Mutual Funds and Investors' Awareness About Mutual Fund Companies

SUMMER INTERNSHIP REPORT
ON
MUTUAL FUNDS AND INVESTORS AWARENESS ABOUT

MUTUAL FUND COMPANIES
SUBMITTED TOWARDS THE PARTIAL FULFILLMENT OF POST
GRADUATE DEGREE IN BUSINESS ADMINISTRATION
BY:
ANKIT OMAR
Roll No. : A0101907051
UNDER THE GUIDANCE OF:

DR.R.S.RAI
AMITY BUSINESS SCHOOL
AMITY UNIVERSITY UTTAR PRADESH

24th July2008
Amity Business School
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DECLARATION
I, student of M.B.A. from AMITY BUSINESS SCHOOL, AMITY UNIVERSITY
UTTAR PRADESH, declare that I have completed this project Mutual Funds And
Investors Awareness About Mutual Fund Companies at ING VYASA BANK within
two months under the guidance of my Faculty Guide DR. R.S. RAI at Amity
Business School, Amity University Uttar Pradesh.
I further declare that the work inside the report is authentic to the best of my knowledge.
Date: 25.07.2008
Ankit Omar
Place: Noida
A0101907051
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CERTIFICATE
This is to certify that Ankit Omar, a student of M.B.A, AMITY BUSINESS SCHOOL,
AMITY UNIVERSITY UTTAR PRADESH, has worked under the guidance of
his Faculty Guide Dr. R.S. Rai for two months, on a project Mutual Funds And
Investors Awareness About Mutual Fund Companies at ING VYASA BANK.
He worked hard displaying enthusiasm and determination for the completion of
his project.
I hereby declare that the work done by him is true as per my knowledge.
Date: 25.07.2008
R.S. RAI
Place: Noida
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ACKNOWLEDGEMENT
At the very outset I would like to express my sincere gratitude to my respected Faculty
Guide Dr. R.S Rai of AMITY BUSINESS SCHOOL, AMITY UNIVERSITY UTTAR
PRADESH for giving me his wholehearted support, guidance and encouragement at
every step of this project. His valuable suggestions and advices have been a constant
source of inspiration to me in completing this project.
I would like to express my sincere thanks to ING ASSEST MANAGEMENT
COMPANY for providing me an opportunity to work with them and to undertake this
project on MUTUAL FUNDS AND INVESTORS AWARENESS ABOUT ASEST
MANAGEMENT COMPANIES. I feel proud to be associated with an esteemed
organization like ING.
I feel especially indebted to Mr. Vikash Mishra (Sr. wealth Manager of ING VYSYA
Bank); without whose consent this project couldnt have been carried out. I express my
sincere gratitude to MR. Naveen Goyal (Sr. Manager ING Investment Management). I
am highly indebted and thankful to all of them for sparing valuable time from their busy
schedule to provide me constant guidance and cooperation for completing this project.
I am very keen to express my gratefulness to my friends, family members and classmates
for their tremendous support, contribution and assistance at many step of this project
which made this difficult job a nice experience.
Ankit Omar
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CONTENTS
Declaration
Certificate
Acknowledgment
Preface
Executive Summary
Chapter No.:
Subject:
Page No:
1.
Introduction
8-10
2.
Review of Literature
11-13
3.
Industry Profile
14-58
4.
Company Profile
59-63
5.
Comparison between funds
64-76
5.
Project Profile
77-78
6.
Research Methodology
79-81
7.
Data Analysis and Interpretation
82-92
8.
Observation
93
9.
Limitations
94
10.
Conclusion
95
Reference
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Annexure- questionnaire
PREFACE
This project report has been made on Rising Demand of Mutual Funds in the present
market. The basic idea of this report is to conduct an analysis of rising need of Mutual
Funds in order to highlight the change in services with the passage of time. The basic
motive is to cover the Upper Middle and Lower segment of the people investing in
mutual funds..
Mutual Fund Industry has grown in a trillion dollar industry by this year and this is due
to the performance given by mutual funds and because of investors faith in making
their money to grow at higher pace than FDs (Fixed deposit)
The data is collected by means of FACTSHEETS provided by Asset Management
Companies and it is analyzed with the help of graphs & tables. I hope this report will
satisfy the readers & present them with detailed information.
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EXECUTIVE SUMMARY
I did my S.I.P with ING VYASA BANK, from 2nd May till 30th June 2008. The basic
objective of this project was to develop an understanding of mutual funds and determine
the level of awareness of the investors about the various mutual fund companies.
With such a large population and the untapped market of population, Mutual funds
happen to be a very big opportunity in India. In spite of all the growth, the statistics of
the penetration of the mutual funds in the country is not good. This is an indicator that
growth potential for the mutual funds is immense in India .
Seeing the past performance of various funds it can be stated that these funds can
provide better options for investors to invest in. As it is less risky compared to
direct investments in stock market.
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INTRODUCTION
A mutual is a trust that pools the savings of a number of investors who share a common
financial goal. The money thus collected is then invested in capital market instruments
such as shares, debentures and other securities. The income earned through these
investments and the capital appreciation realized are shared by its unit holders in
proportion to the number of units owned by them. Thus a Mutual Fund is the most
suitable investment for the common man as it offers an opportunity to invest in a
diversified, professionally managed basket of securities at a relatively low cost.
Mutual funds belong to a group of financial intermediaries known as investment
companies, which are in the business of collecting funds from investors and pooling them
for the purpose of building a portfolio of securities according to stated objectives. They
are also known as open-end investment companies. Other members of the group are
closed-end investment companies (also known as closed-end funds) and unit investment
trust.
Mutual funds are generally organized as corporations or trusts, and, as such, they have a
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board of directors or trustees elected by the shareholders. Almost all aspects of their
operations are externally managed. They engage a management company to manage the
investment for a fee, generally based on a percentage of the fund's average net assets
during the year. The management company may be an affiliated organization or an
independent contractor. They sell their shares to investors either directly or through
other firms such as broker-dealers, financial planners, employees of insurance
companies, and banks. Even the day-to-day administration of a fund is carried out by an
outsider, which may be the management company or an unaffiliated third party.
Benefits from investing in a mutual fund:

