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Documenti di Cultura
INTRODUCTION
1. 2. 3. 4. 5. 6.
MUTUAL FUND SETUP NAV SCOPE BENEFITS OF MUTUAL FUND CAPITAL GAIN INVESTMENT CRITERIA
4 5
PRODUCT &SERVICE
1. TYPES OF MUTUAL FUND 2. INVESTMENT PLAN 3. PRODUCT OF MUTUAL FUND
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INTRODUCTION
1. MUTUAL FUND SETUP 2. NAV 3. SCOPE 4. BENEFITS OF MUTUAL FUND 5. CAPITAL GAIN 6. INVESTMENT CRITERIA
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I NTRODUCTION
The financial market plays a crucial role in the in the economic development of a country by facilitating the allocation of scarce resources. Financial markets essentially involve the allocation of resources. This can be thought of as the brain of the entire economic system, the locus of central decisionmaking; if they fail, not only will the sectors profit be lower than would otherwise have been, but the performance of the entire economic system may be impaired. The efficiency of financial market how ever, depends on the existence of active and efficient financial intermediaries in the system. Deposit taking institutional investor is the important financial intermediaries involved in the task of allocating assets. Structural changes in the financial market have induced a reverse trend in financial intermediation, i.e. financial disintermediation, in which the central role of banking is being taken over by investment institutions and institutional investors. The shift from a creditbased system to a financial has initiated the process of disintermediation, and capital market based factors like insurance, pension funds and mutual funds are increasingly playing the central role. The reforms have successfully dismantled the entry barriers, with the result that today there are domestic and foreign financial institutions, like mutual funds, broking firms and insurance companies, operating in the Indian market. The introduction of capital adequacy norms, prudential regulation and world class regulatory mechanisms to protect the interest of investor, besides the strict requirement of disclosure, have given a boost to the confidence of domestic and foreign investors. The Indian economy has slowly integrated itself with the global economy and financial market.
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There are numerous benefits of investing in mutual funds and one of the key reasons for its phenomenal success in the developed markets like US and UK is the range of benefits they offer, which are unmatched by most other investment avenues. We have explained the key benefits in this section. The benefits have been broadly split into universal benefits, applicable to all schemes, and benefits applicable specifically to open-ended schemes.
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3.
Convenient Administration
Investing n in a Mutual Fund reduces paperwork and helps you avoid many problems such as bad deliveries, delayed payments and unnecessary follow up with brokers and companies. Mutual Funds save your time and make investing easy and convenient. 4. Return Potential Over a medium to long-term, Mutual Funds have the potential to provide a higher return as they invest in a diversified basket of selected securities. 5. Low Costs Mutual Funds are a relatively less expensive way to invest compared to directly investing in the capital markets because the benefits of scale in brokerage, custodial and other fees translate into lower costs for investors. 6. Liquidity In open-ended schemes, you can get your money back promptly at net asset value related prices from the Mutual Fund itself. With close-ended schemes, you can sell your units on a stock exchange at the prevailing market price or avail of the facility of direct repurchase at NAV related prices which some close-ended and interval schemes offer you periodically.
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7. Transparency You get regular information on the value of your investment in addition to disclosure on the specific investments made by your scheme, the proportion invested in each class of assets and the fund manager's investment strategy and outlook. 8. Flexibility Through features such as regular investment plans, regular withdrawal plans and dividend reinvestment plans, you can systematically invest or withdraw funds according to your needs and convenience.
9. Choice of Schemes Mutual Funds offer a family of schemes to suit your varying needs over a lifetime. 10. Well Regulated All Mutual Funds are registered with SEBI and they function within the provisions of strict regulations designed to protect the interests of investors. The operations of Mutual Funds are regularly monitored by SEBI. 11. Understanding and Managing Risk All investments whether in shares, debentures or deposits involve risk: share value may go down depending upon the performance of the company, the industry, state of capital market and the economy; generally, however longer the term, lesser the risk; companies may default in payment of interest/principal on their deposits/bonds debentures; the rate of interest on investment may fall short of the rate of inflation reducing the purchasing power. While risk cannot be eliminated, skillful management can minimize risk. Mutual fund helps to reduce risk through diversification and professional management. The experience and expertise of Mutual Fund managers in selecting fundamentally sound securities and timing their purchases and sales help them to build a diversified portfolio that minimize risk and maximizes returns.
