INTRODUCTION

Definition Mutual Fund Regulations 1993 defines Mutual fund estabilished in the form of a trust by a sponsor to raise money by the trustees through the sale of units to the public under one or more schemes for investing securities in accordance with these regulations. The rationale behind a Mutual fund is that there a large number of investors who lack and or the time and or the skills to manage their money. A mutual fund is nothing more than a collective stock and bonds .You can think of a mutual fund as a company that brings together a group of people and invests their money in stock , bonds and other securities each investos owns shares which represent a portion of holding of the fund. In india,mutual fund Regulations.1996 regulates the structure of mutual fund. Mutual fund in India are constituted in the form of a public trust created under The India Trusts Act,1882. A Mutual Fund is a trust that pools the saving of a number of investors who share common financial goals. The money thus collected is invested by the fund manager in different types of securities depending upon the objective of the scheme. These could range from shares to debentures to money market instruments. The Income earned through these investments and the capital appreciation realized by the scheme are shared by its unit holders in proportion to the number of units owned by them (Pro rata).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 Portfolio at a relatively low cost. Anybody with an investible surplus of as little as a few thousand rupees can invest in Mutual Funds Each Mutual Fund scheme has a defined investment objective and strategy. A Mutual fund is the ideal investment vehicle for todays complex and modern financial scenario. Markets for equity shares, bonds

and other fixed income instruments, real estate, derivatives and assets have become mature and information driven. Price changes in these assets are driven by global events occurring in faraway places. A typical individual is unlikely to have the knowledge; skills, inclination and time to keep track of tracks of events understand also finds it difficult to keep track of ownership of his assets, investments, brokerage dues and bank transactions etc. A mutual fund is to all these situations. It appoints professionally the qualified and experienced staff that manages each of this function on a full time basis. The large pool of money is collected in the funds allows it to hire such staff at a very low cost to each investors. In effects, the mutual fund vehicle exploits economics of scale in all three areas research, investment and transaction processing. While the concept of individual coming together to invest money collectively is not new, thus mutual fund in its present form is a 20th century phenomenon. In facts, mutual funds gained popularity only after the Second World War. Globally, there are thousand of firms offering tens of thousand of mutual funds with different investment objectives. Today, mutual funds collectively manage almost as much as or more money as compared to banks A draft offer document is to be prepared at the time of launching the fund. Typically, it pre specifies the investment objective of the fund, the risk associated the costs involved in the process and the broad rules for entry into and exits from the fund and other areas of operation. In India, as in most countries, these sponsors need approval from a regulator, SEBI (securities exchange Board of India) in our case. SEBI looks track record of the sponsor and its financial strength in granting approval to the fund for commencing operations. A sponsor then hires an assets management company to invest the funds according to the investment objective. It also hires anothers entity to be the custodian of the asses of the fund and perhaps a third one to handle registry work for the unit holders (subscribers) of the fund. In the Indian context, the sponsors promote the Assets management Company also, in which it holds a majority stake. In many Cases a Sponsor can hold a 100% stake in the Assets Management Company

(AMC).e.g.Birla Global Finance is sponsor of the Birla Sun Life Assets Management Company ltd. Which has floated different mutual funds schemes and also acts as an asset manager for the fund collected under the schemes.

HISTORY OF THE INDIAN MUTUAL FUND INDUSTRY

The mutual fund industry in India started in 1963 with the formation of unit trust of India ,at,the initiative of the Government of India and Reserve a bank.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 qualiyies wise as well as quantity wise. Before ,the monopoly had seen an ending phase ;the assests under management was Rs.67 billion.

ADVANTAGES OF MUTUAL FUND

Portfolio diversification Professional management Reduction/ diversification of risk Liquidity

 Flexibility and convenience Reduction in transaction cost Safety of regulated environment Choice of schemes Transparency.

DISADANTAGE OF MUTUAL FUND

No control over cost in the hands of an investor No tailor-made portfolios Managing a portfolio funds Difficulty in selecting a suitable fund scheme

Mutual fund can be classified as follow

Based on their structure : Open ended funds Investors can buy and sell the nits from the fund ,at any point of time. Close ended funds These funds raise money from investors only once.Therefore,after te offer period, fresh investments can not be made into the fund.