The advantages of investing in a Mutual Fund are:
Professional Management
Diversification
Convenient Administration
Return Potential
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Low Costs
Liquidity
Transparency
Flexibility
Choice of schemes
Tax benefits
Well regulated
USAGE
Mutual funds can invest in many different kinds of securities. The most common are
cash, stock, and bonds, but there are hundreds of Sub-categories. Stock funds, for
instance, can invest primarily in the shares of a particular industry, such as technology
or utilities. These are known as sector funds. Bond funds can vary according to risk
(e.g., high-yield junk bonds or investment-grade corporate bonds), type of issuers (e.g.,
government agencies, corporations) or maturity of the bonds (short- or long-term).
Most mutual funds' investment portfolios are continually adjusted under the supervision
of a professional manager, who forecasts the future performance of investments
appropriate for the fund and chooses those which he or she believes will most closely
match the fund's stated investment objective.
Mutual funds are liable to a special set of regulatory, accounting, and tax rules. Unlike
most other types of business entities, they are not taxed on their income as long as they
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distribute substantially all of it to their shareholders. Also, the type of income they earn
is often unchanged as it passes through to the shareholders.
REVIEW OF LITERATURE
This chapter contains the review of the existing research literature on MUTUAL
FUNDS
A prominent study (Switzer, N., Lorne, 2007) examined whether small and mid-cap
fund performance related to fund manager human capital characteristics including
tenure, investment experience, education (MBA designation), professional training
(CFA), and gender. The study identified sample of 1,004 small and mid-cap equity
funds on the Morningstar database as of 31 December 2005 and applied several
statistical tests which considered fund performance, risk, expenses, and turnover
simultaneously.
A prominent article ( Jonson, T, Don, 2006) examined whether real estate investments
will provide better return to investors as it is probably the largest category of asset for
the investors , it can provide investors better margins as it is a sector specific fund .
According to the findings these funds can provide higher management fess to asset
management companies as they are associated with higher returns.
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The article ( Shank ,T, Hill Ron 2005) examined a statement Doing well is doing
good within the financial management literature, using comparisons using socially
responsible mutual funds in NYSE ( New York Stock Exchange). It describes the short
term performance and long term performance of mutual funds and stated the
comparison between them. The performance indicated that the performance for long
term fund were much better than the short term funds.
The prominent study (Glenn, J, Patrick, Thomas 2004) examines the performance of
both open-ended and closed-ended mutual funds-as a fixed income securities and
vehicles of capital gains. A determination is made of which one category outperforms
the other and it tells us about the performance better or worse. This will help to
determine the fund and help the investors in choosing it.
The article (Baris, G, Jay, Warshall, A 2004) examines the mutual funds scandals
involving market timings and late day trading, The Securities and commission issued
Investment Company Governance. The new rule ensure that the investment companies
directors and the company board of chairman should be independent. The new rule
also
require most funds to adopt other governance practices, including
annual selfevaluations and meetings in executive session without the presence of
fund
management. In the adopting release, the SEC also provided guidance
on how fund
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directors should fulfill their fiduciary duties to fund shareholders.
The study (Ramasamy, Bala, Yeung, C, H, Mathew 2003) examines both, in terms of
size and choice, in the mutual fund industry among emerging markets
has been
impressive. However, mutual fund research in emerging markets
hardly exists. This
paper intends to fill this gap. In particular, the paper surveys the
relative importance of
factors considered important in the selection of mutual funds by
financial advisors in
emerging markets.This survey focuses on Malaysia where the mutual
industry started in
the 1950s but only gained importance in the 1980s with the
establishment of a
government initiated programme. The results of the survey point to
three important
factors which dominate the choice of mutual funds. These are
consistent past
performance, size of funds and costs of transaction. Factors which
relate to fund
managers and investment style are not considered to be relatively
important. With the
impending liberalization of the financial markets in the developing
world, the findings
would assist those international funds that are considering expanding
their operations
into these emerging markets.
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The article ( NealO, Edward, Page,E,Daniel 2002) examine the sources

of performance
for a sample of mutual funds that invest primarily in utility companies.
Given
deregulation developments in the utility industry and the sub-market
performance of
utility stocks in the 1990s, the hypothesize that utility funds may be
considering
alternatives to traditional high-yielding electric utility stocks. Although
there is
anecdotal evidence that utility funds may be tilting their focus away
from electric utility
stocks, the findings are that utility mutual funds as a group are no
more or less heavily
invested in utility stocks today than they have been over the past 10
years.
HISTORY
Massachusetts Investors Trust (now MFS Investment Management) was founded on

March 21, 1924, and, after one year, it had 200 shareholders and $392,000 in assets.
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The entire industry, which included a few closed-end funds represented less than $10
million in 1924.
The stock market crash of 1929 hindered the growth of mutual funds. In response to the
stock market crash, Congress passed the Securities Act of 1933 and the Securities
Exchange Act 1934 .These laws require that a fund be registered with the Securities and
Exchange Commission (SEC) and provide prospective investors with a prospectus that
contains required disclosures about the fund, the securities themselves, and fund
manager. The SEC helped draft the Investment Company Act of 1940, which sets forth
the guidelines with which all SEC-registered funds today must comply.
With renewed confidence in the stock market, mutual funds began to blossom. By the
end of the 1960s, there were approximately 270 funds with $48 billion in assets. The
first retail index fund, First Index Investment Trust, was formed in 1976 and headed by
John Bogle,who conceptualized many of the key tenets of the industry in his 1951
senior thesis at Princeton University. It is now called the Vanguard 500 Index Fund and
is one of the world's largest mutual Funds, with more than $100 billion in assets.
IN INDIA:
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The mutual fund industry in India started in 1963 with the formation of Unit Trust of
India, at the initiative of the Government of India and Reserve Bank the. The history of
mutual funds in India can be broadly divided into four distinct phases
First Phase 1964-87

Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It was set up
by the Reserve Bank of India and functioned under the Regulatory and administrative
control of the Reserve Bank of India. In 1978 UTI was de-linked from the RBI and the
Industrial Development Bank of India (IDBI) took over the regulatory and administrative
control in place of RBI. The first scheme launched by UTI was Unit Scheme 1964. At the
end of 1988 UTI had Rs.6,700 crores of assets under management.
Second Phase 1987-1993 (Entry of Public Sector Funds)

1987 marked the entry of non- UTI, public sector mutual funds set up by public sector
banks and Life Insurance Corporation of India (LIC) and General Insurance Corporation
of India (GIC). SBI Mutual
Fund was the first non- UTI Mutual Fund established in June 1987 followed by Canara
bank Mutual Fund (Dec 87), Punjab National Bank Mutual Fund (Aug 89), Indian Bank
Mutual Fund (Nov 89), Bank of India (Jun 90), Bank of Baroda Mutual Fund (Oct 92).
LIC established its mutual fund in June 1989 while GIC had set up its mutual fund in
December 1990.
At the end of 1993, the mutual fund industry had assets under management of Rs.47,004
crores.
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Third Phase 1993-2003 (Entry of Private Sector Funds) With the entry of private
sector funds in 1993, a new era started in the Indian mutual fund industry, giving the
Indian investors a wider choice of
fund families. Also, 1993 was the year in which the first Mutual Fund Regulations came
into being, under which all mutual funds, except UTI were to be registered and governed.
The erstwhile
Kothari Pioneer (now merged with Franklin Templeton) was the first private sector
mutual fund registered in July 1993.
The 1993 SEBI (Mutual Fund) Regulations were substituted by a more comprehensive
and revised Mutual Fund Regulations in 1996. The industry now functions under the
SEBI (Mutual Fund) Regulations 1996.
The number of mutual fund houses went on increasing, with many foreign mutual funds
setting up funds in India and also the industry has witnessed several mergers and
acquisitions. As at the end of January 2003, there were 33 mutual funds with total assets
of Rs. 1,21,805 crores. The Unit Trust of India with Rs.44,541 crores of assets under
management was way ahead of other mutual funds.
Fourth Phase since February 2003

In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI was
bifurcated into two separate entities. One is the Specified Undertaking of the Unit Trust
of India with assets under management of Rs.29,835 crores as at the end of January 2003,
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representing broadly, the assets of US 64 scheme, assured return and certain other
schemes. The Specified Undertaking of Unit Trust of India, functioning under an
administrator and under the rules framed by Government of India and does not come
under the purview of the Mutual Fund Regulations.
The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and LIC. It is
registered with SEBI and functions under the Mutual Fund Regulations. With the
bifurcation of the erstwhile UTI which had in March 2000 more than Rs.76,000 crores of
assets under management and with the setting up of a UTI Mutual Fund, conforming to
the SEBI Mutual Fund Regulations, and with recent
mergers taking place among different private sector funds, the mutual fund industry has
entered its current phase of consolidation and growth. The graph indicates the growth of
assets over the years.
GROWTH IN ASSETS UNDER MANAGEMENT
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FREQUENTLY USED TERMS IN MUTUAL FUND
NET ASSEST VALUE

The net asset value, or NAV, is the current market value of a fund's holdings, usually
expressed as a per-share amount. For most funds, the NAV is determined daily, after
the close of trading on some specified financial exchange, but some funds update their
NAV multiple times during the trading day. The public offering price, or POP, is the
NAV plus a sales charge. Open-end funds sell shares at the POP and redeem shares at
the NAV, and so process orders only after the NAV is determined. Closed-end funds
(the shares of which are traded by investors) may trade at a higher or lower price than
their NAV; this is known as a premium or discount, respectively. If a fund is divided
into multiple classes of shares, each class will typically have its own NAV, reflecting
differences in fees and expenses paid by the different classes.
Some mutual funds own securities which are not regularly traded on any formal
exchange. These may be shares in very small or bankrupt companies; they may be
derivatives; or they may be private investments in unregistered financial instruments
(such as stock in a non-public company).
NAV Calculations
Net Assets
Assets - Liabilities
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Assets
=
Market value of Investments
+ Receivables + Accrued
Other Assets
Liabilities
=
Accrued expenses
Payables Liabilities
NAV of a Unit
income +
Net Assets of the Scheme

