7/23/2019 Mutual Funds Are Essentially Investment Vehicles Where
People With Similar Investment Objective Come Together to Pool
Their Money and Then Invest Accor
1/4
Mutual Funds are essentially investment vehicles where people
with similar investment objective
come together to pool their money and then invest accordingly.
Each unit of any scheme
represents the proportion of pool owned by the unit holder
(investor). Appreciation or reductionin value of investments is
reflected in net asset value (NA) of the concerned scheme! which
is
declared by the fund from time to time. Mutual fund schemes are
managed by respective AssetManagement "ompanies (AM"). #ifferent
business groups$ financial institutions$ ban%s have
sponsored these AM"s! either alone or in collaboration with
reputed international firms. &everalinternational funds li%e
Alliance and 'empleton are also operating independently in ndia .
Many
more international Mutual Fund giants are epected to come into
ndian mar%ets in the near
future.
A mutual fund is the ideal investment vehicle for today*s comple
and modern financial scenario.
Mar%ets for e+uity shares! bonds and other fied income
instruments! real estate! derivatives and
other assets have become mature and information driven. ,rice
changes in these assets are driven
by global events occurring in faraway places. A typical
individual is unli%ely to have the
%nowledge! s%ills! inclination and time to %eep trac% of events!
understand their implications andact speedily. An individual also
finds it difficult to %eep trac% of ownership of his assets!
investments! bro%erage dues and ban% transactions etc.
nvesting in Mutual Fund is convenient because of two basic
reasons. All investment carry ris%s!especially e+uity investment
that bears larger ris%s! their returns are more volatile and
uneven. 'o
cut down the ris% one needs to put money in several instruments
rather than in one or two
products. A Mutual Fund can effectively spread its investments
across various sectors of theeconomy and amongst several products.
-is% diversification is the ey. &econdly *where to
invest and where not to*! is a speciali/ed business. 0ne may not
have the epertise! time and
resources of a well1managed fund.
Objectives
'he research was conducted to find out about the preference of
the target population for E+uity#iversified Mutual Funds and #irect
E+uity. 2esides this the research was conducted to %now
about reasons for preferring mutual funds and direct e+uity
funds.
'he target population mainly included service class people.
3ence convenient sampling was used
in deciding on the target population.
First an eploratory research was conducted to get some insights
about the topic. &econdary data
analysis was performed. t was followed by +uestionnaire filling.
Findings of the eploratory
research were regarded as input to further research. 'his
research will be followed by descriptive
design.
Secondary Data
&econdary data was collected from various sources such as
internet and financial maga/ines.
7/23/2019 Mutual Funds Are Essentially Investment Vehicles Where
People With Similar Investment Objective Come Together to Pool
Their Money and Then Invest Accor
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Primary Data
n ,rimary data! structured +uestionnaire was made and the target
respondents were as%ed to fill
the +uestionnaire.
Questionnaire Design
0bjective was to ma%e respondents little familiar with the
contet of the +uestions. 'his was also
aimed at collecting data about the sample profile that*ll be
subse+uently analy/ed so that the
scope of the project is fully eplored.
4uestion 5 was aimed to chec% the awareness level of the
respondent about various investmentavenues.
4uestion 6 was an open ended +uestion intended to find out some
more factors which people
consider important while investing.
4uestion 7 was aimed to understand the most preferred mode of
investment.
4uestion 8 was designed to understand the types of mutual fund
where people have invested.
4uestion 9 was designed to understand the importance of past
returns in ma%ing decisions aboutvarious investment schemes.
4uestion : was designed to understand if returns were the only
criteria for evaluating the
performance.
4uestion ; was designed to understand the approach of people in
ma%ing investment.
4uestion < was designed to find out what factors are
considered important by people who investdifferent investments.
4uestion = was formulated to %now the period of portfolio review
done by people.
4uestion 5> was put to find out the long term and short term
investors.
4uestion 55 was as%ed to find out how actively investors change
their portfolio.
4uestion 56 was as%ed to compare the e+uity diversified mutual
funds and direct e+uity.
4uestion 57 ? 59 were as%ed to judge the factors why people
prefer to invest in Mutual Fundsand #irect E+uity.
4uestion 58 was as%ed to find out the availability of
information sources for various schemes.
