“INTRODUCTION”

MUTUAL FUNDSI

Shared reserve is a module for assembling the assets by issuing units to the speculators and

placing supplies in securities as per goals as revealed in offer archive.

Welfares in securities are spread over a wide cross-segment of ventures and areas and in this

manner the hazard is decreased. enhancement lessens the hazard since all stocks may not move a

alike way in a like extent in the meantime. Shared reserve issues entities to the speculators as per

quantum of cash contributed by them. Speculators of shared assets are known as unit containers.

The benefits or misfortunes are shared by the financial experts in extent to their ventures. The

common supports regularly turn out with various plans with various speculation goals which are

propelled occasionally. A common store is required to be enlisted with sSecurities and Exchange

bBoard of iIndia (SEBI) which controls securities advertises before it can gather reserves from

people in general.

A shared store is established up as a faith, which has support, trustees, resource Management

Company (AMC) and overseer. The trust is set up by a support or in extra of one support who

resembles promoter of an organization. The executors of the common reserve hold its material

goods for the advantage of the component holders. Assets Management Company affirmed by

SEBI deals with the assets by making interests in different sorts of securities. Caretaker, who is

joined with SEBI, holds the securities of different plans of the store in its guardianship. The

ttrustees are conferred with the overall energy of superintendence and course finished AMC.

They screen the execution and consistence of SEBI Regulations by the common reserve.
UTI was the main shared reserve setiupiiniIndiaiinitheiyeari1963. In mid 1990s, Government
permitted open segment banks and establishments to set up shared assets.

Securities and trade Board of iIndia . Act was passed. The goals of SEBI are to ensure the

enthusiasm of financial specialists in securities and to advance the improvement of and to direct

the securities showcase.

To the magnitude common assets are concerned, SEBI figures arrangements and directs the

shared assets to ensure the enthusiasm of the financial specialists. SEBI informed directions for

the shared supports in 1993. From that point, common assets supported by private segment

elements were permitted to enter the capital market. The controls were completely reexamined in

1996 and have been changed from that point occasionally. SEBI has additionally issued rules to

the common subsidizes occasionally to guarantee the premiums of speculators.

Every shared store whether advanced by open area or private segment elements including those

advanced by remote elements are administered by a similar arrangement of Regulations. tThere

sis no qualification in administrative necessities for these common assets and all are liable to

checking and investigations by SEBI. The dangers related with the plans propelled by the shared

assets supported by these elements are of comparable sort

You can turnover from a common store in three different ways:

1) “Income is earned from profits on stocks and enthusiasm on bonds”

2) If the store offers securities that have expanded in value, the reserve has a capital pick up.
3) If store property increment in cost however are not sold by the reserve supervisor, the

store's offers increment in cost. You would then be capable to deal your common store shares for

a benefit.

Points of interest of mMutual Funds:

• Professional Management - The essential favorable position of assets is the expert

administration of your cash. Speculators buy reserves since they don't have sufficient energy or

the mastery to deal with their own particular portfolios. A shared reserve is a moderately

reasonable route for a little speculator to get a full-time administrator to make and screen

ventures

• Diversification - By owning partakes in a common store as opposed to owning singular

stocks or bonds, your hazard is spread out. The thought behind enhancement is to put resources

into an expansive number of benefits so a misfortune in a specific venture is limited by picks up

in others.

• Economies of Scale - Because a common reserve purchases and offers a lot of securities

at any given moment, its exchange costs are lower than what an individual would pay for

securities exchanges.

• Liquidity - Just like an individual stock, a common store enables you to ask for that your

offers be changed over into money whenever.

• Simplicity – Minimum speculation is little.

Hindrances:
• Dilution - It's conceivable to have excessively broadening. Since reserves have little

possessions in such a large number of various organizations, significant yields from a couple of

speculations regularly don't have much effect on the general return.

• Taxes - When profiting, subsidize supervisors don't think about your own assessment

circumstance.

NEED OF THE STUDY

1. Shared assets are dynamic budgetary instincts which assume critical part in an economy by

activating funds and putting them in the capital market.

2. The exercises of Mutual assets have both short and long haul affect on the investment funds in

the capital market and the national economy.

3. Common assets, trust, help the procedure of monetary developing and intermediation.

4. To managing an account in the meantime they additionally rival banks and other money

related instincts.

5. India is one of only a handful couple of nations to day keep up an investigation development

rate is local reserve funds.

SCOPE OF THE STUDY:

The investigation is constrained to the examination made on two noteworthy kinds of plans

offered by six banks. Each plan is computed in term of their hazard and return utilizing
distinctive execution estimation speculations. The purposes behind such execution in instantly

dissected in the discourse. Segment diagrams are utilized to mirror the portfolio hazard and

return.

Destinations

OBJECTIVE OF THE STUDY:

• A think about on Growth rate examination of common subsidizes in HDFC Limited

(AMC), are affecting on the money related execution of the organization.

AUXILARY OBJECTIVES:

• To know the diverse common reserve conspires in HDFC Limited (AMC) shared Fund.

• To know the idea of Mutual assets.

• To know how the HDFC Limited (AMC) Mutual assets are partaking in the share trading

system.

• To know how the HDFC Limited (AMC) Mutual assets are affecting on the general

execution of the HDFC Limited (AMC) Company.

System

Significance of research: The strategy and system that are utilized for directing the exploration.

Research strategy is a foundational method for taking care of research issue this approach

incorporates every one of the phases of research, for example, look into process, examine

configuration, testing plan, information accumulation, information investigation, information

understanding and information introduction.

Research Process: - This is the way toward leading whole research in such away to tackle the

exploration issue. It incorporates distinguishing proof of issue leading the examination and

understanding of the information and revealing.

To test the Different Mutual reserve Schemes and its impact on the Business with reference to

the KOTAK Mutual Funds.

Research plan: - It shows an outline of research issue and research process

1. Information gathered from the Questionnaire to the HDFC Limited (AMC) Mutual Fund

Hyderabad branch.

2. I gather all the Financial Statements from the HDFC Limited (AMC) Mutual reserve

sites.

Information gathering:- The goal of the present investigation can be refined by leading an orderly

research to know the impact of HDFC Limited (AMC) Mutual Fund Schemes on the Business.

1. Essential information The data displayed in the report is essential information, i.e. the

information Collected from the "HDFC Limited (AMC)" through the Questionnaire.

2. Optional information

Optional information is taken from

 Website

 HDFC Limited (AMC)Journals

 Security Analysis (sem-4)

  Brocuhers

Apparatuses for information examination:- To investigate the data (or) information gathered

shape Branch Manager and different money related Statements the accompanying devices are

utilized:

1. Percentages

2. Averages

3. Range

4. Graphs

5. Bar Chart

LIMITATION OF THE STUDY

• Mostly the information is identified with the auxiliary information.

• To gather the essential information from the organization is troublesome undertaking and

it is a classified issue to the organization.

• The item is confined to just shared assets.

• The information is just constrained to money related execution of the common assets.

• The gathered essential information is just from the one branch head of Hyderabad.

• The correlation for the budgetary execution of the organization is taken just for a long

time.
 REVIEW OF LITEATURE
DEFINITION:

Shared reserve is the pool up investment funds of little financial specialists to raise stores called
common assets. Common assets are put resources into broadened portfolio to spread hazard.
While it opens a venture channel to little speculators, it decreases dangers, enhances liquidity and
results in stable returns and better capital thankfulness over the long haul.

“CONCEPT”

AiMutualiFundiisianiassumeithatipoolsitheireserveifundsiofivariousispeculatorsiwhoishareiaitypicalimo
neyirelatediobjectiveThecashiinithisimannerigatherediisitheniputiresourcesiintoicapitalimarketiinstrum
ents,iforiexample,ioffers,idebenturesiandidifferentisecurities.Theisalaryiearnedithroughitheseiventure
sianditheicapitalithankfulnessiacknowledgediareisharedibyiitsiunitiholdersiiniextentitoitheiquantityiofiu
nitsiclaimedibyithem. In this way a Mutual Fund is the most reasonable venture for the basic man
as it offers a chance to put resources into a differentiated, professionally oversaw container of
securities at a moderately ease. The stream diagram underneath portrays comprehensively the
working of a shared reserve:

“MUTUAL FUND”

Common reserve is an assume that pools cash from a gathering of speculators (sharing normal
budgetary objectives) and put the cash in this manner gathered into resource classes that match
the expressed venture targets of the plan. Since the expressed speculation target of a common
reserve plot for the most part frames the reason for a speculator's choice to contribute cash to the
pool, a shared store can not go astray from its expressed destinations anytime of time.

Each Mutual Fund is overseen by a store administrator, who utilizing his speculation
administration abilities and essential research works guarantees much preferred return over what
a financial specialist can oversee individually. The capital gratefulness and different earnings
earned from these speculations are passed on to the financial specialists (otherwise called unit
holders) in extent of units they possess.

At the point when a financial specialist buys in for the units of a common reserve, he turns out to
be part proprietor of the advantages of the store in an indistinguishable extent from his
commitment sum endure the corpus (the aggregate sum of the reserve). Common Fund financial
specialist is otherwise called a shared store investor or a unit holder.

Any adjustment in the estimation of the ventures made into capital market instruments, (for
example, shares, debentures and so on) is reflected in the Net Asset Value (NAV) of the plan.
NAV is characterized as the market estimation of the Mutual Fund plan's advantages net of its
liabilities. NAV of a plan is ascertained by isolating the market estimation of plan's benefits by
the aggregate number of units issued to the financial specialists.

For instance:

A. If the market estimation of the benefits of a store is Rs. 100,000

B. The add up to number of units issued to the speculators is equivalent to 10,000.

C. ThenitheiNAViofithisiplani=i(A)/(B),ii.e.i100,000/10,000iori10.00i

D. Now if a speculator 'X' possesses 5 units of this plan

ADVANTAGES OF MUTUAL FUND

1. Portfolio Diversification Mutual Funds put resources into a very much broadened arrangement
of securities which empower financial specialist to hold an
enhancediventureiportfolioi(regardlessiofiwhetheritheimeasureiofispeculationiisienormousiorilittle)
2. Proficient Management Fund chief experiences through different research works and has
better venture administration abilities which guarantee higher comes back to the financial
specialist than what he can oversee without anyone else.

3. Less Risk Investors procure an enhanced arrangement of securities even with a little interest
in a Mutual Fund. The hazard in an expanded portfolio is lesser than putting resources into only
2 or 3 securities.

4.LowiTransactioniCostsiDueitoitheieconomiesiofiscalei(advantagesiofibiggerivolumes),icommoniass
etsipayilesseriexchangeicosts.iTheseiadvantagesiareipassedionitoitheifinancialispecialists.

5. Liquidity A financial specialist will be unable to offer a portion of the offers held by him
effortlessly and rapidly, while units of a shared reserve are undeniably fluid.

6. Selection of Schemes Mutual assets give speculators different plans with various venture
goals. Speculators have the alternative of putting resources into a plan having a connection
between's its venture destinations and their own budgetary objectives. These plans additionally
have diverse plans/choices

DISADVANTAGES OF MUTUAL FUND

1.Costs Control Not in the Hands of an Investor needs to pay speculation administration
expenses and reserve circulation costs as a level of the estimation of his ventures (as long as he
holds the units), independent of the execution of the store.

2. NoiCustomizediPortfoliosiTheiarrangementiofisecuritiesiiniwhichiaireserveicontributesiisiaichoice

itakenibyitheistoreidirector. Speculators have no privilege to meddle in the basic leadership

procedure of a reserve director, which a few speculators find as an imperative in accomplishing

their money related goals.

3. Trouble in Selecting a Suitable Fund Scheme Many speculators think that its hard to choose

one alternative from the plenty of assets/plans/plans accessible. For this, they may need to take

counsel from budgetary organizers with a specific end goal to put resources into the correct store

to accomplish their targets.

