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A Study of Preferences of Investeror’s For

Investment in
MUTUAL FUND

Under
INTRODUCTION
Board of Director of Axis
AMC
Shikha Sharma - Associate Director &
Chairperson
T S Narayanasami – Independent Director
Pranesh Mishra – Independent Director
U R Bhatt – Independent Director
Sonu Bhasin – Associate Director
Rajiv Anand – Associate Director & MD &CEO
vision OF AXIS amc
The vision of this company is to have

“AXIS MUTUAL FUND

in every home”
Mutual fund working
Mutual fund working
(cont……)
 Mutual fund working
(cont……)

NAV
The value of each unit of the mutual fund, known as the net asset value (NAV), is
mostly calculated daily based on the total value of the fund divided by the number of
shares currently issued and outstanding. The value of all the securities in the portfolio in
calculated daily. From this, all expenses are deducted and the resultant value divided by
the number of units in the fund is the fund’s NAV.

NAV = Total value of the fund……………….

No. of units currently issued and outstanding
Mutual fund working
(cont……)
Mutual fund working
(cont……)
Mutual fund working
(cont……)
Mutual fund working
(cont……)

RISK V/S. RETURN:

 Mutual fund working
(cont……)

Distribution channels:

1. Direct marketing by the AMC’s

2. Broker/ sub broker arrangements

3. Individual agents, Banks, NBFC (non banking financial corp.)

OBJECTIVES OF THE STUDY

ü To find out the Preferences of the investors

for Asset Management Company.
ü To know the Preferences for the portfolios.
ü To know why one has invested or not
invested in Axis Mutual fund
ü To find out the most preferred channel.
ü To find out what should do to boost Mutual
Fund Industry.
Research methodology
Research type- descriptive
Data collection:
Ø Primary data-
Methods adopted for surveys :
1. Personal meeting with customer’s and
visitor’s.
2. Analysis of response of customer’s and
visitor’s.
3.Questionnaire method
 Durarion of Study

The study was carried out for a

period of two months, from 30th
May to 30th July 2010.
 Investors invested in different kind of investments.
(was aimed to check the awareness level of respondent about various investment avenues)

Kind of Investments No. of Respondents

Saving A/C 195
Fixed deposits 148
Insurance 152
Mutual Fund 120
Post office (NSC) 75
Shares/Debentures 50

Gold/Silver 30
Real Estate 65

Interpretation: From the above graph it can be inferred that out of 200 people, 97.5% people
have invested in Saving A/c, 76% in Insurance, 74% in Fixed Deposits, 60% in Mutual Fund,
37.5% in Post Office, 25% in Shares or Debentures, 15% in Gold/Silver and 32.5% in Real
Estate.
 Preference of factors while investing
(was open ended ques. To find out imp. Factor while inv.)

18% 20%

32% 30%

Liquidity LowRisk HighReturn Trust

Factors (a) Liquidity (b) Low Risk (c) High Return (d) Trust

No. of Respondents 40 60 64 36

Interpretation:
Out of 200 People, 32% People prefer to invest where there is High Return, 30% prefer to invest
where there is Low Risk, 20% prefer easy Liquidity and 18% prefer Trust
 Awareness about Mutual Fund and its Operations
(was aim to check about the awareness of mutual fund)

Response Yes No

No. of Respondents 135 65

Interpretation:
From the above chart it is inferred that 67% People are aware of Mutual Fund and its operations
and 33% are not aware of Mutual Fund and its operations.
 Source of information for customers about
Mutual Fund
(was asked to find out the availability sources for various mutual fund)

Source of information No. of Respondents

Advertisement 18

Peer Group 25

Bank 30

Financial Advisors or Relationship 62

Interpretation:
From the above chart it can be inferred that the Financial Advisor is the most important source of
information about Mutual Fund. Out of 135 Respondents, 46% know about Mutual fund Through
Financial Advisor or relationship, 22% through Bank, 19% through Peer Group and 13% through
Advertisement.
 Investors invested in Mutual Fund
(open ended question aim to check how many invested in mutual fund)
Chart Title

