Project Report

(Submitted for the Degree of Bachelors Of Business

Administration)

A REPORT ON
FIXED DEPOSITS TO MUTUAL FUNDS
(Changing perception of investors)

Submitted To- Submitted by-

Dr.N.S Bohra Divyansh Kaushik

(Associate Professor) BBA Finance

Dept.of Management Studies Roll No:2401726

 DEPARTMENT OF MANAGEMENT STUDIES

__________________________________________________________________

Dr. N. S. Bohra,Ph.D

Associate Professor, Dept. of Management Studies

GUIDE CERTIFICATE

This is to certify that the thesis entitled “FIXED DEPOSITS TO MUTUAL FUNDS-
Changing perception of investors” is a record of research work carried out by Divyansh
Kaushik , during the period of his study under my guidance and supervision. The Research
Project Report has reached the standard of fulfilling the requirements of the regulations
relating to the Bachelors of Business Administration (BBA) degree at Graphic Era (Deemed
to be) University.

Place: Dehradun Signature of Guide

Date: (Dr. N. S. Bohra)

 ACKNOWLEDGEMENT
I hereby declare that the Project Work on “FIXED DEPOSITS TO MUTUAL FUNDS-
Changing perception of investors” under the guidance of Dr.N.S.Bohra , Associate
Professor, Department of Management Studies, Graphic Era Deemed to be University.

Submitted by me for the partial fulfillment of the degree of BACHELORS OF BUSINESS

ADMINISTRATION is my original work and has not been submitted earlier to any other
University/Institution for the fulfillment of the requirement for any course of study.

I also declare that no chapter of this manuscript in whole or in part has been incorporated in
this report from any earlier work done by others or by me. However, extracts of any literature
which has been used for this report has been duly acknowledged providing details of such
literature in the references.

Name: DIVYANSH KAUSHIK

Roll No: 2401726

TABLE OF CONTENT

CONTENT PAGE NO.

Guide Certificate 2

Acknowledgement 3

List Of Figures 4

List Of Tables 6

Abstract 7

CHAPTER 1-INTRODUCTION

Investment

Types of investment

Mutual Funds-

About

History

Benefits

Types

Fixed Deposits-

About

Features

Advantages

Comparison between bank deposits & mutual funds

Changing Trends Of Investment

CHAPTER 2

REVIEW OF LITERATURE

CHAPTER 3

RESEARCH METHODOLOGY

CHAPTER 4
DATA INTERPRETATION & ANALYSIS

CHAPTER 5

CONCLUSION AND SUGGESTIONS

CHAPTER 6

SCOPE OF FUTURE STUDY

LIST OF REFERENCES

BIBLOGRAPHY
LIST OF FIGURES

FIGURE NO. FIGURE TITLE NO. PAGE NO.

1.1

LIST OF TABLES
TABLE NO. TABLE TITLE NO. PAGE NO.

1.1

ABSTRACT
In India, usually all investment avenues professed risky by the investors. The main features of
investments are security of principal amount, liquidity, income stability, approval and easy
transferability. Investment avenues are available such as shares, bank, companies, gold and
silver, real estate, life insurance, postal savings and so on. The required level of returns and
the risk tolerance decided the choice of the investor

Most Indian savers—including retirees who need income—are heavily invested in bank fixed
deposits. Their earnings have fallen by 25% or more in the last three years. So is there a
solution? As it happens, there is. There are mutual fund products that fit the bill perfectly.
They not only give you higher returns than the banking products, but are also liable for a
lower tax outgo, making the effective return very attractive. Investment is an type of activity
that is engaged in by the people who have to do savings i.e. investments are made from
their savings, or in other words it is the people invest their savings. A variety of
different investment options are available that are bank, Gold, Real estate, post
services, mutual funds & so on much more. Investors are always investing their money with
the different types of purpose and objectives such as profit, security,
appreciation, Income stability. In this paper we study about the most popular investment
avenues like fixed deposits and mutual funds. The aim of this research is to find out the
changing perception of investors through awareness about the mutual funds.

In the introductory chapter, We get to know about need of investments, different types of
investment avenues where focus is on mutual funds and fixed deposits. We get to know about
mutual funds in India, Advantages of mutual funds, types of mutual funds, Fixed deposits,
features and benefits of fixed deposits and comparison between mutual funds and bank
deposits etc. At the end of the chapter we get to know about the changing perception of
investors towards mutual funds and changing trends of investment.

The overall objective of my study on this project through primary data is to identify the
factors affecting customers to buy or invest in mutual funds or fixed deposits , to identify
awareness of customers about mutual funds, to find out the risk taking capacity of investors
and if they are satisfied with their investment choice.
 CHAPTER-1
INTRODUCTION
The objective of getting higher returns has dependably induced humankind to grow an ever
increasing number of investment avenues. India has one of the most elevated investment
funds rate all around. This affinity for wealth creation makes it important for Indian financial
specialists to look past the generally supported bank FDs and gold towards mutual funds. Be
that as it may, absence of knowledge has made common people go to popular investment
avenues rather than mutual funds. Even after numerous long periods of money related
division changes and tax reductions, interests in conventional reserve funds instruments like
bank fixed deposits, organization fixed deposits, life insurance, small savings, and so on., still
structure a substantial part of overall savings of Indian financial investors. Explaining and
clarifying risk in mutual funds to financial investors remains a test. Investors require a return
that is superior to the interest on bank deposits. Investors favour investments where the return
is demonstrated before investment, as in bank deposits. Comparison between mutual funds
and fixed deposits is a long discussion, particularly with regards to a comparison between
fixed deposits and debt mutual funds. Indeed, even a couple of years back, any
preservationist and risk averse investor would think putting resources into bank fixed deposits
is superior to mutual funds. Nevertheless , the market situation has changed a great deal in the
ongoing years, and numerous mutual funds companies has come up with interest debt mutual
fund schemes with ensured returns and capital appreciation. This makes the comparison
between mutual funds and fixed deposits increasingly complex, and even the most risk averse
financial investor is directed to reconsider. That being stated, regardless of whether you ought
to put resources into bank fixed deposits or mutual funds is no more a straightforward
decision as it used to be five six years back, and needs an detailed examination and
clarification. Larger part of individuals are missing out on chances to gain better returns at
reasonable risk levels because of absence of financial knowledge.
INVESTMENT-

An investment is a monetary asset purchased with the idea that the asset will provide income
in the future or will later be sold at a higher price for a profit. Investments are important in
light of the fact that in today’s time, simply acquiring cash isn't sufficient. The money that is
earned through hard work may not be adequate to lead a comfortable lifestyle or to fulfill
dreams and life goals. To do that investment is necessary.