12.
Tax Benefits
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When you invest for over a year, the tax payable on encashment is Long term Capitals gains tax at 20%. Once also get an indexation benefit which has been approximately 8% per year. This reduces the taxable income and thus decreases the tax liability.
There is also an opportunity to set off capital losses against gains from income schemes.
Full exemption from capital gains tax as it comes under Section 54EA/EB of the income tax Act.
One has to pay tax only when he encash units, but have to pay tax on the interest earned on other debt instruments every year on an accrual basis, even though he receives the interest later. This generates higher post tax returns compared to other debt instruments. Tax is just like a monster that frightens a number of individuals through out the nation. There are just tow way to fight with this monater: . Conceal/Depress Income . Make tax efficient investments. Perhaps the second option is far better than the first as it gives the peace of mind together with a feeling that one is a responsible citizen of the nation. With
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We Offer
We believe, that, by giving the investor long-term benefits, we have to constantly review the markets for new trends, to identify new growth sectors and share this knowledge with our investors in the form of product offerings. We have come up with various products across asset and risk categories to enable investors to invest in line with their investment objectives and risk taking capacity. Besides, we also offer Portfolio Management Services.
Our Achievements
HDFC Asset Management Company (AMC) is the first AMC in India to have been assigned the CRISIL Fund House Level 1 rating. This is its highest Fund Governance and Process Quality Rating which reflects the highest governance levels and fund management practices at HDFC AMC It is the only fund house to have been assigned this rating for two years in succession. Over the past, we have won a number of awards and accolades for our performance
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3.2 - SPONSORS
Housing Development Finance Corporation Limited (HDFC). HDFC was
incorporated in 1977 as the first specialized Mortgage Company in India. HDFC provides financial assistance to individuals, corporate and developers for the purchase or construction of residential housing. It also provides property related services (e.g. property identification, sales services and valuation), training and consultancy. Of these activities, housing finance remains the dominant activity. HDFC has a client base of around 12 lac borrowers, around 8 lac depositors, over 1.08 lac shareholders and 50,000 deposit agents, as at March 31, 2008. HDFC has raised funds from international agencies such as the World Bank, IFC (Washington), USAID, DEG, ADB and KfW, international syndicated loans, domestic term loans from banks and insurance companies, bonds and deposits. HDFC has received the highest rating for its bonds and deposits program for the thirteenth year in succession. HDFC Standard Life Insurance Company Limited, promoted by HDFC was the first life insurance company in the private sector to be granted a Certificate of Registration (on October 23, 2000) by the Insurance Regulatory and Development Authority to transact life insurance business in India.
Standard Life Investments Limited. The Standard Life Assurance Company was
established in 1825 and has considerable experience in global financial markets. The company was present in the Indian life insurance market from 1847 to 1938 when agencies were set up in Kolkata and Mumbai. The company re-entered the Indian market in 1995, when an agreement was signed with HDFC to launch an insurance joint venture. On April 2006, the Board of The Standard Life Assurance Company recommended that it should demutualise and Standard Life plc float on the London Stock Exchange. At a Special General Meeting held in May voting members overwhelmingly voted in favour of this. The Court of Session in Scotland approved this in June and Standard Life plc floated on the London Stock Exchange on 10th July 2006. Standard Life Investments is a leading asset management company, with approximately US$ 267 billion as at March 31, 2008, of assets under management. The company operates in the UK, Canada, Hong Kong, China, Korea, Ireland, Paris, Sydney and the USA to ensure it is able to
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3.3 - TRUSTEE
HDFC Trustee Company Limited, a company incorporated under the Companies Act, 1956 is the Trustee to HDFC Mutual Fund vide the Trust deed dated June 8, 2000, as amended from time to time. HDFC Trustee Company Ltd is wholly owned subsidiary of HDFC
The Board of Directors of HDFC Trustee company Limited consists of the following eminent persons.
