A PROJECT REPORT

ON COMPARATIVE ANALYSIS OF ULIPS OF MAJOR COMPANIES AND WITH MUTUAL FUND IN BAREILLY REGION SUBMITTED TOWARDS THE PARTIAL FULFILLMENT OF

POST GRADUATE DIPLOMA IN BUSINESS MANAGEMENT (APPROVED BY AICTE, GOVT OF INDIA) (EQUIVALENT TO MBA)
ACCADEMIC SESSION (2007-2009) External Guide: Mr.Ankur Vij BDM Submitted By:Siddharth Agarwal BM 07149 INTERNAL GUIDE Prof. Anagha Shukre Faculty Ims,Ghaziabad

INSTITUTE OF MANAGEMENT STUDIES C-238, BULANDSHAR ROAD, LAL QUAN, G.T.ROAD GHAZIABAD-201009
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ACKNOWLEDGEMENT
I express my profound gratitude to Mr. Ankur Vij BDM, who assigned me as a Summer Trainee in HDFC STANDARD LIFE. I want to give my sincere thanks to his kind advice and guidance that had made my project successful. Many of the sound advices have been well taken by me and it is largely due to his patience that I was able to achieve my goals successfully. I am also grateful to DR. R. K. Bhardwaj Director, Institute of Management Studies, Ghaziabad, Mr. Rohit Seghal Head ,Corporate Resource Centre and Mr. Rajnee Khare Senior Manager, Corporate AffairsInstitute of Management Studies, Ghaziabad and Prof. Anagha Shukre who supported a lot and gave me the permission of Summer Training in HDFC STANDARD LIFE. Also I would like to give regards to my Parents, seniors, friends who have in some way helped me in completing this project.

SIDDHARTH AGARWAL

TO WHOMSOEVER IT MAY CONCERN

This is to certify that Mr. SIDDHARTH AGARWAL student of PGDBM (2007-2009) I.M.S Ghaziabad has done his live summer training project under my guidance and supervision from 20th April2008 to 20th 2008. He has completed the project titled Comparative analysis of ULIPS of major companies with mutual funds in Bareilly region towards the partial fulfillment of PGDBM under my supervision. During his project he was found to be very sincere and attentive to small details whatsoever told to him. I wish him luck and success in future.

Under the guidance of: Prof. Anagha Shukre

PREFACE Man has found out himself many things to make himself and his near dear ones happy. Insurance is one such invention of man. Insurance is many splendid thing. It is not just the reluctant entry and the periodical reminders for paying the premium and the last receipt of the claim money which may look large or a mere pittance depending upon whether the policy was in force earning handsome bonus or had been languishing in a state of suspended animation. insurance is a wonderful world of mortality rates, utmost good faith, medical examinations with ECG and treadmill exercises, bonuses and no claim discounts and a host of other science and arts which the insurance people learn in order to provide what they call financial security and peace of mind which no other invention of man can match. Indian older population may double in 20 years and economic development and widespread migration of young adults are disrupting the traditional support for older people but ironically economy is not growing in the same folds. These changes are alarming, as alternative ways of investing the pension funds for meeting the requirements of old age people are not yet evolving. The main objective of pension is to ensure that entire working population has secured an adequate income during his /her retired life and thereafter for the lifetime of the spouse/dependents. It is a universal truth that people do not willingly accept and adopt the good things of life. Through the universal advantage of insurance are self-evident to a prudent person. Still a great deal of persuasion, explanation and at times pressurization is necessary to make customer centric and this is the matter being translated by new companies. The following research work takes a look on such persuasion of the insurance companies and the way they deal with people regarding the support of life in old age- The Pension Plans.