Based on their investment objectiveEquity funds: These funds invest in equities and equity related instruments.Investment in equity funds should be considered for a period of at least 3-5 years.It can be further classified as: 1.Index funds 2.Equity diversified funds 3.Dividend yield funds 4.Thematic funds 5.sector funds 6.ELSS Balanced fund : balanced funds are the ideal mutual funds vehicle for investors who prefer spreading their risk scross various instruments. 1.Debt-oriented funds Inestment below 65% in equities. 2.Equity oriented funds- Invest at least 65% in equities , remaning in debt. Debt fund : They invest only in debt instruments , and are a good option for investors averse to idea of taking risk associated with equities. 1.liquid funds 2.gift funds ST 3.floating rate funds 4.Arbitrage fund

5.gift funds LT 6.Income funds LT 7.MIPs 8.FMPs

OBJECTIVE OF THE PROPOSED STUDY

To able to understand the technical Know how of Mutual Funds as universal appeal in leveraging emerging opportunities. To be Aware about the behaviour of the customer in Mutual Funds. To Guide the customer How to invest in Mutual Funds.

RESEARCH METHODOLOGY
RESEARCH DESIGN: After research objectives the second stage of research calls for developing the most efficient plan to gathering the needed information. Designing a research plan includes decisions on data sources, research approaches, and research instrument and sampling plan.

DATA COLLECTION TECHNIQUE:

PRIMARY DATA: Primary data is the data gathered for a specific purpose or specific research report. I have collected primary data with the help of Questionnaires from the Users (customers) of Reliance Industry, ICICI bank, HDFC Bank and Others Private and Nationalized banks. SECONDARY DATA: The Secondary Data is the data, which already exits & was collected for some other purpose. The secondary data I Have used in my research report is basically collected from business magazines, Business News papers, journals & websites of trade organizations. RESEARCH APPROACH: Primary data will be collected in four ways: Observation, Focus Groups, and Surveys & Experiments. My approach to the research is survey based, as it is best suited to know customer preferences & practices.

ANALYSIS OF DATA: To know the finding of the research project, an extensive use of Statistical techniques as NAV Method, Pie Chat, histogram etc has been used. 1.On the basis of age of the investors -

2.Investors invested in different kind of investment

3.Educational qualification of investors

4.Awareness about Mutual Fu11nd and its operations

SAMPLE SIZE: ----40 Sample Unit---- Users (Consumer)

SWOT ANALYSIS OF THE MUTUAL FUND Swot analysis of mutual fund to provide recommendation on their performance growth pretential . It is a powerful tool for analysis both complex qualitative ,quantitative facets of an investment decision. Our SWOT analysis identifies strenghts and weakness and relets them with forward looking opportunities and threats. SWOT analysis Strenghts Giving the very good return from inception. Giving the mutual fund exposure. Weakness

People is not interested to invest in mutual funds equity because risk and trust. People not detail knowledge about mutual funds. Not very popular in rural area.

Opportunities Stability through inceased brand awareness,market penetration and service offerings. Across all categoris of financial services. Threats Increasing interest rate scenario. Execution risk. Rising inflation could reduce saving and investments.

LIMITION: Some of the persons were not so responsive.

Possibility of error in data collection because because many of

investors may have not given actual answers of my questionnaire. The sample size may not adequately represent the whole market. Some respondents were reluctant to divulge personal information which can affect the vaildity of all responses.

SCOPE OF THE STUDY

A big boom has been witnessed mutual fund industry in resent time.A large number of new player have entered the market and trying to gain market in this rapidly improving market. The scope of this project is to know about the Behavior of the consumers and to Guide the consumers how to invest in different securities of Mutual Funds So they are able to get better return in respect of their investment.

CONCLUSION
Running a successful mutual funds requires complete understanding of the peculiarities of the Indian stock market and also the psyche of the small investors. This study has made an attempt to understand the financial behavior of mutual fund. I observed that many of people have fear of mutual fund They think their money will not be secure in mutual fund . They need the knowledge of mutual fund and its related terms. Many of people do not have invested in mutual fund due to lack of awareness although they money to invest.As the awareness and income is growing the number of mutual fund investors are also growing. Distribution channels are also important for the investment in mutual fund. Financial advisors are the most preferred channel for the investment in mutual fund. They can change investores mind from on einvestment potion to others. Many of investors directly invest their money through AMC because they do not have to pay entry load. Only those people invest directly who know well about mutual fund and its operationa and those have time.

