mutual fund research paper

8/18/2019 Mutual Fund Research Paper

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PIONEER INSTITUTE OF PROFESSIONAL STUDIES INDORE

A

RESEARCH PAPER

ON

OPPORTUNITIES IN INDIAN MARKET OF

MUTUAL FUNDS INVESTMENT

PIONEER

(Since 1996)

Submitted toSubmitted ByProf. Dr. V K JainRavendra Kushwaha

RAVENDRA KUSHWHA MBA III Sem. Batch 2009-11


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Prof. Nidhi KothariMBA 3rd sem Ro. No. !"!#!##$

DECLERATION

I hereby decare that th!" Re"earch #a$er e%t!ted &'##'R(UNI(IES IN INDIAN MARKE(

') MU(UA* )UNDS INVES(MEN(+ ",bm!tted r the e/tra c c,rr!c,,m act!!t!e"

,!me%t the re,!reme%t Ma"ter B,"!%e"" Adm!%!"trat!% MBA3 #I'NEER

INS(I(U(E ') #R')ESSI'NA* S(UDIES IND'RE !" ba"ed % "ec%dary data ,%d by

me !% ar!," 4m$a%!e" act "heet"5 b6"5 ma7a8!%e" a%d eb"!te" : 4ected by me !%

,%der 7,!da%ce #r. N!dh! Kthar!.

DA(E; Rae%dra K,"haha

MBA


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INTRODUCTION

%hat is mutua funds

A M,t,a ),%d !" a tr,"t that $" the "a!%7" a %,mber !%e"tr" h "hare a cmm%!%a%c!a 7a. A%ybdy !th a% !%e"t!be ",r$," a" !tte a" a e h,%dred r,$ee" ca% !%e"t!% M,t,a ),%d". (he"e !%e"tr" b,y ,%!t" a $art!c,ar M,t,a ),%d "cheme that ha" ade!%ed !%e"tme%t b>ect!e a%d "trate7y.

(he m%ey th," cected !" the% !%e"ted by the ,%d ma%a7er !% d!ere%t ty$e" "ec,r!t!e".(he"e c,d ra%7e rm "hare" t debe%t,re" t m%ey mar6et !%"tr,me%t"5 de$e%d!%7 ,$% the"cheme?" "tated b>ect!e". (he !%cme ear%ed thr,7h the"e !%e"tme%t" a%d the ca$!taa$$rec!at!% rea!8ed by the "cheme are "hared by !t" ,%!t !% $r$rt!% t the %,mber ,%!t"%ed by them. (h," a M,t,a ),%d !" the m"t ",!tabe !%e"tme%t r the cmm% ma% a" !ter" a% $$rt,%!ty t !%e"t !% a d!er"!!ed5 $re""!%ay ma%a7ed ba"6et "ec,r!t!e" at areat!ey -c"t.

Working of the mt!" fn#$



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THE

Con%e&t!" Fr!me'ork

M,t,a ,%d !" a tr,"t that $" m%ey rm a 7r,$ !%e"tr" "har!%7 cmm% !%a%c!a7a"3 a%d !%e"t the m%ey th," cected !%t a""et ca""e" that match the "tated !%e"tme%tb>ect!e" the "cheme. S!%ce the "tated !%e"tme%t b>ect!e" a m,t,a ,%d "cheme7e%eray rm" the ba"!" r a% !%e"tr@" dec!"!% t c%tr!b,te m%ey t the $5 a m,t,a

,%d ca% %t de!ate rm !t" "tated b>ect!e" at a%y $!%t t!me.

Eery M,t,a ),%d !" ma%a7ed by a ,%d ma%a7er5 h ,"!%7 h!" !%e"tme%t ma%a7eme%t "6!"a%d %ece""ary re"earch r6" e%",re" m,ch better ret,r% tha% hat a% !%e"tr ca% ma%a7e %h!" %. (he ca$!ta a$$rec!at!% a%d ther !%cme" ear%ed rm the"e !%e"tme%t" are $a""ed %t the !%e"tr" a" 6%% a" ,%!t hder"3 !% $r$rt!% the %,mber ,%!t" they %.