TYPESiOFiMUTUALiFUNDSi

GeneraliClassificationiofiMutualiFundsi

Open-endiFunds/Closed-endiFundsi

“Open-endiFunds”

Assets that can offer and buy units anytime are delegated Open-end Funds. The reserve measure
of an open-end support is variable (continues changing) due to consistent offering (to financial
specialists) and repurchases (ffrom tthe aspeculators) by the store. An open-end finance isn't
required to continue pitching new units to the financial specialists constantly yet is required to
dependably repurchase, when a speculator needs to offer his units. The NAV of an open-end
subsidize is ascertained each day.

cCLOSED END FUND

AssetsithaticaniofferiaisettledinumberiofiunitsijustiamiditheiNewiFundiOfferi(NFO)iperiodiareiknownia
siClosed-endiFunds. The corpus of a Closed-end Fund stays unaltered constantly. After the
conclusion of the offer, purchasing and reclamation of units by the speculators straightforwardly
from the Funds isn't permitted. Be that as it may, to ensure the premiums of the speculators,
SEBI gives financial specialists two roads to sell their positions:

1.Closed-endiFundsiareirecordedionitheistockitradesiwhereifinancialispecialistsicanipurchase/

offerunitsifrom/toieachiother.iTheiexchangingiisibyiandilargeidoneiatiaimarkdownitoitheiNAViofithe

iplan.iTheiNAViofiaishutiendifinanceiisiprocessedioniaiweekiafteriweekipremisei(refreshedieachi

Thursday)

2. Locked-finish Funds may likewise offer "purchase back of units" to the unit holders. For
this situation, the corpus of the Fund and its remarkable units do get changed.

Load Funds/no-heap reserves

Load Funds
Common Funds acquire different costs on promoting, dissemination, publicizing, portfolio
beating, finance director's compensation and so forth. Numerous assets recuperate these costs
from the financial specialists as load. These assets are known as Load Funds. A heap reserve
may force following kinds of burdens on the financial specialists:

• Entry Load – Also known as Front-end stack, it alludes to the heap charged to a
speculator at the season of his entrance into a plan. Passage stack is deducted from the financial
specialist's commitment add up to the store.

• Deferred Load – Deferred stack is charged to the plan over some undefined time frame.

• Contingent Deferred Sales Charge (CDSS) – In a few plans, the level of leave stack
decreases as the speculator remains longer with the reserve. This kind of load is known as
Contingent Deferred Sales Charge.

No-heap Funds

Every one of those assets that don't charge any of the previously mentioned loads are known as
No-heap Funds.

Expense absolved Funds/Non-Tax-excluded Funds

Expense absolved Funds

Assets that put resources into securities free from assess are known as Tax-excluded Funds. All
open-end value situated assets are absolved from dissemination impose (charge for dispersing
pay to financial specialists). Long haul capital increases and profit pay in the hands of financial
specialists are tax-exempt.

Non-Tax-excluded Funds

Assets that put resources into assessable securities are known as Non-Tax-absolved Funds. In
India, all assets, aside from open-end value situated assets are obligated to pay assess on
circulation wage. Benefits emerging out of offer of units by a financial specialist inside a year of
procurement are sorted as here and now capital additions, which are assessable. Offer of units of
a value arranged reserve is liable to “Securities Transaction Tax.” STT is deducted from the
recovery continues to a financial specialist

Wide MUTUAL FUND TYPES

1. Value Funds

Value stores are thought to be the more dangerous subsidizes when contrasted with other reserve
composes, yet they additionally give higher returns than different assets. It is prudent that a
financial specialist hoping to put resources into a value store ought to contribute for long haul i.e.
for a long time or more. There are distinctive sorts of value subsidizes each falling into various
hazard section. In the request of diminishing danger level, there are following kinds of value
stores:
a. Aggressive Growth Funds - In Aggressive Growth Funds, support supervisors aim for
most extreme capital thankfulness and put resources into less explored offers of theoretical
nature. As a result of these theoretical speculations Aggressive Growth Funds turn out to be more
unstable and therefore, are inclined to higher hazard than other value stores.

b. Growth Funds - Growth Funds additionally contribute for capital gratefulness (with time
skyline of 3 to 5 years) yet they are unique in relation to Aggressive Growth Funds as in they put
resources into organizations that are relied upon to beat the market later on. Without totally
embracing theoretical procedures, Growth Funds put resources into those organizations that are
relied upon to post better than expected income later on.

c. Specialty Funds -

TYPESiOFiMUTUALiFUNDS
GeneraliClassificationiofiMutualiFunds

Open-endiFundsi/iClosed-endiFunds

Open-endiFunds

FundsithaticaniselliandipurchaseiunitsiatianyipointiinitimeiareiclassifiediasiOpen-
endiFunds.iTheifundisizei(corpus)iofianiopen-
endifundiisivariablei(keepsichanging)ibecauseioficontinuousisellingi(toiinvestors)iandirepurchasesi(fr
omitheiinvestors)ibyitheifund.iAniopen-
endifundiisinotirequireditoikeepisellinginewiunitsitoitheiinvestorsiatiallitimesibutiisirequireditoialwaysir
epurchase,iwhenianiinvestoriwantsitoisellihisiunits.iTheiNAViofianiopen-
endifundiisicalculatedieveryiday.

Closed-endiFunds
FundsithaticaniselliaifixedinumberiofiunitsionlyiduringitheiNewiFundiOfferi(NFO)iperiodiareiknownia
siClosed-endiFunds.iTheicorpusiofiaiClosed-
endiFundiremainsiunchangediatiallitimes.iAfteritheiclosureiofitheioffer,ibuyingiandiredemptioniofiunit
sibyitheiinvestorsidirectlyifromitheiFundsiisinotiallowed.iHowever,itoiprotectitheiinterestsiofitheiinvest
ors,iSEBIiprovidesiinvestorsiwithitwoiavenuesitoiliquidateitheiripositions:

1. Closed-
endiFundsiareilistedionitheistockiexchangesiwhereiinvestorsicanibuy/selliunitsifrom/toieachiother.iThe
itradingiisigenerallyidoneiatiaidiscountitoitheiNAViofitheischeme.iTheiNAViofiaiclosed-

endifundiisicomputedioniaiweeklyibasisi(updatedieveryiThursday).
2. iClosed-endiFundsimayialsoiofferi"buy-

backiofiunits"itoitheiunitiholders.iInithisicase,itheicorpusiofitheiFundiandiitsioutstandingiunitsidoigetich
anged.

LoadiFunds/no-loadifunds

LoadiFunds

MutualiFundsiincurivariousiexpensesionimarketing,idistribution,iadvertising,iportfolioichurning,ifun
dimanager’sisalaryietc.iManyifundsirecoveritheseiexpensesifromitheiinvestorsiinitheiformiofiload.iThe
seifundsiareiknowniasiLoadiFunds.iAiloadifundimayiimposeifollowingitypesiofiloadsionitheiinvestors:i

 EntryiLoadi–iAlsoiknowniasiFront-
endiload,iitirefersitoitheiloadichargeditoianiinvestoriatitheitimeiofihisientryiintoiaischeme.iEntryiloadiisid
eductedifromitheiinvestor’sicontributioniamountitoitheifund.i
 ExitiLoadi–iAlsoiknowniasiBack-
endiload,itheseichargesiareiimposedionianiinvestoriwheniheiredeemsihisiunitsi(exitsifromitheischeme).i
Exitiloadiisideductedifromitheiredemptioniproceedsitoianioutgoingiinvestor.i
 DeferrediLoadi–iDeferrediloadiisichargeditoitheischemeioveriaiperiodiofitime.i
 ContingentiDeferrediSalesiChargei(CDSS)i–
iInisomeischemes,itheipercentageiofiexitiloadireducesiasitheiinvestoristaysilongeriwithitheifund.iThisity

peiofiloadiisiknowniasiContingentiDeferrediSalesiCharge.i

No-loadiFundsi

AllithoseifundsithatidoinotichargeianyiofitheiaboveimentionediloadsiareiknowniasiNo-loadiFunds.

Tax-exemptiFunds/iNon-Tax-exemptiFunds

Tax-exemptiFunds

iFundsithatiinvestiinisecuritiesifreeifromitaxiareiknowniasiTax-exemptiFunds.iAlliopen-

endiequityiorientedifundsiareiexemptifromidistributionitaxi(taxiforidistributingiincomeitoiinvestors).i
Longitermicapitaligainsiandidividendiincomeiinitheihandsiofiinvestorsiareitax-free.i

Non-Tax-exemptiFunds

FundsithatiinvestiinitaxableisecuritiesiareiknowniasiNon-Tax-
exemptiFunds.iIniIndia,iallifunds,iexceptiopen-
endiequityiorientedifundsiareiliableitoipayitaxionidistributioniincome.iProfitsiarisingioutiofisaleiofiunit
sibyianiinvestoriwithini12imonthsiofipurchaseiareicategorizediasishort-
termicapitaligains,iwhichiareitaxable.iSaleiofiunitsiofianiequityiorientedifundiisisubjectitoiSecuritiesiTr
ansactioniTaxi(STT).iSTTiisideductedifromitheiredemptioniproceedsitoianiinvestor
BROADiMUTUALiFUNDiTYPES

1.iEquityiFunds

Equityifundsiareiconsidereditoibeitheimoreiriskyifundsiasicompareditoiotherifunditypes,ibutitheyialsoip
rovideihigherireturnsithaniotherifunds.iItiisiadvisableithatianiinvestorilookingitoiinvestiinianiequityifun
dishouldiinvestiforilongitermii.e.ifori3iyearsiorimore.iThereiareidifferentitypesiofiequityifundsieachifalli
ngiintoidifferentiriskibracket.iInitheiorderiofidecreasingiriskilevel,ithereiareifollowingitypesiofiequityif
unds:i
a. AggressiveiGrowthiFundsi-
iIniAggressiveiGrowthiFunds,ifundimanagersiaspireiforimaximumicapitaliappreciationiandiinvestiinil

essiresearchedisharesiofispeculativeinature.iBecauseiofitheseispeculativeiinvestmentsiAggressiveiGr
owthiFundsibecomeimoreivolatileiandithus,iareiproneitoihigheririskithaniotheriequityifunds.i
b. GrowthiFundsi-
iGrowthiFundsialsoiinvestiforicapitaliappreciationi(withitimeihorizoniofi3itoi5iyears)ibutitheyiareidiffer

entifromiAggressiveiGrowthiFundsiinitheisenseithatitheyiinvestiinicompaniesithatiareiexpecteditoioutp
erformitheimarketiinitheifuture.iWithoutientirelyiadoptingispeculativeistrategies,iGrowthiFundsiinves
tiinithoseicompaniesithatiareiexpecteditoipostiaboveiaverageiearningsiinitheifuture.i
c. iSpecialtyiFundsi-

iSpecialtyiFundsihaveistatedicriteriaiforiinvestmentsianditheiriportfolioicomprisesiofionlyithoseicomp

aniesithatimeetitheiricriteria.iCriteriaiforisomeispecialtyifundsicouldibeitoiinvest/notitoiinvestiinipartic
ulariregions/companies.iSpecialityifundsiareiconcentratediandithus,iareicomparativelyiriskierithanidi
versifiedifunds.iThereiareifollowingitypesiofispecialtyifunds:i

1.iSectoriFunds:iEquityifundsithatiinvestiiniaiparticularisector/industryiofitheimarketiareiknowniasiSe
ctoriFunds.iTheiexposureiofitheseifundsiisilimiteditoiaiparticularisectori(sayiInformationiTechnology,i
Auto,iBanking,iPharmaceuticalsioriFastiMovingiConsumeriGoods)iwhichiisiwhyitheyiareimoreiriskyi
thaniequityifundsithatiinvestiinimultipleisectors.