The developing countries in the world, like India face the big task of finding sufficient capital
to utilize in their development efforts. Most of countries find it difficult to get out of the
vicious circle of poverty that is prevailing of low income, low savings, low investment, low
employment etc. With high capital output ratio, that is observed India needs very high rates
of investment that would take and make leap forward in her efforts continues of attaining
high levels of growth.

The major feature that is seen in an investment is safety of principal amount, liquidity,
income and its stability, appreciation and lastly easy transferability. A large and different
variety of investment avenues are available such as shares, banks, companies, gold and silver,
real estate, life insurance, postal savings etc. All the investors invest who wish to invest their
savings money decide their investment avenue on the basis of their risk taking capacity and
their attitude.
TYPES OF INVESTMENTS

Mutual Funds
Mutual funds have been in the market for around the past few decades but they have gained
popularity only in the past few years. These are investment vehicles that pool the money of
many investors and invest it in a way to earn optimum returns. Different types of mutual
funds invest in different types of securities. Equity mutual funds invest primarily in stocks
and equity-related instruments, while the debt mutual funds invest in bonds and papers. There
are also hybrid mutual funds that invest in equity as well as debt. Mutual funds are flexible
investments, in which you can begin and stop investing as per your convenience. Apart from
tax-saving mutual funds, you can redeem investments from mutual funds any time.

Fixed Deposits
Fixed deposits are investments that are for a specific, pre-defined time period. They offer
complete capital protection as well as guaranteed returns. They are ideal for conservative
investors who want to stay away from risks. Fixed deposits are offered by banks and for
different time periods. Fixed deposit interest rates change as per economic conditions and are
decided by the banks themselves. Fixed deposits are typically locked-in investments, but
investors are often allowed to avail loans or overdraft facilities against them. There is also a
tax-saving variant of fixed deposit, which comes with a lock-in of 5 years.

Stocks
Stocks, also known as company shares, are probably the most famous investment in India.
When you buy a company’s stock, you buy ownership in that company that allows you to
participate in the company’s growth. Stocks are offered by companies that are publicly listed
on stock exchanges and can be bought by any investor. Stocks are ideal long-term
investments. But investing in stocks should not be equated to trading in the stock market,
which is a speculative activity.

Recurring Deposits
A recurring deposit is another fixed tenure investment that allows investors to put in a
specific amount every month for a pre-defined period of time. Recurring Deposits are offered
by banks and post offices. The interest rates are defined by the institution offering it. An
investment in this avenue allows the investor to invest a small amount every month to build a
corpus over a defined time period. It offers capital protection as well as guaranteed returns.
Public Provident Fund
The Public Provident Fund (PPF) is a long-term tax-saving investment instrument that comes
with a lock-in period of 15 years. Investments made in PPF can be used to earn a tax break.
The PPF rate is decided by the Government of India every quarter. The corpus withdrawn at
the end of the 15-year period is completely tax-free in the hands of the investor. PPF also
allows loans and partial withdrawals after certain conditions have been met.

Employee Provident Fund

The Employee Provident Fund (EPF) is another retirement-oriented investment that earns a
tax break under Section 80C. EPF deductions are typically a part of an employee’s monthly
salary and the same amount is matched by the employer as well. Upon maturity, the
withdrawn corpus from EPF is also entirely tax-free. EPF rates are also decided by the
Government of India every quarter.

National Pension System

The National Pension System (NPS) is a relatively new tax-saving investment option.
Investors in the NPS stay locked-in till retirement and can earn higher returns than PPF or
EPF since the NPS offers plan options that invest in equities as well. The maturity corpus
from the NPS is not entirely tax-free and a part of it has to be used to purchase an annuity that
will give the investor a regular pension.
 MUTUAL FUNDS

ABOUT MUTUAL FUNDS

A Mutual Fund is promoted by a sponsor and run by a trust that pools the savings of a
number of retail investors who share a common financial goal. The money collected by
selling units of mutual funds is invested by the fund manager in different types of
securities depending according to the objective of the scheme. These could range from
shares to debentures to money market instruments. For an individual investors a Mutual Fund
offers 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.

From its inception the growth of Indian mutual funds industry was very slow and it took
really long years to evolve the modern day mutual funds. Primary motive behind
mutual fund investments is to deliver a form of diversified investment solution. Over
the years the idea developed and people received more and more choices of
diversified investment portfolio through the mutual funds. The credit goes to Unit Trust of
India (UTI) for introducing the first mutual fund in India. Recent years, Indian money and
capital market has shown tremendous growth and expanded its reach to wider
geographical limits .Indian regulators in money and capital market have actively
participated in framing regulations which gives confidence to both individual and
institutional Institutions for participation. Progressive reforms have taken place
with the formation of Security Exchange Board of India (SEBI), capital market regulator in
India which facilitates savings. As a financial intermediary mutual fund has played a
significant role in the development and growth of capital markets in India. According
to the various surveys, conducted in India by SEBI, National Council of Applied
Economic Research (NCAER) and asset management companies (AMCs), small salaried
investors generally goes for bank deposits, government sponsored small savings schemes or
endowment life policies for tax saving purpose, which do not provide hedge against
inflation and often land up earning negative real returns. With the passage of time, India has
witnessed many new and innovative mutual funds. However, there has been a shift in the
methods and ways of selling these funds also changed with time. It is continuing to evolve
to a better future, where the investors will get newer opportunities. In this era of
globalization and competition, the success of this industry is determined by the market
performance of its stock. During the period of this study, performance of mutual fund
industry was not as per the expectation, because of the underperformance of the secondary
market and imposition of ceiling on the expense ratio and entry load charges by
capital market regulator. With regenerated combined efforts of the brokerage houses
and the fund managers and with the backing of market regulators, and extensive awareness
program for investors, investments in mutual funds schemes bound to get boost.
HOW MUTUAL FUNDS WORK-
A mutual fund is a pool of money from numerous investors who wish to save or make
money. Investing in a mutual fund can be a lot easier than buying and selling individual
stocks and bonds on your own. Investors can sell their shares when they want. A mutual fund
is an investment vehicle, which pools money from investors with common investment
objectives. It then invests their money in multiple assets, in accordance with the stated
objective of the scheme. The investments are made by an ‘asset management company’ or
AMC. In a world where investing in financial markets is a critical piece of our retirement
planning, college savings, and healthcare balances, mutual funds – pooled investments under
professional management – are becoming ubiquitous for the individual investor. Rather than
picking stocks and managing money, mutual funds aggregate funds from many thousands of
small investors and maintain a stated, disciplined investment strategy..

