1

PROJECT REPORT

ON

A Study on Mutual funds and Investor awareness

BY

H V KAVANA

1NH20BA053

Submitted to

DEPARTMENT OF MANAGEMENT STUDIES

NEW HORIZON COLLEGE OF ENGINEERING,

OUTER RING ROAD, MARATHALLI,

BENGALURU

In partial fulfilment of the requirements for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

Under the guidance of

Prof. A. R Sainath Ph.D.

2020-2022.

2

DEPARTMENT OF MANAGEMENT STUDIES

CERTIFICATE

This is to certify that H V KAVANA bearing USN 1NH20BA053 (2020-22 batch), is a bonafide

student of Master of Business Administration, New Horizon College of Engineering, Bengaluru

affiliated to Visvesvaraya Technological University, Belagavi.

Project report on “A Study on Mutual funds and Investor awareness” is prepared by her under

the guidance of Prof. A R Sainath, in partial fulfillment of the requirements for the award of the

degree of Master of Business Administration of Visveswaraya Technological University, Belagavi,

Karnataka.

Signature of Internal Guide Signature of HOD Principal

Name of the Examiners with affiliation: Signatures with date

1. External Examiner

2. Internal Examiner

3

DEPARTMENT OF MANAGEMENT STUDIES

CERTIFICATE

This is to certify that H V KAVANA (1NH20BA053), student of MBA from New

Horizon College of Engineering, Bangalore has completed freelance project work

from 16th March 2022 to 18th May 2022.

Project report on “A Study on Mutual funds and Investor awareness” is prepared by her

under the guidance of Prof. A R Sainath, in partial fulfillment of the requirements

for the award of the degree of Master of Business Administration of Visveswaraya

Technological University, Belagavi, Karnataka.

We wish him successful career in life.

Signature of Internal Guide

4

DECLARATION

I, H V KAVANA, hereby declare that the project report at “A Study on Mutual funds and

Investor awareness” prepared by me under the guidance of Prof. A.R. Sainath, faculty of M.B.A

Department, New Horizon College of Engineering.

I also declare that this project report is towards the partial fulfilment of the university regulations

for the award of the degree of Master of Business Administration by Visvesvaraya Technological

University, Belgaum.

I have undergone a project for a period of Eight weeks. I further declare that this report is based on

the original study undertaken by me and has not been submitted for the award of a degree/diploma

from any other University / Institution.

Signature of Student

Place: Bangalore

Date:

5

ACKNOWLEDGEMENT

The successful completion of the project work would not have been possible without the guidance

and support of many people. I would like to express my gratitude towards respected principal Dr.

Manjunatha and Head of Department of management studies Dr. Sheelan Mishra.

I am thankful to my internal guide Prof. A. R. Sainath, Ph.D, for his constant support and inspiration

throughout the project and invaluable suggestions, guidance and also for providing valuable

information.

Finally, I express my gratitude towards my parents and family for their continuous support during

the study.

H V KAVANA

1NH20BA053

6

TABLE OF CONTENTS

SL. NUMBER CONTENTS PAGE NUMBERS

Executive Summary 07

1 Introduction 08 – 14

2 Review of Literature 15 – 19

3 Industry Profile 20 – 26

4 Theoretical Background of the study 27 – 29

5 Analysis and Interpretation 30 – 48

6 Findings, Suggestions and Conclusion 49 – 52

Bibliography 53 – 54

Annexure 55 - 60

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EXECUTIVE SUMMARY

In few years Mutual Fund has emerged as a tool for ensuring one's financial well being. Mutual

Funds have not only contributed to the India growth story but have also helped families tap into the

success of Indian Industry. As information and awareness is rising more and more people are

enjoying the benefits of investing in mutual funds. The main reason the number of retail mutual fund

investors remains small is that nine in ten people with incomes in India do not know that mutual

funds exist. But once people are aware of mutual fund investment opportunities, the number who

decide to invest in mutual funds increases to as many as one in five people. The trick for converting

a person with no knowledge of mutual funds to a new Mutual Fund customer is to understand which

of the potential investors are more likely to buy mutual funds and to use the right arguments in the

sales process that customers will accept as important and relevant to their decision.

This Project gave me a great learning experience and at the same time it gave me enough scope to

implement my analytical ability. The analysis and advice presented in this Project Report is based

on market research on the saving and investment practices of the investors and preferences of the

investors for investment in Mutual Funds.

This Report will help to know about the investors' Preferences in Mutual Fund means Are they prefer

any particular Asset Management Company (AMC), Which type of Product they prefer. Which

Option (Growth or Dividend) they prefer or Which Investment Strategy they follow (Systematic

Investment Plan

The first part gives an insight about Mutual Fund and its various aspects, the Company Profile,

Objectives of the study, Research Methodology. One can have a brief knowledge about Mutual Fund

and its basics through the Project.

The second part of the Project consists of data and its analysis collected through survey done on 100

people. For the collection of Primary data I made a questionnaire and surveyed of 100 people. I also

taken interview of many People those who were coming at the SBI Branch where I done my Project.

I visited other AMEs in Dehradun to get some knowledge related to my topic. I studied about the

products and strategies of other AMCs to know why people prefer to invest in those AMCS. This

Project covers the topic "MUTUAL FUNDS AND INVESTOR AWARENESS" The data collected

has been well organized and presented. hope the research findings and conclusion will be of use.

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CHAPTER 1

INTRODUCTION

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INTRODUCTION

A common asset is an expertly overseen type of aggregate ventures that pools cash from numerous

financial backers and puts it in stocks, securities, momentary currency market instruments, or

potentially different protections. In a common asset, the asset supervisor, who is otherwise called

the portfolio director, exchanges the asset's underlyin g protections, acknowledging capital

increases or misfortunes, and gathers the profit or interest pay. The venture continues are then

given to the singular financial backers.