2.iForeigniSecuritiesiFunds:iForeigniSecuritiesiEquityiFundsihaveitheioptionitoiinvestiinioneiorimor
eiforeignicompanies.iForeignisecuritiesifundsiachieveiinternationalidiversificationiandihenceitheyiare
ilessiriskyithanisectorifunds.iHowever,iforeignisecuritiesifundsiareiexposeditoiforeigniexchangeirateiri

skiandicountryirisk.i

3.iMid-CapioriSmall-CapiFunds:i

Fundsithatiinvestiinicompaniesihavingilowerimarketicapitalizationithanilargeicapitalizationicompanie
siareicallediMid-CapioriSmall-CapiFunds.iMarketicapitalizationiofiMid-
Capicompaniesiisilessithanithatiofibig,iblueichipicompaniesi(lessithaniRs.i2500icroresibutimoreithaniR
s.i500icrores)iandiSmall-
CapicompaniesihaveimarketicapitalizationiofilessithaniRs.i500icrores.iMarketiCapitalizationiofiaicom
panyicanibeicalculatedibyimultiplyingitheimarketipriceiofitheicompany'sishareibyitheitotalinumberiofiit
sioutstandingisharesiinitheimarket.iTheisharesiofiMid-CapioriSmall-
CapiCompaniesiareinotiasiliquidiasiofiLarge-
CapiCompaniesiwhichigivesiriseitoivolatilityiinishareipricesiofitheseicompaniesiandiconsequently,iinv
estmentigetsirisky.i

4.iDiversifiediEquityiFundsi-
iExceptiforiaismalliportioniofiinvestmentiiniliquidimoneyimarket,idiversifiediequityifundsiinvestimain

lyiiniequitiesiwithoutianyiconcentrationioniaiparticularisector(s).iTheseifundsiareiwellidiversifiediandi
reduceisector-specificioricompany-
specificirisk.iHowever,ilikeialliotherifundsidiversifiediequityifundsitooiareiexposeditoiequityimarketiri
sk.iOneiprominentitypeiofidiversifiediequityifundiiniIndiaiisiEquityiLinkediSavingsiSchemesi(ELSS).i
Asiperitheimandate,iaiminimumiofi90%iofiinvestmentsibyiELSSishouldibeiiniequitiesiatiallitimes.iELS
Siinvestorsiareieligibleitoiclaimideductionifromitaxableiincomei(upitoiRsi1ilakh)iatitheitimeiofifilingith
eiincomeitaxireturn.iELSSiusuallyihasiailock-
iniperiodiandiinicaseiofianyiredemptionibyitheiinvestoribeforeitheiexpiryiofitheilock-
iniperiodimakesihimiliableitoipayiincomeitaxionisuchiincome(s)iforiwhichiheimayihaveireceivedianyita
xiexemption(s)iinitheipast.i

EquityiIndexiFundsi-
iEquityi IndexiFundsihaveitheiobjectiveitoimatchitheiperformanceiofiaispecificistockimarketiindex.iThe

iportfolioiofitheseifundsicomprisesiofitheisameicompaniesithatiformitheiindexiandiisiconstitutediinithei

sameiproportioniasitheiindex.iEquityiindexifundsithatifollowibroadiindicesi(likeiS&PiCNXiNifty,iSen
sex)iareilessiriskyithaniequityiindexifundsithatifollowinarrowisectoraliindicesi(likeiBSEBANKEXiori
CNXiBankiIndexietc).iNarrowiindicesiareilessidiversifiedianditherefore,iareimoreirisky.i

2.Debt/IncomeFunds
Fundsithatiinvestiinimediumitoilong-
termidebtiinstrumentsiissuedibyiprivateicompanies,ibanks,ifinancialiinstitutions,igovernmentsiandiot
herientitiesibelongingitoivariousisectorsi(likeiinfrastructureicompaniesietc.)iareiknowniasiDebti/iInco
meiFunds.iDebtifundsiareilowiriskiprofileifundsithatiseekitoigenerateifixedicurrentiincomei(andinotica
pitaliappreciation)itoiinvestors.iIniorderitoiensureiregulariincomeitoiinvestors,idebti(oriincome)ifundsi
distributeilargeifractioniofitheirisurplusitoiinvestors.iAlthoughidebtisecuritiesiareigenerallyilessiriskyit
haniequities,itheyiareisubjectitoicreditiriski(riskiofidefault)ibyitheiissueriatitheitimeiofiinterestioriprinci
palipayment.iToiminimizeitheiriskiofidefault,idebtifundsiusuallyiinvestiinisecuritiesifromiissuersiwhoi
areiratedibyicreditiratingiagenciesiandiareiconsidereditoibeiofi"InvestmentiGrade".iDebtifundsithatitar
getihighireturnsiareimoreirisky.iBasedionidifferentiinvestmentiobjectives,ithereicanibeifollowingitypes
iofidebtifunds:i

a. DiversifiediDebtiFundsi-
iDebtifundsithatiinvestiiniallisecuritiesiissuedibyientitiesibelongingitoiallisectorsiofitheimarketiareikno

wniasidiversifiedidebtifunds.iTheibestifeatureiofidiversifiedidebtifundsiisithatiinvestmentsiareiproperly
idiversifiediintoiallisectorsiwhichiresultsiiniriskireduction.iAnyilossiincurred,ioniaccountiofidefaultibyi

aidebtiissuer,iisisharedibyialliinvestorsiwhichifurtherireducesiriskiforianiindividualiinvestor.i
b. FocusediDebtiFunds*i-
iUnlikeidiversifiedidebtifunds,ifocusedidebtifundsiareinarrowifocusifundsithatiareiconfineditoiinvestm

entsiiniselectiveidebtisecurities,iissuedibyicompaniesiofiaispecificisectorioriindustryioriorigin.iSomeie
xamplesiofifocusedidebtifundsiareisector,ispecializediandioffshoreidebtifunds,ifundsithatiinvestionlyii
niTaxiFreeiInfrastructureioriMunicipaliBonds.iBecauseiofitheirinarrowiorientation,ifocusedidebtifund
siareimoreiriskyiasicompareditoidiversifiedidebtifunds.iAlthoughinotiyetiavailableiiniIndia,itheseifunds
iareiconceivableiandimayibeioffereditoiinvestorsiveryisoon.i

c. AssurediReturniFundsi-
iAlthoughiitiisinotinecessaryithatiaifundiwillimeetiitsiobjectivesioriprovideiassuredireturnsitoiinvestors,i

butithereicanibeifundsithaticomeiwithiailock-
iniperiodiandiofferiassuranceiofiannualireturnsitoiinvestorsiduringitheilock-
iniperiod.iAnyishortfalliinireturnsiisisufferedibyitheisponsorsioritheiAssetiManagementiCompaniesi(A
MCs).iTheseifundsiareigenerallyidebtifundsiandiprovideiinvestorsiwithiailow-
riskiinvestmentiopportunity.iHowever,itheisecurityiofiinvestmentsidependsiuponitheinetiworthiofithei
guarantori(whoseinameiisispecifiediiniadvanceionitheiofferidocument).iToisafeguarditheiinterestsiofiin
vestors,iSEBIipermitsionlyithoseifundsitoiofferiassuredireturnischemesiwhoseisponsorsihaveiadequat
einet-
worthitoiguaranteeireturnsiinitheifuture.iInitheipast,iUTIihadiofferediassuredireturnischemesi(i.e.iMont
hlyiIncomeiPlansiofiUTI)ithatiassuredispecifiedireturnsitoiinvestorsiinitheifuture.iUTIiwasinotiableitoif
ulfilliitsipromisesiandifacedilargeishortfallsiinireturns.iEventually,igovernmentihaditoiinterveneiandito
okioveriUTI'sipaymentiobligationsioniitself.iCurrently,inoiAMCiiniIndiaioffersiassuredireturnischeme
sitoiinvestors,ithoughipossible.i

d. FixediTermiPlaniSeriesi–i

FixediTermiPlaniSeriesiusuallyiareiclosed-
endischemesihavingishortitermimaturityiperiodi(ofilessithanioneiyear)ithatiofferiaiseriesiofiplansiandiis
sueiunitsitoiinvestorsiatiregulariintervals.iUnlikeiclosed-
endifunds,ifixeditermiplansiareinotilistedionitheiexchanges.iFixeditermiplaniseriesiusuallyiinvestiinideb
ti/iincomeischemesianditargetishort-
termiinvestors.iTheiobjectiveiofifixeditermiplanischemesiisitoigratifyiinvestorsibyigeneratingisomeiex
pectedireturnsiiniaishortiperiod.i

3.GiltFundsi
AlsoiknowniasiGovernmentiSecuritiesiiniIndia,iGiltiFundsiinvestiinigovernmentipapersi(namedidatedi
securities)ihavingimediumitoilongitermimaturityiperiod.iIssuedibyitheiGovernmentiofiIndia,itheseiinv
estmentsihaveilittleicreditiriski(riskiofidefault)iandiprovideisafetyiofiprincipalitoitheiinvestors.iHowev
er,ilikeiallidebtifunds,igiltifundsitooiareiexposeditoiinterestirateirisk.iInterestiratesiandipricesiofidebtisec
uritiesiareiinverselyirelatediandianyichangeiinitheiinterestiratesiresultsiiniaichangeiinitheiNAViofidebt/
giltifundsiinianioppositeidirection.

4.iMoneyiMarket/LiquidiFunds

Moneyimarketi/iliquidifundsiinvestiinishort-
termi(maturingiwithinioneiyear)iinterestibearingidebtiinstruments.iTheseisecuritiesiareihighlyiliquidia
ndiprovideisafetyiofiinvestment,ithusimakingimoneyimarketi/iliquidifundsitheisafestiinvestmentioptio
niwhenicomparediwithiotherimutualifunditypes.iHowever,ievenimoneyimarketi/iliquidifundsiareiexpo
seditoitheiinterestirateirisk.iTheitypicaliinvestmentioptionsiforiliquidifundsiincludeiTreasuryiBillsi(iss
uedibyigovernments),iCommercialipapersi(issuedibyicompanies)iandiCertificatesiofiDepositi(issuedi
byibanks).
5.iHybridiFundsi

Asitheinameisuggests,ihybridifundsiareithoseifundsiwhoseiportfolioiincludesiaiblendiofiequities,idebtsi
andimoneyimarketisecurities.iHybridifundsihaveianiequaliproportioniofidebtiandiequityiinitheiriportfol
io.iThereiareifollowingitypesiofihybridifundsiiniIndia:i

a. BalancediFundsi

Theiportfolioiofibalancedifundsiincludesiassetsilikeidebtisecurities,iconvertibleisecurities,iandiequityi
andipreferenceisharesiheldiiniairelativelyiequaliproportion.iTheiobjectivesiofibalancedifundsiareitoire
wardiinvestorsiwithiairegulariincome,imoderateicapitaliappreciationiandiatitheisameitimeiminimizingi
theiriskioficapitalierosion.iBalancedifundsiareiappropriateiforiconservativeiinvestorsihavingiailongiter
miinvestmentihorizon.i

b.iGrowth-and-IncomeiFundsi

FundsithaticombineifeaturesiofigrowthifundsiandiincomeifundsiareiknowniasiGrowth-and-
IncomeiFunds.iTheseifundsiinvestiinicompaniesihavingipotentialiforicapitaliappreciationiandithoseikn
owniforiissuingihighidividends.iTheileveliofirisksiinvolvediinitheseifundsiisilowerithanigrowthifundsia
ndihigherithaniincomeifunds.i

6.iCommodityiFunds

Thoseifundsithatifocusioniinvestingiinidifferenticommoditiesi(likeimetals,ifoodigrains,icrudeioilietc.)i
oricommodityicompaniesioricommodityifuturesicontractsiareitermediasiCommodityiFunds.iAicomm
odityifundithatiinvestsiiniaisingleicommodityioriaigroupioficommoditiesiisiaispecializedicommodityifu
ndiandiaicommodityifundithatiinvestsiinialliavailableicommoditiesiisiaidiversifiedicommodityifundian
dibearsilessiriskithaniaispecializedicommodityifund.i“PreciousiMetalsiFund”iandiGoldiFundsi(thatiinv
estiinigold,igoldifuturesiorisharesiofigoldimines)iareicommoniexamplesioficommodityifunds.

7.iRealiEstateiFunds
Fundsithatiinvestidirectlyiinirealiestateiorilenditoirealiestateidevelopersioriinvestiinishares/securitizedia
ssetsiofihousingifinanceicompanies,iareiknowniasiSpecializediRealiEstateiFunds.iTheiobjectiveiofithe
seifundsimayibeitoigenerateiregulariincomeiforiinvestorsioricapitaliappreciation.

i8.iExchangeTradedFundsi(ETF)i

ExchangeiTradediFundsiprovideiinvestorsiwithicombinedibenefitsiofiaiclosed-endiandianiopen-
endimutualifund.iExchangeiTradediFundsifollowistockimarketiindicesiandiareitradedionistockiexchan
gesilikeiaisingleistockiatiindexilinkediprices.iTheibiggestiadvantageiofferedibyitheseifundsiisithatitheyi
offeridiversification,iflexibilityiofiholdingiaisingleisharei(tradableiatiindexilinkediprices)iatitheisameiti
me.iRecentlyiintroducediiniIndia,itheseifundsiareiquiteipopulariabroad.i

9.iFundiofiFunds

iMutualifundsithatidoinotiinvestiinifinancialioriphysicaliassets,ibutidoiinvestiiniotherimutualifundische

mesiofferedibyidifferentiAMCs,iareiknowniasiFundiofiFunds.iFundiofiFundsimaintainiaiportfolioicom
prisingiofiunitsiofiotherimutualifundischemes,ijustilikeiconventionalimutualifundsimaintainiaiportfoli
oicomprisingiofiequity/debt/moneyimarketiinstrumentsiorinonifinancialiassets.iFundiofiFundsiprovid
eiinvestorsiwithianiaddediadvantageiofidiversifyingiintoidifferentimutualifundischemesiwithieveniais
malliamountiofiinvestment,iwhichifurtherihelpsiinidiversificationiofirisks.iHowever,itheiexpensesiofiF
undiofiFundsiareiquiteihighioniaccountioficompoundingiexpensesiofiinvestmentsiintoidifferentimutual
ifundischemes.