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6/22




7/22


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Difining Mt!" Fn#$ In#$tr,

A$$et$ n#er m!n!gment

(he !%d!a% m,t,a ,%d" !%d,"tr!e" a a"t 7r!%7 !%d,"try .I%d!a% m,t,a ,%" !%d,"tr!e" 7e%erated ",b"ta!%t!a 7rth !% ,%der ma%a7me%t er the $a"t 10

year". M"t the m%ey !% e,!ty ,%d" !t rm !%d!!",a !%e"tme%t.'%e %tabe charactr!c !%d!a% m,t,a ,%d mar6et !" the h!7h $arce%ta7e "hare e%ed bycr$rat!%".O'ner$hi& Mt!" Fn#$

Accrd!%7 t a""c!at!% m,t,a ,%d" !% !%d!a !%d!!",a !%e"tr" hed "!7hty ,%der 0 m,t,a ,%d" a""et" a%d cr$rat!% hed "!7hty er 0 a" the e%d march 200C.

Hi$tor, of mt!" fn# in#$tr,

I% I%d!a5 the m,t,a ,%d !%d,"try "tarted !th the "ett!%7 ,$ the er"th!e U%!t (r,"t I%d!a!% 19


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T,&e$ of Mt!" Fn#$ S%heme$ in In#i!

W!de ar!ety M,t,a ),%d Scheme" e/!"t" t cater t the %eed" ",ch a" !%a%c!a $"!t!%5r!"6 tera%ce a%d ret,r% e/$ectat!%" etc. th," m,t,a ,%d" ha" Var!ety ar"5 Be!%7 acect!% ma%y "tc6"5 a% !%e"tr" ca% 7 r $!c6!%7 a m,t,a ,%d m!7ht be ea"y. (here are

er h,%dred" m,t,a ,%d" "cheme t ch"e rm.It !" ea"!er t th!%6 m,t,a ,%d" !% cate7r!e"5 me%t!%ed be.

-. O&en / En#e# S%heme$+

A% $e%-e%d ,%d !" %e that !" aa!abe r ",b"cr!$t!% a thr,7h the year. (he"e d %t

hae a !/ed mat,r!ty. I%e"tr" ca% c%e%!e%ty b,y a%d "e ,%!t" at Net A""et Va,e

NAV3 reated $r!ce". (he 6ey eat,re $e%-e%d "cheme" !" !,!d!ty.

2. 4"e - E%ded Scheme";

(he"e "cheme" hae a $re-"$ec!!ed mat,r!ty $er!d. '%e ca% !%e"t d!recty !% the "cheme at

the t!me the !%!t!a !"",e. De$e%d!%7 % the "tr,ct,re the "cheme there are t e/!t$t!%" aa!abe t a% !%e"tr ater the !%!t!a er $er!d c"e". I%e"tr" ca% tra%"act

b,y r "e3 the ,%!t" the "cheme % the "tc6 e/cha%7e" here they are !"ted. (he

mar6et $r!ce at the "tc6 e/cha%7e" c,d ary rm the %et a""et a,e NAV3 the "cheme

% acc,%t dema%d a%d ",$$y "!t,at!%5 e/$ectat!%" ,%!thder a%d ther mar6et

actr". Ater%at!ey "me c"e-e%ded "cheme" $r!de a% add!t!%a $t!% "e!%7 the

,%!t" d!recty t the M,t,a ),%d thr,7h $er!d!c re$,rcha"e at the "cheme" NAV heer



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%e ca%%t b,y ,%!t" a%d ca% %y "e ,%!t" d,r!%7 the !,!d!ty !%d. SEBI Re7,at!%"

e%",re that at ea"t %e the t e/!t r,te" !" $r!ded t the !%e"tr.