CONTENT CHAPTER1:Brief History8 How big is the insurance market..9 Indian Scenario9 Need for insurance...9 What is Human Life Value (HLV)..9 What is a contract of insurance..10 Classification of insurance business...10 CHAPETR2:The Insurance Players..12 Types of Plan...12 Conventional12 ULIP13 CHAPTER3:Profile...13 HDFC Standard Life Insurance Co. History14 Insurance Sector...14 CHAPTER4:Concept of Unit Linked.14 ULIP of HDFC..14 ULIP with insurance.15 ULIP as pure investment..16 FMC a small but handy tool.17 CHAPETR5:INTRODUCTION TO MUTUAL FUND18 Mutual Funds Concept...19 Net asset value (NAV) of a scheme..20 The intelligent investor's seven rules.21 Measuring performance of Mutual Fund...21 Risks involved in investing in Mutual Funds24 Types of Mutual Fund...25 Benefits of Investing In Mutual Funds.30 Disadvantages of Mutual Funds33 Scope for Development of Mutual Fund Business in India..34

.CHAPETR6 Objectives.34 Research Methodology....35 Limitation.....51 Conclusion.......51 Recommendation & Suggestions....51 7. Appendix.....53 8. Bibliography.......57

Insurance Sector The practice of insurance in the world is quite old infect. How ever, life insurance business, as it is known today, is a much later development. It evolved from the great transformation in life, which began with the decline of the agrarian society in the western countries in the 19th century. Industrialization with its cities, factories, cash economy and an urban saving class set the stage for life insurance as a large scale national institution. It can truly be that life insurance is a product of modern industry. Growth of life insurance Company in any country will illustrate introduced modern life insurance business didnt make much headway. The business started taking its deeper roots only when in the late 19th century India insurance companies appeared on the scenes and started accepting India lies freely on the same terms as European lives in India. The growth of India life insurance business continued to remain restricted till the Swedish movement gathered momentum. The business passed through the period of ups and downs with the political and economic situation in the country. Need for Association With the rise in the number of Indian life insurance companies occasioned by the growth in the national spirit as a result of the independent movement a need was felt by the companies for an organization to assist them in solving the problems faced by them. With a view to meeting this need and also to providing a representative body for expression of a common viewpoint of Indian insurance before the government regarding insurance legislation and Indian life Assurance offices association was established in 1928. The association played companies forum for expression of representative views on insurance and taxation legislation and imparting insurance education. Nationalization Even during days of the freedom struggle there was occasional demand for nationalization of life insurance industry. The demand naturally gathers mare momentum after independence. Mismanagement had lead to liquidation of as many as 25 life insurance companies in the decade after independence. Another 25 insurance companies had during the same period so frittered away their resources that their business had to be transferred to other companies. All these cost financial losses and consequent suffering to several policyholders who had entrusted their hard earned saving to the care of the company management. This misuse of power, position and privilege by these companies in the private sector was one of the most compelling reasons that influenced the decision of the government of India to nationalize the life insurance industry in 1956. The life insurance industry in India had to be geared up for raising resources for execution national programs. One of the objectives of the national plans was to build a pay welfare state. It was therefore, essential that benefits of life insurance were made available to every family in the country and that the business should be conducted with utmost economy by the management acting in a spirit of trusteeship to enable maximization of

the peoples saving that could be analyzed through the life insurance into the development programs. Objectives of nationalization: The decision of the Government of India to nationalize life insurance industry was implemented by the passage of the life insurance Corporation Act, 1956, by Parliament. The objectives of nationalization of life insurance industry that emerged out of the discussion and speeches in the parliament in the time passage of the act were: Spread of message of life insurance as far and wide as possible reaching out beyond the more advanced urban areas well into hitherto neglected areas. Effective mobilization of the peoples savings. Complete security to policyholders. Prompt and efficient services to the policyholders. Conducting of the business with the utmost economy and with the full realization that the money. Belonged to the policyholders. Investment of funds in such a way as to secure maximum yield consistent with safety of capital. Economic premium rates. Development of a dynamic and vigorous organization under a management conducted in sprit of Trusteeship. Formulation of scheme of insurance to suit different section of the community.