A mutual fund is a trust that pools the savings of a number of investors who share a common
financial goal and investments may be in shares, debt securities, money- market securities or
a combination of these. Those securities are professionally managed on behalf of the unit
holders and each investor holds a pro-rata share of the portfolio, that is, entitled to profits as
well as losses. Income earned through these investments and the capital appreciation realized
is shared by its unit holders in proportion to the number of units owned by them. A mutual
fund is the most suitable investment scope for common people as it offers an opportunity to
invest in a diversified, professionally managed basket of securities at the relatively lower
cost.

A mutual fund is nothing more than a collection of stocks and/or bond. It is a company that
brings together a group of people/ corporate investors and invests their money in stocks,
bonds and other securities. Each investors own shares, which represent a portion of the
holdings of the funds.

Mutual funds are considered as one of the best available investments as compare to others,
they are very cost efficient and also easy to invest in, thus by pooling money together in a
mutual fund, investors can purchase stocks or bonds with much lower trading costs than if
they tried to do it on their own. But the biggest advantage to mutual funds is diversification,
by minimizing risk and maximizing returns. There are lot of investment avenues available
today in the financial market for an investor with an investable surplus. They can invest in
bank deposits, corporate debentures, and bonds where there is low risk but low return. They
may invest in stock of companies where the risk is high and the returns are also high. The
recent trends in the stock market have shown that an average retail investor always lost with
periodic bearish tends. People began opting for portfolio managers with expertise in stock
markets who would invest on their behalf. Thus we had wealth management services
provided by many institutions. However, they proved too costly for a small investor. These
investors have found a good shelter with the mutual funds. Mutual funds are trusts, which
accept savings from investors and invest the same in diversified financial instruments in
terms of objectives set out in the trusts deed with the view to reduce the risk and maximize
the income and capital appreciation for distribution for the members. A mutual fund is a
corporation and the fund manager’s interest is to professionally manage the funds provided
by the investors and provide a return on them after deducting reasonable management fees.
The objective sought to be achieved by mutual fund is to provide an opportunity for lower
income groups to acquire without much difficulty financial assets. They cater mainly to the
needs of the individual investor whose means are small and to manage investors portfolio in a
manner that provides a regular income, growth, safety, liquidity and diversification
opportunities. Mutual funds are collective savings and investment vehicles where savings of
small investors are pooled together to invest for their mutual benefit and returns distributed
proportionately. A mutual fund is an investment that pools individual’s money with the
money of an unlimited number of other investors. In return, they and the other investors each
own shares of the fund. The fund’s assets are invested according to an investment objective
into the fund’s portfolio of investments. Aggressive growth funds seek long-term capital
growth by investing primarily in stocks of fast-growing smaller companies or market
segments. Aggressive growth funds are also called capital appreciation funds.
HISTORY OF MUTUAL FUNDS IN INDIA
The first introduction of a mutual fund in India occurred in 1963, when the Government of
India launched Unit Trust of India (UTI). UTI enjoyed a monopoly in the Indian mutual fund
market until 1987, when a host of other government- controlled Indian financial companies
established their own funds, including State Bank of India, Canara Bank and Punjab National
Bank. This market was made open to private players in 1993, as a result of the historic
constitutional amendments brought forward by the then Congress-led government under the
existing regime of Liberalization, privatization, and Globalization (LPG). The first private
sector fund to operate in India was Kothari Pioneer, which later merged with Franklin
Templeton. In 1996, SEBI, the regulator of mutual funds in India, formulated the Mutual
Fund Regulation which is a comprehensive regulatory framework. Income from MFs could
take two forms – dividends and capital gains.

First Phase – 1964-1987

Unit Trust of India (UTI) was established in 1963 by an Act of Parliament. 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. 6,700 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 Canara bank Mutual Fund (Dec 87), Punjab National Bank Mutual Fund (Aug
89), Indian Bank Mutual Fund (Nov 89), Bank of India (Jun 90), 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.

At the end of 1993, the mutual fund industry had assets under management of Rs. 47,004
crores.
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. 1,21,805
crores. The Unit Trust of India with Rs. 44,541 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 by Government of India and does not come under the purview of the
Mutual Fund Regulations.

The second is the UTI Mutual Fund, 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.
BENEFITS OF INVESTING IN MUTUAL FUNDS-

1. Risk diversification

The biggest advantage of investing in mutual funds versus stocks is risk diversification.
Every stock is subject to three types of risk: company risk, sector risk and market risk.
Company risk and sector risk are unsystematic risks, while market risk is known as
systematic risk. What is the essential difference between unsystematic and systematic risk?
The stock price of a company may fall if the company's financial performance is poor, even if
the market rises. On the other hand, even if the company performs well, the stock price may
still fall, if the market falls. Mutual funds help investors diversify unsystematic risks by
investing in a diversified portfolio of stocks across different sectors.

Hence, mutual fund risk is much lower than individual stocks.

2. Smaller capital outlay

Investors require a large capital outlay to build a diversified portfolio of stocks.

On the other hand, since mutual funds work on the basis of pooling of money, mutual fund
investors can have the beneficial ownership of a diversified portfolio of stocks with a much
smaller capital outlay.Investors can buy units of a diversified equity fund with an investment
as low as Rs 5,000 only (or even lower for some schemes).

3. Investment expertise

Investing in stock market requires a lot of experience and expertise. In our view
understanding the risk return trade-offs in stock market investments is the most important
part of equity investing. Many retail investors have lost money in share trading because they
make poor risk return trade-offs.

Mutual funds are managed by professional fund managers who have sufficient expertise and
experience in picking the right stocks to get the best risk adjusted returns.

4. Economies of scale in transaction costs

Since mutual funds buy and sell securities in large volumes, transaction costs on a per unit
basis is much lower than what retail investors may incur if they buy or sell shares through
stock brokers.
5. Variety of products

Mutual funds offer investors a variety of products to suit their risk profiles and investment
objectives. Apart from equity funds, there are also balanced funds, monthly income plans,
income funds and liquid funds to suit different investment requirements.