The worth ofTa portion of the common asset, known as the net resource esteem per share (NAV) is

determined day to day founded on the complete worth ofTthe reserve partitioned by the quantity of

offers as of now given and remarkable.

Common asset is a trust that pools the reserve funds of various financial backers who share a

typical monetary objective. This pool ofTmoney is put resources into understanding with an

expressed goal. The joint proprietorship ofTthe reserve is accordingly "Common", i.e., the asset has

a place with all financial backers. The cash hence gathered is then put resources into capital market

instruments like offers, debentures and different protections. The pay procured through these

speculations and the capital appreciations acknowledged are shared by its unit holders in extent the

quantity of units possessed by them. In this way, a Mutual Fund is the most reasonable venture for

the everyday person as it offers a valuable chance to put resources into an enhanced, expertly

oversaw bushel ofTsecurities for a moderately minimal price.

A Mutual asset is and speculation instrument that permits little financial backers admittance to a

well - broadened arrangement of values, bonds and different protections. Every investor partici

pates in the addition or loss of the asset. Units are given and can be reclaimed as n eeded. The

asset's Net Asset esteem (NAV) is resolved every day.

Interests in protections are spread across a wide cross-segment ofTindustries and areas and

subsequently the gamble is decreased. Enhancement decreases the gamble since all stocks may not

move in a similar course in a similar p roportion simultaneously. Shared store issues units to the

financial backers in accordanc e with quantum of cash contributed by them. Financial backers

ofTmutual reserves are known as unit holders.

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At the point when a financial backer buys in for the units of a common asset, he turns out to be part

proprietor of the resources ofTthe reserve in similar extent as his commitment sum set up with the

corpus (the aggregate sum of the asset). Common Fund financial backer is otherwise called a

common asset investor or a unit holder. Any adjustment of the worth of the speculations mama de

into capital market instruments, (for example, shares, debentures and so on) is reflected in t he Net

Asset Value (NAV) of the plan. NAV is characterized as the market worth of the Mutual Fund

plan's resources net of its liabilities. NAV of a plan is cal culated by partitioning the market worth

of plan's resources by the all out number of un its given to the financial backers.

GROWTH OF MUTUAL FUNDS

The Indian Mutual Fund has gone through three stages. The principal stage was wagered ween 1964 and

1987 and the main player was the Unit Trust of India, which had an all out resource ofTRs. 6,700 crores

toward the end ofT1988. The subsequent stage is betwe en 1987 and 1993 during which period 8 Funds

were laid out (6 by banks and

one each by LIC and GIC). The all out resources under administration had developed to 6 1,028 crores

toward the finish of 1994 and the quantity of plans was 167.

The third stage started with the passage ofTprivate and unfamiliar areas in the Mutual Fund industry in

1993. Kothari Pioneer Mutual Fund was the main Fund to be es

tablished by the confidential area in relationship with an unfamiliar Fund. As toward the end ofTfinancial

year 2000(31st walk) 32 Funds were working with Rs. 1, 13,005 crores as complete resources under

administration. As on august end 2000, there were 33 F unds with 391 plans and resources under

administration with RS 1,02,849 crores.

The protections and Exchange Board ofTIndia (SEBI) emerged with far reaching guideline in 1993 which

characterized the construction ofTMutual Fund and Asset Manage ment Companies interestingly. A few

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confidential areas Mutual Funds were laun ched in 1993 and 1994. The offer ofTthe private players has

risen quickly since t hen. Right now there are 34 Mutual Fund associations in India overseeing 1,02,000

crores.

Significance OF THE STUDY

Common assets give a large group of advantages which make them significant. How about we take a

gander at the significance ofTmutual assets as recorded underneath.

Comfort:

For financial backers, quite possibly the most noticeable advantages that common asset give is con

venience. By putting resources into a solitary asset, they can get to an expansive scope of the monetary

market. An ordinary expanded value asset can fan out the cash across many stocks with some piece put

resources into fixed pay protections too.

Broadening:

Further, to zero in on one fragment ofTthe market, for example, huge

cap stocks, reserves zeroed in on this section can fan out the speculation across m ultiple enormous

cap stocks in only one exchange ofTpurchasing the asset. In the event that the financial backer were to

attempt to do that without anyone's help, it would require a great deal of exertion, exchange cost, and

time

to make a singular enormous

cap stock portfolio. The circumstance with putting resources into securities is considerably more

troublesome in the event that one attempts to do it separately as opposed to taking the asset course.

Simplicity Of Investment:

Aside from this, shared reserves are not difficult to trade. One can either connect with th e administrations

ofTa wholesaler or specialist to execute in reserves or do it over the actual web. On account of last, the

exchange sum is charged from or come

s straightforwardly to the financial balance connected to the common asset account contingent upon w

hether an asset has been traded.

Spoilt For Choice:

This element follows from the comfort perspective talked about above. Financial backers have s everal

decisions with regards to common assets. What's more, given their speculation objectiv es, reserves give

admittance to a wide reach ofTfinancial instruments, areas, and stra tegies.

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Proficient Management:

This is one of the variables, which is a critical feature of the significance of shared reserves. Because of

need ofTexpertise a few financial backers don't have the trust in taking the monetary market course to

develop their riches. They believe they have restricted or no capacity to put resources into stocks and

bonds all alone and don't have the ti me to continue to follow their ventures even ifTthey figure out how

to contribute all alone.

Common finances take care ofTthis issue by giving the mastery of the asset manag er and their group

ofTanalysts, which play out the investigation ofTfinancial markets and instruments consistently. They

charge an expense for their expert administrations, w

hich are packaged into the cost proportion of a common asset.

Some asset supervisors likewise put resources into the equivalent fund(s) that they make due, in this way

makin g them responsible for their exhibition; they have a stake in the asset doing we ll. This mastery and

involvement with cash the board make shared reserves an incredible

vehicle for financial backers.

