Faculty of Management

MBA Programme

Subject: Summer Research Project

A Research Proposal
On

“A Study of comparison between mutual funds with other investment schemes”

Submitted to:
Faculty of management

Under the guidance of:

Prof. Smruti Vakil

Submitted by:

Yukta Shah Enrollment No.: 202000620010666

Arun Kalwani Enrollment No.: 202000620010548

Batch: 2020-2022
1. INTRODUCTION:
Investors always look for safer investment avenues and want to maximize their returns in
accordance with their risk tolerance. One tries to invest money as early as possible so that the
money will grow accordingly in his lifetime. Choosing a wise investing option is very crucial
because a balance is required to be maintained between the risks and returns involved. Return is
motivating force and the principal reward in the investment process. One of the important reason
that’s why one needs to invest wisely is to meet the cost of inflation. Inflation is the rate at which
the cost of living increases at that time. The cost of living is simply what it cost to buy the goods
and services one needs to live. Inflation causes money to lose value because it will not buy the
same amount of a goods or services in the future as it does now or did in the past. Savings, when
not invested will gradually lose its value due to inflation or rise price level. Hence if a person
saves, investment becomes a compulsion and not an option. Usually investors in a country like
India prefer bank deposits and insurances as their favorite instruments of investments. The
increasing awareness towards the structured products and financial literacy has drawn investors
or Householders’ attention towards mutual funds and equity markets. These draw our attention
for comparison of resource mobilization towards these investment avenues and draw some
conclusive remarks between Mutual Fund Investment and Traditional Investment.

2. LITERETURE REVIEW:
(B & J, 2012) The study analyses the difference in perception of investors in decision of
investing on the basis of age and gender. Various investment options are examined in these
research such as Secured deposits, Life insurance policies, Provident fund , Pension schemes,
Bonds, Debentures, Equity shares, Mutual funds, Real estate, postal schemes etc. investment
decisions are to be taken by self and has to wait to see the results of it, which fascinates some
investors.

(N & M, 2011) This study examines the factors responsible for investment behaviour of people
and different investment options available. Equity are high risk and high return investment with
liquidity, debts are low risk and fixed return instruments, Mutual funds and bonds are low risk
with normal returns instruments, Company deposits and bank deposits has low risk and low
returns, post office savings, PPF and insurance policies are no risk investment with low returns,
Real estate and Gold has no returns on investment but has capital appreciation.
(N. & S., 2013) Saving certificates life insurance policies, mutual funds etc. study covers
Government colleges, Private colleges and aided colleges which states that maximum teachers
saves below one lakh. Maximum respondents invest in fixed deposits.

(Odomenem, 2013) Investment is laying money now for return in future. Study reveals that
policy makers do not make comprehensive and adequate saving schemes for rural area. Which
leads to inadequate savings and Investments by small scale farmers The study analyses socio-
economical status of the respondents. Purpose of saving is to take care of families and not to
invest.

(S., 2014) Investment means saving with a hop that some benefit will arise in future. Investment
options are available like Bank deposits, NRO funds, Real Estate, Shares and Bonds etc.
Respondent of the study reveals that majority of respondents selected deposit as a mode of
investment..

(UjwalaBairagi & CharuRastogi, 2013) Household investments are the major determinant of
gross domestic savings. Majority respondents selected the option of Bank deposits and Insurance
policies. Study analyses the awareness about investment avenues which state that respondent
between the age of 41 to 50 years are more aware about investment options.

(Jain, 2014) Two classes of investments like Fixed income statements i.e. Preference shares ,
Bonds, fixed deposits and Variable income investment i.e. equality capital, proprietary
ownership. Data shows that respondents between the age group of 26 years to 35 years are
involve in investment activities.

(Tare & Mehta, 2012)By analyzing advantages and disadvantages of investment avenues
investor can select appropriate investment plan for self. Data examination states that 32 percent
investors selected LIC / NSS, 31 percent investors had selected Fixed deposits, 9 percent
investors selected Mutual funds 6 percent investors opt for Chits and Jeweler etc. Investment
management is a Science as well as an Art.

(L.Pandiyan & T.Aranganatham, 2012) Decision making process on savings and investment is
affected by the attitude of the respondent. Study analyses shows that level of attitude of male and
female, female group are not interested in investment but more wrong investment decisions are
made by male group. Respondent of age are neutral opinion on investment. Investment pattern is
affected by the family size too.