6. Variety of modes of investments

Mutual funds also offer investors flexibility in terms of modes of investment and withdrawal.
Investors can opt for different investment modes like lump sum (or one time), systematic
investment plans, systematic transfer plans (from other mutual fund schemes), systematic
withdrawal plans, switches from one scheme to another etc. You can invest in growth option
of mutual funds if you want to take advantage of compounded returns over a long investment
period. You can invest in dividend option if you want regular income from your investment.
No other investment product offers such wide array of investment modes.

7. Disciplined investing

Share prices are highly volatile and can induce the investor to buy or sell in short time
periods due to fear or greed. Frequent trading often leads the investor to incur losses. Mutual
funds encourage investors to invest over a long time horizon, which is essential to creating
wealth. Furthermore, systematic investment plans encourage investors to invest in a
disciplined manner to meet their long term financial objectives. Many investors fail to build a
substantial investment corpus because they are not able to invest in a disciplined way
.Savings not invested regularly often gets spent on discretionary lifestyle related expenses.
Systematic investment plans (SIPs) in mutual funds help investors to maintain a disciplined
approach to savings and investment. SIPs also help investors take emotions out of the
investment process. Very often investors get very enthusiastic in bull market conditions, but
get nervous in bear markets.It is an established fact that investments made in bear markets
help investors get high returns in the long term.By investing through SIPs in a mechanical
way, investors can stay disciplined, which is critical to achieving their financial objectives.
TYPES OF MUTUAL FUNDS

There are many different types of mutual funds categorized based on structure, asset class
and investment objectives. Choosing the right type of fund for your investment needs will
depend on your investment goal.

Types of Mutual Funds based on structure

Open-Ended Fund: These are funds in which units are open for purchase or redemption
through the year. All purchases/redemption of these fund units are done at prevailing Net
asset value. Basically these funds will allow investors to keep invest as long as they want.
There are no limits on how much can be invested in the fund. They also tend to be actively
managed which means that there is a fund manager who picks the places where investments
will be made. These funds also charge a fee which can be higher than passively managed
funds because of the active management. They are an ideal investment for those who want
investment along with liquidity because they are not bound to any specific maturity periods.
which means that investors can withdraw their funds at any time they want thus giving them
the liquidity they need.

Close-Ended Funds: These are funds in which units can be purchased only during the initial
offer period. Units can be redeemed at a specified maturity date. To provide for liquidity,
these schemes are often listed for trade on a stock exchange. Unlike open ended mutual
funds, once the units or stocks are bought, they cannot be sold back to the mutual fund,
instead they need to be sold through the stock market at the prevailing price of the shares.

Interval Funds: These are funds that have the features of open-ended and close-ended funds
in that they are opened for repurchase of shares at different intervals during the fund tenure.
The fund management company offers to repurchase units from existing unit holders during
these intervals. If unit holders wish to they can offload shares in favour of the fund.
Types of Mutual Funds based on asset class

Equity Funds: These are funds that invest in equity stocks/shares of companies. These are
considered high-risk funds but also tend to provide high returns. Equity funds can include
specialty funds like infrastructure, fast moving consumer goods and banking to name a few.
They are linked to the markets.

Debt Funds: These are funds that invest in debt instruments e.g. company debentures,
government bonds and other fixed income assets. They are considered safe investments and
provide fixed returns. These funds do not deduct tax at source so if the earning from the
investment is more than Rs. 10,000 then the investor is liable to pay the tax on it himself.

Money Market Funds: These are funds that invest in liquid instruments e.g. Treasury Bills,
Commercial Papers etc. They are considered safe investments for those looking to invest
surplus funds for immediate but moderate returns. Money markets are also referred to as cash
markets and come with risks in terms of interest risk, reinvestment risk and credit risks.

Balanced or Hybrid Funds: These are funds that invest in a mix of asset classes. In some
cases, the proportion of equity is higher than debt while in others it is the other way round.
Risk and returns are balanced out this way. An example of a hybrid fund would be Franklin
India Balanced Fund-DP (G) because in this fund, 65% to 80% of the investment is made in
equities and the remaining 20% to 35% is invested in the debt market. This is so because the
debt markets offer a lower risk than the equity market.

Types of Mutual Funds based on investment objective

Growth funds: Under these schemes, money is invested primarily in equity stocks with the
purpose of providing capital appreciation. They are considered to be risky funds ideal for
investors with a long-term investment timeline. Since they are risky funds they are also ideal
for those who are looking for higher returns on their investments.

Income funds: Under these schemes, money is invested primarily in fixed-income

instruments e.g. bonds, debentures etc. with the purpose of providing capital protection and
regular income to investors.

Liquid funds: Under these schemes, money is invested primarily in short-term or very short-
term instruments e.g. T-Bills, CPs etc. with the purpose of providing liquidity. They are
considered to be low on risk with moderate returns and are ideal for investors with short-term
investment timelines.

Tax-Saving Funds (ELSS): These are funds that invest primarily in equity shares.
Investments made in these funds qualify for deductions under the Income Tax Act. They are
considered high on risk but also offer high returns if the fund performs well.

Capital Protection Funds: These are funds where funds are are split between investment in
fixed income instruments and equity markets. This is done to ensure protection of the
principal that has been invested.

Fixed Maturity Funds: Fixed maturity funds are those in which the assets are invested in
debt and money market instruments where the maturity date is either the same as that of the
fund or earlier than it.

Pension Funds: Pension funds are mutual funds that are invested in with a really long term
goal in mind. They are primarily meant to provide regular returns around the time that the
investor is ready to retire. The investments in such a fund may be split between equities and
debt markets where equities act as the risky part of the investment providing higher return
and debt markets balance the risk and provide lower but steady returns. The returns from
these funds can be taken in lump sums, as a pension or a combination of the two.

Types of Mutual Funds based on specialty

Sector Funds: These are funds that invest in a particular sector of the market e.g.
Infrastructure funds invest only in those instruments or companies that relate to the
infrastructure sector. Returns are tied to the performance of the chosen sector. The risk
involved in these schemes depends on the nature of the sector.

Index Funds: These are funds that invest in instruments that represent a particular index on
an exchange so as to mirror the movement and returns of the index e.g. buying shares
representative of the BSE Sensex.