Number of units outstanding
DISCLOSING NET ASSEST VALUE OF A UNIT
Date on which NAV is calculated is called Valuation Date.
Open ended Funds are required to compute and disclose NAV Daily.
Close ended Funds can compute NAVs every week but disclose Daily.
NAV Calculation has to consider up to date transactions.
All income, expenditure to be accounted upto date of valuation.
Non accrual of small amounts not affecting NAV by more than 1% permitted.
Non-recorded transactions should not affect NAV calculation by More than 2% .
FACTORS AFFECTING NET ASSEST VALUE OF A UNIT
NAV is affected by 4 set of factors:
Purchase & sale of investment securities
Valuation of all investment securities held
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Other assets and liabilities
Units sold or redeemed
Sale Price
Is the price you pay when you invest in a scheme. Also called Offer Price. It may include
a sales load.
Repurchase Price
Is the price at which a close-ended scheme repurchases its units and it may include a
back-end load. This is also called Bid Price.
Redemption Price
Is the price at which open-ended schemes repurchase their units and close-ended schemes
redeem their units on maturity. Such prices are NAV related.
Sales Load
Is a charge collected by a scheme when it sells the units. Also called, Front-end load.
Schemes that do not charge a load are called No Load schemes.
Repurchase or Back-end Load

Is a charge collected by a scheme when it buys back the units from the unit holders.
Wide variety of Mutual Fund Schemes exists to cater to the needs such as financial
position, risk tolerance and return expectations etc. The table below gives an overview
into the existing types of schemes in the Industry.
Organization of a mutual fund:
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There are many entities involved and the diagram below illustrates the organizational set
up of a mutual fund:
Source- AMFI
TYPES OF MUTUAL FUND SCHEMES
1. Open-Ended Funds.
2. Close-Ended Funds.
3. Load Funds.
4. No Load Funds.
5. Tax Exempt.
6. Non Tax Exempt Funds.
Open Ended Funds: The term mutual fund is the common name for an open-end
investment company. Being open-ended means that, at the end of every day, the fund
issues new shares to investors and buys back shares from investors wishing to leave the
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fund.
Unit Variable Capital .
Fresh subscription may be discounted i.e. if a new NFO (New Fund Offer) is
offered Assest Management Companies may leave exit load.
Any time investors can redeemed there values, except when there is a lockin
period.
2. Closed Ended Schemes: These schemes have a stipulated maturity period.

Typically, you can invest in them for between 3 to 10 year. These schemes are open for
subscription only during a specified period at the time of their lunch. In case of listed
schemes, you can invest in the scheme at the time of the initial issue and thereafter units
of the scheme can be bought or sold on the stock exchange where the scheme is listed.
Traded on stock exchange at a discount / premium to NAV.
Redemption of units on expiry date.
Unit Capital constant.
These funds can allow buy back of units option.
3. Load Funds: Load is one time fee payable by the investor when
they enter / exit an open-ended scheme.
Loads are charged to recover initial issue expenses including

marketing and selling expenses , brokerage .advertising
cost.
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There can be Entry load, exit load or Both.
Entry load is also called Front end load.
Exit load is also called Back end load or deferred load.
4. No load Funds: In no load funds marketing and selling expenses

Are absorbed by the AMC and the investor buys
and sell units at NAV price.
Return on investment to the investor is reduced because of

the loads.
Mutual Funds classified as per Class of Investments
1. Equity Funds.
2. Money Market Funds.
3. Bond Fund.
4. Hybrid Funds.
5. Gilt funds.
6. Balanced Funds.
7. Growth and Income Funds.
8. Real Estate funds.
9. Funds of Funds.
10. Commodity funds.
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11. Exchange Traded funds.
Equity Funds: Equity funds consists mainly of stock investments, are the most
common type of mutual funds. Equity funds hold more than 50 percent of all amount
invested in mutual funds in India.
High risk and aim at Capital appreciation

Types of Equity Funds
Aggressive Growth Funds
Growth Funds
Value Funds
Specialty Funds:
Sector Funds
Foreign Securities Funds
Mid-Cap or Small-Cap Equity Funds
Option Income Fund.
Diversified Equity Funds
ELSS Funds
Equity Index Funds
Equity Income or Dividend Yield Fund
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Money Market Funds: Invest in securities that mature in one year or less, such as
Treasury bills, commercial paper, and certificates of deposits. They are often
referred to as short term funds.
High liquidity and safety of principle amount.
Low risk of loosing principle amount.
Low returns.
Hybrid Funds: They invest in long term securities, as such; it is known as longterm funds. . Hybrid funds invest in a combination of stocks, bonds, and other
securities.
Gilt Funds: Invest in only government securities of over 1 year maturity.
Risk and return are low but higher than MMF Fund.
No default risk but carry interest rate risk.
Fund value drops when interest rates goes up and rise when
Interest rates go down.
Balanced funds: Balanced Funds seek to provide Income and Capital

Appreciation.
Debt Funds: Invest in Corporate Bonds and Government securities.

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Risk higher than that of Gilt Funds
Aims at regular income distribution and not at capital

Appreciation.
Types of Debt Funds:
Diversified Debt Funds
Focused Debt Funds
High yield Debt Funds
Assured return Debt Funds
Fixed Term Plan Series
Growth and Income funds: Seek to provide High Dividend and Capital
Appreciation.
Asset Allocation Funds: Flexible Assest location between debt Equity and MM.
Commodity Funds: Invest in Commodity Stocks.
Real State Funds: Invest in stocks of Real Estate companies in India or across the
world.
Exchange traded Fund: A relatively recent innovation, the exchange traded fund
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(ETF), is often formulated as an open-Ended. Investment company. ETFs combine

characteristics of both mutual funds and closed-end funds.
Funds of Fund: Funds of funds (FOF) are mutual funds which Invests in other
underlying mutual funds i.e. they are funds comprised of other funds.
Mutual Funds classified as per Investment Objectives
1. Growth Schemes.
2. Income Schemes.
3. Balanced Schemes.
4. Liquid Schemes.
1. Growth schemes: Growth schemes are designed to provide optimum
returns though capital appreciation over medium to long term. A major part
of their funds are invested in equities. So, though there could be a decline
in their value in the short-term these schemes deliver in the long run. It is
an ideal option for those in their prime earning years.
2. Income Schemes: If you are looking for regular and steady returns go for
income schemes. These schemes generally invest in fixed income securities
such as bonds and corporate debentures. Their returns may not be as
attractive as growth schemes but they are steady and less risky as compared
to equity schemes. If you have retired or need capital stability and income
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to supplement your current earnings opt for an income scheme.
3. Balanced Schemes: Balanced funds give you the best of both and income
schemes. A balanced fund invests both in equities and fixed income
security. Their returns are less volatile as compared to pure equity funds.
4. Liquid Schemes: Liquid schemes are also known as money market

schemes. These schemes generally invest in safer short-term instruments
such as treasury bills, certificates of deposits, commercial papers and
government securities. It is a good idea to invest your surplus funds for
short periods in liquid schemes.
TAXATION ON MUTUAL FUNDS AND INVESTORS
Finance Act 1999 radically changed taxation of Dividends received by

investors in Mutual Funds
Mutual Fund as an entity is not taxed since it is a Pass through Entity.
Finance Act 1999 made income (dividends) from UNITS totally EXEMPT from
Tax u/s 10(33) in the hands of all investors.
Income (dividends) distributed by a Debt Fund was made liable to Dividend
Distribution Tax at applicable rate.
Open Ended Funds with more than 50% invested in equity do not pay any DDT
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Security Transaction Tax (STT) is charged as applicable
80 C benefit under ELSS upto Rs. 1 Lac
Restriction on dividend stripping
Within 3 months prior to record date of dividend distribution and within