RiskiHierarchyiofiDifferentiMutualiFundsi

iThus,idifferentimutualifundischemesiareiexposeditoidifferentilevelsiofiriskiandiinvestorsishouldiknow

itheileveliofirisksiassociatediwithitheseischemesibeforeiinvesting.iTheigraphicalirepresentationihereu

nderiprovidesiaicleareripictureiofitheirelationshipibetweenimutualifundsiandilevelsiofiriskiassociatedi
withitheseifunds:i
MUTUALiFUNDiSTRUCTURE

TheiSEBIi(MutualiFunds)iRegulationsi1993idefineiaimutualifundi(MF)iasiaifundiestablishediinitheifor
miofiaitrustibyiaisponsoritoiraiseimoniesibyitheiTrusteesithroughitheisaleiofiunitsitoitheipubliciunderion
eiorimoreischemesiforiinivestingiinisecuritiesiiniaccordanceiwithitheseiregulations.i

TheseiregulationsihaveisinceibeenireplacedibyitheiSEBIi(MutualiFunds)iRegulations,i1996.iTheistruc
tureiindicatedibyitheinewiregulationsiisiindicatediasiunder.

Aimutualifundicomprisesifouriseparateientitles,inamelyisponsor,imutualifunditrust,iAMCiandicustodi
an.iTheisponsoriestablishesitheimutualifundiandigetsiitsiregisterediwithiSEBI.i
Theimutualifundineedsitoibeiconstitutediinitheiformiofiaitrustianditheiinstrumentiofitheitrustishouldibeii
nitheiformiofiaideediregisterediunderitheiprovisionsiofitheiIndianiRegistrationiAct,i1908.

Theisponsoriisirequireditoicontributeiatileasei40%iofitheiminimuminetiworthi(Rs.10icrore)iofitheiasseti
managementicompany.iTheiboardiofitrusteesimanagesitheiMFianditheisponsoriexecutesitheitrustideed
siinifavouriofitheitrustees.iItiisitheijobiofitheiMFitrusteesitoiseeithatischemesifloatediandimanagedibyith
eiAMCiappointedibyitheitrusteesiareiiniaccordanceiwithitheitrustideediandiSEBIiguidelines.

SponsoriCompanyi EstablishesitheiMFiasiaitrust

(E.g.iPrudential,iICICI) RegistersitheiMFiwithiSEBI

ManagedibyiaiBoardiofiTrusteesi

MutualiFund Holdiunit-
holdersifundsiiniMFienteriintoianiagr
(E.g.iPrudential,iICICI,iMutualiFund) eementiwithiSEBIiandiensureicompli

AMC FloatiMFifunds

(e.g.iprudentialiICICIiAsseti ManagesitheifundiasiperiSEBIiguideli
nes and AMC agreement
Custodiani Provideicustodialiservices

Registrar Providesiregistrarianditransferiservic
esi

Distributors Providesitheinetworkifori

distributioniofitheischemeitoitheiinv
estors
PerformanceiMeasuresiofiMutualiFundsi
Theimostiimportantiandiwidelyiusedimeasuresiofiperformanceiare:i
 TheiTreynoriMeasurei
 TheiSharpeiMeasurei
 JensoniModeli
 FamaiModeli

TheiTrevnoriMeasurei
DevelopedibyiJackiTreynor,ithisiperformanceimeasureievaluatesifundsionitheibasisiofiTreynor'siInde
x.iThisiIndexiisiairatioiofireturnigeneratedibyitheifundioveriandiaboveiriskifreeirateiofireturni(generallyi
takenitoibeitheireturnionisecuritiesibackedibyitheigovernment,iasithereiisinoicreditiriskiassociated),idur
ingiaigiveniperiodiandisystematiciriskiassociatediwithiiti(beta).iSymbolically,iiticanibeirepresentedias:i
Treynor'siindexi(Ti)i=i(Rii-iRf)/Bii
Where,iRiirepresentsireturnionifund,iRfiisiriskifreeirateiofireturniandiHiiisibetaiofitheifund.i
Allirisk-
averseiinvestorsiwouldilikeitoimaximizeithisivalue.iWhileiaihighiandipositiveiTreynor'siIndexishowsia
isuperioririsk-

adjustediperformanceiofiaifund,iailowiandinegativeiTreynor'siIndexiisianiindicationiofiunfavorableiper
formance.i

TheiSharpeiMeasurei
Inithisimodel,iperformanceiofiaifundiisievaluatedionitheibasisiofiSharpeiRatio,iwhichiisiairatioiofireturn
sigeneratedibyitheifundioveriandiaboveiriskifreeirateiofireturnianditheitotaliriskiassociatediwithiit.iAcco
rdingitoiSharpe,iitiisitheitotaliriskiofitheifundithatitheiinvestorsiareiconcernediabout.iSo,itheimodelieval
uatesifundsionitheibasisiofirewardiperiunitiofitotalirisk.iSymbolically,iiticanibeiwrittenias:i
SharpeiIndexi(Si)i=i(Rii–iRf)/Sii
Where,iSiiisistandardideviationiofitheifund.i
WhileiaihighiandipositiveiSharpeiRatioishowsiaisuperioririsk-
adjustediperformanceiofiaifund,iailowiandinegativeiSharpeiRatioiisianiindicationiofiunfavorableiperfo
rmance.i
ComparisoniofiSharpeiandiTreynori
SharpeiandiTreynorimeasuresiareisimilariiniaiway,isinceitheyibothidivideitheiriskipremiumibyiainumer
icaliriskimeasure.iTheitotaliriskiisiappropriateiwheniweiareievaluatingitheiriskireturnirelationshipifori
welliidiversifiediportfolios.iOnitheiotherihand,itheisystematiciriskiisitheirelevantimeasureiofiriskiwheni
weiareievaluatingilessithanifullyidiversifiediportfoliosioriindividualistocks.iForiaiwell-
diversifiediportfolioitheitotaliriskiisiequalitoisystematicirisk.iRankingsibasedionitotaliriski(Sharpeimea
sure)iandisystematiciriski(Treynorimeasure)ishouldibeiidenticaliforiaiwell-
diversifiediportfolio,asitheitotaliriskiisireduceditoisystematicirisk.iTherefore,iaipoorlyidiversifiedifundit
hatiranksihigherioniTreynorimeasure,icomparediwithianotherifundithatiisihighlyidiversified,iwilliranki
lowerioniSharpeiMeasure.i

JensoniModeli
Jenson’simodeliproposesianotheririskiadjustediperformanceimeasure.i
ThisimeasureiwasidevelopedibyiMichaeliJensoniandiisisometimesireferreditoiasitheiDifferentialiRetur
niMethod.iThisimeasureiinvolvesievaluationiofitheireturnsithatitheifundihasigeneratedivs.itheireturnsia
ctuallyiexpectedioutiofitheifundigivenitheileveliofiitsisystematicirisk.iTheisurplusibetweenitheitwoiretu
rnsiisicallediAlpha,iwhichimeasuresitheiperformanceiofiaifundicomparediwithitheiactualireturnsioverit
heiperiod.iRequiredireturniofiaifundiatiaigivenileveliofiriski(Bi)icanibeicalculatedias:i
Rii=iRf+iBii(Rmi–iRf)i
Where,iRmiisiaverageimarketireturniduringitheigiveniperiod.iAftericalculatingiitialphaicanibeiobtaine
dibyisubtractingirequiredireturnifromitheiactualireturniofitheifund.
Higherialphairepresentsisuperioriperformanceiofitheifundiandiviceiversa.iLimitationiofithisimodeliisit
hatiiticonsidersionlyisystematiciriskinotitheientireiriskiassociatediwithitheifundiandianiordinaryiinvesto
ricaninotimitigateiunsystematicirisk,iasihisiknowledgeiofimarketiisiprimitive.i
FamaiModeli
TheiEugeneiFamaimodeliisianiextensioniofiJensonimodel.iThisimodelicomparesitheiperformance,ime
asurediinitermsiofireturns,iofiaifundiwithitheirequiredireturnicommensurateiwithitheitotaliriskiassociat
ediwithiit.iTheidifferenceibetweenitheseitwoiisitakeniasiaimeasureiofitheiperformanceiofitheifundiandiis
icalledinetiselectivity.i

Theinetiselectivityirepresentsitheistockiselectioniskilliofitheifundimanager,iasiitiisitheiexcessireturniove
riandiaboveitheireturnirequireditoicompensateiforitheitotaliriskitakenibyitheifundimanager.iHigherivalu
eiofiwhichiindicatesithatifundimanagerihasiearnedireturnsiwelliaboveitheireturnicommensurateiwithith
eileveliofiriskitakenibyihim.i
Requiredireturnicanibeicalculatedias:iRii=iRfi+iSi/Sm*(Rmi–iRf)i
Where,iSmiisistandardideviationiofimarketireturns.iTheinetiselectivityiisithenicalculatedibyisubtractingithisireq
uiredireturnifromitheiactualireturniofitheifund.iAmongitheiaboveiperformanceimeasures,itwoimodelsinamely,i
TreynorimeasureiandiJensonimodeliuseisystematiciriskibasedionitheipremiseithatitheiunsystematiciriskiisidiver
sifiable.iTheseimodelsiareisuitableiforilargeiinvestorsilikeiinstitutionaliinvestorsiwithihighiriskitakingicapacitie
siasitheyidoinotifaceipaucityiofifundsiandicaniinvestiiniainumberiofioptionsitoidiluteisomeirisks.iForithem,iaiport
folioicanibeispreadiacrossiainumberiofistocksiandisectors.iHowever,iSharpeimeasureiandiFamaimodelithaticons
ideritheientireiriskiassociatediwithifundiareisuitableiforismalliinvestors,iasitheiordinaryiinvestorilacksitheineces
saryiskilliandiresourcesitoidiversified.iMoreover,itheiselectioniofitheifundionitheibasisiofisuperioristockiselecti
oniabilityiofitheifundimanageriwillialsoihelpiinisafeguardingitheimoneyiinvesteditoiaigreatiextent.iTheiinvestme
ntiinifundsithatihaveigeneratedibigireturnsiatihigherilevelsiofirisksileavesitheimoneyiallitheimoreiproneitoirisksio
fiallikindsithatimayiexceeditheiindividualiinvestors’iriskiappetite.
LISTiOFiAMC’S

Kotakimutualifunds

ABNiAMROiMutualifund

BirlaiMutualifund

DeutscheiMutualifund

DSPiMerrilliLynchiMutualifund

FrankliniTempletoniMutualifund

HDFCiMutualifund

HSBCiMutualifund

INGiVysyaiMutualifund

JMiFinancialiMutualifund

NetworthiMutualifund

LICiMutualifund

MorganiStanleyiMutualifund

PrincipaliMutualifund

PrudentialiKOTAKiMutualifund

RelianceiMutualifund

SBIiMutualifund

SundaramiMutualifund

TATAiMutualifund

UnitiTrustiofiIndiaiMutualifund

UTIiMutualifund
 TYPESiOFiMUTUALiFUNDiSEHEMES

BYiSTRUCTUREi

 Open-EndediSchemes
 Close-EndediSchemes
 IntervaliSchemes
BYiINVESTMENTiOBJECTIVEi

 GrowthiSchemes
 IncomeiSchemes
 BalancediSchemes
 MoneyiMarketiSchemes
OTHERiSCHEMES

 TaxisavingiSchemes
 SpecialiSchemes
 IndexiSchemes
 SectoriSpecificiSchemes

Mutualifundischemesimayibeiclassifiedionitheibasisiofiitsistructureiandiitsiinvestmentiobjective.
ByiStructure:
Open-endedifunds
Aniopeniendedifundiisioneithatiisiavailableiforisubscriptioniallithroughitheiyear.iTheseidoinotihaveiaifixedi
maturity.iInvestorsicaniconvenientlyibuyiandiselliunitsiatiNetiAssetiValuei(“NAV”)irelatediprices.iTheik
eyifeatureiofiopen-endischemesiisiliquidity.
Closed-endedifunds

Aiclosediendifundihasiaistipulatedimaturityiperiodiwhichigenerallyirangingifromi3itoi15iyears.iTheifundii
siopeniforisubscriptionionlyiduringiaispecificiperiod.iInvestorsicaniinvestiinitheischemeiatitheitimeiofitheii
nitialipubliciissueiandithereafteritheyicanibuyiorisellitheiunitsiofitheischemeionitheistockiexchangesiwherei
theyiareilisted.