This expects a great deal of significance for financial backers as by effective money management

negligible investment, they can change it up of instruments to their speculation portfolio.

Sorts OF MUTUAL FUNDS

Value Funds

Stock assets, additionally called value reserves (putting resources into public instead of p rivately-

possessed organizations), are the most unstable of the three, with their worth at times r ising and falling

strongly over a brief period.

Fixed Income Funds

Security reserves, otherwise called fixed pay, put resources into corporate and government obligation

with the reason ofTproviding pay through profit installments. Security reserves are many times

remembered for a portfolio to support a financial backer's complete return, by giving stea dy pay when

stock assets lose esteem.

Currency Market Funds

Currency market reserves have somewhat low dangers, contrasted and other common assets and most

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different ventures. By regulation, they are restricted to putting just in unambiguous

top caliber, short-

term ventures gave by the U.S. government, U.S. companies, and state and l ocal state run administrations.

NEED FOR THE STUDY

The primary motivation behind doing this undertaking was to be aware of shared reserve and its f

unctioning. This assists with knowing in insights concerning common asset industry right from it s

beginning stage, development and future possibilities.

It likewise helps in understanding various plans ofTmutual reserves. Since my stud y relies on

unmistakable assets in India and their plans like value, pay, b alance as well as the profits related with

those plans.

The task study was finished to learn the resource assignment, section load, leave load, related with the

common assets. At last this would help in understanding.

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SCOPE OF THE STUDY

In my venture the extension is restricted to a few conspicuous common supports in the shared asset

industry. I examined the assets relying upon their plans like value, pay, balance. However, there is

such countless different plans in shared reserve industry like particular (banking, framework, drug

store) reserves, record reserves and so forth.

My review is principally focused on value plots, the profits, in pay conspire s the rating ofTCRISIL,

ICRA and other credit score offices.

OBJECTIVE

• To give a briefTidea about the advantages accessible from Mutual Fund speculation

• To give a thought of the sorts of plans accessible.

• To examine about the market patterns ofTMutual Fund venture.

• To concentrate on some ofTthe common asset plots and break down them

• Notice the asset the board cycle of shared reserves

• Investigate the new advancements in the shared assets in India

• To give a thought regarding the guidelines of common assets

Limits

• The time requirement was one ofTthe serious issues.

• The review is restricted to the various plans accessible under the common finances s chose.

• The review is restricted to chosen shared store plans.

• The absence of data hotspots for the investigation part.

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CHAPTER 2

REVIEW OF LITERATURE

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Proclamation OF THE PROBLEM

The common asset plans are more unique in the current situation. The principal justification for

financial backers to put resources into different common asset plans is to get more significant yields

by money management doable sum. Be that as it may, there are numerous Indian common asset plans

with various gamble factors. In this way, it is an issue for financial backers to perceive viable plans

to put away their cash.

Goals:

• To figure out the conduct part of individual financial backers predominantly their venture

mode and their determination conduct.

• Factors affecting their way of behaving and their mindfulness level concerning shared

reserves.

NEED FOR THE STUDY:

The exploration includes just a general report connected with the speculation Awareness of financial

backers towards common assets. The exploration would uncover results in regards to the Investment

Awareness of different financial backers about shared assets and accordingly thusly, assists the

association with distinguishing the cosciousness of different financial backers and to work on the

showcasing of common asset.

Extent OF THE STUDY:

This concentrate essentially endeavors to comprehend the mindfulness level of the singular financial

backer. The concentrate likewise attempts to figure out the venture inclination, famous sort of shared

reserve plans, contemplations of financial backers while putting resources into common supports

examination between financial backers inclination of common asset speculation and other venture

choice and distinction between financial backers conduct in Bangalore city.

RESEARCH METHODOLOGY:

⮚ Inspecting SIZE:

0.02% percent of Bangalore city populace is taken for inspecting

⮚ Wellsprings OF DATA:

Essential: The review depends on essential information. Essential information will be gathered by

poll and study strategy.

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⮚ Devices FOR DATA ANALYSIS

SPSS Software and MS succeed.

Writing Review:

1. "An observational investigation on view of financial backers towards different venture roads":

G. Velmurugan, V. Selvam, N. Abdul Nazar

This observational review is an endeavor to grasp the different view of financial backers on various

roads especially in Tamil Nadu, Vellore city.

The review educates us concerning the different open doors for normal and little financial backers

towards different speculation roads and furthermore shows the fast development in venture

businesses, and speculation procedures of financial backers and furthermore the development

unfamiliar support. All through the review we run over the which are the protected venture regions

and furthermore shows the mindfulness and impression of financial backers in Vellore city towards

M.F and other venture roads.

2. "An venture choice according to financial backers perspective":

Mr. Jay R. Joshi.

For a financial backer to put his cash in different venture roads there are different elements that should

be considered for speculation choice. The fundamental focal point of these review is to realize about

the financial backers view and inclination towards common assets. This study is made through target

populace in Anand - Vidyanagar western province of Gujarat (India) by reviews. Shared reserve has

become significant entryway for little financial backers and assumes a colossal part in Indian

economy. The consequence of these review shows us about the primary purposes behind financial

backers putting resources into shared assets and attempt to figure out the variables that financial

backers is thinking before interest in common asset organization.

N. Geetha and Dr. N. Ramesh (2011).

There are parcel of decisions for speculation however one should choose the proper decision.

Individuals who are managing speculation should know the monetary preparation and how to pick

the venture which can achieve

3. "Research on individuals' inclination for venture conduct":

generally goals. The subtleties of making putting resources into different speculation roads in

different ways must be kept up with and oversaw so the inclination of venture is to be clear for

individuals. The review is settled on individuals' decision on Kurumbalur and information is gathered

18

through surveys and information is examined through chi - square method.