Fund of funds: These are funds that invest in other mutual funds and returns depend on the
performance of the target fund. These funds can also be referred to as multi manager funds.
These investments can be considered relatively safe because the funds that investors invest in
actually hold other funds under them thereby adjusting for risk from any one fund.
Emerging market funds: These are funds where investments are made in developing
countries that show good prospects for the future. They do come with higher risks as a result
of the dynamic political and economic situations prevailing in the country.

International funds: These are also known as foreign funds and offer investments in
companies located in other parts of the world. These companies could also be located in
emerging economies. The only companies that won’t be invested in will be those located in
the investor’s own country.

Global funds: These are funds where the investment made by the fund can be in a company
in any part of the world. They are different from international/foreign funds because in global
funds, investments can be made even the investor's own country.

Real estate funds: These are the funds that invest in companies that operate in the real estate
sectors. These funds can invest in realtors, builders, property management companies and
even in companies providing loans. The investment in the real estate can be made at any
stage, including projects that are in the planning phase, partially completed and are actually
completed.

Commodity focused stock funds: These funds don’t invest directly in the commodities.
They invest in companies that are working in the commodities market, such as mining
companies or producers of commodities. These funds can, at times, perform the same way the
commodity is as a result of their association with their production.

Market neutral funds: The reason that these funds are called market neutral is that they
don’t invest in the markets directly. They invest in treasury bills, ETFs and securities and try
to target a fixed and steady growth.

Inverse/leveraged funds: These are funds that operate unlike traditional mutual funds. The
earnings from these funds happen when the markets fall and when markets do well these
funds tend to go into loss. These are generally meant only for those who are willing to incur
massive losses but at the same time can provide huge returns as well, as a result of the higher
risk they carry.

Asset allocation funds: The asset allocation fund comes in two variants, the target date fund
and the target allocation funds. In these funds, the portfolio managers can adjust the allocated
assets to achieve results. These funds split the invested amounts and invest it in various
instruments like bonds and equity.

Gift Funds: Gift funds are mutual funds where the funds are invested in government
securities for a long term. Since they are invested in government securities, they are virtually
risk free and can be the ideal investment to those who don’t want to take risks.
Exchange traded funds: These are funds that are a mix of both open and close ended mutual
funds and are traded on the stock markets. These funds are not actively managed,they are
managed passively and can offer a lot of liquidity. As a result of their being managed
passively, they tend to have lower service charges (entry/exit load) associated with them.

Types of Mutual Funds based on risk

Low risk: These are the mutual funds where the investments made are by those who do not
want to take a risk with their money. The investments in such cases are made in places like
the debt market and tend to be long term investments. As a result of them being low risk, the
return on these investments is also low. One example of a low risk fund would be gift funds
where investments are made in government securities.

Medium risk: These are the investments that come with a medium amount of risk to the
investor. They are ideal for that that are willing to take some risk with the investment and
tends to offer higher returns. These funds can be used as an investment to build wealth over a
longer period of time.

High risk: These are those mutual funds that are ideal for those who are willing to take
higher risks with their money and are looking to build their wealth. One example of high risk
funds would be inverse mutual funds. Even though the risks are high with these funds, they
also offer higher returns.
TYPES OF RETURNS IN MUTUAL FUNDS

Following are the ways by which returns can be realized in a mutual fund:

Dividends

Unit holders earn dividends on mutual funds. These dividends are distributed from the
income generated through dividends on stocks and interest on other instruments.

Capital Gains

Investors get capital gains on mutual funds. If the fund sells securities that have appreciated
in value, it earns capital gains. Most funds distribute these capital gains also to investors.

Profit from higher NAV

Any increase in value of fund’s asset increases the Net Asset Value (NAV) of the fund.
Investors can make profit by selling back their units to fund house.
ORGANISATIONS OF A MUTUAL FUND

Sponsor

Sponsor is the person who either alone or in association with another corporate body,
establishes a mutual fund. The sponsor must contribute at least 40% of the net worth of the
investment managed and meet the eligibility criteria prescribed under the Securities and
Exchange Board of India (Mutual Funds) Regulations, 1996.The sponsor is not responsible or
liable for any loss or shortfall resulting from the operation of the schemes beyond the initial
contribution made by it towards setting up of the mutual fund.

Trust

The mutual fund is constituted as a trust in accordance with the provisions of the Indian
Trusts Act, 1882 by the sponsor. The trust deed is registered under the Indian Registration
Act, 1908.

Trustee

Trustee is usually a company (corporate body) or a Board of Trustees (body of individuals).

The main responsibility of the trustee is to safeguard the interest of the unit holders and inter
alias ensure that the AMC functions in the interest of investors and in accordance with the
Securities and Exchange Board of India (Mutual Funds) Regulations, 1996, the provisions of
the trust deed and the offer documents of the respective schemes. At least 2/3rd of the
directors of the Trustee are independent directors who are not associated with the sponsor in
any manner.

Asset Management Company (AMC)

The trustee, as the investment manager of the mutual fund, appoints the AMC. The AMC is
required to be approved by the Securities and Exchange Board of India (SEBI) to act as an
asset management company of the Mutual fund. At least 50% of the directors of the AMC are
independent directors who are not associated with the sponsor in any manner. The AMC must
have a net worth of at least Rs. 10 crore at all times.
Custodian

A trust company, bank or similar financial institution, registered with SEBI is responsible for
holding and safeguarding the securities owned within a mutual fund. A mutual fund’s
custodian may also act as its transfer agent.

Registrar and Transfer Agent

The AMC, if so authorized by the trust deed, appoints the registrar and transfer agent to the
mutual fund. The registrar processes the application form, redemption requests and
dispatches account statements to the unit holders. The registrar and transfer agent also
handles communication with investors and updates investor records.
MUTUAL FUND COMPANIES IN INDIA

• Axis Asset Management Company Ltd.

• Baroda Pioneer Asset Management Company Ltd.

• BNP Paribas Asset Management Company Ltd.

• BOI AXA Investment Managers Pvt. Ltd.

• Birla Sun Life Asset Management Company Ltd.

• Canara Robeco Asset Management Company Ltd.

• Deutsche Asset Management (India) Pvt. Ltd.

• DSP BlackRock Investment Managers Pvt. Ltd.

• Daiwa Asset Management (India) Pvt. Ltd.

• Edelweiss Asset Management Ltd.

• Escorts Asset Management Ltd.

• Franklin Templeton Asset Management (India) Pvt. Ltd.

• FIL Fund Management Pvt. Ltd.

• Goldman Sachs Asset Management (India) Pvt. Ltd.