(Vyas, 2012)is study finds the form of investments preferred by investors. Mutual fund
investment is a secured investment with good returns on investments. Data analyses show that
maximum respondent invest in Gold followed by bank deposits and Insurance schemes. Mutual
fund investments are very limited. For Safety, Liquidity, Reliability, Tax benefits and high
returns Mutual fund has average score among investors.
 (Jain P. , 2012)The study analyses the various investment avenues available for the investors. It
state Equity shares has low return but high capital appreciation, risk liquidity, Marketability, tax
benefit, Debentures has high return but low risk liquidity and marketability. Bank deposits have
moderate returns but low capital appreciation and risk liquidity.

(Jain B. , 2012) in an article “A study on investors’ attitude towards mutual funds as an

investment option” from International Journal of Research in Management has reiterated the
need for spreading the awareness about Mutual Funds among common masses. There is a strong
need to make people understand the unique features of investment in Mutual Funds. From the
existing investors point of view the benefits provided by mutual funds like return potential and
liquidity have been perceived to be most attractive by the invertors’ followed by flexibility,
transparency and affordability.

(Mishra & Kumar, 2011) The study here is how mutual fund investors objectively influence
their knowledge about information retrieval and processing behavior. In this article they are
objective knowledge i, e, what is actually stored in memory, subjective knowledge, ie how
individuals affect different things how information retrieval and processing information behavior
I tried to prove what to do.

(Professor & R.R.Karrupasamy, 2014) The research of mutual funds is considered to be one of
the best investments available to investors compared to other investors. Mutual funds, and
investors, can also buy stocks and bonds at much lower costs. This study shows that the majority
of the public selected for external research have implemented a variety of plans based on Sharp,
Trenol, and Jensen's performance measures

(Professor & R.R.Karrupasamy, 2014) The research of mutual funds is considered to be one of
the best investments available to investors compared to other investors. Mutual funds, and
investors, can also buy stocks and bonds at much lower costs. This study shows that the majority
of the public selected for external research have implemented a variety of plans based on Sharp,
Trenol, and Jensen's performance measures

(Chhabra & Mundra, 2014)The study state various invest options available with the investors. In
earlier time because of non availability of banking system investors use to keep hard cash, gold
and silver ornament, precious stones etc as savings. Now investment are made through bank,
insurance policies, mutual funds, pension funds, collective investment schemes, investment
clubs.

(Murty & Shastry, 2014) Investor’s choice with the objective of return optimization is
investment in the stock market instruments or securities. Stock market securities are affected by
various internal and external factors. Study examines the perception of small investment
investors towards returns on investment.
(Paunikar, 2014)Equity Linked Saving Schemes are similar to equity diversification schemes
with tax saving benefit under section 80C. The study aims at understanding scheme- wise
benefits under Equity Linked Saving Schemes for tax saving. Data analysis shows that Equity
Linked Saving Schemes has better returns on investments.

(Ng, 2011) This paper examines the influence of demographic and investment experience on
retirement planning intension. A data analysis reveals that investors at age of 20 to 29 are more
concern about investment for retirement. Singles invest more in EPF for retirement over the
married people.

(Mazumdar, 2014)Individuals invest rationally with intention of maximizing utility for given
level of risk. This study examines the relationship between investment behaviour and level of
knowledge. Financial knowledge leads to investing in different investment avenues such as
equity, gold, real estate, fixed deposits etc. study examines the aggressive investors, adverse
investors and moderate risk taker with the help of financial knowledge.

3. GAP OF THE STUDY:

From the literature reviewed, it is appear that there is still some gap in the research due to some
kind of issue like India is a country of savers and not much of investors. Only 2% per cent
participate in equity markets directly or through mutual funds, and there is almost zero direct
participation in bond markets. Mutual funds are subject to market risk. And It is difficult task
to select appropriate and suitable financial securities for investment to generate higher returns.
There would be a Inflation risk if a company’s value could drop because it’s hurt by rising
inflation, thus diluting its worth.

4. OBJECTIVES OF THE STUDY

4.1 Primary Objective:

 To understand risk and return of the various schemes.

 To help an investor to make right choice of investment, while considering the inherent
risk factors.
 To understand risk and return of the various schemes and the resent trends in the Mutual
Fund world.