Brief History
The insurance sector in India dates back to 1818, when Oriental Life Insurance Company like Bombay life Assurance Company, in 1823 and Tritons Insurance Company, for General Insurance, in 1850 were incorporated. Insurance ACT was passed in 1928 but it was subsequently reviewed and comprehensive legislation was enacted in 1938. The nationalization of life insurance business took place in 1956 when 245 Indian and Foreign insurance societies were first merged and then nationalized. It paved the way towards the establishment of life insurance Corporation (LIC) and since then it has enjoyed a monopoly over the life insurance business in India. General Insurance business. Subsequently in 1973, non-life insurance business was nationalized and the General Insurance Business (Nationalization) ACT, 1972 was promulgated. The General Insurance Corporation (GIC) in its present form was incorporated in 1972 and maintains a very strong hold over the non-life insurance business in India. Due to concerns of relatively low spread of insurance in the country. The efficient and quality functioning of the Public Sector Insurance Companies. The untapped potential for mobilizing long-term contractual savings funds for infrastructure. The (Congress) government set up Insurance set u an Insurance Reforms committee in April 1993. The committee submitted its report in January 1994, recommended a phased program of liberalization, and called for private sector entry and restructuring of the LIC and GIC.

How big is the insurance market?

Insurance is a Rs.400 billion business in India, and together with banking services adds about 7% to India's Gap. Gross premium collection is about 2% of Gap and has been growing by 15-20% per annum. India also has the highest number of life insurance policies in force in the world, and total investible funds with the LIC are almost 8% of GDP. Yet more than three-fourths of India's insurable population has no life insurance or pension cover. Health insurance of any kind is negligible and other forms of non-life insurance are much below international standards. Indian Scenario : Unfortunately the concept of insurance is not popular in our country .As per the latest estimates, the total premium income generated by life and general insurance in India is estimated at around a meager 1.95% of GDP. However India's share of world insurance market has shown an increase of 10% from 0.31% in 2004-2005 to 0.34% in 2005-2006 India's market share in the life insurance business showed a real growth of 11 % thereby out performing the global average of 7.7% Non-life business grew by 3.1% against global average of 0.20%. In India insurance spending per capita was among the lowest in the world at $7.6 compared to $7 in the previous year. Amongst the emerging economies, India is one of the least insured countries but the potential for further growth is phenomenal, as a significant portion of its population is in services and the life expectancy has also increased over the years. Need for insurance: Modern life insurance caters to multiple needs for insurance, which can be broadly classified as under: Cash and income needs on an immediately following death. Family income needs. Income needs of a widow on the death of her husband. Cash and income needs of a husband on the death of his wife. Retirement income needs. Education needs. Business needs What is Human Life Value (HLV)? Human life value is: Capitalized value of the net earnings Present value of the total income lost to the family in the event death. These points will be more cleared with this example: Suppose an individual earns Rs. 10000/month. The personal expense is Rs.2000/month Therefore the income provided to his family is Rs. 8000/month.

The annual income provided to his family works out to Rs. 96000 Now if he were not to earn it for them , the family would have to Rs.1600000 in a bank so that they get Rs. 96000 yearly at 6% (96000*100/6) Therefore the HLV of the person is Rs. 1600000.

interest.

Ps. Note that we have not taken into account the future income growth of the person. Hence this is not the exact human life value but only a representation to give the customer a fair idea of how it works.

What is a contract of insurance?

A contract of insurance is a contract of utmost good faith, technically known as uberrima fides. The doctrine of disclosing all material facts is embodied in this important principal that applies to all forms of insurance. The purpose, who is one of the parties to the contract, is presumed to have means of knowledge that are not accessible to the corporation who is the other party to the contract. Therefore, the purpose is bound to tell the insurer everything affecting the judgment of the insurer. In all the contracts of insurance the proposes is bound to make full disclosure of all material facts and not merely, those which he thinks material Misrepresentation non-disclosure or fraud in any document leading to the acceptance of the risk automatically discharges the corporation from all liability under the contract. Although Section 45 of the Insurance Act, 1938 provides that no policy can be called in question after a period of two years from the date of its issue on the ground that any statement in proposal or a related document was false or inaccurate (making the policy indisputable), This provision is not applicable if the corporation can prove that misrepresentation or non- disclosure was on a material fact and was fraudulently made and that the policyholder knew at the time that statement he made was false. It is, therefore, in the interest of the would be policyholder to disclose all the material facts to the corporation to avoid any complication when the claim arises. It is equally obligatory on an agent to see that the assured doesn't obtain the contract by means of untrue representation or concealment in any respect. It is the duty that the agent owes both to his client and to the corporation.