Intervalifunds

Theseicombineitheifeaturesiofiopen-endediandiclosed-
endedischemes.iTheyiareiopeniforisaleioriredemptioniduringipre-
determinediintervalsiatiNAVirelatediprices.

ByiInvestmentiObjective:

Growthifunds

Theiaimiofigrowthifundsiisitoiprovideicapitaliappreciationioveritheimediumitoilong-
term.iSuchischemesinormallyiinvestitheimajorityiofitheiricorpusiiniequities.iItihasibeeniprovenithatireturn
sifromistocks,ihaveioutperformedimostiotherikindiofiinvestmentsiheldioveritheilongiterm.iGrowthischem
esiareiidealiforiinvestorsihavingiailong-termioutlookiseekingigrowthioveriaiperiodiofitime.

Incomeifunds

Theiaimiofiincomeifundsiisitoiprovideiregulariandisteadyiincomeitoiinvestors.iSuchischemesigenerallyiin
vestiinifixediincomeisecuritiesisuchiasibonds,icorporateidebenturesiandigovernmentisecurities.iIncomeif
undsiareiidealiforicapitalistabilityiandiregulariincome.

Balancedifunds

Theiaimiofibalancedifundsiisitoiprovideibothigrowthiandiregulariincome.iSuchischemesiperiodicallyidistr
ibuteiaipartiofitheiriearningiandiinvestmentibothiiniequitiesiandifixediincomeisecuritiesiinitheiproportionii
ndicatediinitheiriofferidocuments.iIniairisingistockimarket,itheiNAViofitheseischemesimayinotinormallyik
eepipace,iorifalliequallyiwhenitheimarketifalls.iTheseiareiidealiforiinvestorsilookingiforiaicombinationiofii
ncomeiandimoderateigrowth.

Moneyimarketifunds

Forioveri30iyears,imoneyimarketifundsihaveitreatediinvestorsiwell.iMoneyimarketifundsihaveibeeniarou
ndifori30iyearsiandiareiaiveryipopulariplaceiforiinvestorsitoiparkitheirimoney.

Moneyimarketifundsiareiaitypeiofimutualifundithatiinvestsiinishort-
termi(lessithaniaiyear)idebtisecuritiesiofiagenciesiofitheiU.S.iGovernment,ibanksiandicorporationsiandiU.
S.iTreasuryiBills.iTheyiareifixediati$1iperishareiandionlyitheiyieldifluctuates.i

LoadiFunds

Ailoadifundiisioneithatichargesiaicommissioniforientryiofiexit.iThatiis,ieachitimeiyouibuyioriselliunitsiinith
eifund,iaicommissioniwillibeipayable.iTypicallyientryiexitiloadsirangeifromi1%itoi2%.iIticouldibeicorpusii
siputitoiwork.

No-LoadiFunds

AiNo-
Loadifundiisioneithatidoesinotichargeiaicommissioniforientryioriexit.iThatiis,inoicommissioniisipayableion
ipurchaseiorisaleiofiunitsiinitheifund.iTheiadvantageiofiaiNo-

Loadifundiisithatitheientireicorpusiisiputitoiwork.i

OtheriSchemes:

TaxisavingiSchemes:

TheseischemesiofferitaxirebatesitoitheiinvestoriunderispecificiprovisionsiofitheiIndianiincomeitaxilawsiasi
theiGovernmentioffersitaxiincentivesiforiinvestmentiiniEquityiLinkediSavingiSchemei(ELSS)iandiPensi
oniSchemesiareiallowediasideductioniu/si88iofitheiIncomeiTaxiAct.iTheiActialsoiprovideiopportunitiesitoi
investorsitoisaveicapitaligainsiu/si54EAiandi54EBibyiinvestingiiniMutualifunds,iprovideditheicapitaliasse
tihasibeenisolditoiAprili1,2000ianditheiamountiisiinvestedibeforeiSeptemberi30,2000.

SpecialiSchemes:

IndustryiSpecificiSchemes

IndustryiSpecificiSchemesiinvestiinitheiindustriesispecifiediinitheiofferidocument.iTheiinvestmentiofithe
seifundsiisilimiteditoispecificilikeiInfoiTech,iFMCG,iandiPharmaceuticalsietc.

IndexiSchemes:

IndexiFundsiattemptitoireplicateitheiperformanceiofiaiparticulariindexisuchiasitheiBSEisensexioritheiNSE
.i

SECTORALiSCHEMES:

Sectoralifundsiareithose,iwhichiinvestiexclusivelyiiniaispecifiediindustryioriaigroupiofiindustriesiorivario
usisegmentsisuchiasi‘A’iGroupisharesioriinitialipubliciofferings.
FREQUENTLYiUSEDiTERMS
NetiAssetiValuei(NAV)
NetiAssetiValueiisitheimarketivalueiofitheiassetsiofitheischemeiminusiitsiliabilities.iTheiperiunitiNAViisith
einetiassetivalueiofitheischemeidividedibyitheinumberiofiunitsioutstandingionitheiValuationiDate.i
Isitheipriceiatiwhichiaiclose-endedischemeirepurchasesiitsiunitsiandiitimayiincludeiaiback-
endiload.iThisiisialsoicallediBidiPrice.

RedemptioniPrice
Isitheipriceiatiwhichiopen-endedischemesirepurchaseitheiriunitsiandiclose-
endedischemesiredeemitheiriunitsionimaturity.iSuchipricesiareiNAVirelated.

SalesiLoad
Isiaichargeicollectedibyiaischemeiwheniitisellsitheiunits.iAlsoicalled,i‘Front-
end’iload.iSchemesithatidoinotichargeiailoadiareicalledi‘NoiLoad’ischemes.

Repurchaseiori‘Back-end’iLoad
Isiaichargeicollectedibyiaischemeiwheniitibuysibackitheiunitsifromitheiunitiholders.

i HistoryiofitheiIndianiMutualiFundiIndustry:

TheimutualifundiindustryiiniIndiaistartediini1963iwithitheiformationiofiUnitiTrustiofiIndia,iatitheiinitiat
iveiofitheiGovernmentiofiIndiaiandiReserveiBanki.Theiobjectiveitheniisitoiattractitheismalliinvestorsiandiintrod
uceithemitoimarketiinvestments.iSinceithen,itheihistoryiofimutualifundsiiniIndiaicanibeibroadlyidividediintoifo
uridistinctiphases.

FirstiPhasei–i1964-87:

UnitiTrustiofiIndiai(UTI)iwasiestablishedioni1963ibyianiActiofiParliament.iItiwasisetiupibyitheiReserve
iBankiofiIndiaiandifunctionediunderitheiRegulatoryiandiadministrativeicontroliofitheiReserveiBankiofiIndia.iIni

1978iUTIiwaside-
linkedifromitheiRBIianditheiIndustrialiDevelopmentiBankiofiIndiai(IDBI)itookioveritheiregulatoryiandiadmini
strativeicontroliiniplaceiofiRBI.iTheifirstischemeilaunchedibyiUTIiwasiUnitiSchemei1964.iAtitheiendiofi1988iU
TIihadiRs.6,700icroresiofiassetsiunderimanagement.iTheimutualiFundsiIndustryiiniIndiainotionlyistartediwithi
UTI,ibutistillicountiUTIiasiitsilargestiPlayeriwithitheilargesticorpusiofiinvestibleifundsiamongialliMutualiFundsi
currentlyiopeningiiniIndia.

Foritheiperiodiofi1987-88

iTableiNo:i1iSource:iSecondaryiData

AmountiMobilizedi(Rs. AssetsiUnderiManagementi(iRs.Cr
Crores) ores)

2,175 6,700
UTI

Total 2,175 6,700

SecondiPhasei–i1987-1993i(EntryiofiPubliciSectoriFunds):

1987imarkeditheientryiofinon-
iUTI,ipublicisectorimutualifundsisetiupibyipublicisectoribanksiandiLifeiInsuranceiCorporationiofiIndiai(LIC)ian

diGeneraliInsuranceiCorporationiofiIndiai(GIC).iSBIiMutualiFundiwasitheifirstinon-
iUTIiMutualiFundiestablishediiniJunei1987ifollowedibyiMutualiFundi(Deci87),iPunjabiNationaliBankiMutuali

Fundi(Augi89),iIndianiBankiMutualiFundi(Novi89),iBankiofiIndiai(Juni90),iBankiofiBarodaiMutualiFundi(Octi
92).iLICiestablishediitsimutualifundiiniJunei1989iwhileiGICihadisetiupiitsimutualifundiiniDecemberi1990.iAtith
eiendiofi1993,itheimutualifundiindustryihadiassetsiunderimanagementiofiRs.47,004icrores.iFromi1987toi1992-
93,itheifundiindustryiexpandedinearlyisevenitimesiinitermsiofiAssetsiunderiManagement,iasiseeniinitheifollowi
ngifigures:

Foritheiperiodiofi1992-93

iTableiNo:i2iSecondaryiData

AmountiMobilizedi(Rs. AssetsiUnderiManagementi(iRs.
Crores) Crores)

UTI 11,057 38,247

PubliciSector 1,964 8,757

Total 13,021 47,004

ThirdiPhasei–i1993-2017i(EntryiofiPrivateiSectoriFunds):i

Withitheientryiofiprivateisectorifundsiini1993,iainewieraistartediinitheiIndianimutualifundiindustry,igivingit
heiIndianiinvestorsiaiwiderichoiceiofifundifamilies.iAlso,i1993iwasitheiyeariiniwhichitheifirstiMutualiFundi
Regulationsicameiintoibeing,iunderiwhichiallimutualifunds,iexceptiUTIiwereitoibeiregisterediandigoverne
d.iTheierstwhileiKothariiPioneeri(nowimergediwithiFrankliniTempleton)iwasitheifirstiprivateisectorimutu
alifundiregisterediiniJulyi1993.Thei1993iSEBIi(MutualiFund)iRegulationsiwereisubstitutedibyiaimoreicom
prehensiveiandirevisediMutualiFundiRegulationsiini1996.iTheiindustryinowifunctionsiunderitheiSEBIi(M
utualiFund)iRegulationsi1996.

Theinumberiofimutualifundihousesiwentioniincreasing,iwithimanyiforeignimutualifundsisettingiupifun
dsiiniIndiaiandialsoitheiindustryihasiwitnessediseveralimergersiandiacquisitions.iAsiatitheiendiofiJanuaryi2017,i
thereiwerei33imutualifundsiwithitotaliassetsiofiRs.i1,21,805icrores.iTheiUnitiTrustiofiIndiaiwithiRs.44,541icror
esiofiassetsiunderimanagementiwasiwayiaheadiofiotherimutualifunds.

FourthiPhasei–isinceiFebruaryi2003:

IniFebruaryi2003,ifollowingitheirepealiofitheiUnitiTrustiofiIndiaiActi1963iUTIiwasibifurcatediintoitwo
iseparateientities.iOneiisitheiSpecifiediUndertakingiofitheiUnitiTrustiofiIndiaiwithiassetsiunderimanagementiofi

Rs.29,835icroresiasiatitheiendiofiJanuaryi2017,irepresentingibroadly,itheiassetsiofiUSi64ischeme,iassurediretur
niandicertainiotherischemes.iTheiSpecifiediUndertakingiofiUnitiTrustiofiIndia,ifunctioningiunderianiadministr
atoriandiunderitheirulesiframedibyiGovernmentiofiIndiaiandidoesinoticomeiunderitheipurviewiofitheiMutualiFu
ndiRegulations.