9 months after record date for dividend distribution
Impact of Dividend Distribution Tax
Investor pays the tax indirectly, since NAV comes down to the extent of tax
paid by the Fund.
DD Tax bears no relationship to the investors tax bracket.
Dividend reinvested is also subject to Dividend Distribution Tax.
In Growth Plans, Dividend Distribution Tax not applied, since no dividend is

distributed.
Short / Long Term Capital Gains Tax
Short Term Capital Gain
If units held for less than 12 months
Long Term Capital Gain
If units held for more than 12 months
Short Term Capital Gains at normal tax rates as applicable to investor
Long Term Capital Gains taxed at 20% with indexation or at 10% without
indexation of cost + Applicable Surcharge & Educational Cess.
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Capital Gains Tax
Option to pay 20% or 10% lies with investor for each and every security
2% surcharge also payable
Indexation Benefit on Unlisted Bonds not available
No Capital Gain tax payable if entire Capital gain invested in
Capital Gain Bonds of NABARD, NHAI, REC
Calculating Capital Gain Tax - An Example

Mr. H Invests Rs.2 lacs in MF units during FY 97-98
After 2 years, he sells units and gets Rs.2.4 lacs
His tax liability will be:

CII 99-00 : 389, CII 97-98 : 331 , Ratio : 389/331=1.18
Indexed Cost (2,00,000 x 1.18) = Rs.2,36,000
Capital Gains Rs.4,000
Long Term Capital Gain tax of Mr. H:

Rs.4,000* 20%=Rs.800 or 10% of Rs. 40,000/- i.e. Rs. 4,000/-
Obviously he will select the option of paying Rs. 800/-
LEGAL AND REGULATORY FRAMEWORKS
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SEBI is Capital Market Regulator with legal powers
SEBI regulates Mutual Funds.
All Mutual Funds to be registered with SEBI
RBI is Money Market Regulator
SEBI is regulator for Liquid Funds Investing in MM instruments
MOF supervisory body for RBI & SEBI
Security Appellate Tribunal setup in 2003 to hear appeal against SEBI decisions
Registrar of Companies(ROC) ensures compliance by AMC & by

Trusteeship Company with Indian company act 1956.
No promises in the future without resources backed guarantee
Standard measures to compare such as Annual Yield, CAGR.
Annualised yields for at least one, three, five years & since
Launch.
For less than 1 year performance, Absolute Return without

Annualisation.
Appropriate benchmark to be chosen
Risk factors prominently stated.
Appropriate benchmark to be chosen.
Any ranking of fund to be explained.
OFFER DOCUMENT
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Offer Document of a MF scheme is like a Prospectus issued by inviting public to

subscribe to units of MF scheme. It discloses adequate information for investors to
take informed investment decisions.
Offer Document
A Legal document.
Issued by AMC on behalf of Trustees.
Offer Document describes the Product/Scheme.
Very important document for prospective investor.
First time investors must read OD before deciding to

Invest.
For Close Ended Fund issued at the time of launching a

Scheme.
For Open Ended Fund revised every 2 year.
Contents of Offer Document
Summary information on Cover page:
Risk factors: Standard & Scheme Specific
Legal & Regulatory Compliance Certificate
Financial information on Schemes & Expenses for last 3 years.
Constitution of MF its Sponsors, Trustees, AMC & their functions.
Investment objectives & policies
Management of Funds: Names of Fund Manager
Offer related information: Minimum Subscription amount
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Names of Trustees, AMC, Schemes, Period of Opening/closing, face value of

unit, Disclaimer.
Financial Information in Offer Document
Expenses
Sales load, Redemption load
Contingent Deferred Sales Charge
Initial Issue Expenses for the scheme and for schemes

Launched during last one year.
Estimated annual recurring expenses
FUND DISTRIBUTION
Residents
Resident Individuals / HUF
Indian companies
Partnership Firms
Indian Trusts / Charitable Institutions
Insurance Companies
Banks
Financial Institutions
NBFCs
Provident Funds
Mutual Funds
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Non Residents
NRIs & Persons of Indian Origin
Overseas Corporate Bodies (OCBs)
Foreign Entities
FIIs registered with SEBI
Foreign nationals cannot invest in MF
AMFI CODE OF ETHICS
Funds to be managed in the interest of unit holders
Unit holders to be treated equally & fairly
Ensure meaningful disclosures
Avoid conflict of interest
Ensure segregate accounting
Stick to ethical standards and fairness in dealings
High standards of care, diligence, services and disclosure announcements.
CHARGES IN MUTUAL FUNDS
Mutual Funds can recover two types of Expenses

a.
Initial issue expenses
b.
Recurring Expenses
Initial Issue Expenses
effective April 04 2006 allowed up to 6% for Close Ended
Page 36
funds only
Close Ended Funds cannot charge Entry Loads
Open Ended Funds can recover initial expenses through entry Load
MAXIMUM RECURRING EXPENSEX

Recurring Expenses cannot exceed the following
regulatory limits:
Average Weekly
For Equity
For Bond Funds
Assets
Funds
For first Rs.100 crores
2.50%
2.25%
For next Rs.300
crores
For next Rs.300
crores
On the Balance
Average Weekly
Assets
2.25%
2.00%
2.0%
1.75%
1.75%
1.50%
Page 37
Sources-AMFI
ASSEST MANAGEMENT FEES
AMC charges Asset Management Fees

Limits on AMC Fees as per SEBI Regulations:
1.25% of the 1st Rs. 100 crores of weekly Average Net assets
1.00% of the weekly Average Net Assets in excess of Rs. 100

Crores.
AMC may charge additional 1% of weekly Average Net Assets

for No Load Funds
Asset Management Fees are not in addition to but a part of recurring Expenses
Asset Management fees are usually lower for Debt Funds as compared to Equity
Funds and are disclosed in OD (Offer Document).
Types of Equity Instruments
Equity Shares
Preference Shares
Equity Warrants
Convertible Debentures
Management of Equity Portfolios
Asset Allocation
Page 38
Stock Selection
Market timing
Monitoring of performance
Portfolio re-balancing
Evaluation of performance
Risk assessment and Risk management
Equity Markets: Positive Features
Largest number of listed stocks (9400 companies listed on all stock exchanges
as at 31/3/04 out of which 7200 listed at BSE with a market cap of over 13 Lac
Crores)
Industrial diversity (50 Industries / Sectors represents.
Electronic Trading and Settlement System
Growing number of Institutional Players
Lower Transactions Cost
Lower Settlement Risks
Debt Securities: Types
Debt Securities
Central Government Securities
State Government Securities
Government Guaranteed Bonds
PSU Bonds ( Public saving units )
Page 39
FI Bonds ( financial Institution )
Bank Bonds
Corporate Debentures
Debt Securities: Positive Features
Other Features
Fixed rate / Floating rate Debt Securities
Coupon Bonds / Cumulative Bonds
Listed / Un-listed Debt Securities
Rated / Un-rated Debt Securities
Secured / Unsecured Bonds
Money Market Securities
All Debt Securities maturing within one year are called Money Market Securities
Money Market Securities (Instruments) are:
T-Bills ( Treasury Bills )
CDs ( Corporate Debentures)
Call Money
Repos
Market Capitalization based Classification of Shares
Large cap companies
High Liquidity
Page 40
Low Transaction costs
Mid cap companies
Moderate Liquidity
More transaction cost
Small cap companies
High Profit potential
High Transactions costs
High Volatility
Different Indices and Benchmarks for Large / Mid / Small Cap
Price/Earnings Ratios
Higher the P/E, greater the growth potential
Dividend yield
Lower the dividend yield, Higher the growth potential
Equity Portfolio Management Organization Structure
Fund Manager
Focuses on a certain location
Selects stocks
Fixes price range for purchase & sale
Analyst
researches companies
recommends buy & sell
Page 41
Dealer
Collects market intelligence
Places buy and sell orders with brokers
METHODS OF MEASSURING/EVALUATING MF PERFORMANCE
Major sources of return to investors are Dividends and Capital