ect!e the"e ),%d" !" t !%e"t !% debt $a$er". Jer%me%t a,thr!t!e"5 $r!ate

cm$a%!e"5 ba%6" a%d !%a%c!a !%"t!t,t!%" are "me the ma>r !"",er" debt $a$er". By

!%e"t!%7 !% debt !%"tr,me%t"5 the"e ,%d" e%",re r!"6 a%d $r!de "tabe !%cme t the

!%e"tr". Debt ,%d" are ,rther ca""!!ed a";

3i"t Fn#$; I%e"t the!r cr$," !% "ec,r!t!e" !"",ed by Jer%me%t5 $$,ary 6%%

a" Jer%me%t I%d!a debt $a$er". (he"e ),%d" carry 8er Dea,t r!"6 b,t are

a""c!ated !th I%tere"t Rate r!"6. (he"e "cheme" are "aer a" they !%e"t !% $a$er"

bac6ed by Jer%me%t.

In%ome Fn#$; I%e"t a ma>r $rt!% !%t ar!," debt !%"tr,me%t" ",ch a" b%d"5

cr$rate debe%t,re" a%d Jer%me%t "ec,r!t!e".

MIP$; I%e"t" ma/!m,m the!r tta cr$," !% debt !%"tr,me%t" h!e they ta6e

m!%!m,m e/$",re !% e,!t!e". It 7et" be%e!t bth e,!ty a%d debt mar6et. (he"e

"cheme ra%6" "!7hty h!7h % the r!"6-ret,r% matr!/ he% cm$ared !th ther debt

"cheme".



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Short Term P"!n$ 4STP$5; Mea%t r !%e"tme%t hr!8% r three t "!/ m%th".

(he"e ,%d" $r!mar!y !%e"t !% "hrt term $a$er" !6e 4ert!!cate De$"!t" 4D"3

a%d 4mmerc!a #a$er" 4#"3. Sme $rt!% the cr$," !" a" !%e"ted !%

cr$rate debe%t,re".

Li1i# Fn#$; A" 6%% a" M%ey Mar6et Scheme"5 (he"e ,%d" $r!de" ea"y

!,!d!ty a%d $re"erat!% ca$!ta. (he"e "cheme" !%e"t !% "hrt-term !%"tr,me%t"

!6e (rea",ry B!"5 !%ter-ba%6 ca m%ey mar6et5 4#" a%d 4D". (he"e ,%d" are

mea%t r "hrt-term ca"h ma%a7eme%t cr$rate h,"e" a%d are mea%t r a%

!%e"tme%t hr!8% 1day t < m%th". (he"e "cheme" ra%6 % r!"6-ret,r%

matr!/ a%d are c%"!dered t be the "ae"t am%7"t a cate7r!e" m,t,a ,%d".

6. *!"!n%e# fn#$+

A" the %ame ",77e"t they5 are a m!/ bth e,!ty a%d debt ,%d". (hey !%e"t !% bth

e,!t!e" a%d !/ed !%cme "ec,r!t!e"5 h!ch are !% !%e !th $re-de!%ed !%e"tme%t b>ect!e

the "cheme. (he"e "cheme" a!m t $r!de !%e"tr" !th the be"t bth the rd".

E,!ty $art $r!de" 7rth a%d the debt $art $r!de" "tab!!ty !% ret,r%".

Further the mutual funds can be broadly classified on the basis of investment parameter

viz,

Each cate7ry ,%d" !" bac6ed by a% !%e"tme%t $h!"$hy5 h!ch !" $re-de!%ed !% the

b>ect!e" the ,%d. (he !%e"tr ca% a!7% h!" % !%e"tme%t %eed" !th the ,%d"

b>ect!e a%d !%e"t accrd!%7y.

*, in(e$tment o)7e%ti(e+

3ro'th S%heme$+ Jrth Scheme" are a" 6%% a" e,!ty "cheme". (he a!m

the"e "cheme" !" t $r!de ca$!ta a$$rec!at!% er med!,m t %7 term. (he"e

"cheme" %rmay !%e"t a ma>r $art the!r ,%d !% e,!t!e" a%d are !!%7 t bear

"hrt-term dec!%e !% a,e r $""!be ,t,re a$$rec!at!%.