TheisecondiisitheiUTIiMutualiFundiLtd,isponsoredibyiSBI,iPNB,iBOBiandiLIC.iItiisiregisterediwithiS
EBIiandifunctionsiunderitheiMutualiFundiRegulations.iWithitheibifurcationiofitheierstwhileiUTIiwhichihadiini
Marchi2000imoreithaniRs.76,000icroresiofiassetsiunderimanagementiandiwithitheisettingiupiofiaiUTIiMutualiF
und,iconformingitoitheiSEBIiMutualiFundiRegulations,iandiwithirecentimergersitakingiplaceiamongidifferenti
privateisectorifunds,itheimutualifundiindustryihasienterediitsicurrentiphaseioficonsolidationiandigrowth.iAsiatit
heiendiofiOctoberi31,i2003,ithereiwerei31ifunds,iwhichimanageiassetsiofiRs.126726icroresiunderi386ischemes
.iTheigraphiindicatesitheigrowthiofiassetsioveritheiyears

Fig:i1.GROWTHiINiASSETSiUNDERiMANAGEMENT

UnitiholdingipatterniofimutualifundsiindustryiasioniMarchi31,i2003

SEBIihasidoneianianalysisiofitheiunitiholdingipatterniofimutualifundsiindustryiasioniMarchi31,i2003.iheidetailsi
areigivenibelow:i-

A]iMutualiFundsiIndustryiUnitiholdingiPatterni

Fromitheidataicollectedifromitheimutualifunds,itheifollowingihasibeeniobserved:-i

i) AsioniMarchi31,i2003ithereiareiaitotalinumberiofi1.6icroreiinvestorsiaccountsi(itiisilikelyithatithereima
yibeimoreithanioneifolioiofianiinvestoriwhichimightihaveibeenicountedimoreithanionceiandiactualinu
mberiofiinvestorsiwouldibeiless)iholdingiunitsiofiRs.i79,601icrore.iOutiofithisitotalinumberiofiinvestor
siaccounts,i1.56icroreiareiindividualiinvestorsiaccounts,iaccountingifori97.42%iofitheitotalinumberiof
iinvestorsiaccountsiandicontributeiRs.32,691icroreiwhichiisi41.07%iofitheitotalinetiassets.i
ii) Corporateiandiinstitutionsiwhoiformionlyi2.04%iofitheitotalinumberiofiinvestorsiaccountsiinitheimutu
alifundsiindustry,icontributeiaisizeableiamountiofiRs.45,470icroreiwhichiisi57.12%iofitheitotalinetiass
etsiinitheimutualifundsiindustry.

iii) TheiNRIs/OCBsiandiFIIsiconstituteiaiveryismallipercentageiofiinvestorsiaccountsi(0.54%)iandicontri
buteiRs.1440.18crorei(1.81%)iofinetiassets.i

Theidetailsiofiunitiholdingipatterniareigiveniinitheifollowingitable:i

TableiNo:i3iSecondaryiData

UNITiHOLDINGiPATTERNiOFiMUTUALiFUNDSiINDUSTRYi

No.iOfiInvestorsi %iToiTotaliInvest NAV(Rs.Crore) %ToiTotali

Category
A/C orsiA/C NAV

Individuals 15,557,506 97.42 32,691.12 41.07

NRIs/OCBs 84,311 0.53 878.51 1.10

FIIs 2,058 0.01 561.67 0.71

Corporate/iInstit
utions/Others 324,979 2.04 45,469.53 57.12

TOTAL 15,968,854 100.00 79,600.83 100.00

B]iUnitiholdingiPatterni–iPrivate/PubliciSectoriMutualiFunds:i

FromitheianalysisiofidataioniunitiholdingipatterniofiPrivateiSectoriMutualiFundsiandiPubliciSectoriMutualiFun
ds,itheifollowingiobservationsiareimade:-i

1.iOutiofiaitotaliofi1.6icroreiinvestorsiaccountsiinitheimutualifundsiindustry,i(itiisilikelyithatithereimayibeimoreit
hanioneifolioiofianiinvestoriwhichimightihaveibeenicountedimoreithanionceiandithereforeiactualinumberiof
iinvestorsimayibeiless)i42.93ilakhiinvestorsiaccountsii.e.i27%iofitheitotaliinvestorsiaccountsiareiiniprivateis
 ectorimutualifundsiwhereasithei1.17icroreiinvestorsiaccountsiie.73%iareiwithitheipublicisectorimutualifun
dsiwhichiincludesiUTIiMutualiFund.iHowever,itheiprivateisectorimutualifundsimanagei71.2%iofitheinetias
setsiwhereasitheipublicisectorimutualifundsiownionlyi28.8%iofitheiassets.

2.iUTIiMutualiFundihasi97.i12ilakhiinvestors’iaccountsiwhichiisi60.82%iofitheitotaliinvestor’siaccountsiinithei
mutualifundsiindustry.

Detailsiofiunitiholdingipatterniofiprivateisectoriandipublicisectorimutualifundsiare:

TableiNo:i4iSecondaryiData

UNITiHOLDINGiPATTERNiOFiPRIVATEiSECTORiMFS

No.iOfiInvestorsiA %iToiTotaliInvest NAV(Rs.Cr %ToiTotaliN

Category
/C orsiA/C ore) AV

Individuals 4001841 93.23 17956.48 31.68

NRIs/OCBs 38416 0.89 723.02 1.28

FIIs 1317 0.03 528.51 0.93

Corporate/iInsti
tutions/iOthers 250972 5.85 37465.91 66.11

TOTAL 4292546 100.00 56673.92 100.00

TableiNo:i5iSecondaryiData

UNITiHOLDINGiPATTERNiOFiPUBLICiSECTORiMFSi(INCLUDINGiUTIiMFi)

NO.iOfiInvestor %iToiTotaliInvest NAV(Rs.Cr %ToiTotaliN

Category
siA/C orsiA/C ore) AV

Individuals 11,555,665 98.97 14734.64 64.27

NRIs/OCBs 45895 0.39 155.49 0.68

FIIs 741 0.01 33.16 0.14

Corporate/iInstit
utions/iOthers 74007 0.63 8003.62 34.91

TOTAL 11676308 100.00 22926.91 100.00

 RECENTiTRENDSiINiMUTUALiFUNDiINDUSTRY:

Theimostiimportantitrendiinitheimutualifundiindustryiisitheiaggressiveiexpansioniofitheiforeigniowned
imutualifundicompaniesianditheideclineiofitheicompaniesifloatedibyinationalizedibanksiandismalleriprivateisec

toriplayers.

Manyinationalizedibanksigotiintoitheimutualifundibusinessiinitheiearlyininetiesiandigotioffitoiaigoodist
artidueitoitheistockimarketiboomiprevailingithen.iTheseibanksididinotireallyiunderstanditheimutualifundibusine
ssianditheyijustiviewediitiasianotherikindiofibankingiactivity.iFewihiredispecializedistaffiandigenerallyichoseito
itransferistaffifromitheiparentiorganizations.i

iTheiperformanceiofimostiofitheischemesifloatedibyitheseifundsiwasinotigood.iSomeischemesihadioffe

rediguaranteedireturnsianditheiriparentiorganizationsihaditoibailioutitheseiAMCsibyipayingilargeiamountsiofim
oneyiasitheidifferenceibetweenitheiguaranteediandiactualireturns.i

iTheiserviceilevelsiwereialsoiveryibad.iMostiofitheseiAMCsihaveinotibeeniableitoiretainistaff,ifloatinew

ischemesietc.iandiitiisidoubtfuliwhether,ibarringiaifewiexceptions,itheyihaveiseriousiplansioficontinuingitheiacti

vityiiniaimajoriway.

TheiexperienceiofisomeiofitheiAMCsifloatedibyiprivateisectoriIndianicompaniesiwasialsoiveryisimilar
.iTheyiquicklyirealizedithatitheiAMCibusinessiisiaibusiness,iwhichimakesimoneyiinitheilongitermiandirequiresi
deep-
pocketedisupportiinitheiintermediateiyears.iSomeihaveisoldioutitoiforeigniownedicompanies,isomeihaveimerge
diwithiothersiandithereiisigeneralirestructuringigoingion.

Theiforeigniownedicompaniesihaveideepipocketsiandihaveicomeiinihereiwithitheiexpectationiofiailongi
haul.iTheyicanibeicreditediwithiintroducingimanyinewipracticesisuchiasinewiproductiinnovation,isharpiimprov
ementiiniserviceistandardsiandidisclosure,iusageiofitechnology,ibrokerieducationiandisupportietc.iInifact,itheyi
haveiforceditheiindustryitoiupgradeiitselfiandiserviceilevelsiofiorganizationsilikeiUTIihaveiimprovedidramatic
allyiinitheilastifewiyearsiiniresponseitoitheicompetitioniprovidedibyithese.
COMPANYiPROFILE

HDFCiAssetiManagementiCompanyiLimitedi(AMC)

HDFCiAssetiManagementiCompanyiLtdi(AMC)iwasiincorporatediunderitheiCompaniesiAct,i1956,ioniDecem
beri10,i1999,iandiwasiapproveditoiactiasianiAssetiManagementiCompanyiforitheiHDFCiMutualiFundibyiSEBIi
videiitsiletteridatediJulyi3,i2000.

TheiregisterediofficeiofitheiAMCiisisituatediatiRamoniHouse,i3rdiFloor,iH.T.iParekhiMarg,i169,iBackbayiRecl
amation,iChurchgate,iMumbaii-i400i020.i

InitermsiofitheiInvestmentiManagementiAgreement,itheiTrusteeihasiappointeditheiHDFCiAssetiManagementi
CompanyiLimiteditoimanageitheiMutualiFund.iTheipaidiupicapitaliofitheiAMCiisiRs.i25.241icroreiasioniSepte
mberi30,i2013.i

TheipresentiequityishareholdingipatterniofitheiAMCiisiasifollowsi:

Particulars %iofitheipaidiupiequityicapital

HousingiDevelopmentiFinanceiCorporationiLimited 59.98

StandardiLifeiInvestmentsiLimited 39.99

OtheriShareholdersi(sharesiissuedioniexerciseiofiStockiOptions) 0.03

ZurichiInsuranceiCompanyi(ZIC),itheiSponsoriofiZurichiIndiaiMutualiFund,ifollowingiaireviewiofiitsioverallis
trategy,ihadidecideditoidivestiitsiAssetiManagementibusinessiiniIndia.iTheiAMCihadienterediintoianiagreemen
tiwithiZICitoiacquireitheisaidibusiness,isubjectitoinecessaryiregulatoryiapprovals.i

Oniobtainingitheiregulatoryiapprovals,itheifollowingiSchemesiofiZurichiIndiaiMutualiFundihaveimigrateditoi
HDFCiMutualiFundioniJunei19,i2003.iTheseiSchemesihaveibeenirenamediasifollows:i
FormeriName NewiName

ZurichiIndiaiEquityiFund HDFCiEquityiFund

ZurichiIndiaiPrudenceiFund HDFCiPrudenceiFund

ZurichiIndiaiCapitaliBuilderiFund HDFCiCapitaliBuilderiFund

ZurichiIndiaiTaxSaveriFund HDFCiTaxSaver

ZurichiIndiaiTopi200iFund HDFCiTopi200iFund

ZurichiIndiaiHighiInterestiFund HDFCiHighiInterestiFund

ZurichiIndiaiLiquidityiFund HDFCiCashiManagementiFund

ZurichiIndiaiSovereigniGiltiFund HDFCiSovereigniGiltiFund*

*HDFCiSovereigniGiltiFundihasibeeniwoundiupiiniMarchi2006i

TheiAMCiisialsoiprovidingiportfolioimanagementi/iadvisoryiservicesiandisuchiactivitiesiareinotiiniconflictiwit
hitheiactivitiesiofitheiMutualiFund.iTheiAMCihasirenewediitsiregistrationifromiSEBIivideiRegistrationiNo.i-
iPMi/iINP000000506idatediFebruaryi12,i2013itoiactiasiaiPortfolioiManageriunderitheiSEBIi(PortfolioiManage

rs)iRegulations,i1993.iTheiCertificateiofiRegistrationiisivalidifromiJanuaryi1,i2013itoiDecemberi31,i2017.