4. "A concentrate on status of mindfulness among common asset financial backers in Tamil

Nadu":

G. Prathap and Dr. A. Raja Mohan.

Shared reserves have become significant benefiter for both family and monetary business sectors

especially in value market. Through this study we comprehend how common asset is giving fluid,

minimal expense partakes in expanded arrangement of monetary resources chose by proficient

directors and furthermore attempt to comprehend how individuals has their mindfulness towards

speculations and determination conduct among different offers and other venture roads that are

accessible in the monetary market.

5. "Research on Understanding Individual Investors' Awareness Level and Choice Behavior of

Indian Mutual Fund Plans":

Dr. Rajesh Arora (2013).

After autonomy India took on the arranged improvement of five years monetary arrangement for

every one of the financial backers and that necessary tremendous capital inflows both from both

inside and outside the country. Inflows which were required is to be regarded with market based

identical returns. In 1992 Indian government began different monetary changes and furthermore

opened global market around the same time, this made India more appealing for different

speculations. The review educates us concerning the how individual financial backer conduct changes

as per the monetary market and furthermore the way in which they figure out the market and pick the

venture more or pull out the past speculations made in shared store and other monetary roads and

furthermore shows the consequence of understanding and dissecting financial backers conduct and

impacts on monetary business sectors.

6. "Financial backers' Investment in Mutual Funds: A Comparative Study in the Telangana

Region of Andhra Pradesh":Prof. Mohd Akbar Ali Khan and A. Kotishwar (January 2013).

By knowing the perspective of the client is significant in any industry. It likewise gives conduct and

assumptions from industry players. In beyond couple of years India has seen fast development in

common asset industry in both public and confidential area. The review breaks down whether there

is any connection between segment profile of the financial backers and elements that financial backers

think prior to putting resources into any common asset plans among private and public area. The

central point that impact the financial backer to choose the option among public and confidential area

is recognized by leading overviews among arbitrarily chose people and the review uncovers that

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the financial backers discernment is reliant upon segment profile surveys, age, conjugal status and

schooling is immediate effect on the decision of interest in monetary roads. It additionally uncovers

that not more number female financial backers are not taken advantage of the ventures and even there

is low objective on higher pay bunch individuals. The consequences of this study show the variables

which are affecting the financial backers and uncovers which are the higher effect on view of the

financial backers.

7. "Indian financial backers discernment towards common assets":

Dr. Nishi Sharma (Aug 2012).

The idea of shared reserve arose in India by Unit Trust of India in 1960s. As shared store industry

gives different choice of broadened speculation structure for Indian financial backers. It's mostly

acquainted with tap reserve funds of everyday person except by and by it got neglected to turn into

an essential venture decision of the average person. During the time span shared reserve acquainted

with till now industry had encountered extraordinary reserve funds contrasted with created nations

consistently is a common asset holder and item couldn't get a lot of prominence in India. Concerning

this, the review has been made to know why in India MF has not become essential venture and what

is the impression of the normal individual towards this monetary industry and looks at financial

backers discernment regarding many highlights by MF organization to draw in the financial backers

for effective money management reserves.

7. "Grasping the Investment Behavior of Individual Investors in Mutual Funds" (from Investor

Research on the northern shoreline of Andhra Pradesh):Dr. K. Rakesh and Mr. V S M Srinivas (2013).

After 1990 changes in India there was a tremendous change in the economic situation where new

monetary firms got acquainted in with the market to build the venture choice for little and enormous

financial backers. As common asset industry and other monetary roads acquainted venture example

and plans with draw in the financial backers and furthermore noticed the conduct change in financial

backers. Regarding this the review found the space of monetary gamble changed returns and monetary

preparation, financial backers conduct so on. Be that as it may, there wasn't any huge review to be

familiar with the financial backer's discernments towards interest in chosen portfolios, on the grounds

that every individual has their own insight towards speculations and there exists a hole in the

exploration. Thusly, there should be a legitimate report to be directed to figure out the conduct

components and to distinguish the financial backers mentality towards speculations. Consequently to

satisfy the hole the accompanying review has been started.

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CHAPTER 3

INDUSTRY PROFILE AND COMPANY

PROFILE

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INDUSTRY PROFILE

SBI shared reserve was arrangement on June 29th, 1987 and consolidated on February seventh, 1992.

It is an outcome ofTjoint adventure between State Bank of India and Society Generale Asset

Management of France. This is a bank supported common asset and ha s a base ofT3.5 million

financial backers (approx.). Throughout the long term it has cut a specialty for itselfTthrough

reasonable speculation choices and reliable abundance creation for its

clients. They offer Mutual Fund items in Equity Funds, Index Funds, Balanced Funds, Debt reserves

and so on.

The resources under administration are Rs 33,727.90 crores as of June, 30, 2010.

Venture Yogi examinations the best performing SBI common asset in the Balanced Fund,

Equity Fund and Equity Linked Savings Scheme (ELSS) classifications.

SBI Mutual Fund works under State Bank of India and Society Generale Asset Management of France

and has resource the board insight of over 25 years. SBI Mutual Fund offers various types of items

like development based items, pay based items and adjusted reserves.

The SBI Mutual Fund works under State Bank of India and Société Générale Asset Management of

France. With north of twenty years of involvement with resource the board, the organization has

developed monstrously since its foundation. SBI Mutual Fund s offer inventive common asset items

to its wide pool of clients and its master conduits are accessible across India. It has wide arrangement

of items that meet the necessities of various kinds of financial backers. The SBI Mutual assets is

going by Mr. Syed Shahabuddin, overseeing head of the ofTthe organization.