In%ome S%heme$;I%cme Scheme" are a" 6%% a" debt "cheme". (he a!m the"e

"cheme" !" t $r!de re7,ar a%d "teady !%cme t !%e"tr". (he"e "cheme"

7e%eray !%e"t !% !/ed !%cme "ec,r!t!e" ",ch a" b%d" a%d cr$rate debe%t,re".

4a$!ta a$$rec!at!% !% ",ch "cheme" may be !m!ted.

*!"!n%e# S%heme$+ Baa%ced Scheme" a!m t $r!de bth 7rth a%d !%cme by

$er!d!cay d!"tr!b,t!%7 a $art the !%cme a%d ca$!ta 7a!%" they ear%. (he"e"cheme" !%e"t !% bth "hare" a%d !/ed !%cme "ec,r!t!e"5 !% the $r$rt!% !%d!cated

!% the!r er dc,me%t" %rmay 0;03.

Mone, M!rket S%heme$; M%ey Mar6et Scheme" a!m t $r!de ea"y !,!d!ty5

$re"erat!% ca$!ta a%d mderate !%cme. (he"e "cheme" 7e%eray !%e"t !% "aer5

"hrt-term !%"tr,me%t"5 ",ch a" trea",ry b!"5 cert!!cate" de$"!t5 cmmerc!a

$a$er a%d !%ter-ba%6 ca m%ey.



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Other $%heme$

T!0 S!(ing S%heme$+

(a/-"a!%7 "cheme" er ta/ rebate" t the !%e"tr" ,%der ta/ a" $re"cr!bed rm t!me t

t!me. U%der Sec.== the I%cme (a/ Act5 c%tr!b,t!%" made t a%y E,!ty *!%6ed Sa!%7"Scheme E*SS3 are e!7!be r rebate.

In#e0 S%heme$+

I%de/ "cheme" attem$t t re$!cate the $errma%ce a $art!c,ar !%de/ ",ch a" the BSE

Se%"e/ r the NSE 0. (he $rt! the"e "cheme" ! c%"!"t %y th"e "tc6" that

c%"t!t,te the !%de/. (he $erce%ta7e each "tc6 t the tta hd!%7 ! be !de%t!ca t the

"tc6" !%de/ e!7hta7e. A%d he%ce5 the ret,r%" rm ",ch "cheme" ,d be mre r e""

e,!ae%t t th"e the I%de/.

Se%tor S&e%ifi% S%heme$+

(he"e are the ,%d""cheme" h!ch !%e"t !% the "ec,r!t!e" %y th"e "ectr" r !%d,"tr!e"

a" "$ec!!ed !% the er dc,me%t". e.7. #harmace,t!ca"5 Stare5 )a"t M!%7 4%",mer

Jd" )M4J35 #etre,m "tc6"5 etc. (he ret,r%" !% the"e ,%d" are de$e%de%t % the

$errma%ce the re"$ect!e "ectr"!%d,"tr!e". Wh!e the"e ,%d" may 7!e h!7her ret,r%"5

they are mre r!"6y cm$ared t d!er"!!ed ,%d". I%e"tr" %eed t 6ee$ a atch % the

$errma%ce th"e "ectr"!%d,"tr!e" a%d m,"t e/!t at a% a$$r$r!ate t!me.

(y$e" ret,r%"

(here are three ay"5 here the tta ret,r%" $r!ded by m,t,a ,%d" ca% be e%>yed by

!%e"tr";

I%cme !" ear%ed rm d!!de%d" % "tc6" a%d !%tere"t % b%d". A ,%d $ay" ,t

%eary a !%cme !t rece!e" er the year t ,%d %er" !% the rm a

d!"tr!b,t!%.

I the ,%d "e" "ec,r!t!e" that hae !%crea"ed !% $r!ce5 the ,%d ha" a ca$!ta 7a!%.

M"t ,%d" a" $a"" % the"e 7a!%" t !%e"tr" !% a d!"tr!b,t!%.