• HSBC Asset Management (India) Pvt. Ltd.

• HDFC Asset Management Company Ltd.

• IDFC Asset Management Company Ltd.

• IDBI Asset Management Ltd.

• ICICI Prudential Asset Management Company Ltd.

• India Infoline Asset Management Company Ltd.

• India bulls Asset Management Company Ltd.

• ING Investment Management (India) Pvt. Ltd.

• JM Financial Asset Management Pvt. Ltd.

• JP Morgan Asset Management India Pvt. Ltd.

• Kotak Mahindra Asset Management Company Ltd.

• L and T Investment Management Ltd.

• LIC NOMURA Mutual Fund Asset Management Company Ltd.

• Mirae Asset Global Investments (India) Pvt. Ltd.

• Morgan Stanley Investment Management Pvt. Ltd.

• Motilal Oswal Asset Management Company Ltd.

• Peerless Funds Management Company Ltd.

• Pine Bridge Investments Asset Management Company (India) Pvt. Ltd.

• Pramerica Asset Managers Pvt. Ltd.

• Principal PNB Asset Management Company Pvt. Ltd.

• Quantum Asset Management Company Pvt. Ltd.

• Reliance Capital Asset Management Ltd.

• Religare Asset Management Company Pvt. Ltd.

• Sahara Asset Management Company Pvt. Ltd.

• SBI Funds Management Pvt. Ltd.

• Sundaram Asset Management Company Ltd.

• Tata Asset Management Ltd.

• Taurus Asset Management Company Ltd.

• Union KBC Asset Management Company Pvt. Ltd.

• UTI Asset Management Company Ltd.

FIXED DEPOSITS
ABOUT FIXED DEPOSITS:

Fixed deposit (FD) is a financial instrument where a sum of money is given to a bank,
financial institution or company whereby the receiving entity pays interest at a specified
percentage for the time duration of the deposit. The rate of interest paid for fixed deposit vary
according to the amount, period and from bank to bank. At the end of the time period of the
deposit the amount that is originally given is returned to the investor.

The account which is opened for a particular fixed period of time by depositing particular
amount is known as Fixed Deposit Account. The term 'fixed deposit' means that the deposit is
fixed and is repayable only after a specific period is over.

Under fixed deposit account, the money is deposited for a fixed period which can be six
months, one year, five years or even ten years. The money deposited in this account can not be
withdrawn before the expiry of time period. The rate of interest paid for fixed deposit vary
(changes) according to amount, period and from bank to bank.

All Banks in India (including State Bank of India, Punjab National Bank, Bank of Baroda,
Canara Bank, ICICI Bank, Yes Bank etc.) offer fixed deposits schemes with a wide range of
tenures for periods which vary from 7 days to 10 years. These are also popularly known as FD
accounts.  However, in some other countries these are called as Term Deposits or even called
Bond.    The term "fixed" in Fixed Deposits (FD) denotes the period of maturity or tenure.
Therefore, the depositors  are supposed to continue such Fixed Deposits for the  length of time
for which the depositor decides to keep the money with the bank.  However, in case of need, 
the depositor can ask for closing (or breaking) the fixed deposit prematurely by paying a
penalty (usually of 1%, but some banks either charge less or no penalty). Some banks
introduced variable interest fixed deposits.  The rate of interest on such deposits  keeps on
varying with the prevalent market rates i.e. it will go up if market interest rates goes and it will
come down if the market rates fall.  However, such type of fixed deposits have not been
popular till date.

The rate of interest for Fixed Deposits differs  from bank to bank (unlike earlier when the
same were regulated by RBI and all banks used to have the same interest rate structure.   The
present trends indicate that private sector and foreign banks offer higher rate of interest.  

The earlier trend that private sector and foreign banks offer higher rate of interest is no more
valid these days.  However, now a days small banks are forced to offer higher rate of interest
to attract more deposits.   Usually a bank FD is paid in lump sum on the date of maturity. 
However, most of the banks have also facility to pay/ credit interest in saving account at the
end of every quarter.  If one desires to get interest paid every month, then  the interest paid
will  be at a marginal discounted rate.  In the changed computerized environment, now the
Interest payable on Fixed Deposit can also be easily transferred on due dates to Savings Bank
or Current Account of the customer. 
 FEATURES:-
i. The main purpose of fixed deposit account is to enable the individuals to earn a higher rate of
interest on their surplus funds (extra money).
ii. The amount can only be deposited only once. For further such deposits, separate accounts need
to be opened.
iii. The period of fixed deposits range between 15 days to 10 years.
iv. A high interest rate is paid on fixed deposits. The rate of interest may vary as per amount, period
and from bank to bank.
v. Withdrawals are not allowed. However, in case of emergency, banks allow to close the fixed
account prior to maturity date. In such cases, the bank deducts 1% (deduction percentage many
vary) from the interest payable as on that date.
vi. The depositor is given a fixed deposit receipt, which depositor has to produce at the time of
maturity. The deposit can be renewed for a further period.

ADVANTAGES:

i. Fixed deposit encourages savings habit among investors for a longer period of time..
ii. Fixed deposit account enables the depositor to earn a high interest rate.
iii. The depositor can get loan facility from the bank.
iv. On maturity the amount can be used to make purchases of assets.
v. The bank can get the funds for a long period of time.
vi. The bank can lend such funds for short term loans to businessmen.
vii. Fixed deposits indirectly boost economic development of the country.
viii. The bank can also invest such funds in profitable areas.
 COMPARISON BETWEEN MUTUAL FUNDS AND FIXED DEPOSITS

Comparison between fixed deposits and mutual funds is a long debate. Even a few years ago,
any conservative and risk averse investor would think investing in fixed deposits is better
than investing in mutual funds . Nevertheless, the market scenario has changed a lot in the
recent years, and many mutual funds companies has come up with interest mutual fund
schemes with guaranteed returns alongside capital appreciations. This makes the comparison
between mutual funds and fixed deposits more complex, and even the most risk averse
investor is made to think twice before selecting investment avenue. That being said, whether
we should invest in bank fixed deposits or mutual funds is no more a simple question as it
used to be five-six years ago, and needs a detailed examination and explanation. While only
you can finally decide whether mutual funds or fixed deposit where to invest — depending
on the risk taking abilities, return expectations, and investment horizons. Some key factors
which help in comparison between bank FD and mutual funds are-

1. Return on investments vary for mutual funds, but not fixed deposits:
Fixed deposits offer a fixed rate of return, as would be agreed upon by the investor and the bank
at the time of the investment. For example, if we put 50 thousand rupees in Fixed deposit for 5
years and the agreed interest rate is 8% per annum, we will get the same interest rate throughout
the tenure of the investment. On the other hand, debt mutual funds have no fixed assured rate,
and the return on investment for debt mutual funds completely depends on the market conditions
and the performance of the mutual fund. Fluctuations in the money market impact the Net Asset
Value of the fund, thereby changing the returns. Thus, a great advantage of fixed deposits is
that, we will continue to earn the same interest rates even if the market goes down..