Mr. Anil Kumar Hirjee Mr. James Aird Mr. Shishir K. Diwanji Mr. Ranjan Sanghi Mr. V. Srinivasa Rangan
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2. HDFC High Interest Fund - Short Term Plan - Ranked a Five Star Fund indicating performance among the top 10% in the category of "Open Ended Debt - Short Term" for one year period ending December 31, 2007 (from amongst 20 schemes).
3. HDFC Prudence Fund - Ranked a Five Star Fund indicating performance among the top 10% in the category of "Open Ended Balanced" for the three year period ending December 31, 2007 (from amongst 16 schemes).
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Disclaimer: The illustration above is merely indicative in nature and should not be construed as investment advice. It does not in any manner imply or suggest performance of any HDFC Mutual Fund Scheme(s). Please read Risk Factors.
Benefit 3 Take Advantage of Rupee Cost Averaging Most investors want to buy stocks when the prices are low and sell them when prices are high. But timing the market is timeconsuming and risky. A more successful investment strategy is to adopt the method called Rupee Cost Averaging. To illustrate this well compare investing the identical amounts through a SIP and in one lump sum. Imagine Suresh invests Rs. 1000 every month in an equity mutual fund scheme starting in January. His friend, Rajesh, invests Rs. 12000 in one lump sum in the same scheme. The following table illustrate how their respective investments would have performed from Jan to Dec:
Sureshs Investment Month Jan-04 Feb-04 Mar-04 Apr-04 May-04 Jun-04 Jul-04 Aug-04 Sep-04 Oct-04 Nov-04 Dec-04 NAV 9.345 9.399 8.123 8.750 8.012 8.925 9.102 8.310 7.568 6.462 6.931 7.600 Amount 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 Units 107.0091 106.3943 123.1072 114.2857 124.8128 112.0448 109.8660 120.3369 132.1353 154.7509 144.2793 131.5789 Rajeshs Investment Amount 12000 Units 1284.1091
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Disclaimer: The illustration above is merely indicative in nature and should not be construed
as investment advice. It does not in any manner imply or suggest performance of any HDFC Mutual Fund Scheme(s). Rupee Cost Averaging neither ensures you profits nor protects you from making a loss in declining markets. Please read Risk Factors. As seen in the table, by investing through SIP, you end up buying more units when the price is low and fewer units when the price is high. However, over a period of time these market fluctuations are generally averaged. And the average cost of your investment is often reduced.
At the end of the 12 months, Suresh has more units than Rajesh, even though they invested the same amount. Thats because the average cost of Sureshs units is much lower than that of Rajesh. Rajesh made only one investment and that too when the per-unit price was high. Sureshs average unit price = 12000/1480.6012 = Rs. 8.105 Rajeshs average unit price = Rs. 9.345
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Benefit 4 Grow Your Investment With Compounded Benefits It is far better to invest a small amount of money regularly, rather than save up to make one large investment. This is because while you are saving the lump sum, your savings may not earn much interest. With HDFC MF SIP, each amount you invest grows through compounding benefits as well. That is, the interest earned on your investment also earns interest. The following example illustrates this. Imagine Neha is 20 years old when she starts working. Every month she saves and invests Rs. 5,000 till she is 25 years old. The total investment made by her over 5 years is Rs. 3 lakhs.Arjun also starts working when he is 20 years old. But he doesnt invest monthly. He gets a large bonus of Rs. 3 lakhs at 25 and decides to invest the entire amount.