I ,%d hd!%7" !%crea"e !% $r!ce b,t are %t "d by the ,%d ma%a7er5 the ,%d@"

"hare" !%crea"e !% $r!ce. L, ca% the% "e y,r m,t,a ,%d "hare" r a $r!t. ),%d"! a" ,",ay 7!e y, a ch!ce e!ther t rece!e a chec6 r d!"tr!b,t!%" r t

re!%e"t the ear%!%7" a%d 7et mre "hare".



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R!tion!"e of the &!&er

I%d!a !" dee$!%7 c,%try there are aay" mar6et r!"e a%d a I a%t t !%d ,t the

$$rt,%!t!e" r the !%e"tr" thr,7h th!" re"earch !th the he$ the"e re"earch e areabe t !%d ,t he% the m,t,a ,%d mre r!"6y .

We a" 6% ab,t the ada%ta7e" a%d d!"ada%ta7e" m,t,a ,%d !%e"tme%t !% I%d!a%mar6et

O)7e%ti(e$ of the re$e!r%h

( 6% ab,t the $$rt,%!t!e" !% I%d!a% mar6et.( 7!e a br!e !dea ab,t the be%e!t" aa!abe rm M,t,a ),%d !%e"tme%t.

( 7!e a% !dea the ty$e" "cheme" aa!abe.

( d!"c,"" ab,t the mar6et tre%d" M,t,a ),%d !%e"tme%t.

( 7!e a% !dea ab,t the re7,at!%" m,t,a ,%d".

Liter!tre Re(ie'

M!, 2889: Pro7e%t re&ort ), $h!i"en#r! k!$'!n

(he t$!c $r>ect a" m,t,a ,%d" A ca"e "t,dy a%d ",rey. Ater the re"earch r6" Mr.Sha!e%dra Ka"a% c%c,ded that m,t,a ,%d !%d,"try !" e%ar7!%7 !t" "!8e !% I%d!a!%e"tr" are !!%7 $,r m%ey !% m,t,a ,%d". De"$!te "me tem$rary re7!"tra%t"5 therec%m!c mde" are !% arabe mde. (h," e %eed $r$er ma%a7eme%t ad!"ry"er!ce" mre "cheme" !%a%c!a ad!"r a%d !%"t!t,t!% t cater the mar6et.

I%d,"try %eed t re!"e !t" b,"!%e"" "trate7y. I%e"tr" $erce$t!% !" %t $r!r!t!8ed yet!%"tead cm$et!%7 tar7et5 ad!"r" r6!%7 ,%der !%"t!t,t!%" "h,d c%"!der the

re,!reme%t" the !%e"tr". We %eed cha%7!%7 $atter% "e!%7 m,t,a ,%d".

De%em)er 288;: Pro7e%t re&ort ), Mr. Vim!"


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t!me ,%d the r!"6 !" h!7h. A%d !% ra%6!%e a/!cab ,%d !" a" %ear ab,t "ame a" Kda6 $$rt,%!ty ,%d b,t !% th!" ,%d the ret,r%" mre the% three AM4?" HD)45RE*AIN4Ea%d HSB43. I% Re!a%ce e,!ty $$rt,%!ty the ret,r% !" med!,m cm$are t ther AM4?"B,t !% HSB4 cre a%d "ate!te ,%d the ret,r% !" cm$are t ther AM4?" . A%d HSB4I%d!a $$rt,%!ty ,%d !" r!"6y ,%d.