Gains.
Investor should track the value of his investments in terms of
Return on such investments
Decide whether he needs to switch to another fund.
Absolute Return Method
Simple Annual Return Method
Total Return Method
Total Return Method when Dividend is Reinvested
Compounded Annual Average Rate Method (CAGR)
Expense Ratio Method
Income Ratio Method
Portfolio Turn over Ratio Method
Transaction Cost Method
Fund Size
Cash Holding Percentage
Page 42
Fund Evaluation against Benchmarks
Funds Performance can be evaluated against some

Performance Indicators called Benchmarks
Mutual Funds are required by regulations to state the

benchmark in the OD against which scheme
performance will be compared
Investors expect Fund Performance better than the

Benchmark
3 Types of Benchmarks :
Relative to Market as a whole.
Relative to other Mutual Funds
Relative to other comparable financial products.
Benchmarks for Equity Funds
Type of Equity Fund
Name of Benchmark
Index Funds
BSE Sensex Index or

S&P CNX Nifty Index
Page 43
BSE 200 Index
Sector Funds
Sector Specific Index
Benchmarks for Debt Funds & Money Market Funds
Type of Debt
Fund
Name of Benchmark
Gilt Fund
Government Security Index
Debt Fund
Corporate Bond Index
Money Market
Fund
Mibor reflecting inter bank call

money market interest rates.
There are various Indices for benchmarking of Debt Funds
I-Bex Index of I-SEC is used for tracking Govt. Security performance
CRISIL has 8 Debt Indices for tracking performance of mutual funds.
Corporate Bond Market & Money Market
NSE has Govt. Security Index & Treasury Bill Index
Page 44
Source- AMFI
SOURCES OF TRACKING MF PERFORMANCE

Following sources of information can be used to track performance of Mutual Fund
Schemes
Mutual Funds Annual periodic Reports.
Mutual Funds website.
AMFI website
Daily Financial News Papers.
Fund Tracking Agencies Credence, Value Research & Lipper

India
Newsletters from brokers.
Offer Document of the Fund
Analytical Articles
Page 45
MUTUAL FUND COMPANIES PRESENT IN INDIA

1. ABN AMRO MUTAL FUND
2. AIG GLOBAL INVESTMENT
3. BOB (BANK OF BARODA)
4. BENCHMARK
5. CANARA ROBOECCO
6. DBS CHOLAMANDALAM
7. DSP MERILL LYNCH
8. DEUTSCHE INVESTMENT
9. ESCORTS MUTUAL FUND
10. FIDELITY INVESTMENTS
11. FRANKLIN TEMPLETON INVESTMENTS
12. HDFC MUTUAL FUNDS
13. HSBC MUTUAL FUNDS
14. PRUDENTIAL ICICI MUTUAL FUNDS
15. ING MUTUAL FUNDS
16. JM MUTUAL FUNDS
Page 46
17. JP MORGAN INVESTMENTS

18. LIC MUTUAL FUNDS
19. LOTUS INDIA MUTUAL FUND
20. MIRAE ASSEST INVESTMENTS
21. MORGAN STANLEY INVESTMENTS
22. OPTIMIX INVESTMENTS
23. PRINCIPAL MUTUAL FUNDS
24. QUANTUM INVESTMENTS
25. RELIANCE MUTUAL FUNDS
26. SBI MAGNUM MUTUAL FUNDS
27. SAHARA MUTUAL FUNDS
28. SUNDARAM BNP PARIBAS MUTUAL FUND
29. TATA MUTUAL FUND
30. TAURAS INVESTMENTS
Page 47
TOP MUTUAL FUND COMPANIES

HSBC Mutual Funds
Incorporated
7/2/2002
Ownership
Private
Sponsor
HSBC Securities and Capital

management private ltd.
Total Assest
17,625.70 as on 6/30/2008
Equity Funds (open ended)
Debt funds (Open ended)
12
Short term Debt(Open Ended)
15
Hybrid Funds(Open End)
Chief Executive
Sanjay Prakash
Chief Executive Offer
Gordon Rodriguez, Mihir Vora
Investors Relation officer
K. Sriram
Address
314, D.N Road, Fort

Mumbai 400001
Telephone
022) 66145000
URL
www.hsbcinvestments.co.in
Page 48
Source- Value research online.com

HDFC Mutual Fund
Incorporated
30/6/2000
Ownership
Private
Sponsor
Housing Development Finance Corporation

Ltd, Standard Life Investments Ltd
Total Assest
52,581.40 as on 6/30/2008
11
13
13
Closed Ended Funds
73
Chief Executive
Milind Barve
Prashant Jain
Yezdi Khariwala
Address
Ramon House, 3rd Floor, H.T.Parekh Marg,

169, Backbay Reclamation, Churchgate
Mumbai 400020
Telephone
022) 22029111/ 66316333
URL
www.hdfcfund.com
Page 49
Prudential ICICI Mutual Funds

Incorporated
30/6/2000
Ownership
Private
Sponsor
Prudential plc, ICICI Bank
Total Assest
58,583.51 as on 6/30/2008
23
32
17
Closed Ended Funds
78
Chief Executive
Nimesh Shah
Nilesh Shah
Ranganath Athreya
Address
Peninsula Tower,8th Floor,503 Peninsula

Corporate Park,Ganpatrao Kadam Marg,
Off.Senapati Bapat Marg,Lower Parel
Mumbai 400013
Telephone
(022) 24997000
URL
www.icicipruamc.com
Page 50
LIC Mutual Fund

Incorporated
19/6/1989
Ownership
Public
Sponsor
Life Insurance Corporation Of India.
Total Assest
14,845.99 as on 6/30/2008
13
Closed Ended Funds
15
Chief Executive
Sushobhan Sarker
S.K Das
Neeraj Verma
Address
Industrial Assurance Building 4th Floor,

Opp. Churchgate Station
Mumbai 400020
Telephone
(022) 22885971/ 55719750/9324543832
URL
www.licmutual.com
Page 51
Reliance Mutual Fund

Incorporated
30/6/95
Ownership
Private
Sponsor
Reliance Capital Ltd
Total Assest
70,811.86 as on 6/30/2008
22
19
Closed Ended Funds
64
Chief Executive
Vikrant Gugnani
Madhusudan Kela, Amitabh Mohanty
Madhusudan Kela, Amitabh Mohanty
Address
Express Building, 4th & 6th Floor, 14 - 'E' Road, Above Satkar Hotel, Opposite
Churchgate Station Churchgate
Mumbai 400020
Telephone
(022) 30414900
URL
www.reliancemutual.com
Page 52
SBI Mutual Fund

Incorporated
29/6/1987
Ownership
Public
Sponsor
State Bank of India, Societe Generale

Asset Management
Total Assest
26,977.36 as on 6/30/2008
14
12
12
Closed Ended Funds
21
Chief Executive
Syed Shahabuddin
Sanjay Sinha
G Kandasubramanian
Address
191, Maker Tower 'E' 19th Floor,Cuffe

Parade
Mumbai 400005
Telephone
(022) 22180221/ 27
URL
www.sbimf.com
Page 53
SUNDARAM BNP PARIBAS Mutual Fund

Incorporated
24/8/1996
Ownership
Foreign JV
Sponsor
Sundaram Finance Ltd., BNP Paribas

Asset Management
Total Assest
13,483.48 as on 6/30/2008
15
11
12
Closed Ended Funds
31
Chief Executive
T. P Raman

P Sundararajan
Address
2nd Floor, 46, Whites Road,

Chennai 600014
Telephone
(044) 28583362/ 28583367/ 28569900
URL
www.sundarambnpparibas.in
Page 54
TATA Mutual Fund

Incorporated
30/6/1995
Ownership
Foreign JV
Sponsor
Tata Investment Corporation Ltd, Tata

Sons LTD.
Total Assest
18,605.60 as on 6/30/2008
16
18
13
Closed Ended Funds
39
Chief Executive
Ved Prakash Chaturvedi

Latha Rajaraman
Address
Mulla House, Ground Floor 51, M.G.Road

Near Flora Fountain
Mumbai 400001
Telephone
(022) 66315191/92/93
URL
www.tatamutualfund.com
Page 55
BIRLA SUN LIFE Mutual Fund

Incorporated
23/12/1994
Ownership
Foreign JV
Sponsor
37,316.31 as on 6/30/2008
Total Assest
Sun Life (India) AMC Investments

Inc., Birla Global Finance Ltd
20
29
17
Closed Ended Funds
61
Chief Executive
Anil Kumar
A Balasubramanian
Rajiv Joshi
Address
Ahura Centre, 2nd Floor, Tower A,

96A-D, Mahakali Caves Road,
Andheri (East)
Mumbai 400093
Telephone
(022) 66928000
URL
www.birlasunlife.com
Page 56
ING Mutual Fund

Incorporated
11/2/1999
Ownership
Private
Sponsor
National Nederlanden Interfinance B.V

(ING Group)
Total Assest
9,795.73 as on 6/30/2008
13
13
10
Closed Ended Funds
41
Chief Executive
Vineet K. Vohra
Paras Adenwala, Ramanathan K
Jyothi Krishnan
Address
601-602, 6th Floor, "Windsor" Off.