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LIQUID FUND
DEBT/INCOME FUND
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LIQUID FUND
HDFC Liquid Fund HDFC Liquid Fund Premium Plan HDFC Liquid Fund Premium Plus Plan HDFC Cash Management Fund Call HDFC Cash Management Fund - Savings Plan
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The investment philosophy rests on a two-pronged approach. 60-80% of the portfolio will aim to stay invested for most of the time in large cap stocks that satisfy the above investment criteria. This allocation to large cap stocks also ensures greater liquidity in the portfolio. 20-40% of the portfolio will be invested in companies of scale that are either large market share holder
Returns
HDFC Growth (NAV as at evaluation date, Rs. 53.472
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* Absolute Returns ** Compounded Annualised Returns # SENSEX ~ Due to an over all sharp rise in the stock prices ^ Past performance may or may not be sustained in the future
SIP Returns
SIP Investments Total Amount Invested (Rs.) Market Value as on June 30, 2008 Returns (Annualised)*% Benchmark Returns
# SENSEX
Benchmark - BSE Sensex Disclaimer: The above investment simulation is for illustrative purposes only and should not be construed as a promise on minimum returns and safeguard of capital. The AMC / Mutual Fund is not guaranteeing or promising or forecasting any returns. SIP does not assure a profit or guarantee protection against a loss in a declining market. Please refer SIP Enrolment Form or contact nearest ISC for SIP Load Structure
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Open Ended Growth Scheme October 11, 1996 Dividend Plan,Growth Plan. The Dividend Plan offers Dividend Payout and Reinvestment Facility. NAV Date 18 Aug 2008 18 Aug 2008 NAV Amount 38.29 129.56
The Scheme may also invest upto 25% of net assets of the Scheme in derivatives such as Futures & Options and such other derivative instruments as may be introduced from time to time for the purpose of hedging and portfolio balancing and and other uses as may be permitted under the regulations and guidelines. The Scheme may also invest a part of its corpus, not exceeding 40% of its net assets, in overseas markets in Global Depository Receipts (GDRs), ADRs, overseas equity, bonds and mutual funds and such other instruments as may be allowed under the Regulations from time to time.
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Returns
HDFC Top 200 Fund Date March 30, 2007 December 28, 2007 June 29, 2007 June 30, 2005 June 30, 2003 June 30, 1998 October 11, 1996 (NAV as at evaluation date, Rs. Per unit) Period NAV Last 458 days Last Six months (185 days) Last 1 Year (367 days) Last 3 Years (1096 days) Last 5 Years (1827 days) Last 10 Years (3653 days) Since Inception (4280 days) Since Inception 141,000.00 835,535.45 27.85% 18.32% 104.504 167.8880 120.34 57.343 23.358 12.749 10.000 115.424 Returns(%) $$ ^ 8.24** -31.25* -4.06** 26.23** 37.6** 27.12** 25.3** Benchmark Returns(%)# 4.45** -37.53* -8.85** 21.2** 29.43** 17.55** 15.18**
SIP Returns
SIP Investments Total Amount Invested (Rs.) Market Value as on June 30, 2008 Returns (Annualised)*% Benchmark Returns Benchmark - BSE 200 Disclaimer: The above investment simulation is for illustrative purposes only and should not be construed as a promise on minimum returns and safeguard of capital. The AMC / Mutual Fund is not guaranteeing or promising or forecasting any returns. SIP does not assure a profit or guarantee protection against a loss in a declining market. Please refer SIP Enrolment Form or contact nearest ISC for SIP Load Structure 10 Year 120,000.0 0 580,129.0 4 29.65% 20.25% 5 Year 60,000.00 113,375.0 2 25.77% 18.90% 3 Year 36,000.0 0 41,661.2 9 9.73% 5.82% 1 Year 12,000.00 9,843.01 -31.64% -38.40%
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Investment Strategy:
In order to provide long term capital appreciation, the Scheme will invest predominantly in growth companies. Companies selected under this portfolio would as far as practicable consist of medium to large sized companies which:
are likely achieve above average growth than the industry; enjoy distinct competitive advantages, and have superior financial strengths. The aim will be to build a portfolio, which represents a cross-section of the strong growth companies in the prevailing market. In order to reduce the risk of volatility, the Scheme will diversify across major industries and economic sectors
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PROJECT ON STUDY OF PERFORMANCE OF MUTUAL FUNDS IN REFEENCE TO HDFC BANK Investment Pattern
The asset allocation under the Scheme will be as follows : Sr.No. 1 2 Asset Type Equities and Equity Related Instruments Debt & Money Market Instruments (% of Portfolio) 80 - 100 0 - 20 Risk Profile Medium to High Low to Medium