,

KEY INFORMATION OF SBI MUTUAL FUNDS

Setup date

Jun-29-1987

Incorporation date Feb-07-1992

Sponsor State Bank of India

Trustee SBI Mutual Fund Trustee Company Priva

CEO Mr. Vinay M. Tonse

Head Compliance and Company Secretary Vinaya Datar

Asset Managed 5,04,455.21 crore

Custodians Computer Age Management Services Pvt.L

Corporate Office SBI Funds Management Pvt Ltd. Cuffe p arad

15

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Customer service 18002093333

SBI Mutual fund schemes SBI Equity Funds

SBI Equity Funds are curated for long-

term capital appreciation through investment in extensively researched shares and st ocks of top-

rated companies. The funds are picked based on the consistency of performance an d are

designed for generating high returns. These funds are high-

risk funds and require careful consideration before investing.

Fund Name

Risk

5-

year

Ret

urn

Objective

BI Magnum

Midcap Fun

d

Moder

ately

High

24.08

The fund provides long-

term growth opportunities to its investors with th e

liquidity of an open-

ended scheme. Investors can invest primarily in e

quity stocks of midcap companies that is well di versified.

BI Magnum

Multicap F

und

Moderat

ely High

19.88

The fund allows investors the prospects of long- term

growth in their capital through an active management of the

investments that carry the liquidity of an open-

ended scheme. The fund is diversified in its offering with

equity stocks, debts and money market instruments.

BI Bluechip

Fund

Moderat

ely High

16.97

he SBI Blue Chip Fund is an actively managed, a well-

diversified fund comprising large-

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cap equity stocks that offer investors long-

term growth opportunity.

BI Magnum

Equity ESG

Fund

High

14.01

Aimed at long-

rm growth, the fund comprises a diversified set of

stocks from sectors like Environmental, Social

, and Governance, etc.

SBI Large

& Midcap F

und

Moderat

ely High

18.46

The fund provides opportunities for capital appreciation

int he longer run by investing in well- diversified large

and mid-cap companies.

SBI Tax Saving Funds

SBI Tax Savings Funds are aimed at encouraging the habit of saving by investing in equity

shares that provide tax deductions under Section 80C of the Income-

tax Act. These are diversified equity mutual funds that have a lock- in period of 3 years.

Tax Saving Fund

Name

Risk

5-

year

Re

turn

Objective

SBI Magnum Tax

Gain Scheme

Moderat

ely High

15.01

The scheme offers the benefit of investment in a portfolio of

equity shares, with tax deduction benefits

under Section 80C of the Income-

x Act, 1961. Depending on distributable surplus, it seeks to

distribute income periodically, with a lock

-in period of 3 years.

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SBI Debt Funds

SBI Debt Funds offer a safer investment option to the more risk- averse investor. These funds with

comparatively lower return prospects come in various short-term fixed income security options like

commercial papers, government bonds, treas ury bills and certificates of deposits.

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20

ABOUT SBI MUTUAL FUNDS

SBI MF has been credited with successfully managing the country’s offshore funds since the year

1988. The SBI Funds Management is also one of the first banks

to come up with an offshore fund. The aim ofTthe SBIMF is to offer its investor s the opportunity

for long-term growth in a diverse array of stock of Indian companies. The dedicated fund house is

known for its enterprising approach to risk-management backed by a highly experienced risk

management team and financial e xperts. The SBI mutual funds are constructed with the help of

extensive investmen t research to outperform the industry benchmarks. The Fund House also

engages in an active management style to achieve this. The schemes that are offered are as

diverse as can be and the blend of the products – large, mid and small cap or sector specific, are

designed to leverage the growth opportunities of Indian equities. There are several benefits of

investing in SBI Mut ual Funds:

▪ The SBI Funds Management has comprehensive experience and expertise and is one of the

major advisers to pension funds, financial institutions and asset management companies.

▪ The products offered are picked based on empirical research and potential, a nd for the most

part, carry a CRISIL rating of three or more.

▪ SBIMF over the years has excelled at understanding the objective and needs of its investor

and has catered to their risk-return expectations.

▪ There is a wide spectrum of funds that SBI offers, to suit investors’ appetit e for high to

moderate to low risk.

▪ Depending on your personalized requirements, you can pick from a wide ra nge of customized

investment plans to meet your investment needs.

▪ SBI MF offers both domestic funds and offshore funds.

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COMPETITORS OF SBI MUTUAL FUNDS

Some of the main competitors ofTSBI Mutual Fund in India

▪ ICICI Mutual fund

▪ Reliance Mutual Fund

▪ Birla Mutual Fund

▪ Kotak Mutual Fund

▪ HDFC Mutual Fund

▪ LIC Mutual Fund

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THREE TIER STRUCTURE OF MUTUAL FUNDS

In India, the structure of Mutual Funds is a three-

tier structure with a few other significant components. It is not just the different banks or AMCs

that create or float different mutual fund schemes; instead, there a re other players that are

involved in the structure of mutual funds. The primary w atchdog in all these transactions is the

Securities Exchange Board ofTIndia (‘SEBI’

) under whom each entity is required to be registered with. The inception of SEB I (Mutual Funds)

Regulations, 1996, revolutionized the structure of mutual funds an d since then all the entities

are regulated under it. Currently, mutual funds compri se of five basic participants, namely a Sponsor,

Mutual Fund Trustee, Asset Mana gement Company, Custodian & Registrar and a Transfer Agent.

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Sponsor

A sponsor is any person or entity that can set up a mutual fund scheme to gener ate income through

fund management. The sponsor can be said as the first layer of the three-tier structure of mutual

funds in India. The sponsor is required to approach SEBI and get a mutual fund scheme approved.

The sponsor cannot work alone. It needs to create a Public Trust under the Indian Trust Act 1882 and

get the same regis tered with SEBI. Once the trust is created, the Trustee is registered with

SEBI an d is appointed as the trustee of the fund in order to safeguard the interest of the unit holders

and to adhere the SEBI Mutual Fund regulations. The Sponsor subsequently creates an Asset

Management Company under the Companies Act, 1956 to deal with the fund management. There are

certain eligibility criteria to become a Sponsor, as prescribed under:

24

➢ The Sponsor must have profit in 3 of the last 5 years including immediately p receding year.