SUGGESTIONS AND RECOMMENDATIONS :--

The most vital problem spotted is of ignorance.Investors should be made aware of the benefitis.Nobody will invest until and unless he is fully convinced.Investors should be made to realize that ignorance is no longer bliss and what they are losing by not investing. Mutual fund offer a lot of benfit which no other single option could offer.But most of the people are even of what actually a mutual fund? They only see it as just another invesment option. So the advisors should try to change their mindsets. The advisors should target for more and young investors. Young investors as well as persons at the height of their career would like to go for advisors due to lack of expertise and time. Mutual fund company needs to give the training of the individual financial advisors about the fund/ scheme and its objective , because they are the main source to influence the investors. Before making any investment financial advisors should first enquireabout the risk tolerance of the investors /customers, their need and time. By considering these three things they can take the customers into consideration.

BIBLIOGRAPHY
1. Internet: www.moneycontrol.com www.businessstandard.com www.mutualfundsindia.com www.amfiindia.com www.nseindia.com

2. Business News paper, Business Line.

QUESTIONNAIRE

1. Do you know about Mutual Fund?

a. _____ b. _____

Yes No

2. Your Age: a. _____ b. _____ c. _____ d. _____ e. _____ Below 30 years 30-40 years 40-50 years 50-60 years Above 60 years

3.

What percentage of your annual income do you set aside for savings/investments? a._____ b._____ c._____ d._____ e._____ less than 10% 10%---20% 20%---30% 30%---40% Over -40%

3. How much do You Want to invest?

a. _____ b. _____ c. _____

within Rs5000 within Rs10000 More than above

5. How do you want to invest in Mutual Fund? a. _____ b. _____

One time payment plan SIP(Systematic investment plan)

6. For What Purpose Do you want to invest? a. b. c. d.

_____ _____ _____ _____

For Regular Income For Buying House/Finance& wedding purpose Educate Your Childrens Tax Saving

7. What is the time Horizon for your investment?

a. _____ b. _____ c. _____

Short-Term Medium- Long Term Long Term

8. What Channel you will adopt to make in investment? a. b. c. d.

_____ _____ _____ _____

Banking Channel National Distributor Channel Corporate IFA(Individual Financial Advisor)

9. What is the Best basis for Your Investment?

a. _____ b. _____ c. _____

Equity Debts Partially Equity and Partially Debts

10.Do you think it is safe to make investment directly in Equity Market or through Mutual Fund?

a. _____ b. _____

Yes No

11.In What Way Do you want to pay Premium?

a. _____Yearly b. _____Half- yearly c. _____Quarterly

12.Your Expection on the level of future earning?

a. b. c. d.

_____Will Far outpace inflation _____Will be some what ahead of inflation _____Will keep pace of inflation _____May decrease for reason of retirement, recession.etc

A PROJECT REPORT ON Mutual Funds as universal appeal in leveraging Emerging opportunities.

Submitted in partial fulfillment for Post graduate diploma in management Programme of Batch 2010-12

Submitted by:MANDEEP KAUR PGDM Batch[2010-2012] Enrolment No.10037

DECLARATION

I hereby declare that the work which is being present in this report entitled Mutual Funds As a Universal Appeal in leveraging emerging opportunities is an auhentic record of my own work carried out under the supervision of prof.Taruna Gautam [HOD PGDM] Institute of management education.The matter embodied in this report has not been sudmitted by me for the award of any other degree.

MANDEEP KAUR PDM 1st YEAR (2010-2012)

ACKNOWLEDGEMENT

The entire journey from the very idea of this project to reality would not have possible without the guidance and support of many experienced people and I take this opportunity to thanks allof them. I am deeply indebted to my project guide PROF.TARUNA GAOTAM[HOD] for their guidance and support that was indispensable for the completion of this project.

I would like to thankmy friends for their valuable guidance and constant encouragement at every stage from formulation of the proposal to drafting of this report.

MANDEEP KAUR PGDM 1st YEAR 2010-2012

CONTENTS

INTRODUTION. OBJECTIVE OF THE PROPOSED STUDY. RESEARCH METHODOLOGY. ANALYSIS OF DATA.. SWOT ANALYSIS OF THE MUTUAL FUND SCOPE OF THE STUDY.. CONCLUSION

Page 1 page 6 Page 6 page 7 Page 10 page 12 page 12

SUGGESTIONS AND RECOMMENDATIONS

page 13

BIBLIOGRAPHY

page14