Investment in Securitised debt, if undertaken, would not exceed 20% of the net assets of the scheme. The Scheme may also invest upto 25% of net assets of the Scheme in derivatives such as Futures & Options and such other derivative instruments as may be introduced from time to time for the purpose of hedging and portfolio balancing and other uses as may be permitted under the Regulations. The Scheme may also invest a part of its corpus, not exceeding 40% of its net assets, in overseas markets in Global Depository Receipts (GDRs), ADRs, overseas equity, bonds and mutual funds and such other instruments as may be allowed under the Regulations from time to time. Also refer to the Section on Policy on off-shore Investments by the Scheme(s). If the investment in equities and related instruments falls below 70% of the portfolio of the Scheme at any point in time, it would be endeavoured to review and rebalance the composition. Not with standing anything stated above, subject to the regulations, the asset allocation pattern indicated above may change from time to time, keeping in view market conditions, market opportunities, applicable regulations and political and economic factors. It may be clearly understood that the percentages stated above are only indicative and are not absolute and that they can vary substantially depending upon the perception of the AMC, the intention being at all times to seek to protect the NAV of the scheme. Such changes will be for short term and defensive considerations. Provided further and subject to the above, any change in the asset allocation affecting the investment profile of the Scheme and amounting to a change in the Fundamental Attributes of the Scheme shall be effected in accordance with sub-regulation (15A) of regulation 18 of SEBI regulations.
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* Absolute Returns ** Compounded Annualised Returns # S&P CNX 500 ^ Past performance may or may not be sustained in the future
SIP Returns
SIP Investments Total Amount Invested (Rs.) Market Value as on June 30, 2008 Returns (Annualised)*% Benchmark Returns Since Inception 162,000.00 1,494,753.92 29.53% 16.18% 10 Year 120,000.0 0 646,490.6 5 31.66% 19.77% 5 Year 60,000.00 107,904.1 2 23.71% 17.56% 3 Year 36,000.0 0 38,998.6 7 5.27% 3.25% 1 Year 12,000.00 9,408.57 -37.52% -40.27%
Disclaimer:
The above investment simulation is for illustrative purposes only and should not be construed as a promise on minimum returns and safeguard of capital. The AMC / Mutual Fund is not guaranteeing or promising or forecasting any returns. SIP does not assure a profit or guarantee protection against a loss in a declining market. Please refer SIP Enrolment Form or contact nearest ISC for SIP Load Structure.
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Investment Pattern:
The asset allocation under the respective Plans will be as follows: Type of Instruments Minimum Maximum Allocation (% of Allocation(% of Net Assets) Net Assets) Equity and Equity Related 65% 100% Instruments of infrastructure / infrastructure related companies Equity and Equity Related 0% 35% Instruments of companies other than mentioned above Debt Securities and Money 0% 35% Market Instruments* and Fixed Income Derivative ; Risk Profile of the Instrument Medium to High
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* Investments in securitised debt shall not normally exceed 30% of the net assets of the Scheme. The Scheme may seek investment opportunity in Foreign Securities (max. 35% of net assets). The Scheme may take derivatives position for hedging, portfolio balancing or to undertake any other strategy as permitted under SEBI Regulations from time to time (max. 20% of the net assets) based on the opportunities available subject to SEBI Regulations.
Returns
HDFC Infrastructure Fund Date March 30, 2007 December 28, 2007 June 29, 2007 June 30, 2005 June 30, 2003 June 30, 1998 March 10, 2008 (NAV as at evaluation date, Rs. Per unit) Period NAV Last 458 days Last Six months (185 days) Last 1 Year (367 days) Last 3 Years (1096 days) Last 5 Years (1827 days) Last 10 Years (3653 days) Since Inception (112 days) N.A N.A N.A N.A N.A N.A 10.000 7.48 Returns(%) $ $^ N.A. N.A. N.A. N.A. N.A. N.A. -25.2* Benchmark Returns(%)# 1.47** -39.38* -11.59** 18.87** 29.03** 17.75** -18.45*
* Absolute Returns ** Compounded Annualised Returns # S&P CNX 500 ~ Due to an over all sharp rise in the stock prices ^ Past performance may or may not be sustained in the future
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Returns
HDFC Prudence Fund Date March 30, 2007 December 28, 2007 June 29, 2007 June 30, 2005 June 30, 2003 June 30, 1998 February 1, 1994 * Absolute Returns (NAV as at evaluation date, Rs. Per unit) Period NAV Last 458 days Last 185 days Last 1 Year (367 days) Last 3 Years (1096 days) Last 5 Years (1827 days) Last 10 Years (3653 days) Since Inception (5263 days) 110.132 160.6870 124.716 64.682 19.230 11.480 10.000 112.678 Returns(%) $$ ^ 1.84** -29.88* -9.6** 20.3** 42.37** 26.8** 20.41** Benchmark Returns(%)# 6.01** -22.7* -1.33** 15.38** 19.31** N.A. N.A.