2. Capital appreciation:
When it come to capital appreciation, mutual funds are better than fixed deposits, because of the
equity investment. In longer time periods, market changes result in increasing interest rates. And,
the mutual funds manager with all the expertise and professionalism ensures a better capital
appreciation.

3. Liquidity:
In terms of liquidity, these days both fixed deposits and mutual funds are almost the same. Fixed
deposits are actually meant for long lock in periods, but most banks allow premature withdrawals
with a nominal penalty of usually 1%. The interest rate calculation for fixed deposit withdrawals
is done on how long the money was invested. Mutual funds are equally liquid; any number of
units can be taken out within a couple of days. The return for premature withdrawal of mutual
funds units is done on the prevalent Net Asset Value of the fund. Usually, there is an exit load of
1% for premature withdrawals before 1 year.
4. Risk involved:
The only reason why most investors prefer fixed deposits over mutual funds is the assured return
of the capital. On the other hands, returns from investments in mutual funds are subject to the
market conditions, and may result in low or even negative returns. An investor should be wise
enough to judge the quality of the investment instrument and thereby minimizing risk factors. If
the mutual fund is kept for short-term then there is more risk involved as compared to when it is
kept for long-term.

5. Cost of investments:
Investment in fixed deposits costs nothing. On the other hand, there is a minimum charge for
mutual funds investments management and fund distribution, which is borne by the investor
irrespective of returns. In other words, no matter whether your return on mutual funds
investments is positive or negative, we have to bear an expense as the fees of fund management.
Sometimes, entry loads are there as well, but quite rarely.

6. Tax benefits :
Fixed deposits interests are considered incomes and come under income taxes. Moreover, there is
a TDS (Tax Deducted at Source) at the rate of 10.3% p.a. if your total cumulative interest on all
FD is more than Rs. 10,000 in any financial year. Similarly, short term capital gains of funds are
considered income and are accordingly taxable. For long term capital gains, tax is 10% without
indexation or 20% with indexation. And if the mutual fund is debt based, dividends received on
debt mutual funds are tax free.

BASIS MUTUAL FIXED

FUND DEPOSIT

RETURN better low

RISK moderate low

LIQUIDITY better at a cost

INVESTMENT more less

OPTIONS

ADMINISTRATIV low high

E EXPENSES
Recent changes in india (changing trends)
CHAPTER- 2
REVIEW OF
LITERATURE

V.R.Palanivelu & K.Chandrakumar (2013) examined the Investment choices of salaried

class in Namakkal Taluk, Tamilnadu, India with the help of 100 respondents as a sample size
& it reveals that as per Income level of employees, invest in different avenues. Age factor is
also important while doing investments.
Manish Mittal and Vyas R.K(2008) Investors have certain cognitive and emotional
weaknesses which come in the way of their investment decisions. Over the past few years,
behavioral finance researchers have scientifically shown that investors do not always act
rationally. They have behavioral biases that lead to systematic errors in the way they process
information for investment decision. Many researchers have tried to classify the investors on
the basis of their relative risk taking capacity and the type of investment they make.
Empirical evidence also suggests that factors such as age, income, education and marital
status affect an individual's investment decision. This paper classifies Indian investors into
different personality types and explores the relationship between various demographic factors
and the investment personality exhibited by the investors.

Patil, S., & Nandawar, K. (2014). studied preferred investment avenues among salaried
people with reference to Pune City, India. A sample size of 40 investors has been taken from
the Pune City, India. The result of finding showed 60% investors were aware about the
investment avenues whereas 40% were unaware.

• Friend, et al., (1962) Made an extensive and systematic study of 152.Mutual funds found
that mutual fund schemes earned an average annual return of 12.4 percent, while their
composite benchmark earned a return of 12.6 percent. Their alpha was negative with 20 basis
points. Overall Results did not suggest widespread inefficiency in the industry.Comparison of
fund returns with turnover and expense categories did not reveal a strong relationship

• McDonald and John, (1974) Examined 123 mutual funds and identified the existence of
positive relationship between objectives and risk. The study identified the existence of
positive relationship between return and risk. The relationship between objective and risk-
adjusted performance indicated that, more aggressive funds experienced better result.

• Lal C and Sharma Seema (1992) ,identified that, the householdsector’s share in the
Indian domestic savings increased from 73.6 percent in 1950-51 to 83.6 percent in 1988-89.
The share of financial assets increased from 56 percent in 1970-71 to over 60 percent in
1989-90 bringing out a tremendous impact on all the constituents of the financial market.

•Byrne (2005) shows that risk and investment experience tend to indicate a positive
correlation. Past experience of successful investment increases investor tolerance of risk.
Inversely, unsuccessful past experience leads to reduced tolerance to risk. Therefore past
investment behavior affects future investment behavior.
•Corter and Chen (2006) studied that investment experience is an important factor
influencing behavior. Investors with more experience have relatively high risk tolerance and
they construct portfolios of higher risk

Sandhu and Singh (2004) The study analyzed in case of adopters that transparency, safety,
convenience and economy judged as an important feature of net trading followed by market
quality and liquidity whereas in case of non-adopters economy and convenience were the
important features followed by the other factors like market quality, safety and liquidity.

Sasidharan (1990)30 had observed that about 23 percent of the population covered was aware
of the Mutual Fund schemes but the awareness level was very low. The traditional savings
eclipsed mutual fund schemes' promises like high returns, capital growth and liquidity. Out of
23 percent of the population only 18 percent had adopted mutual fund schemes. The main
objective in choosing mutual fund schemes by respondents who were aware of the schemes
was capital growth followed by future needs, tax savings and minimization of risk.