Response No. of Respondents

YES 120
NO 80

Total 200

Interpretation:
Out of 200 People, 60% have invested in Mutual Fund and 40% do not have invested in Mutual
Fund.
 Reason for not invested in Mutual Fund
(open ended question aim to check why respondent not invested in mutual fund)

Reason No. of Respondents

Not Aware 65
Higher Risk 5
Not any Specific Reason 10

Interpretation:
Out of 80 people, who have not invested in Mutual Fund, 81% are not aware of Mutual Fund,
13% said there is likely to be higher risk and 6% do not have any specific reason.
Investors invested in different Assets Management
Co. (AMC)
(was aim to understand the type of AMC where people have invested)

Name of AMC No. of Investors

Axis MF 55
UTI 75
HDFC 30
Reliance 75
ICICI Prudential 56
Kotak 45
Sbi 70

Interpretation:
In Patiala most of the Investors preferred UTI and Reliance Mutual Fund. Out of 120 Investors
62.5% have invested in each of them, only 46% have invested in Axis MF, 47% in ICICI
Prudential, 37.5% in Kotak and 25% in HDFC.
 Reason for invested in Axis Mutual Fund
(was aimed to understand the imp. Of brand in making decision about various investment schemes)

27%

64%

9%

AssociatedwithAxis Betterreturn AgentAdv./relationship

Reason No. of Respondents

Associated with Axis 35

Better return 5

Agents Advice or relationship 15

Interpretation:
Out of 55 investors of Axis MF 64% have invested because of its association with Brand Axis,
27% invested on Agent’s Advice or Relationship Advice, 9% invested because of better return.
 Reason for not invested in Axis Mutual Fund
(was aimed to understand that which are the reason’s of not investment in AxisMF)

Chart Title

Reason No. of Respondents

Not Aware 25

Less Return 18

Agent’s Advice, Not in reach 22

Interpretation:
Out of 65 people who have not invested in Axis MF, 38% were not aware with Axis MF, 28% do
not have invested due to less return and 34% due to Agent’s Advice or Not in Reach.
 Preference of Investors for future investment in
Mutual Fund

Name of AMC No. of Investors

Axis 76
UTI 45
HDFC 35
Reliance 82
ICICI Prudential 80
Kotak 60
SBI 75

Interpretation:
Out of 120 investors, 68% prefer to invest in Reliance, 67% in ICICI Prudential, 63% in Axis
MF, 62.5% in SBI, 50% in Kotak, 37.5% in UTI and 29% in HDFC Mutual Fund.
 Channel Preferred by the Investors for
Mutual Fund Investment
(was aimed to understand the most preferred mode of investment)
Chart Title

Channel Financial Advisor or Bank AMC

Relationship

No. of Respondents 72 18 30

Interpretation:
Out of 120 Investors 60% preferred to invest through Financial Advisors or in Relaionship , 25%
through AMC and 15% through Bank.
 Mode of Investment Preferred by the Investors

Mode of Investment One time Investment Systematic Investment Plan (SIP)

No. of Respondents 78 42

Interpretation:
Out of 120 Investors 65% preferred One time Investment and 35 % Preferred through Systematic
Investment Plan.
 Preferred Portfolios by the Investors
37% 46%

17%

Equity Debt Balance

Portfolio No. of Investors
Equity 56
Debt 20
Balanced 44

Interpretation:
From the above graph 46% preferred Equity Portfolio, 37% preferred Balance and 17% preferred
Debt portfolio
 Option for getting Return Preferred by the
Investors

Option Dividend Payout Dividend Growth

Reinvestment

No. of Respondents 25 10 85

Interpretation:
From the above graph 71% preferred Growth Option, 21% preferred Dividend Payout and 8%
preferred Dividend Reinvestment Option.
 Preference of Investors whether to invest in
Sectoral Funds

Response No. of Respondents

Yes 25

No 95

Interpretation:
Out of 120 investors, 79% investors do not prefer to invest in Sectoral Fund because there is
maximum risk and 21% prefer to invest in Sectoral Fund.
 FINDINGS