** Compounded Annualised Returns Due to an over all sharp rise in the stock prices
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Investment Strategy
As outlined above, the investments in the Scheme will comprise both debt and equities. The Fund would invest in Debt instruments such as Government securities, money market instruments, securitised debts, corporate debentures and bonds, preference shares, quasi Government bonds, and in equity shares. In the long term, the mix between debt instruments and equity instruments is targeted between 60:40 and 40:60 respectively. The exact mix will be a function of interest rates, equity valuations, reserves position, risk taking capacity of the portfolio without compromising the consistency of dividend pay out (in the case of Dividend Plan), need for capital preservation and the need to generate capital appreciation. Fund Manager Mr. Prashant Jain Mr. Anand Laddha - Dedicated Fund Manager - Foreign Securities
Investment Pattern
The following table provides the asset allocation of the Scheme's portfolio. The asset allocation under the respective Plans will be as follows : Sr.No. Type of Instruments 1 2 Equities & Equity related instruments Debt Securities, Money Market instruments(including cash/call money) Normal Allocation (% of Net Assets) 40 - 75% 25 - 60% Risk Profile Medium to High Low to Medium
(Investment in Securitised debt, if undertaken,would not exceed 10% of the net assets of the Scheme.)
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Investment Pattern
The asset allocation under the Scheme will be as follows : Sr.No. 1 2 Asset Type Equities and Equity Related Instruments Debt & Money Market Instruments (% of Portfolio) Risk Profile Upto 100% Medium to High Not more than 20% Low to Medium
Investment in Securitised debt, if undertaken, would not exceed 20% of the net assets of the scheme. The Scheme may also invest upto 25% of net assets of the Scheme in derivatives such as Futures & Options and such other derivative instruments as may be introduced from time to time for the purpose of hedging and portfolio balancing and other uses as may be permitted under the regulations and guidelines. The Scheme may also invest a part of its corpus, not exceeding 40% of its net assets, in overseas markets in Global Depository Receipts (GDRs), ADRs, overseas equity, bonds and mutual funds and such other instruments as may be allowed under the Regulations from time to time. Also refer to the Section on Policy on off-shore Investments by the Scheme(s). SIP Investments Total Amount Invested (Rs.) Market Value as on June 30, 2008 Returns (Annualised)*% Benchmark Returns Since Inception 173,000.00 890,131.42 20.51% 15.04%
SIP Returns
10 Year 120,000.0 0 463,752.0 8 25.51% 19.77% 5 Year 60,000.00 103,349.4 0 21.92% 17.56% 3 Year 36,000.0 0 37,539.3 4 2.74% 3.25% 1 Year 12,000.00 9,242.16 -39.73% -40.27%
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Returns
HDFC Capital Builder Fund Date March 30, 2007 December 28, 2007 June 29, 2007 June 30, 2005 June 30, 2003 June 30, 1998 February 1, 1994 * Absolute Returns # S&P CNX 500 ^ Past performance may or may not be sustained in the future (NAV as at evaluation date, Rs. Per unit) Period NAV Last 458 days Last Six months (185 days) Last 1 Year (367 days) Last 3 Years (1096 days) Last 5 Years (1827 days) Last 10 Years (3653 days) Since Inception (5263 days) 60.3 105.1230 73.27 37.474 13.117 7.480 10.000 64.169 Returns(%) $ $^ 5.08** -38.96* -12.36** 19.62** 37.32** 23.96** 13.76** Benchmark Returns(%)# 1.47** -39.38* -11.59** 18.87** 29.03** 17.75** 7.95**
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1. 2.
