.2 9803.8 9537.4 8727.8 8613.2 9196.7 8330.5 7927.9

(R-R1)2 return R-R1 -3.23471 -1.75218 3.070131 9.031393 10.51393 110.5427 -1.02875 0.453783 0.205919 -9.51453 -8.03199 64.51289 8.434721 9.917255 98.35195 -2.71731 -1.23478 1.524681 -8.48869 -7.00615 49.08617 -1.31305 0.169488 0.028726 6.774486 8.25702 68.17838 -9.4186 -7.93606 62.98108 -4.83284 -3.35031 11.22457 -1.48253

SD 6.534573

Return
10 5 0 1 -5 -10 -15 2 3 4 5 6 7 8 9 10 11 12 BSE 100 Index

15

Return Comparision

10

5 Axis Title

-5

-10

-15 Birla sunlife ICICI Prudential SBI Magnum Franklin India HDFC BSE Benchmatrk

1 0 0 0 0 0 0

10

11

12

-3.8426768.74471090.9511457-2.9978591.9426049-1.299264 -8.33699 -0.3350894.2267051-8.018433-4.659319 -2.9578359.7276265-0.650118-2.8554432.1432945-0.839329-8.524788-0.066094 6.547619 -7.07635 -3.006012 -3.024244-5.4896911.1180802 -3.15534 0.7240323-0.387061-7.6325280.54086543.1081889-7.043478-4.957905 -5.4054058.97959181.87265920.7352941-0.364964 -0.3663 -6.25 -1.5686272.3904382-5.836576-5.785124 -3.6221598.02014250.5798749-3.6400633.0384796 -2.16327 -8.1228910.59531355.2505666-8.278502-4.238946 -3.2347139.0313927-1.028751-9.5145268.4347211-2.717314-8.488687-1.3130466.7744857-9.418596-4.832843

Analysis of risk factor Name BIRLA SUN LIFE TOP 100 FUNDS ICICI PRUDENTIAL MUTUAL FUNDS SBI MAGNUM TAX GAIN SCHEEM FRANKLINE INDIA PRIMA FUNDS HDFS GROWTH FUNDS BSE 100 INDEX INTERPRETATION: 1. 2. 3. 4. ICICI PRUDENTIAL MUTUAL FUNDS has highest risk factor. SBI MAGNUM TAX GAIN SCHEEM has lowest risk factor. BENCHMARK risk factor is 6.53 Average risk is 4.525. risk 4.89 5.10 3.45 4.43 4.76 6.53

Interpretation: Risk is a major factor influence of all type of investors. In above selected mutual funds schemes average risk factor is 4.52. Risk factor of benchmark is 7.20. so in mutual fund schemes risk is less than the benchmark.

Analysis of return:

Name BIRLA SUN LIFE TOP 100 FUNDS ICICI PRUDENTIAL MUTUAL FUNDS SBI MAGNUM TAX GAIN SCHEEM FRANKLINE INDIA PRIMA FUNDS HDFS GROWTH FUNDS BSE 100 INDEX

risk -1.23 -0.06 -2.38 -1.05 -1.14 -1.48

1. ICICI PRUDENTIAL MUTUAL FUNDS has got lowest negative return. 2. BENCHMARK return is -1.48. 3. Average return of mutual funds schemes is -1.46.

Interpretation: Return is a major factor influencing all type of investors. Here average return is 1.46 which is very close to the benchmark.

Compare of selected mutual funds schemes and equity funds.

In respect of their risk

Investment Risk Interpretation:

Equity funds 7.18

Mutual funds 4.52

Mutual funds and equity funds are subject to the market risk. Based on the above analysis equity funds have an average risk of 7.18 which higher in comparison of mutual funds schemes whose average risk is 4.52. Those who want to avoid risk should go for mutual funds.

In respect of their return:

Investment Return

Equity funds -1.27

Mutual funds -1.46

Interpretation: Mutual funds and equity funds are subject to the market risk. Based on the above analysis equity funds have an average return of -1.27 which higher in comparison of mutual funds schemes whose return is -1.46. Those who want to earn more can go for equity funds.

Hypothesis of risk: As the return on equity and mutual fund schemes are not equal, we will accept the alternative hypothesis that return on equity and mutual funds are not equal. As the risk on equity and mutual fund schemes are not equal, we will accept the alternative hypothesis that risk on equity and mutual funds are not equal.

Hypothesis of return:

As the return on equity and mutual fund schemes are not equal, we will accept the alternative hypothesis that return on equity and mutual funds are not equal.

Findings
Saving money is not enough. Each of us also need to invest ones savings intelligently in order to have enough money available for funding the higher education of ones children, for buying a house or for ones own golden years.

1. Investments in both equity and mutual funds schemes are subject to the market risk. 2. Now a days investment in equity and mutual fund schemes are increasing because of awareness of equity capital and mutual funds schemes in the minds of investors. 3. According to our research equity is more risky than the mutual funds but return associated with equity is more than return associated with mutual funds schemes. 4. On the basis of above research it has been proved higher the risk higher the return.

Suggestion: As in this study we can see that risk associated with equity is more than the risk associated with mutual fund, investors who do not want to take risk should go for mutual funds. But return on equity is more than return on mutual funds, so invest who want to earn more and can bear little a bit more risk should go for equity.

BIBLIOGRAPHY: 1. http://business.mapsofindia.com/investment-industry/ 2. Mutualfundsindia.com 3. (http://www.bseindia.com/about/st_key/index_ratios2011.asp, 4. http://www.moneycontrol.com/mutual-funds/nav/franklin-india-primafund/MKP002, 5. http://money.rediff.com/companies/acc/11510001