A&ri" 288; Pro7e%t re&ort ), Mr. Vik!$h km!r

(he t$!c a" a "t,dy $reere%ce" !%e"tr" r !%e"tme%t !% m,t,a ,%d" r the SBIm,t,a ,%d". Mr. V!6a"h 6,mar c%c,ded that m"t the !%e"tr" d%?t !%e"t !% Sb!m,t,a ,%d d,e t %% aare%e"". A%d he add" that m"t the !%e"tr" $at%a had!%e"ted !% re!a%ce r U(I m,t,a ,%d" a%d I4I4I m,t,a ,%d" a" ha" 7d bra%d $"!t!% am%7 them. A%d Sb! m $ace" ater I4I4I m,t,a ,%d accrd!%7 t re"$%de%t".(he m"t $rt! are e,!ty "ec%d m"t !" baa%ce a%d ea"t $reer $rt! a" debt" $rt!. M"t the !%e"tr" de"%?t a%t t !%e"t !% "ectred ,%d. A%d he b"ered that

ma%y $e$e hae the ear m. (hey %eed !%rmat!% bra%d $ace a%d !m$rta%t re a%dSBI m U(I m I4I4I m etc. are e %% bra%d " they are d!%7 e.

Se&tem)er 288;::. Pro7e%t Re&ort ), Amit =!#!(

(he t$!c a" &A $r>ect re$rt % cm$ar!"% ar!," ,%d"+. Ater a%ay8!%7 a%d"t,dy!%7 Mr. Am!t yada 7!e the ra%6!%7 t the ,%d % three yeary ret,r% ba"!" thatDS#M* e,!ty !" % !r"t5 6ta6


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Metho#o"og,

Re$e!r%h De$ign

A methd a%d "y"tem a "tat!ca a%ay"!" ba"ed % $a"t h!"try t ac!!tate the !%e"tme%t $rce"". re"$ect!e ,%d ,"!%7 a $r!%c!$a actr ",ch a" c,m,at!e 7rth a%d "tab!!ty. )r trac6!%7 !%e"tme%t5 ,$$er a%d er c%tr !m!t" are de!%ed accrd!%7 t "ta%dardde!at!% aera7e tta ret,r% er $redeterm!%e $er!d t!me t !m$re cha%ce" the!%e"tr" ach!e!%7 a $r!t a" e a" a %ear $t!m,m $errma%ce. .

(h!" re"earch methd7y he$" ," t 7!e !%rmat!% ab,t the $$rt,%!t!e" m,t,a,%d" !%e"tme%t. It ! he$ t "t,dy the mar6et m,t,a ,%d" better.

S!m&"e De$ign

A m,t,a ,%d cm$a%!e" a%d there ret,r% % !%e"tme%t.

Too"$ of #!t! %o""e%tion

(here are ma%y methd" data cect!% h!ch ca% be ,"ed accrd!%7 t %at,re a%d ty$e re"earch. I ! ,"e !%7 data r the re"earch $,r$"e.

My re"earch %y the ba"!" "ec%dary data.

Se%on#!r, #!t!• Art!ce"

• )act"heet

• Ma%a7eme%t 7e%era"

• A%%,a re$rt

• Re"earch $a$er"

• I%ter%et

•

4m$a%!e" $rd,ct ,cher• Ne" $a$er"

Too"$ for #!t! An!",$i$

-. Ret,r% % !%e"tme%t2. Jra$h6. 4hart



16/22


M!7or Fin#ing

Ater a,at!% the data I am !%d!%7 ,t "me $"!t!e a%d "me %e7at!e re",t r

I%d!a% mar6et m,t,a ,%d" $$rt,%!t!e". Po$iti(e re$"t$+

-. Profe$$ion!" M!n!gement / (he ba"!c ada%ta7e ,%d" !" that5 they are $re""!%a

ma%a7ed5 by e ,a!!ed $re""!%a. I%e"tr" $,rcha"e ,%d" beca,"e they d %t hae

the t!me r the e/$ert!"e t ma%a7e the!r % $rt!. A m,t,a ,%d !" c%"!dered t be

reat!ey e"" e/$e%"!e ay t ma6e a%d m%!tr the!r !%e"tme%t".

2. Di(er$ifi%!tion / #,rcha"!%7 ,%!t" !% a m,t,a ,%d !%"tead b,y!%7 !%d!!d,a "tc6" r

b%d"5 the !%e"tr" r!"6 !" "$read ,t a%d m!%!m!8ed ,$ t certa!% e/te%t. (he !dea beh!%d

d!er"!!cat!% !" t !%e"t !% a ar7e %,mber a""et" " that a "" !% a%y $art!c,ar

!%e"tme%t !" m!%!m!8ed by 7a!%" !% ther".