The secondary data are those, which have already been collected by someone else thorough Books, Internet, Television, journals, Magazines, etc. On the other hand primary data does not exist here. The researcher has to gather primary data afresh for the specific study undertaken by him. Primary data has been collected here by questionnaire method and personal interview method is followed. Primary sources such as Interviews,
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In Sagar i.e. rural area it is still a new concept so it will take some more time to really penetrate into this market apart from people who are HNIs though these people are given more emphasis by all the Mutual funds and distribution channels. With the introduction of SIPs the industry has created some options clear for retail investors to enter this market. My survey says that it the awareness level that is playing acting as an obstacle in the growth of Mutual fund Industry in Sagar as a whole. People in Bhubaneswar are now opening up and interested in looking forward for certified investment planners to help them designing their investment portfolio. Sagar as a market was not that efficient few years back, but now with lot of multinational companies and other reputed companies coming down, the Sagar market is slowly picking up. For mutual funds it is one of the emerging markets that can be trapped form its developing stage and though people of rural areas prefer Moderate risk they can easily accept mutual funds. Mutual fund Industry is delivering a splendid performance and will of course continue in coming future. But
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No of respondent - 200
Male Female - 135 - 65
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The survey is conducted on a sample of 200 people which includes 110 males and 90 females. The sample contains consumers from all the age groups so that an ideal sample can be obtained.
1. Investment Avenues available in the market, that investor are aware
of?
Postal schemes Government securities Direct equity investment Bank FDs Mutual funds Insurance
Direct equity investm ent 15% Bank FD's 33%
INFERENCE: According to the investors in Sagar city, 33% of investors prefer to deposit there money in bank FDs. Where as 8% of the investors want to invest in postal scheme, 4% in
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. INFRENCE:
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PROJECT ON STUDY OF PERFORMANCE OF MUTUAL FUNDS IN REFEENCE TO HDFC BANK According to people of Sagar city they attract with past performance of the company if company past records is good then they interested to invest. After that people attract with tax benefit then return on investment
INFRENCE:
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PROJECT ON STUDY OF PERFORMANCE OF MUTUAL FUNDS IN REFEENCE TO HDFC BANK By this we come to know that most of the people use to go for mutual fund as we can see by the above graph that 83 people from 200 goes for 20% to50% investment in Mutual Funds.
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INFERENCE: According to the Investors in Sagar city 35% of investors prefer to invest in HDFC mutual fund, 27% of investors prefer Reliance mutual fund where as Birla share 12% and ICICI by 17%.but only 9% investors invest in ABN AMRO mutual fund. I have compared these five fund house because they are the main competitors in Rourkela.
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5. How do investors manage his investment portfolio? Solely of my own On advise of a friend On advise of a distributor/agent On advise of your banker On advice of mutual fund house people
INFRENCE: According to my survey most no of people manage his investment port folio by own, 84 people out of 200 manage his portfolio by own and 45 & 36 people manage with the help of bankers and MF house
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INFRENCE: According to my survey before 5 year most of the people(113) of Sagar city invested his money in insurance sector and 90 people out of 200 invested in bank FD. But only 43 people out of 200 invest in mutual fund which was verylow
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7. Among the huge number of people going for mutual fund, in which kind of fund they normally invest?
Equity Oriented Debt Oriented Balanced Oriented
INFERENCE: In the city like Sagar city in between the age group 18-30, 62% investor invested in equity oriented, and only 18% people invest in debt fund. But group of people more than 50 year 55% investor invest in debt fund and only 23% people invest in equity fund. It mean younger people attract with equity fund and old man attract with debt fund. but in balanced fund every groups are equally invest
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PROJECT ON STUDY OF PERFORMANCE OF MUTUAL FUNDS IN REFEENCE TO HDFC BANK Risk appetite of people in Sagar Preferred Risk and Return
High risk high return Moderate risk moderate return Low risk low return (H,H) (M,M) (L,L)
INFERENCE: According to the survey, we can conclude that, people in rural areas mostly believe in Moderate risk, and moderate returns. Even mutual funds have moderate risk and the return is quite less than as it is in case of equities. So, for the people of Rural areas mutual funds are the right kind of investment option.