C.S.T.Road, Vidyanagari Marg, Kalina,
Santacruz-(East)
Mumbai 400098
Telephone
(022) 39827999
URL
www.ingim.co.in
Page 57
Classification of Funds Based on Risk Levels
Low Risk Funds :
Money Market Fund
Government Securities Fund
Moderate Risk Funds :
Income Fund
Balanced Fund
Growth & Income Fund
Growth Fund
Short Term Bond Fund
Intermediate Bond Fund
Index Fund
High Risk Funds :
Aggressive Growth Fund
International Fund
Sector Fund
Specialized Fund
Page 58
Risk High
Sector Funds
Index Funds
Balanced Funds
Debt Funds
Gilt Funds
Risk Low
MMMF
Low return
High return
Risks in Mutual Fund Investing
Risk in a generic sense means the possibility of financial loss
In the investment world possibility of financial loss arises from variability of

earnings from time to time.
A fund with stable, positive earnings is less risky than a fund with fluctuating
total return.
Page 59
Risk is thus equated with volatility of earnings - a statistically measurable

concept.
COMPANY PROFILE
INTRODUCTION
ING Group is a global financial institution of Dutch origin with 120,000 employees.
ING offers banking, insurance and asset management to more than 60 million clients in
over 50 countries. The clients are individuals, families, small businesses, large
corporations, institutions and governments. ING comprises a broad spectrum of
prominent businesses that increasingly serve their clients under the ING brand.
Key to ING's retail business is its distribution philosophy of 'click-call-face'. This is a
flexible mix of internet, call centers, intermediaries and branches that enables ING to
deliver what today's clients expect: unlimited access, maximum convenience,
immediate and accurate execution, personal advice, tailor-made solutions and
competitive rates. ING's wholesale product offering focuses strongly on its strengths in
employee benefits/pensions, financial markets, corporate banking and asset
management.
IN INDIA
In India, ING is present in all three fields of banking, insurance and asset management
Page 60
in the form of ING Vysya Bank, ING Vysya Life Insurance and ING Investment
Management respectively. The presence in all three fields signifies the importance that
the group attaches to the Indian markets and the group's operations here, as well as its
bullish future outlook on the country.ING Vysya Bank and ING Vysya Life Insurance
are headquartered at Bangalore, while the corporate office of ING Investment
Management is situated at Mumbai. The synergies arising out of the three distinct
but complimentary businesses are bound to be an asset to the group in the changing
market dynamics of the future. The first such signs are already visible on the horizon
with combined products being successfully launched by the different entities of the
group in conjunction with each other.
I
ING INVESTMENT MANAGEMANT

PROFILE
In India ING Investment Management (I) Pvt Ltd has an investor base of over 1,92,677
with Rs.9795.73 crores as of June 30th, 08 (Source: www.amfiindia.com). With a
presence in 40 locations, currently manage 21 schemes.
ING Investment Management (I) Pvt Ltd has been associated with innovation and
responsive adaptability with sharp minds at work. ING Investment Management has
sealed a position of strength and is considered as one of the top contenders to challenge
the market leaders. ING Investment Management has enjoyed many firsts and has
always maintained a pioneering outlook.
Page 61
A few achievements are highlighted below:

1. First Investment Manager to launch a packaged concept in Asset Management
2. Industry.
3. ING Dynamic Asset Allocation Fund was awarded Most Innovative Product
by Asia Asset Monitor.
4. First company to launch Daily Transfer Plan called as Zoom Investment Plan.
BUSINESS PRINCIPLE
As a global provider of financial products and services, ING plays an important role in
society. In order to fulfill this role it needs to maintain the confidence of its customers,
shareholders, employees, and other stakeholders by acting with professionalism and
integrity.
ING Group attaches paramount importance to upholding its reputation, and the ING
Business Principles play an important role in this respect. ING expects the highest
levels of integrity from its employees, regardless of their position in the organization.
THE ING BUSINESS PRINCIPLES ARE:

1. Commitment to their integrity.
2. Aim for above average return.
Page 62
3. Respect each other.

4. To promote sustainable development and respect human rights.
5. Involved in the communities they operate.
MISSION
Setting the standard in helping their customers manage their financial future.
STRATEGY
To remain focus on creating values for shareholders and rewarding them with better total
returns on investment than the average of our peers in the financial sector over a long
time.
INTEGRATED RISK MANAGEMENT

IN recent years ING has systematically invested in improving their risk management
capabilities, building a strong rirk management function fully integrated to the daily
management of business and daily planning. It also works with businesses to identify
and execute business opportunities, lower funding costs and strategic planning.
THE AMC is managing 20 open ended funds and 2 closed ended funds
Open Ended
1. ING Select Debt Fund
2. ING ATM Fund
3. ING Balanced Fund
4. ING Dividend Yield Fund
5. ING Domestic Opportunity Fund
6. ING Equity Fund
Page 63
7. ING Floating rate fund

8. ING Gilt Fund
9. ING GILT Provident Fund
10. ING Income Fund
11. ING Income Fund-Short Term Plan
12. ING L.I.O.N Plan
13. ING Liquid Fund
14. ING Midcap Fund
15. ING MIP Fund Plan A
16. ING MIP Fund Plan B
17. ING Nifty Plus Fiund
18. ING Select Stock Fund
19. ING Tax Saving Fund
20. ING Latin America Fund
Closed Ended
1. ING C.U.B Fund
2. ING Dynamic Assest Allocation Fund
Page 64
COMPARING ING FUNDS WITH OTHER MUTUAL FUNDS

EQUITY
ICICI PRUDENTIAL INFRASTRUTURE FUND
DATE
PERIOD
30-apr 08
NAV
INFRASTRUTUR
BENCHMARK
E FUND
RETURN
29.13
30-apr-08
Last 1 year
19.19
51.62
26.29
31-aug-05
Since inception
10.00
49.34
33.64
Page 65
Source- ICICI FACTSHEET
BIRLA MIDCAP FUND
RETURNS
1 YEAR
3 YEAR
5 YEAR
Madcap fund
32.51
34.83
52.15
SINCE
INCEPTION
45.88
Cnx midcal
28.50
26.68
47.41
42.25
Page 66
Source- BIRLA FACTSHEET
SBI MAGNUM COMMA FUND
COMPOUND
ANNUALIZED
RETURNS
Return for the last 1 year
Return since Inception
COMMA FUND
RETURN
BSE 200 INDEX

RETURN
52.37
38.74
48.50
40.46
Page 67
Source SBI FACTSHEET
HSBC EQUITY FUND

COMPOUND
ANNUALISED RETURN
1 year
3 year
5 year
Since inception
HSBC EQUITY FUND
BSE 200
30.24
34.64
54.27
50.74
24.13
30.56
39.96
35.52
Page 68
Source - HSBC FACTSHEET
HDFC GROWTH FUND