6. E%onomie$ of S%!"e / M,t,a ,%d b,y a%d "e ar7e am,%t" "ec,r!t!e" at a t!me5 th,"he$ t red,c!%7 tra%"act!% c"t"5 a%d he$ t br!%7 d% the aera7e c"t the ,%!t r

the!r !%e"tr".

?. Li1i#it, / ,"t !6e a% !%d!!d,a "tc65 m,t,a ,%d a" a" !%e"tr" t !,!date

the!r hd!%7" a" a%d he% they a%t.

@. Sim&"i%it, / I%e"tme%t" !% m,t,a ,%d !" c%"!dered t be ea"y5 cm$are t ther

aa!abe !%"tr,me%t" !% the mar6et5 a%d the m!%!m,m !%e"tme%t !" "ma. M"t AM4 a"

hae a,tmat!c $,rcha"e $a%" hereby a" !tte a" R". 20005 here SI# "tart !th >,"t R".0

$er m%th ba"!".



17/22


Ftre of Mt!" Fn#$ in In#i!

)!%a%c!a e/$ert" be!ee that the ,t,re M,t,a ),%d" !% I%d!a ! be ery br!7ht. It ha" bee% e"t!mated that by March-e%d 20105 the m,t,a ,%d !%d,"try I%d!a ! reach R"05905000 crre5 ta6!%7 !%t acc,%t the tta a""et" the I%d!a% cmmerc!a ba%6". (hee"t!mat!% a" ba"ed % the December 200 a""et a,e R" 1505r re !% the M,t,a ),%d" mar6et by $r!d!%7 $e$e !th $r$er !%a%c!a $a%%!%7.



18/22


TEN ADVANTA3ES OF INVESTIN3 IN MUTUAL FUNDS

#re""!%a Ma%a7eme%t

D!er"!!cat!%

4%e%!e%t Adm!%!"trat!% Ret,r% #te%t!a

* 4"t"

*!,!d!ty

(ra%"$are%cy

)e/!b!!ty

4h!ce Scheme"

We Re7,ated

Neg!ti(e re$"t$+

-. Profe$$ion!" M!n!gement- Sme ,%d" de"%?t $errm !% %e!ther the mar6et5 a" the!r

ma%a7eme%t !" %t dy%am!c e%,7h t e/$re the aa!abe $$rt,%!ty !% the mar6et5 th,"

ma%y !%e"tr" debate er hether r %t the "-caed $re""!%a" are a%y better tha%

m,t,a ,%d r !%e"tr h!m "e5 r $!c6!%7 ,$ "tc6".

2. Co$t$ O (he b!77e"t ",rce AM4 !%cme5 !" 7e%eray rm the e%try : e/!t ad h!chthey char7e rm a% !%e"tr"5 at the t!me $,rcha"e. (he m,t,a ,%d !%d,"tr!e" are th,"

char7!%7 e/tra c"t ,%der ayer" >ar7%.

6. Di"tion - Beca,"e ,%d" hae "ma hd!%7" acr"" d!ere%t cm$a%!e"5 h!7h ret,r%"

rm a e !%e"tme%t" te% d%@t ma6e m,ch d!ere%ce % the era ret,r%. D!,t!% !"

a" the re",t a ",cce"", ,%d 7ett!%7 t b!7. Whe% m%ey $,r" !%t ,%d" that hae

had "tr%7 ",cce""5 the ma%a7er te% ha" tr,be !%d!%7 a 7d !%e"tme%t r a the %e

m%ey.

?. T!0e$ - he% ma6!%7 dec!"!%" ab,t y,r m%ey5 ,%d ma%a7er" d%@t c%"!der y,r

$er"%a ta/ "!t,at!%. )r e/am$e5 he% a ,%d ma%a7er "e" a "ec,r!ty5 a ca$!ta-7a!% ta/

!" tr!77ered5 h!ch aect" h $r!tabe the !%d!!d,a !" rm the "ae. It m!7ht hae bee%mre ada%ta7e," r the !%d!!d,a t deer the ca$!ta 7a!%" !ab!!ty.