•In Patiala in the Age Group of 36-40 years were more in numbers. The
second most Investors were in the age group of 41-45 years and the least
were in the age group of below 30 years.
•In family Income group, between Rs. 20,001- 30,000 were more in
numbers, the second most were in the Income group of more than
Rs.30,000 and the least were in the group of below Rs. 10,000.
•About all the Respondents had a Saving A/c in Bank, 76% Invested in
Fixed Deposits, Only 60% Respondents invested in Mutual fund.
•Mostly Respondents preferred High Return while investment, the
second most preferred Low Risk then liquidity and the least preferred
Trust.
•Only 67% Respondents were aware about Mutual fund and its
operations and 33% were not..
 FINDINGS (cont…..)
•Among 200 Respondents only 60% had invested in Mutual Fund and 40% did
not have invested in Mutual fund.
•Out of 80 Respondents 81% were not aware of Mutual Fund, 13% told there is

not any specific reason for not invested in Mutual Fund and 6% told there is
likely to be higher risk in Mutual Fund.
•Most of the Investors had invested in Reliance or UTI Mutual Fund, ICICI

Prudential has also good Brand Position among investors, AXIS MUTUAL
FUND places after ICICI Prudential according to the Respondents.
•Out of 55 investors of AXIS MUTUAL FUND 64% have invested due to its

association with the Brand AXIS , 27% Invested because of Advisor’s Advice
and 9% due to better return.
•Most of the investors who did not invested in AXIS MUTUAL FUND due to

not Aware of AXIS MUTUAL FUND, the second most due to Agent’s advice
and rest due to Less Return.
• For Future investment the maximum Respondents preferred Reliance Mutual

Fund, the second most preferred ICICI Prudential, AXIS MUTUAL FUND has
been preferred after them. Payout and then Dividend Reinvestment
 FINDINGS (cont…..)

•60% Investors preferred to Invest through Financial Advisors, 25% through

AMC (means Direct Investment) and 15% through Bank.
• 65% preferred One Time Investment and 35% preferred SIP out of both type
of Mode of Investment.
•The most preferred Portfolio was Equity, the second most was Balance

(mixture of both equity and debt), and the least preferred Portfolio was Debt
portfolio.
•Maximum Number of Investors Preferred Growth Option for returns, the

second most preferred Dividend

SUGGESTIONS & RECOMMENDATIONS
• The most vital problem spotted is of ignorance. Investors should be made
aware of the benefits. 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 funds offer a lot of benefit which no other single option could offer. But
most of the people are not even aware of what actually a mutual fund is? They
only see it as just another investment option. So the advisors should try to
change their mindsets. The advisors should target for more and more 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 enquire about
the risk tolerance of the investors/customers, their need and time (how long they
want to invest). By considering these three things they can take the customers
into consideration.
SUGGESTIONS & RECOMMENDATIONS(cont…)

• Younger people aged under 35 will be a key new customer group into the
future, so making greater efforts with younger customers who show some
interest in investing should pay off.
• Customers with graduate level education are easier to sell to and there is a

large untapped market there. To succeed however, advisors must provide sound
advice and high quality.
• Systematic Investment Plan (SIP) is one the innovative products launched by

Assets Management companies very recently in the industry. SIP is easy for
monthly salaried person as it provides the facility of do the investment in EMI.
Though most of the prospects and potential investors are not aware about the
SIP. There is a large scope for the companies to tap the salaried persons.
CONCLUSION

3737
 CONCLUSION

Running a successful Mutual Fund 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 investors in connection with the
preferences of Brand (AMC), Products, Channels etc. 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 have money to invest. As
the awareness and income is growing the number of mutual fund
investors are also growing.
 CONCLUSION (cont….)
“Brand” plays important role for the investment. People invest in those
Companies where they have faith or they are well known with them.
There are many AMCs in Patiala but only some are performing well due
to Brand awareness. Some AMCs are not performing well although
some of the schemes of them are giving good return because of not
awareness about Brand. Reliance, UTI, AXIS MUTUAL FUND, ICICI
Prudential and SBI Mutual Fund etc. they are well known Brand, they
are performing well and their Assets Under Management is larger than
others whose Brand name are not well known like Principle, Sundram,
etc.
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 investors’ mind from one
investment option to others. Many of investors directly invest their
money through AMC because those who dontwant to pay Advisry fee.
Those people invest directly who know well about mutual fund and its
operations and those have time.
Thank
You