DATE
Dec,28 2007
June.30 2005
June,30 2003
Since
inception
PERIOD
185 days
Last 3 years
Last 5 years
Oct,11 96
NAV
167.888
57.343
23.358
10
RETURNS
-31.25
26.23
37.60
25.30
BSE 200
-37.53
21.20
29.43
15.18
Page 69
SOURCE- HDFC FACTSHEET
ING CORE EQUITY FUND
ANNUALISED RETURN
1 year
3 year
5 year
Since inception
% CHANGE IN NAV
26.64
38.71
42.89
14.81
BSE 100
30.71
40.46
44.24
21.46
Page 70
Sources-ING FACTSHEET
COMPARISION BETWEEN EQUITY FUNDS
EQUITY FUND
ING
HDFC
SINCE INCEPTION
21.46
15.18
Page 71
HSBC
SBI
BIRLA
ICICI
35.52
40.46
42.25
49.34
BEBT FUNDS
ING LIQUID FUND
RETURNS FOR THE

PERIOD
1 year
3 year
% CHANGE IN NAV
7.60
6.70
% CHANGE IN
BENCHMARK
7.17
6.37
Page 72
5 year
Since inception
5.96
6.73
5.49
N/A
HDFC LIQUID FUND
DATE
June,23 2008
Dec,28 2007
June,30 2005
Since inception
NAV
16.394
15.752
13.331
10.00
RETURNS
.17
4.25
7.19
6.65
BENCHMARK
.09
3.60
6.46
N/A
Page 73
RELIANCE LIQUID FUND
PERIOD
Last 1 year
Last 3 year
Last 5 year
Since inception
RETURNS
6.63
5.43
5.68
6.75
BENCHMARK RETURN
6.39
5.13
5.51
N/A
Page 74
ICICI PRUDENTIAL LIQUID PLAN
DATE
Apr,30 2007
Apr,29 2005
Apr,30 2003
Since inception
LIQUID PLAN
8.87
7.31
6.62
7.08
BENCHMARK
8.86
6.26
5.43
N/A
Page 75
BIRLA SUNLIFE LIQUID PLAUS FUND
RETURNS
1 year
3 year
5 year
Since inception
LIQUID PLUS
8.59
6.91
6.27
6.06
BENCHMARK
8.78
6.09
5.41
N/A
Page 76
COMPARISION BETWEEN DEBT FUNDS
DEBT FUNDS
ING
HDFC
RELIANCE
SINCE INCEPTION
6.73
6.65
6.75
Page 77
ICICI
BIRLA
7.08
6.06
PROJECT PROFILE
During our 8-10 weeks training program, we were assigned a specific Project Work as
summer project which involved project design, designing of questionnaires, sampling
techniques, administering the survey, data tabulation, and analysis and drawing
inferences.
The details of the projects are given below:
Page 78
PROJECT TITLE
INVESTORS AWARENESS ABOUT ASSEST MANAGEMENT

COMPANIES
OBJECTIVES
1. To understand the mutual fund companies.

2. To understand the competition among competitors.
3. To know investors knowledge about mutual fund.
4. To do customer survey for noticing the trend of investment of their income.
5. Customer perspective in terms of affordability, awareness, acceptance, etc.
6. Comparison of the products and services of ING AMC with its competitors.
LEARNINGS
1. Learnt about the functioning of stock market and the basis of share
trading.
2. Investors perception about mutual funds companies.
3. Comparison of all the mutual funds.
4. Comparison between funds offered by different asset management companies.
Page 79
STRATEGY
To go for project work, first I understood the company, its products and services and
the industry. Then I studied the products and services of its competitors so that I can
understand the competition in the market. After collecting information of competitors, I
fabricated a questionnaire and conducted investors survey to find investments trend of
people in various financial products and to understand the interests of people towards
companies.
RESEARCH METHODOLOGY
A systematic Research reduces the uncertainty in the decision-making process
management. Properly conducted marketing research is an indispensable tool for top
management in marketing decision. Marketing Research is defined as systematic
design, collection analysis and reporting of data and findings relevant to a specific
marketing situation facing the company.
Page 80
DATA COLLECTION
Data has been collected through primary as well as from secondary sources:Primary Data:-In the present study primary data has been collected on the basis of face
to face interaction and questionnaires.
Secondary Data:-The secondary data is being structured from various websites, books,
magazines and journals.
OBJECTIVE OF THE STUDY
The objective of the project is to find the following points:

1. Products and services provided by the competitors to their
customers.
2. Investment trend of people.
3. Returns derived in last 3 to 5 years.
4. Risk appetite of people and their consideration behind investments.
5. Awareness of people about Assets management companies.
6. Interest of interest in mutual funds.
SCOPE OF THE STUDY

1. ING and other players in the market..
2. Investors of NCR region interest in Asset Management company.
Page 81
RESEARCH DESIGN
Methodology for Customer Survey
Target Population: All customers of ING VYSYA Bank
Page 82
Survey Frame: All Atm Machines of ING and data of investors

of ING VYSYA bank for my survey.
Sampling Element: Individuals.
Sample Size: 2oo customers.
Sample Area: Customers of bank in the NCR region
Type of data used: Primary data.
Tools Used: Questionnaire
Gender: Males and Females
Age: 25 years to 70 years.
DATA ANALYSIS AND INTERPRETATION

1. What is your age?
Page 83
Out of total sample of 200 investors, 34 are in the category of 20-30, 54 falls in the
category of 30-40, 62 investors are in the age group of 40-50 years, 50 falls in the
category of above 50 years of age.
2. What is your annual income?
Page 84
48% respondents are having an annual income between Rs. 2.5 Lacs and Rs. 5 Lacs,
35% respondents are having an annual income between Rs. 1 Lac and Rs. 2.5 Lacs,
10% respondents are earning above Rs. 5 Lacs and only 7% are in the category of
below 1 Lac.
3. What kind of investment do you make?

This question was asked to know investors pattern of investment in mutual funds.
Page 85
.
In the above diagram maximum investors i.e 150 out of 200 are investing in equity. The
reason behind it is that they want maximum profit from their investments. the other
reason is the past performance of equity funds. In liquid funds 40 out of 200 investors
are investing . This is due to the fear of loosing money in Equity market and they want
to play the safe game and 10 out of 200 are investing in Debt market as their capital
will be safe.
4. From last how many years you are doing investments?

This question was asked to find out investors knowledge about mutual funds.
Page 86
The above diagram shows that 40 % or 80 investors out of 200 are investing from less
than 2 years another 40 % are investing in mutual funds from last 5 years.Investors who
are investing in mutual funds from 10 years are only 15 % and who are investing in
mutual funds from above 10 years are only 5 % i.e only 10 out of 200.
5. Which mutual fund company have you invested in?

This question was asked to find out in which company investors have invested their
money.
Page 87
From the questionnaire the findings is that 28 % have invested in Reliance

mutual fund, 18 % of investors have invested in ICICI mutual funds, 8 % or 16
out of 200 investors have invested in ING mutual funds and other mutual fund
company 46 % of investors have invested i.e. 96 out of 200. =
6. In which ING plan you have done investments?

This question was asked to find out in which ING scheme investors have invested.
Page 88
The above diagram shows that in DOF (Domestic Opportunity Fund) 27 % of investors
have invested. In RLF (Real Estate Fund) 38 % of investors have invested. In Liquid
Plus fund 20 % of investors have invested and in other fund only 15 % of investors
have invested.
7. What is your main investment objective?

This question was asked to find investors criteria of investment.
Page 89
From the figure it can be see that out of sample size of 200 investors, 53% of the
respondents have returns as their main investment consideration because everybody
wants good income on their investments, 22% respondents save their money for the
purpose of tax saving so that they can pay less tax to the government ,22 % look safety
perspective as their main objective is to save some amount of money and only 4 % of
investors are their who dont know .
8. For what time period you do investments?

This question was asked to find out their investment policy.
Page 90
The above figures shows that majority of people i.e. 41 % invest between 1-3 years so
that they can earn maximum appreciation in their capital , 33 % of investors invest for
more than 3 years for security reasons and only 26 % of investors do investments for 1
years as they dont want to take risk .
9. In which plan you have invested?