➢ The Sponsor must have a minimum of 5 years of experience in financial services.

➢ The net worth of the Sponsor must be positive for all the preceding five years.

➢ Out of the total net worth of the AMC, 40% must be participated by the Sponsor.

As seen above, the position of a Sponsor is crucial and they should have high credibility. Strict norms

show that the sponsor must have enough liquidity and faithfulness to return the money of an innocent

investor, in case ofTa financial meltdown.

Trust And Trustees

Trust and trustees make up the second layer of the structure of mutual funds. Tru stees are also known

as the protectors of the fund and are employed by the fund sponsor. As the name suggests, they

have a very important role in maintaining t he trust of the investors and to oversee the growth

of the fund. SEBI mandates t he trustees to provide a report on the fund and the functioning of

the AMC on a half- yearly basis. Trustees can be created either in the form of Board of Trustees or

a Trust Company. The Trustees supervise the entire functioning of the AMC and regulate the

operations of the mutual fund schemes. The SEBI has tightened the rule of transparency so as

to avoid any conflict of interest between the Sponsor and the AMC. Without the permission and

approval ofTthe Trust, an AMC cannot flo at a new mutual fund scheme. It is important for

the Trustees to act independentl y and take appropriate measures to safeguard the hard- earned

money of the investors. The Trustees are also required to be registered und er SEBI, and SEBI

further regulates their registration by either suspending or revo king the registration if found

breaching any conditions.

Asset Management Company

An AMC is the third working layer in the structure of mutual funds. An AMC fl oats various schemes

of mutual fund in the market, pursuant to the needs of the investors and the nature of the market.

They create mutual funds along with the t rustee and the sponsor and then oversee its

development. While creating the schem e, they take help of bankers, brokers, RTAs auditors

etc. and enter into an agree ment with them. An AMC is a company formed under

Companies Act and needs to be registered under SEBI. Similar to the Trustees, an AMC also

25

needs to ens ure that there is no conflict of interest amongst them, the sponsor and the trustees

Other Participants In The Structure Of Mutual Funds

Custodian

A Custodian is an entity, which is responsible for the safekeeping ofTthe securities. Custodians are

registered with SEBI and are responsible for the transfer and deli very of units and securities.

Custodians also enable investors in updating their hold ings at a particular point ofTtime and help

them in keeping track of their investm ents. Along with the primary job of safekeeping, custodians

are also in charge of the collection ofTcorporate benefits such as bonus issue, interest, dividends etc..

Registrar And Transfer Agents

RTAs are an important link between fund managers and investors. They cater to t he fund managers

by updating them with the investor details and to investors by delivering the benefits of the fund

to them. RTAs are SEBI registered entities wh o process the applications of mutual funds, help

with investor KYC, manage and deliver periodical statements of investments, update records of

investors and process

investor requests. Link-

in time, Karvy etc. are some of the famous RTAs in India and they provide the requisite operational

support to the AMC in mutual fund activities.

Other Participants

Some other participants in the structure of mutual funds are brokers, auditors, and bankers. The brokers

are responsible to attract investors and help to disseminate the fund. The brokers help investors in

sell, purchase of units and provide with their valuable advice. Brokers also study the market trend

and predict the future movement of the market. Unlike brokers, auditors are an independent

internal watchdog, who audit the financials of the AMC, Trustee, and Sponsor and provide their

report. Bankers are also an important participant, who act as collecting agents on behalf ofTthe fund

managers.

These are the participants who play a key role in the management of mutual funds. Each participant

has their individual role to play. However, their functions are i nterlinked with each other. Mutual fund

regulations are the bible by which all the participants are bound together, to perform

26

their functions more diligently and without prejudice to the interest of the investors.

Investment Management Process

Step 1: Contact a representative of SBI Mutual Fund or an empanelled distributor of SBI Mutual

Fund.

Step 2: Procure application and KYC form (if KYC procedure not completed) fro m website or

any branch of SBI Mutual Fund or empanelled distributor office.

Step 3: Fill the application/KYC (if applicable) form, provide necessary information i.e., name,

address, PAN, email address, mobile number, etc. This email address and mobile number will be

used for further communication, and can also be used

to register for online transaction services.

Step 4: Attach copies of relevant documents and submit them along with a chequ e or

demand draft of the desired investment amount.

Step 5: Submit duly signed application/KYC (if applicable) form(s), with the cheq ue and all

relevant documents, to any branch of SBI Mutual Fund or point of ac ceptance.

Step 6: SBI Mutual Fund will then allocate and provide you a folio number for that particular

investment. You will also receive an Account Statement, after the tr ansaction is processed.

27

CHAPTER 4

THEORETICAL BACKGROUND OF THE STUDY

28

A Market Research was performed to find out the actuality from the investors abo ut what they

think about the various Investment Options. It was done to find out the investment patterns and

behavior of the people i.e. how much they invest, w

hat are the reasons behind their investments, and where they invest.

Thus a questionnaire was devised to fetch the above mentioned information from t he investors.

Most of the questions in the questionnaires were objective in nature which helped the people to

fill it with utmost ease. The sample size for the resea rch was 100, which included all the classes

of people aged 18 and above. The q uestionnaire devised for them market research is attached to

the report as Annexure I.

Each question of the questionnaire is discussed on a separate page and the results are explained with

the help of graphs.

Data sources:

Research is totally based on primary data. Secondary data can be used only for th e reference.

Research has been done by primary data collection, and primary data has been collected by

interacting with various people. The secondary data has been

collected through various journals and websites and some special publications of SBI.