HDFCiAssetiManagementiCompanyiLimitedi(AMC)

HDFCiAssetiManagementiCompanyiLtdi(AMC)iwasiincorporatediunderitheiCompaniesiAct,i1956,ioniDecem
beri10,i1999,iandiwasiapproveditoiactiasianiAssetiManagementiCompanyiforitheiHDFCiMutualiFundibyiSEBIi
videiitsiletteridatediJulyi3,i2000.i

TheiregisterediofficeiofitheiAMCiisisituatediatiRamoniHouse,i3rdiFloor,iH.T.iParekhiMarg,i169,iBackbayiRecl
amation,iChurchgate,iMumbaii-i400i020.i

InitermsiofitheiInvestmentiManagementiAgreement,itheiTrusteeihasiappointeditheiHDFCiAssetiManagementi
CompanyiLimiteditoimanageitheiMutualiFund.iTheipaidiupicapitaliofitheiAMCiisiRs.i25.169icrore.
TheiBoardiofiDirectorsiofitheiHDFCiAssetiManagementiCompanyiLimitedi(AMC)iconsistsiofitheifollo
wingieminentipersons.i

 Mr.iDeepakiS.iParekhi
 Mr.iN.iKeithiSkeochi
 Mr.iKekiiM.iMistryi
 Mr.iJamesiAirdi
 Mr.iP.iM.iThampii
 Mr.iHumayuniDhanrajgiri
 Dr.iDeepakiB.iPhataki
 Mr.iHoshangiS.iBillimoriai
 Mr.iRajeshwariRajiBajaaji
 Mr.iVijayiMerchanti
 Ms.iRenuiS.iKarnadi
 Mr.iMilindiBarvei
DATA ANALYSIS AND INTERPRETATION
STATEiBANKiOFiINDIA

StateiBankiofiIndiaiisitheifirstiBankisponsorediMutualiFunditoilaunchioffshoreifund,itheiIndiaiMagnumiFundiwithi
aicorpusiofiRs.i225icr.iapproximately.iTodayiitiisitheilargestiBankisponsorediMutualiFundiiniIndia.iTheyihaveialre
adyilaunchedi35iSchemesioutiofiwhichi15ihaveialreadyiyieldedihandsomeireturnsitoiinvestors.iStateiBankiofiIndia
iMutualiFundihasimoreithaniRs.i5,500iCroresiasiAUM.iNowiitihasianiinvestoribaseiofioveri8ilakhs.iSpreadioveri18

schemes

NAViHistoryi–iHistoricalivalueiforiaiperiodiof

3-Nov-2017itoi20-Jan-2018
SBIiMUTUALiFUND

MagnumiEquityiFundi–iGrowthi&iDividend

DATE DIVIDEND iGROWTH

03-Nov-2017 45.21 40.25

10-Nov-2017 37.51 41.25

17-Nov-2017 37.84 43.06

24-Nov-2017 38.33 43.61

06-Dec-2017 39.31 44.73

12-Dec-2017 40.06 45.58

20-Dec-2017 38.80 44.15

27-Dec-2017 39.68 45.15

02-Jan-2018 41.52 47.24

08-Jan-2018 42.51 48.36

14-Jan-2018 41.46 47.17

17-Jan-2018 33.74 43.24

20-Jan-2018 34.89 39.70

 SBIiMAGNUMiEQUITYiFUNDi–iDividendi&iGrowth

50 3-Nov-17
45
10-Nov-17
40
17-Nov-17
35
24-Nov-17
30
25 6-Dec-17
20 12-Dec-17
15 20-Dec-17
10 27-Dec-17
5 2-Jan-18
0
8-Jan-18
DIVIDEND GROWTH

TheiaboveigraphiindicatesithatitheiEquityiFundi-
iGrowthiandiDividendifromithei1stiweekiofiDeciisialmostiperformingisameibutiini2ndiweekiofiJanitheiperformance

iofiGrowthihasidrasticallyichangediwhenicompareditoiDividends,iandiagainitheiperformanceishowediisisimilariinir

estiofitheiweeks.iBecauseiofideclaringiDividendsifrequently,itheiperformanceiofiDividendialwaysishowsilessiwhe
nicomparediwithiothers.
UNITiTRUSTiOFiINDIAi(UTI)
i

UTI,itheifirstibankitoibeginioperationsiasinewiprivateibanksiini1994iafteritheiGovernmentiofiIndiaiallowe
dinewiprivateibanksitoibeiestablished.iUTIiBankiwasijointlyipromotedibyitheiAdministratoriofitheispecifi
ediundertakingiofitheiUnitiTrustiofiIndiai(UTI-
I),iLifeiInsuranceiCorporationiofiIndiai(LIC)iandiGeneraliInsuranceiCorporationiLtd.iAlsoiwithiassociat
esiviz.iNationaliInsuranceiCompanyiLtd.,itheiNewiIndiaiAssuranceiCompany,iTheiOrientaliInsuranceiC
orporationiandiUnitediInsuranceiCompanyiLtd.

UTIiBankiiniIndiaitodayiisicapitalizediwithiRs.i232.86iCroresiwithi47.50%ipubliciholdingiotherithanipro
moters.iItihasimoreithani200ibranchiofficesiandiExtensioniCountersiinitheicountryiwithioveri1250iUTIiB
ankiATMiprovingitoibeioneiofitheilargestiATMinetworksiinitheicountry.iUTIiBankiIndiaicommitsitoiadop
titheibestiindustryipracticesiinternationallyitoiachieveiexcellence.iUTIiBankihasistrengthsiiniretailiasiwell
iasicorporateibanking.

ByitheiendiofiDecemberi2004,iUTIiBankiiniIndiaihadioveri2.7imillionidebiticards.iThisiisitheifirstibankiini
IndiaitoiofferitheiATiPARiChequeifacility,iwithoutianyicharges,itoialliitsiSavingsiBankicustomersiiniallith
eiplacesiacrossitheicountryiwhereiitihasipresence.

TheilatestiofferingsiofitheibankialongiwithiDollarivariantiisitheiEuroiandiPoundiSterlingivariantsiofitheiInt
ernationaliTraveliCurrencyiCard.iTheiTraveliCurrencyiCardiisiaisignatureibasedipre-
paiditravelicardiwhichienablesitravellersiglobaliaccessitoitheirimoneyiinilocalicurrencyiofitheivisitingicou
ntryiiniaisafeiandiconvenientiway.
i StockiExchangeiwhereitheisharesiofiUTIiBankiareilisted:

StockiExchange CodeiNo.iISINiNo.

Ahmedabad CodeiNo.i63134

Mumbai CodeiNo.i532215i–iAiGroup

NSE CodeiNo.iUTIBANKEQ

OTCEI CodeiNo.iPermittediSecurity

NSDL ISINiNo.iINE238A01026

CDSL ISINiNo.iINE238A01026

ShareiCapitaliofiUTIiBanki
AuthorizediShareiCapital:iRs.i300iCroresi
PaidiUpiShareiCapital:iRs.i232.86iCroresi
DeclarediRateiofiInterestsibyiUTIiBank

UTIiMutualiFundiisimanagedibyiUTIiAssetiManagementiCompanyiPrivateiLimitedi(Estb:iJani14,i2003)i
whoihasibeeniappointedibyitheiUTIiTrusteeiCompanyiPrivateiLimitediforimanagingitheischemesiofiUTIi
MutualiFundianditheischemesitransferredi/imigratedifromiUTIiMutualiFund.i
TheiUTIiAssetiManagementiCompanyihasiitsiregisterediofficeiat:iUTIiTower,iGniBlock,iBandrai-
iKurlaiComplex,iBandrai(East),iMumbaii-

i400i051iwilliprovideiprofessionallyimanagedibackiofficeisupportiforiallibusinessiservicesiofiUTIiMutual

iFundi(excludingifundimanagement)iiniaccordanceiwithitheiprovisionsiofitheiInvestmentiManagementiA

greement,itheiTrustiDeed,itheiSEBIi(MutualiFunds)iRegulationsianditheiobjectivesiofitheischemes.iState
-of-the-
artisystemsiandicommunicationsiareiiniplaceitoiensureiaiseamlessiflowiacrossitheivariousiactivitiesiunder
takenibyiUTIiAMC.i
UTIiAMCiisiairegisterediportfolioimanageriunderitheiSEBIi(PortfolioiManagers)iRegulations,i1993ioniF
ebruaryi3i2004,iforiundertakingiportfolioimanagementiservicesiandialsoiactsiasitheimanageriandimarkete
ritoioffshoreifundsithroughiitsi100i%isubsidiary,iUTIiInternationaliLimited,iregisterediiniGuernsey,iCha
nneliIslands.i
UTIiMutualiFundihasiaitrackirecordiofimanagingiaivarietyiofischemesicateringitoitheineedsiofieveryiclassi
oficitizenry.iItihasiainationwideinetworkiconsistingi70iUTIiFinancialiCentersi(UFCs)iandiUTIiInternatio
naliofficesiiniLondon,iDubaiiandiBahrain.iWithiaiviewitoireachitoicommoniinvestorsiatidistrictilevel,i4isat
elliteiofficesihaveialsoibeeniopenediiniselectitownsiandidistricts.iItihasiaiwell-
qualified,iprofessionalifundimanagementiteam,iwhoihasibeenihighlyiempowereditoimanageifundsiwithig
reateriefficiencyiandiaccountabilityiinitheisoleiinterestiofiunitiholders.i

NAViHistoryi–iHistoricalivalueiforiaiperiodiof
3-Nov-2017itoi20-Jan-2018
UTIiMUTULiFUND
UTIiEquityiFundi–iGrowthi&iDividend
DATE
i DIVIDEND GROWTH
03-Nov-2017 42.15 47.85
10-Nov-2017 39.88 43.22
17-Nov-2017 42.09 45.60
24-Nov-2017 40.80 44.21
06-Dec-2017 41.63 45.11
12-Dec-2017 41.30 45.20
20-Dec-2017 41.85 45.36
27-Dec-2017 42.73 46.31
 02-Jan-2018 44.30 48.02
08-Jan-2018 45.68 49.51
14-Jan-2018 44.91 48.68
17-Jan-2018 38.30 41.50
20-Jan-2018 39.10 42.39

UTIiEQUITYiFUNDi–iDividendi&iGrowth
i

50 3-Nov-17
45 10-Nov-17
40 17-Nov-17
35 24-Nov-17
30 6-Dec-17
25 12-Dec-17
20 20-Dec-17
15 27-Dec-17
10 2-Jan-18
5 8-Jan-18
0 14-Jan-18

FromitheiaboveigraphiweicaniobserveithatiGrowthiisishowingimoreiperformanceithaniDivi
dends.iInitheimonthiofiFebiweicaniseeithatiGrowthihasifallenidowniinitheilastiweekiandirosei
inifirstiweekianditheiDividendihasialsoiriseniinithei1stiweekiofiFeb.iBecauseiofideclaringiDi
videndsifrequently,itheiperformanceiofiDividendialwaysishowsilessiwhenicomparediwithi
others
HSBC

HSBCiisitheilargestibankiiniHongiKongiandisecondilargestigroupiinitheiworldiafteriCiticorp.iBeforeimov
ingiitsiheadquarteritoiLondoniini1990,iitiwasiheadquarterediiniHongiKong.iHSBCiIndiaiisihavingibranch
esiiniAhmedabad,iBangalore,iChennai,iChandigarh,iCoimbatore,iGurgaon,iHyderabad,iJaipur,iKochi,i
Kolkata,iLudhiana,iMumbai,iNewiDelhi,iNoida,iPune,iThane,iTrivandrumiandiVisakhapatnam.
HSBCiNRIicentresiareilocatediiniAsia-
Pacific,itheiMiddleiEast,iEuropeiandiNorthiAmerica.iHSBCiNRIicentresiprovideifullirangeiofipersonalia
ndiprivateibankingiproductsiiniIndiaiandioverseas.iHSBCiInternetibankingiaddsitoitheiservicesiofiHSBCi
Indiaiabroad.
HSBCiIndia,ialongiwithiHSBCiInvestmentiproductiandiHSBCiInsurance,iitioffersiinternationaliGoldiCa
rdiandiClassiciCreditiCardsifromiVISAiandiMasterCardiandidebiticardsifromiVisa.iHSBCiiniIndiaigivesi
24ihouribankingiservices,iextensiveinetworkiofiATMs,iintegratediCalliCentreiandialsoiHSBCie-banking.
HSBCiBankiIndiaiFactiFile
TheiHSBCiGroupidevelopsiandiappliesiadvanceditechnologyitoitheiefficientiandiconvenientideliveryiofi
bankingiandirelatedifinancialiservices.iHSBCiBankiIndiaiprovidesitheifollowing:i
 Self-serviceibankingiwithioveri150iin-branchiandioff-branchiATMsiandi24-
houriphoneibanking.i
 Tradeiandicorporateibankingiservicesiwithireal-
timeiaccessitoiaicentralisediinformationidatabasei
 Instantaneousiinter-cityitransactionsithroughionlineiconnectionsibetweeniallibranches
i
i