19/22


Di$%$$ion !n# !n!",$i$ of re$"t$

Ater ea,at!%7 the re",t there are t" $$rt,%!t!e" !% !%e"tme%t !% I%d!a% mar6et .

(he %et a""et a,e the ),%d !" the c,m,at!e mar6et a,e the a""et" ),%d %et !t"!ab!!t!e". I% ther rd"5 ! the ),%d !" d!""ed r !,!dated5 by "e!%7 a the a""et"!% the ),%d5 th!" !" the am,%t that the "harehder" ,d cect!ey %. (h!" 7!e" r!"et the c%ce$t %et a""et a,e $er ,%!t5 h!ch !" the a,e5 re$re"e%ted by the %er"h!$ %e ,%!t !% the ),%d. It !" cac,ated "!m$y by d!!d!%7 the %et a""et a,e the ),%d by the%,mber ,%!t". Heer5 m"t $e$e reer "ey t the NAV $er ,%!t a" NAV5 !7%r!%7the &$er ,%!t+. We a" ab!de by the "ame c%e%t!%.4ac,at!% NAV(he %et a""et a,e !" the act,a a,e a ,%!t % a%y b,"!%e"" day. NAV !" the barmeter the $errma%ce the "cheme.(he %et a""et a,e !" the mar6et a,e the a""et" the "cheme m!%," !t" !ab!!t!e" a%d

e/$e%"e". (he $er ,%!t NAV !" the %et a""et a,e the "cheme d!!ded by the %,mber the,%!t" ,t"ta%d!%7 % the a,at!% date.

I%tere"t Rate R!"6; I% a ree mar6et ec%my !%tere"t rate" are d!!c,t ! %t !m$""!be t $red!ct. 4ha%7e" !% !%tere"t rate" aect the $r!ce" b%d" a" e a" e,!t!e". I !%tere"trate" r!"e the $r!ce" b%d" a a%d !ce er"a. E,!ty m!7ht be %e7at!ey aected a" e!% a r!"!%7 !%tere"t rate e%!r%me%t. A e-d!er"!!ed $rt! m!7ht he$ m!t!7ate th!"r!"6.

"me !%e"tme%t !% e,!t!e" m!7ht he$ m!t!7ate th!" r!"6.



20/22


Limit!tion$

P (he t!me c%"tra!%t a" %e the ma>r $rbem".

P (he "t,dy !" !m!ted t the d!ere%t "cheme" aa!abe ,%der the m,t,a ,%d" "eected.

P (he "t,dy !" !m!ted t "eected m,t,a ,%d "cheme".

P (he ac6 !%rmat!% ",rce" r the a%ay"!" $art.



21/22


Con%"$ion

*6!%7 at the $a"t dee$me%t" a%d cmb!%!%7 !t !th the c,rre%t tre%d" !t ca% be c%c,ded

that the ,t,re M,t,a ),%d" !% I%d!a ha" t $"!t!e th!%7" t er t !t" !%e"tr".



22/22


Referen%e$ !n# *i)"iogr!&h,

We)$ite$

htt$;./y7.cm.my,%!tr,"t.htmhtt$;."ec.7r,e"!%a!c-20$$rt,%!tyhtt$;.7etm%eyr!ch.cm!%e"tme%t-$$rt,%!t!e"-!%-!%d!a-!%ra"tr,ct,re-m,t,a-,%d"htt$;!%e"t!%7.b7a%d!%.cm20100=1ar!,"-"e7me%t"--m,t,a-,%d"-!%-!%d!ahtt$;.>a7!%e"tr.cm20100=be"t-e,!ty-d!er"!!ed-m,t,a,%d .!6!$ed!a.cmhtt$;d!"c,"".!tac,me%".cm!%de/.$h$Qt$!c=

mutual fund research paper

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