Sampling

The sample is selected in a random way, irrespective of them being investor or n ot or availing

the services or not. It was collected through mails and personal visi ts to the known persons, by

formal and informal talks and through filling up the questionnaire prepared. The data has been

analyzed by using the measures of centr al tendencies like mean, median, mode. The group has

been selected and the anal ysis has been done on the basis of statistical tools available.

29

Sample size:

The sample size ofTmy project is limited to only 100 only. Out of which only 8 8 attempted

all the questions. Other 12 are not investing in MF attempted basic q uestionnaire.

Sample design:

Data has been presented with the help of Bar graph, pie chart, line graph.

RESEARCH METHODOLOGY TABLE

Universe

1st floor, Baba Towers,162/158 6th Main Road, Diagonal Rd, 4th Block,

Jayanagar, Bengaluru, Karnataka 560011

Sample size

100 customers

Sample unit Customer visiting at SBI bank

Sampling

technique

Convenience sampling

Research design Descriptive

Collection of data Primary data through Questionnaires and interaction with customers

Secondary data

Internet

Duration

60 Days

30

CHAPTER 5

ANALYSIS AND INTERPRETATION

31

ANALYSIS AND INTERPRETATION OF DATA

1. Investigator age distribution

FINDINGS

Out of 100 investors 15% investors are below the age of 30 years, 45% investors are between 30-

40 years 40% investors are above the age of 40 years

32

2. investor Qualification

Graduation/PG 60

Under Graduate 15

Others 45

FINDINGS

Out of 100 investors 60% are graduate, 15% are under graduates and 15% are ot hers.

33

3. occupation of investors

Government service 40

Private service 20

Business 20

Agriculture 4

Others 16

FINDINGS

Out ofT100 investors 40 are in govt sector, 20 are in private sector, 20 are in b usiness, 4 from

agriculture, 16 investors are from various sectors.

34

4. Income distribution of investor

Below 100000 10

100,000-500,000 48

500,000-10,00,000 32

Above 10,00,000 10

FINDINGS

Out of 100 investor the income of 10 investor is below 100,000, 48 investor's inc ome is between

100,000-500,000, 32 investor income is between 500,000- 10,00,000, & 10 investor has their income

greater than.

35

5. Customer preference about type of investment

Fixed deposit 25

Insurance 15

Mutual Funds 30

Post Office/NSE 3

Share/Debenture 5

Gold/Silver 7

Real Estate 15

FINDINGS

Out ofT100 investor 30% are investing in Mutual funds, 15% are investing in Ins urance are

investing in Fixed deposits, 7% are in investing in gold, 15% are inve sting in real estate

,5% investing in share and debenture, & other are investing in

other instruments.

36

6. factor affecting while investing

Liquidity 15

Low risk 20

High return 60

Trust 5

FINDINGS

Out ofT100 investor 60% are investing due to high return, 20% are invest due to low risk, 15%

are investing due to liquidity and 5% due to trust in SBI.3

37

7. Awareness regarding mutual funds

Aware 70

Not Aware 30

FINDINGS

Out of 110 investor 70% are aware towards mutual funds, 30% are n ot aware

38

8. Medium to know about mutual funds

Advertisement 15

Peer Group 10

Banks 35

Financial advisors 10

FINDINGS

Out of those who invest in mutual funds( i.e 70 investor), 50% are know about mutual funds through

banks, 14% are from financial advisor, 22% are know throug h advertisement, & 14% from

peer groups

39

9. invested in mutual funds

Invested 60

Not invested 40

FINDINGS

Out of 70 investor 60% are investing and 40% are not investing.

10. Reason for not investment in mutual funds

Not Aware of MF 30

High Risk 21

Not any specification 0

40

FINDINGS

Out of those who don’t invest in MF 30 investor are not aware of m utual funds, 15

are not investing due to high market risk

11. Which mutual fund select while investing

SBI Mutual funds 15

UTI 4

HDFC 6

Relaince 2

Kotak 3

Other 0

41

FINDINGS

Out ofT30 investor 50% investor are investing in SBI MF, 20% investor are inves ting in HDFC,

13% are in UTI, 7% are in reliance, 10% are in kotak

12. If invested in SBIMF, you do so because

SBIMF is associated with State Bank of India 6

They have a record of giving good returns good returns year after year 7

Agent Advice 2

42

FINDINGS

Out of those who investing in SBI MF (i.e.15 investor) 40% are investing in SBI due to high

return 47% are investing due to the name ofTSBI and 13% are inv

esting from agent advice.

13. Not invested in SBIMF, you do so because

You are not aware of SBIMF 8

SBIMF gives less return compared to others 4

Agent advice 3

43

FINDINGS

Out of 15 investor 53% are not aware, 27% investor are investing du e to less

return and 20% are other not specific reason.

14. To invest your money in asset management co. which AMC will

you prefer?

Assets management co.

SBIMF 30

UTI 10

Reliance 15

HDFC 10

Kotak 12

ICICI 3

44

FINDINGS

Out of 80 investor 30 investor are preference SBI AMC, 10 are UTI, 15 are pref er reliance,

10 prefer HDFC, 12 investor prefer kodak and 3 are ICICI

15. Which channel will you prefer while investing in mutual fund

Financial advisor 15

Banks 40

AMC 15

45

FINDINGS

Out of 70% investor 57% are investing through banks, 21% are from AMC, 22% are from

financial advisor.

16. Mode of investment will you prefer

One time investment 30

Systematic investment plan 40

46

FINDINGS

Out of 70 investor 57 investor are investing in SIP, and 43%investor are investing

one time

17. Type of funds would choose

Having only debt portfolio 15

Having debt and equity portfolio 20

Only equity portfolio 35

47

FINDINGS

Out of 70 investor 50% investor are investing in debt and equity portf olio, 29% are

investing in hybrid fund, 21% investor are investing in debt portfolio.

18. willing to receive the returns every year

Dividend payout 10

Dividend re-investment 15

Growth in NAV 45

48

FINDINGS

Out of 70 investor 45 investor are like to receive return on growth in NA, 15 investors

like to receive dividend re-

investment and 10 investors lie to receive dividend payout.