4.2 Secondary Objective:

Our secondary objective is to study the approach of investors towards mutual funds and other
investment schemes and the behavior of the investors for preferring mutual funds and other
schemes. It is also to understand the resent trends in the Mutual Fund world.
5. REASEARCH METHODOLODY:

5.1 SCOPE OF THE STUDY:

 This study will help the people to know best investment options available in today’s world.
 This study will clear out the differences between mutual funds and other investments options.
 This study will also help to better understand the industry of mutual funds.
 This study will determine the risk percentage involved in other investment instruments and
mutual funds.
 This study will help to find what is people’s perception towards investing in mutual funds as
compared to other traditional investment instruments.

5.2 RESEARCH DESIGN:

 Descriptive research design

5.3 DATA COLLECTION METHOD:

(1) PRIMARY DATA

 Data collected through questionnaire.

(2) SECONDARY DATA

 Data collected from various sites.

5.4 SAMPLING PLAN:

5.4.1 Population:
People of Ahmedabad

5.4.2 Sampling Method:

Convenient sampling method

5.4.3 Sampling size:

Sample size is 100

CONCLUSION:
The Indian capital market having a long history spanning over a century has passed through the
most radical phases. It has witnessed extraordinary developments and innovations during the
nineties. One such development was the improved role of the mutual funds in financial
intermediation. Mutual funds in India have fast emerged as an important instrument of household
savings. Due to the flexibility and variety available in them they have the potential to rival
traditional money saving instruments by attracting household sector or retail investor’s savings.
India has been amongst the fastest growing markets for mutual funds since 2004, witnessing a
CAGR of 29 % in the five-year period from 2004 to 2008 (though period of 2008–10 saw a
decline due to global crisis) as against the global average of 4 %. The increase in revenue and
profitability, however, has not been proportionate with the AUM growth in the last 10 years.
Low share of global assets under management, low penetration levels, limited share of mutual
funds in the household financial savings and the climbing growth rates in the last few years that
are amongst the highest in the world, all point to the future scope of growth for the Indian mutual
fund industry.The study shows that there have been drastic upward movements in the NAVs,
which show that they have performed very well in terms of their market value. It can also be
concluded that mutual funds in India are becoming better and better in handling market and fund
specific risk both. The more experience they are gaining in the economy.

REFERENCES:

B. N., & J. K. (2012). to analyses the difference in perception of investors in decision of

investing on the basis of age and gender.

Chhabra, G., & Mundra, A. (2014). study various invest options available with the investors.

Jain, B. (2012). to reitered the need for spreading the awareness about mutual funds among
common masses.

Jain, P. (2012). to nalyses the various investment avenues available for the investors.

Jain, R. (2014). to Investment is the consumption and saving opportunity in future expressed in
monetary terms.

L.Pandiyan, & T.Aranganatham. (2012). to make the decision process on savings and
investment.
Mazumdar, S. (2014). individual invest retionally with intention of maximizing utility for given
level of risk.

Mishra, S. K., & Kumar, M. (2011). to find out how mutual fund investors influence their
knowledge .

Murty, T., & Shastry, P. (2014). choice with the objective of return optimization.

N. G., & M. R. (2011). to Examines the factors responsible for investment behaviour of people
and different investment options available. .

N. S., & S. V. (2013). to analyses various avenues of investment such as Government deposits,
bonds, real estates, post office.

Ng, T.-H. (2011). to examines the influence of demographic and investment experience.

Odomenem. (2013).

P. V., & R.R.Karrupasamy. (2014). reseach of mutual fund is considered to be one of the best
investments compared to other investors.

P. V., & R.R.Karrupasamy. (2014). to research of mutual fund is considered to be one of the best
investment available compared to other investors.

Paunikar, N. (2014). Equity linked saving schemes are similar to equity diversification schemes.

S. P. (2014). To Investment and savings are two different things.

Srividhya, N., & S. V. (2013). To analyses various avenues of investment such as Government
deposits, bonds, real estates, post office.

Tare, U., & Mehta, V. (2012). to analyze that the large number of investment outlets are
available to investor. .

UjwalaBairagi, & CharuRastogi. ( 2013). To The study states the Household investors preferred
investments in Bank Deposits.

Vyas, R. (2012). to form of investment preffered by investors.