Gupta (1991)31 had found that mutual fund units were perceived as safe by a great majority
of household investors. But despite the image of high safety and also higher returns than bank
fixed deposits, mutual fund schemes had not been as popular among the lower income groups
of investors as 24 among the higher income groups of investors. Such investment was less
popular than both bank fixed deposits and equity shares in every income group. The majority
of respondents were not willing to invest in mutual fund schemes unless there was the promise
of a minimum return, as they consider schemes without such promise not very safe. The
highest preference among investors was for income kds and the least preferred was the unit
linked insurance schemes. Among the upper income groups growth schemes and tax saving
schemes were much-preferred schemes.

Thiripalraju, M. (1993) had observed that the awareness level of mutual funds was very poor
among the rural population. Though advertisements were the main sources of information,
they evoke very little response from the public. He had suggested that special efforts should be
made by the concerned agencies to propagate the mutual fund schemes, especially in the rural
and semi-urban areas to increase the awareness and adoption levels.

Dutta (2009) in his article compared the growth of Indian mutual funds industry with that of
the banking industry in the last two decades. Banking industry was undoubtedly ahead of the
mutual funds industry in terms of size but mutual funds industry had gained momentum in the
past few years. Gross mobilization by the mutual funds industry picked up post 1999 by
74.03%. Although net resource mobilization by mutual funds industry as on 2006 over 1993
had increased at a CAGR of 13.37% lower than the growth of deposit of all scheduled
commercial banks over the same period i.e. 16.42% in the post 1999 scenario there was
striking increase in the net resource mobilization. Against outflow of ` 950 crores during the
year 1989-99 there was a huge inflow of `18960 crores during the following year 1999- 00. To
stay at par with international standard the article suggested that the Indian mutual funds
industry should increase penetration, diversify products and use better risk mitigation
techniques.

 CHAPTER-3
RESEARCH
METHODOLOGY
 RESEARCH METHODOLOGY

The research article is based upon descriptive as well as exploratory research. Secondary
sources of data collection have been adopted for the study. The secondary data has been
collected through journals and website. In my study the research work is exploratory study i.e.
research has been done by primary data collection and primary data has been collected by
interacting with various people.

Objectives of the Study

1) To identify the factors motivating people invest their money.

2) To study the investment requirements of individuals.
3) To know and study about the level of awareness among people regarding mutual
funds and fixed deposits in India.
4) To find out the popular form of investment between mutual funds and fixed deposits.
5) To find out the satisfaction of people in investment in a particular investment avenue.

 Source of Data : Primary & Secondary

 Research Approach: Survey Method
 Sampling Size: Total 50 respondents are taken as a sample for survey.
 Statistical Tools and Techniques: Percentage method.
 Sample design: Data has been presented with the help of bar graph, line graphs etc.

SAMPLING PROCEDURE:- The sample was selected for them who are business man ,
government employee , self employed etc irrespective of them being investor or not or
availing the services or not. It was also collected through personal visits to persons, by
filling up the questionnaire prepared and from past data from different sources..

FIELD WORK

1. Study of secondary data: The quickest and the most economical way to find possible
hypothesis is to take the advantage of the work done earlier and thus utilize their efforts.
2. In-depth interviews: I used in-depth interviews because it attempts to influence respondents
to talk freely about their subject of interest. A formal questionnaire was made and according to
which the questions were asked to respondents.
Basic Methods of collecting Primary Data

1. Questionnaire Method
2. Contact Method
 CHAPTER-4
DATA ANALYSIS
AND
INTERPRETATION
BIBLIOGRAPHY

 Friend, I., Brown, F. E., Herman, E. S., & Vickers, D. (1962). A

study of mutual funds. US Government Printing Office, Washington,
DC.
 McDonald, J. G. (1974). Objectives and performance of mutual funds,
1960–1969. Journal of Financial and Quantitative Analysis, 9(3), 311-
333.
 Lal, C., & Seema, S. (1992). Mutual Fund-A Buoyant Financial
Instrument. Finance India, 6(4), 811-18.
 Thiripalraju, M. (1993). Financial Innovations in the Indian Capital
Market. Finance India, 7(1), 43-62.
 Singh, A., Sandhu, H. S., & Kundu, S. C. (2010). Investors’ adoption
of internet stock trading: A study. Journal of Internet Banking and
Commerce, 15(1), 1-21.
 Byrne, K. (2005). How do consumers evaluate risk in financial
products?. Journal of Financial Services Marketing, 10(1), 21-36.
 Corter, J. E., & Chen, Y. J. (2006). Do investment risk tolerance
attitudes predict portfolio risk?. Journal of Business and Psychology,
20(3), 369.
 Mittal, M., & Vyas, R. K. (2008). Personality type and investment
choice: An empirical study. The ICFAI University Journal of Behavioral
Finance, 5(3), 7-22.
 Chandrakumar, K., & Palanivelu, V. R. (2013). Investor awareness in
mutual funds: a study with reference to Namakkal district, Tamilnadu,
India. ZENITH International Journal of Multidisciplinary Research,
3(11), 203-212.
 Patil, S., & Nandawar, K. (2014). A Study on Preferred Investment
Avenues among Salaried People With Reference To Pune, India. IOSR
Journal of Economics and Finance (IOSRJEF) e-ISSN, 23215933, 09-
17.
Questionnaire

1)NAME:
2)AGE GROUP :
 18-25
 26-35
 36-45
 46-60
 ABOVE 60
3)OCCUPATION:
 Self employed
 Business person
 Housewife
 Student
 Professional
 Retired
 Pvt. Firm employee
 Govt. employee
4)INCOME:
 Less than 2.5
 2.5lac-5lac
 5lac-10lac
 Above 10lac

5) Do you invest?
 Yes
 No

6) Do you know about the following financial instruments?

 Fixed Deposit
 Mutual Funds
7) Where do you invest/want to invest out of these two?
 MUTUAL FUNDS
 FIXED DEPOSITS

8) What is the percentage of savings you invest from your total income ?
 0-10%
 10-20%
 20-30%
 30 & above

9)How long would you like to invest?

 <1 year
 1-3year
 3-5year
 5 & above

10)While investing your money which factor you prefer most? Tick any one/two
 Liquidity
 Low risk
 High return

11)What kind of investor are you?

 Low Risk taker
 Moderate risk taker
 High risk taker

12) Do you perceive mutual funds investment is completely safe.

 Yes
 No
13)Do you invest on your own or you invest through a financial advisor?
 ON YOUR OWN
 FINANCIAL ADVISOR
14)Are you satisfied with your investment choice?

 YES
 NO