49

CHAPTER 6

SUMMARY OF FINDINGS, SUGGESTION AND

CONCLUSION

50

FINDINGS

✓ According to my survey in Dehradun maximum numbers of investors falls in the age group

of 30-40 years. The second most Investors were in the age group of above 40 years and

the least were in the age group of below 30 years.

✓ According to my research in Dehradun most of the Investors were Graduate or Post Graduate

and below HSC there were very few in numbers.

✓ In annual Income group, between 100,000-500,000 were more in numbers invested in mutual

fund, the second most were in the Income group betweenRs.5- 10lakh and the least were in

the group of below Rs. I lakh.

✓ 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.

✓ Among 100 Respondents only 60% had invested in Mutual Fund and 40% did not have

invested in Mutual fund.

✓ Most of the investors did not invested in SBIMF due to unawareness of SBIMF,the

second most due to Agent's advice and rest due to Less Return.

✓ Out of 70 people, 43% preferred One Time Investment and 57% preferred SIP out of

both type of Mode of Investment.

✓ The most preferred Portfolio was Equity, the second most was Balance.

51

SUGGESTON

To regulate entry and exit loads effectively as it creates a lot of confusion during actual

settlement of costs and bills.

To better operations management so as to reduce the time lag and improve customer feedback.

To improve market penetration by targeting not only metros but mini- metros and smaller

towns more effectively.

To come up with more innovative schemes and products so as to expand over the largest

customer base as possible.

The most vital problem spotted is ofTignorance. Investors should be made aware of the

benefits. Nobody will invest until and unless he is fully convi nced. 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 off er. But most

of the people are not even aware of what actually a mutual f und 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 t ime. 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.

52

CONCLUSION

The project that I undertook in my MUTUAL FUND provided me a good experience of Investment

Avenues like Mutual Funds, Insurance, Fixed Deposits and relate d activities. It was a good

experience for me as it helped me enhance my knowledge as well as gave a good industry

exposure for the period which would definitely prove to be very useful at the time of placements.

The complete project helped me gain knowledge and at the same time it was very beneficial

for the company.

The study performed using the historical data will help the company in two ways. Firstly, it would let

the company know which of the funds under the given cate gory works well and which does

not. It can design certain strategies for the funds which are still underperforming and are in

their nascent stages. Secondly, it would help the organization, the financial consultants and the

marketing team to provide a strategy for the investors who can now easily decide where to invest

and where not to.

The Market Research performed gave an insight of the actual investors, their investment behaviour

and their investment trends which would again help the company to make correct strategies to

attract more customers and provide them with what t hey are comfortable with.

Summing up. I am thankful to the Company and the Project that gave me an opportunity where could

learn new things, enhance my knowledge, gain some industry exposure and at the same time, do

something that could be beneficial for the company and the investors.

53

BIBLIOGRAPHY

54

BIBLIOGRAPHY

Consulting various reference points on the aforementioned topics became pertinent. A list

of such references is provided as follows:

References:

➢ direct interaction with bank customers

➢ Brochures of product offerings of SBI MUTUL FUND.

➢ www.SBIMF.com

➢ www.mutual fundsindia.com

➢ www.bseindia.com

➢ www.nseindia.com

➢ www.investopedia.com

55

ANNEXURE QUESTIONNAIRE

56

QUESTIONNAIRE

A STUDY OF PREFERENCES OF THE INVESTORS FOR INVE

STMENT IN MUTUAL FUNDS

1. Personal Details:

a) Name

b) Address

c) Age

d) Phone

2. Qualification:

a) Graduation/PG

b) Under Graduate

c) Others

3. Occupation:

a) Govt. ser

b) Pvt. Ser

c) Business

d) Agriculture

e) Others

57

4. What is the monthly family income approximately?

a) Below 20000

b) 20,000 – 50,000

c) 50,000 – 10,00,000

d) 10,00,000 - 50,00,000

5. What kind of investments you have made so far?

a) Fixed deposit

b) Insurance

c) Mutual funds

d) Post office/NSE

e) Share/Debenture

f) Gold/Silver

g) Real estate

6. While investing your money, which factor will you prefer?

a) Liquidity

b) Low risk

c) High return

d) Trust

7. Are you aware about mutual funds and their operations?

a) Aware

b) Not aware

58

8. If yes how did you about mutual fund?

a) Advertisement

b) Peer group

c) Banks

d) Financial advisors

9. Have uou ever invested in mutual fund?

a) Invested

b) Not invested

10. If not invested in mutual funds then why?

a) Not aware ofTMF

b) High risk

c) Not any specific reason

11. If yes, in which mutual fund you have invested?

a) SBI Mutual funds

b) UTI

c) HDFC

d) Reliance

e) Kotak

f) Other

59

12. If invested in SBIMF, you do so because

a) SBIMF is associated with SBI

b) SBIMF gives less return compared to others

c) Agent advisor

13. If NOT invested in SBIMF, you do so because?

a) You are not aware ofTSBIMF

b) SBIMF gives less return compared to the others

c) Agent advice

14. When you plan to invest your money in asset management co, which AMC will you prefer?

a) Asset management co.

b) SBIMF

c) UTI

d) Reliance

e) Kotak

f) ICICI

15. Which channel will you prefer while investing in mutual funds?

a) Financial Adivisor

b) Banks

c) AMC

16. When you invest in mutual funds which mode of investment will you prefe r?

a) One time investment

b) Systematic investment plan (SIP)

60

17. When you want to invest which type ofTfunds would you choose?

a) Having only debt portfolio

b) Having debt and equity portfolio

c) Only equity portfolio

18. How would you like to receive the returns every year?

a) Dividend payout

b) Dividend re-investment

c) Growth in NAV

61