NAViHistoryi–iHistoricalivalueiforiaiperiodiof
i
3-Nov-2017itoi20-Jan-2018

HSBCiMUTUALiFUND

HSBCiEquityiFundi–iGrowthi&iDividend

DATE
i DIVIDEND GROWTH
03-Nov-2017 41.25 105.64
10-Nov-2017 42.82 103.31
17-Nov-2017 45.02 108.62
24-Nov-2017 43.96 106.06
06-Dec-2017 45.27 109.22

12-Dec-2017 46.10 111.23

20-Dec-2017 45.20 109.06
27-Dec-2017 46.12 111.27
02-Jan-2017 47.68 114.92
08-Jan-2018 48.95 118.11
14-Jan-2018 48.40 116.78
17-Jan-2018 41.49 100.10
20-Jan-2018 42.67 102.96
 HSBCiEQUITYiFUNDi–iDividendi&iGrowth

3-Nov-17
120
10-Nov-17
100 17-Nov-17
24-Nov-17
80 6-Dec-17
12-Dec-17
60
20-Dec-17
27-Dec-17
40
2-Jan-18

20 8-Jan-18
14-Jan-18
0 17-Jan-18
DIVIDEND GROWTH 20-Jan-18

TheiaboveigraphithereiisilittleifluctuationsiinitheivaluesiofiDividendsiandiGrowth.iButihereiweicaniseeithatiGrowth
iisiagainiperformingiwell.iItishowediailessiperformanceiinitheilastiweekiandiDividendishowedisimilariperformance

iiniallitheiweeks.iBecauseiofideclaringiDividendsifrequently,itheiperformanceiofiDividendialwaysishowsilessiwhe

nicomparediwithiothers.

i
ICICIiBANK

ICICIiLimitediwasiestablishediini1955ibyitheiWorldiBank,itheiGovernmentiofiIndiaianditheiIndianiIndu
stry,iforitheipromotioniofiindustrialidevelopmentiiniIndiaibyigivingiprojectiandicorporateifinanceitoitheii
ndustriesiiniIndia.i
ICICIiBankihasigrownifromiaidevelopmentibankitoiaifinancialiconglomerateiandihasibecomeioneiofitheil
argestipublicifinancialiinstitutionsiiniIndia.iICICIiBankihasifinancediallitheimajorisectorsiofitheieconom
y,icoveringi6,848icompaniesiandi16,851iprojects.iAsiofiMarchi31,i2000,iICICIihadidisbursediaitotaliofiR
s.i1,i13,070icrores,isinceiinception.

ICICIiBankiFactiFilesi

Totaliassets:iRs.146,i214icrorei(Decemberi31,i2004)
Networki:i530ibranches
ATMsi:iOveri1,880
AbroadiSubsidiariesi:iUnitediKingdomiandiCanada
Abroadibranchesi:iSingaporeiandiBahrain
Representativeiofficesi:iUnitediStates,iChina,iUnitediArabiEmirates,iBangladeshiandi
SouthiAfrica.
 NAViHistoryi–iHistoricalivalueiforiaiperiodiof

3-Nov-2017itoi20-Jan-2018

ICICIiPRUDENTIALiMUTUALiFUND

ICICIiEquityiFUNDiGrowthi&iDividend

DATE
i iDIVIDEND GROWTH

03-Nov-2017 23.15 35.54

10-Nov-2017 22.45 38.94
17-Nov-2017 24.86 39.51
24-Nov-2017 25.14 38.42
06-Dec-2017 26.05 39.80

12-Dec-2017 27.85 42.56

20-Dec-2017 28.07 41.95

27-Dec-2017 28.06 42.88

02-Jan-2018 30.19 46.12

08-Jan-2018 31.14 47.58
14-Jan-2018 29.62 45.26
17-Jan-2018 23.25 38.30
20-Jan-2018 23.55 38.80
i
ICICIiEQUITYiFUNDi–iDividendi&iGrowth
i

50 3-Nov-17

45 10-Nov-17
17-Nov-17
40
24-Nov-17
35
6-Dec-17
30
12-Dec-17
25
20-Dec-17
20 27-Dec-17
15 2-Jan-18
10 8-Jan-18
5 14-Jan-18
0 17-Jan-18
DIVIDEND GROWTH 20-Jan-18

FromitheiaboveigraphiitiindicatesithatitheiGrowthiandiDividendiareiperformingisimilaributiinitheimonthio
fiFebibothiofithemihaveideclinedi.ItihadidrasticallyifalleniinitheimonthiofitheiFeb.iFromithei1stiweekiofiDe
citoi1stiweekiofiFebibothihaveiincreasedianditheiperformanceishowediisiwell.iBecauseiofideclaringiDivid
endsifrequently,itheiperformanceiofiDividendialwaysishowsilessiwhenicomparediwithiothers.
 NAViHistoryi–iHistoricaliNAViforiaiPeriodifromi3-Nov-2017itoi20-Jan-2018

NATIONALiBANKS COPERATEiBANKS

SBI UTI HSBC ICICI

DATE Dividend Growth Dividend Growth Dividend Growth Dividend Growth

03-Nov-
2017 42.14 42.17 41.42 44.89 44.25 106.75 24.13 36.87

10-Nov-
2017 35.57 40.47 39.88 43.22 42.82 103.31 23.63 36.10

17-Nov-
2017 37.84 43.06 42.08 45.60 45.02 108.62 25.86 39.51

24-Nov-
2017 38.33 43.61 40.80 44.21 43.96 106.06 25.14 38.42

06-Dec-
2017 39.31 44.73 41.63 45.11 45.27 109.22 26.05 39.80

12-Dec-
2017 40.06 45.58 41.30 45.20 46.10 111.23 27.85 42.56

20-Dec-
2017 38.80 44.15 41.85 45.36 45.20 109.06 28.07 41.95

27-Dec-
2017 39.68 45.15 42.73 46.31 46.12 111.27 28.06 42.88

02-Jan-
2018 41.52 47.24 44.30 48.02 47.68 114.92 30.19 46.12

08-Jan-
2018 42.51 48.36 45.68 49.51 48.95 118.11 31.14 47.58
 14-Jan-
2018 41.46 47.17 44.91 48.68 48.40 116.78 29.62 45.26

17-Jan-
2018 33.74 43.24 38.30 41.50 41.49 100.10 23.25 38.30

20-Jan-
2018 34.89 39.70 39.10 42.39 42.67 102.96 23.55 38.80

i
 iPERFORMANCEiCHARTiOFiDIVEDEND

50

45

40

35

30

25

20

15

10

i
iPERFORMANCEiCHARTiOFiGROWTH

120

100

80
SBI

UTI
60
HSBC

ICICI
40

20

TheiaboveigraphiclearlyiindicatesitheioveralliperformanceiofiEquityiFund-
DividendiandiGrowthiofiallitheibanksitakeniintoiconsideration.iIniSBI,iGrowthiisiperformingiwelliwhenicompare
ditoiDividends.iFromitheistartingimonthiGrowthiisihigh.iThereiareislightifluctuationsiinibothiGrowthiandiDividen
d.iIniUTI,iweicaniobserveithatiGrowthiisishowingimoreiperformanceithaniDividends.iInitheimonthiofiFebiweicanis
eeithatiGrowthihasifallenidowniinitheilastiweekiandiraisediinifirstiweekianditheiDividendihasialsoiraisediinithei1stiw
eekiofiFeb.iIniHSBC,ithereiareilittleifluctuationsiinitheivaluesiofiDividendsiandiGrowth.iButihereiweicaniseeithatiG
rowthiisiagainiperformingiwell.iItishowediailessiperformanceiinitheilastiweekiandiDividendishowedisimilariperfor
manceiiniallitheiweeks.iIniICICI,iitiindicatesithatitheiGrowthiandiDividendiareiperformingisimilaributiinitheimonth
iofiFebibothiofithemihaveideclinedi.ItihadidrasticallyifalleniinitheimonthiofitheiFeb.iFromithei1stiweekiofiDecitoi1sti

weekiofiFebibothihaveiincreasedianditheiperformanceishowediisiwell.iIniHDFC,irightifromitheistartingimonthiGro
wthiisishowingigoodiperformanceicompareitoiDividends.iThereiareisomeifluctuationsiiniGrowth,ibutiinidividendsi
theivaluesishowniareialmosticonstant.iBecauseiofideclaringiDividendsifrequently,itheiperformanceiofiDividendial
waysishowsilessiwhenicomparediwithiothers.

FromitheiaboveigraphiiticlearlyiindicatesithatitheiHDFCibankiisishowingiexcellentiperformanceiwhenicomparedit
oiotheriBanks.iTheiCorporateiBankingisectorsiareishowingigoodiperformanceithaninationalizediBankingisectors.
 CHAPTER-V
 FINDINGS
 SUGGESSIONS
 CONCLUSIONS
 BIBLIOGRAPHY
FINDINGS

1. In UTI bank table we can see that growth has performed well when compared to dividends.
There was a slight fluctuation in the values of dividends and growth.

2. In SBI bank table we can see that performance of growth was good. The dividends was constant
in there values. During the first week of Feb the NAV values of both Dividends and Growth
were high.

3. When we see corporate banks (i e) HDFC the performance of Growth is very good when
compared to Dividends. This bank has been shown a positive performance when compared to
other banks were it is good for investing in this bank.

4. When we see INGbank both the Dividends and Growth are equal or similar to each other there
is no change in them. In the month of Feb it raised in the first week but it had a drastic fall in all
the following weeks.

5. When we see HSBC bank here again growth has been performed well when we compare to
dividends. This increase in the value has been reached to certain extent and it has been declined
in last week of Feb.If we compare Nationalized and Corporate banks we can see that corporate
banks have performed well during these 3 months.

6. Nationalized banks performed well up to certain extent and it values were declining further.
This decline may cause due to declaration of any dividends in those banks and so it was
showing low values.

7. In Nationalized banks we can see internally in Dividends bank has performed well and if we see
Growth UTI bank has performed well.

8. In corporate banks we can see internally in Dividends and Growth HDFC bank has performed
relatively well when compare to other banks. Both the values are high in this bank. It had
reached to a maximum height.

9. So it’s better for investors to invest in corporate sectors rather than investing in Nationalized
sector which gives them maximum number of return for their investment.
 CONCLUSION:

1. Corporate sectors provide good services if we see through customer point of view. They are very
caring to their customers.

2. With the increase in infrastructure, technology, introduction of various schemes and services,
online trading its clear that any one wants to invest will surely invest in corporate banks.

3. Now u can see most of them are opening their account in corporate banks instead of nationalized
banks this is due to extra benefit & services which they are getting from that sector.
 SUGGESTIONS

These are the few exact as regards investment in MF’s taken from the book with “Marketing for the 90’s”
given by the Wall Street. Check your letter of offer of funds prospectus to guard yourselves against any hidden
fees.

Ensue that the funds track record is the same as that of the current management.

Avoid mutual funds that charge exit fees at the back end door (fees charged by MF from the unit holders at the
time to redemption of the units).

Buy the funds with no sale charged loads. (a load is a charge by the fund when investor buys it is called the
entry load or when he sells is called the exit load).

If the charge is heavy by the mutual fund to discourage the investors from taking short positions in the funds
units because too many investors sell their units at a time then the fund has to sell its holdings to meet the
obligations that yield into vital of the fines overall return. Most short funds like guilt funds (these are the funds
which can be invested only in government securities and treasury bills thus the investors have an opportunity
to buy risk free securities). These funds yield a better return than a money market fund. It is good for the
investors who desire safety of principal amount. Money market funds (these funds in views in money market
instruments such as treasury bills, govt.bonds, certificates of bank deposits, commercial deposits). They charge
no loads, however loads are limited by SEBI to 7%.

Check funds performance in bear as well as the bull market.

Guard fund risk by checking its portfolio for diversification volatility.

 BIBLIOGRAPHY

Books References:

1. Security Analysis and Portfolio Management

(Fischer & Jordan)

2. Investment Decisions

(V.K. Bhalla)

3. Security Analysis & Portfolio Management

(Robbins)

WEBSITES

www.mutualfundsindia.com

www.reliancemutual.com

www.sbimf.com

www.hdfc.com

www.moneycontrol.com

www.amfiindia.com

www.nse-india.com