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INFRENCE: According to my survey of Sagar city people , most no of people are more serious about financial planning
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FINDINGS
In India Mutual fund Industry has seen Dramatic improvements in Quality as well as quality of products and services offering over the past decade, but the industry has witnessed growth in the last 10 years considerably below potential. The Asset under Management have grown from about Rs. 470 billion in march 1993 to Rs. 1,540 billion in April 2004(CAGR of 11.4 percent) & now it grown to Rs. 5,620 billion till sep 2008. This has mainly achieved due to collection through mutual fund IPOs that has been increasing due to the investors feeling that it is cheaper in its IPO stage on account of its Rs. 10 NAV.
There has been a strong appreciation in equities in comparison to the debt market, which has shown a downward trend last year. And in turn Mid-cap and diversified funds have delivered the highest in comparison to other funds. As the Indian economy is showing a growing trend with GDP more than 6% and expected to show 8% and Indian household saving being 24% of the entire GDP. There is a strong growth potential of Mutual fund industry in India.
In Sagar i.e. rural area it is still a new concept so it will take some more time to really penetrate into this market apart from people who are HNIs though these people are given more emphasis by all the Mutual funds and distribution channels. With the introduction of SIPs the industry has created some options clear for retail investors to enter this market. My survey says that it the awareness level that is playing acting as an obstacle in the growth of Mutual fund Industry in Sagar as a whole.
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RECOMMENDATION
HDFC Mutual Fund is one of the largest mutual funds and well-established fund house in the country with consistent and above average fund performance across categories since its incorporation on December 10,1999.The single most important factor that drives HDFC Mutual Fund is its belief to give the investor the chance to profitably invest in the financial market, without constantly worrying about the market swings.
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CONCLUSION
The global financial market has transformed from Sellers market to Buyers market with liberalization, Globalizations and privatization. The Indian mutual fund market has also become global when foreign funds entered, they came up with probably best marketing strategies to beat Indian giants like BIRLA, HDFC, and ICICI have come up with aggressive strategies to beat the foreign funds. Now the cutthroat competition goes on and on. HDFC Mutual funds have rewarded investors with hand some returns. The good news is that this is poised to become a trend. The mutual funds have strengthened their distribution networks, become more transparent and investor friendly and are rewarding investors. The mutual fund is finally, proving itself as a vehicle of safety for investments. But it is still the fund managers investment philosophy that makes the difference between the winner and the losers. Careful market analysis, consumer segmentation, identification of investor needs, service designing are to be carried out for the successful implementation of different schemes by mutual fund organizations. Regulatory measures by SEBI should be clearly explained to the investors. Positioning of the schemes and their branding will help a lot for growth of the industry. Creativity and innovation are the means of marketing in the days to come for Indian mutual fund market.
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BIBLIOGRAPHY
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BIBLIOGRAPHY
MAGAZINES INDIA TODAY BUSINESS WORLD WEB SITES WWW.HDFCFUND.COM http://www.hdfcfund.com/AboutUs/ http://www.hdfcfund.com/Products/ WWW.AMFIINDIA.COM http://www.amfiindia.com/showhtml.asp?page=mfconcept#A
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QUESTIONARE
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Name
_______________________________________________________
Age
Sex
Occupation
Organization Designation -
_______________________________________________________ _______________________________________________________
Annual Income -
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3. In your point of view what is more attractive about mutual funds? Returns Moderate risk Tax benefits No idea 4. If you have invested in Mutual funds, what percentage of your entire investment includes mutual funds? Below 20% 20 to 50% 50 to 80% 80% above Hassle free Past performance Well regulated
5. What were your Savings/investment avenues 5 year back? Bank FD, Savings Mutual funds Govt. securities Postal savings, FD Insurance Equity market Real estate
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11. Would you like to undergo a financial planning exercise for yourself? Yes No
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