This question was asked to know investment detail .
Page 91
From the above figure we get to know that 53 % of investors invest in SIP ( Systematic
Investment Plan) , the reason behind is the fluctuation of share market as they want to
get better returns and they are basically service class people as they cant afford to pay
money at a single time.. 47 % of investors invest in lumpsum amount as they believe
that they can get maximum appreciation in their capital if they invest at a single time.
10. Why have you chosen SIP for doing investments?
Page 92
In the above diagram, we find that majority of the investors (42% i.e. 84 out of 200
investors) go for the option of monthly saving, 41% people i.e. 82 of them want to
reduce the risk of fluctuating market and rest 17% of investors do it for other purpose.
11. Why have you opted lump sum for doing investments?
Page 93
In the above diagram it is shown the preference of the investors regarding investment in lump
sum plan and it is found that majority of the investors (60% i.e. 120 out of 200 investors)
invest for the purpose of getting higher returns, they give first preference of investing in lump
sum plan to getting higher returns and they give preference to the fluctuating market or
arbitrage i.e. buying in lower market and selling in higher market (30% i.e. 60 out of 200)
and lastly they want to invest for short period (only 20 out of 200 investors). As they earn \
profit or get returns maximum returns they sell the fund.
OBSERVATIONS
Page 94
1. Some investors see it as a Gambling and some see it as the best way to increase their capital.
2. Investors still dont have proper knowledge about mutual funds.
3. Investors usually watch past performance of funds before investing.
4. Investors still belief that if they invest in SBI and Reliance their capital will be safe.
5. Business class people doesnt want to invest as they believe that they can earn more if they
invest same amount in their business.
LIMITATIONS
Page 95
Wherever study is conducted involving human behavior, it suffers from certain

drawbacks because there is possibility of deviation between what is recorded and what
truth is. So there are few drawbacks in this study that are under mentioned.
1. Sample size is very small and the obtained frequencies may do not have good fit
expected frequencies, so there might be some discrepancies in options.
2. The sample, which was selected, may not represent the true characteristics of all the
questions. So there may be variations in the results found from the reality.
3. Respondents were hesitant to give information to some questions.
4. Some investors didnt entertain me.
5. They didnt give us information easily.
6. It was difficult to collect the correct information.
CONCLUSION
Page 96
Under this project, I had the opportunity to get in-depth understanding about mutual
funds and different terms related with the financial market. This project enabled me to
know the awareness level of the investors about the various mutual fund companies.
This project also helped me gain an insight into various aspects like the different products
and services offered by the competitors and the investment trend of the people.
With the help of this project, I have been able to broaden my knowledge about the
financial markets especially in terms of mutual funds.
REFERENCES
Page 97
ING ORANGE BOOK

JAGDEESH, N. and S. TITMAN ( Returns of buying Winners and Selling Loosers:
Implications of stock market efficiency) page no. 65-91.
M. USEEM: Investors Capitalism. page no. 104-107
Mutual Funds Insight Magazine.
Value Research Magazine
Factsheet Of Various Mutual Fund Companies.
WWW..
www.investmarketbusiness.com
www.ingim.com
www.valueresearchonline.com
www.investopedia.com
1. Switzer, N, Lorne, Huang, Yanfen, INTELLECTUAL CAPITAL How
does human capital affect the performance of small and
mid-cap mutual funds . Year 2007 issue 4, page no. 666-881,
Emerald group publisher
2. Johnson, T, Don MANAGERIAL FINANCE Real estate
investing.
Year 2006 issue 6, page no. 953-954, Emerald group publisher
3. Shank, Todd, Hill Ron, MANAGERIAL FINANCE A Study of
Socially
Responsible Firms' Short-Term versus Long-term
Performance. Year 2005
issue 8, page no. 33-46, Emerald group publisher.
4. Baris, G,Jay, Warshall ,A INVESTMENT COMPLIANCE Investment
Company Governance. Year 2004, issue 2, page no. 16-22.Emerald Publisher.
5. Ramasamy, Bala, Yeung, H, C INTERNATIONAL JOURNAL OF
BANKING
MARKETING Evaluating mutual funds in an
emerging market: factors
that matter to financial
Page 98
advisors. Year 2003, issue 3, page no. 122136.Emerald publisher.
QUESTIONNAIRE
Investors Awareness about Asset Management Company .
NAME:
OCCUPATION:
CONTACT NO:
1. What is your age?
(a) 20-25
(b) 25-30
(e) Above 40
(c) 30-35
(d) 35-40
2. What is your annual income?

(a) Less than Rs.100000
(b) Between Rs.100000- Rs.250000
(c) Between Rs.250000- Rs.500000
(d) Above Rs.500000
3. From last how many years are you doing investment?
(a) Less than 2 years
(b) 3-5 years
(c) 5-10 years
(d) More than 10 years
4. What kind of investment do you make? (You can tick more than one)
(a) EQUITY
(b) DEBT
(c) LIQUID
5. Which mutual fund company you have invested in.
(a) ING
(b) RELIANCE
(c) ICICI PRUDENTIAL
(d) OTHERS
Page 99
SPECIFY:
6. In which plan of ING you have done investment?
(i) DOMESTIC OPPORTUNITY FUND
(ii) REAL ESTATE FUND
(iii) Any other
(b) Debt
(c) Liquid Fund
7. What is your main investment objective?
(You can tick more than one)
(a) Savings
(b) Tax saving
(c) Capital appreciation
8. For what time period you do investment?
(a) Short term (Up to 1 year)
(b) Middle term (1-3 years)
(c) Long term (Above 3 years)
9. In which plan have you opted?
(a) SIP (Systematic Investment Plan)
(b) Lump sum
10. Why have you chosen SIP for doing investment?
(a) Monthly saving
(b) To reduce risk of fluctuating market
(c) Any other
11. Why have you opted lump sum for doing investment?
(a) Short period investment
(b) Greater returns
(c) To take the advantage of arbitrage (buying in
lower market and selling in higher market)
Page 100
Page 101

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SUMMER INTERNSHIP REPORT

MUTUAL FUNDS AND INVESTORS AWARENESS ABOUT

UNDER THE GUIDANCE OF:

AMITY BUSINESS SCHOOL

AMITY UNIVERSITY UTTAR PRADESH

Amity Business School

Amity Business School

Amity Business School

Amity Business School

Comparison between funds

Data Analysis and Interpretation

Amity Business School

Amity Business School

Benefits from investing in a mutual fund:

Amity Business School

Amity Business School

directors should fulfill their fiduciary duties to fund shareholders.

Amity Business School

The article ( NealO, Edward, Page,E,Daniel 2002) examine the sources

Massachusetts Investors Trust (now MFS Investment Management) was founded on

Amity Business School

Amity Business School

First Phase 1964-87

Second Phase 1987-1993 (Entry of Public Sector Funds)

Amity Business School

Fourth Phase since February 2003

GROWTH IN ASSETS UNDER MANAGEMENT

Amity Business School

Amity Business School

FREQUENTLY USED TERMS IN MUTUAL FUND

NET ASSEST VALUE

Amity Business School

Net Assets of the Scheme

DISCLOSING NET ASSEST VALUE OF A UNIT

Date on which NAV is calculated is called Valuation Date.

NAV Calculation has to consider up to date transactions.

All income, expenditure to be accounted upto date of valuation.

Non-recorded transactions should not affect NAV calculation by More than 2% .

FACTORS AFFECTING NET ASSEST VALUE OF A UNIT

NAV is affected by 4 set of factors:

Purchase & sale of investment securities

Valuation of all investment securities held

Amity Business School

Other assets and liabilities

Units sold or redeemed

Repurchase or Back-end Load

Amity Business School

TYPES OF MUTUAL FUND SCHEMES

Amity Business School

Unit Variable Capital .

2. Closed Ended Schemes: These schemes have a stipulated maturity period.

Traded on stock exchange at a discount / premium to NAV.

Redemption of units on expiry date.

Unit Capital constant.

These funds can allow buy back of units option.

Loads are charged to recover initial issue expenses including

Amity Business School

There can be Entry load, exit load or Both.

Entry load is also called Front end load.

Exit load is also called Back end load or deferred load.

4. No load Funds: In no load funds marketing and selling expenses

Return on investment to the investor is reduced because of