Classification of insurance business:

The insurance is broadly classified as: 1 .Life insurance business 2. Non-life insurance business Life insurance business: It is the business of effecting contracts of insurances upon human life including any contract whereby the payment of money is assured on death or on the happening of any contingency to the dependent on human life and any contract which is subject to the payment of premiums for a term and shall be deemed to include:

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The granting disability and double and triple indemnity accident benefits, if so provided in the contract of insurance. The granting of annuities of human life. The granting of super-annuation allowance and annuities payable out of any fund applicable solely to the relief and maintenance of the person engaged or who have been engaged in any particular profession, trade or employment or of the dependents of such persons. Non life insurance business : Conventional classification of insurance business: 1. Fire insurance 2. Marine insurance 3. Miscellaneous insurance (accident) Modern classification of general insurance 1. Insurance of person 2. Insurance of property 3. Insurance of interest 4. Insurance of liability ROLE OF INSURANCE REGULATORY AND DEVLOPMENT AUTHORITY (IRDA) ACT, 1999 An act to provide for the establishment of an authority to protect the interests of policyholders, to regulate, to promote and ensure orderly growth of the insurance industry and for matters connected therewith for incidental thereto and further to amend, the Life Insurance Corporation Act, 1956 and the insurance Act, 1938 and General Insurance Business Act 1972. Spread Life Insurance much more widely and in particular to the rural areas and to the socially and economically backward classes with a view to reaching all insurable persons in .the country and providing them adequate financial cover against death at a reasonable Cost. Maximize mobilization of people's savings by making insurance linked savings adequately attractive. Bear in mind, in the investment of funds, the primary obligation to its policyholders, whose money it holds in trust, without losing sight of the interest of the; community as a whole; the funds to be deployed to the best advantage of the investors as well as the community as a whole, keeping in view national priorities and obligations of attractive return. Conduct business with utmost economy and with the full realization that the moneys belong to: the policyholders. Act as trustees of the insured public in their individual and collective capacities. Meet the various life insurance needs of the community that would arise in the changing social and economic environment. Involve all people working in the Corporation to the best of their capability in furthering the interests of the insured public by providing efficient service with courtesy.

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Promote amongst all agents and employees of the Corporation a sense of participation, pride and job satisfaction through discharge of their duties with ded1cat1on towards achievement of Corporate Objective.

The Insurance Players

HDFC Standard Life Insurance Company Limited Birla Sun Life Insurance Company Limited TATA AIG Life Insurance Company Limited Max New York Life Insurance Company Limited Kotak Mahindra Old Mutual Life Insurance Limited SBI Cardiff Life Insurance Company Limited ING Vysya Life Insurance Company Limited Bajaj Allianz Life Insurance Company Limited ICICI Prudential Life Insurance Company Limited MetLife Life Insurance Company Limited Aviva Life Insurance Company Limited Reliance Life Insurance Company Limited Sahara India Life Insurance Limited Shriram Life Insurance Company Limited

Types of Plan..
Conventional ULIP

Conventional:Conventional plans are those plans in which returns are known and are fixed. Example: Childrens Plan. In this plan the customer has knows how much return he will get after maturity or any miss happening occurs. Here risk is low and returns are also low, because it is not dependent on the market risk and is a rigid policy. It is seen that people also invest less in such type of policies as returns are less and there is a compulsion attached is of compulsory premium submission till the policy matures. Illustration: Premium for 10 yrs is 20000 20000+20000+20000+20000+20000+20000+20000+20000+20000+20000= 2lks Return described was 2.5 times So the customer will get approx 5 lkhs after deducting all charges. Insurance is always of the parent and beneficiary is the child. There are 2 types of loss that occurs on any type of miss happening i.e. emotional loss and monetary loss

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company cant full fill emotional loss but can help in monetary loss by giving the 2lks Rs. At the miss happening and will give the rest premium by its own and will give the bonus at maturity again to the child.

ULIP ULIP stands for UNIT LINK INSURANCE PLAN. As it is said higher risk higher return

Profile
The Housing Development Finance Corporation Limited (HDFC) was amongst the first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector, as part of the RBI's liberalization of the Indian Banking Industry in 1994. The bank was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial Bank in January 1995.

Capital Structure
The authorized capital of HDFC Bank is Rs.450 crore (Rs.4.5 billion). The paid-up capital is Rs.311.9 crore (Rs.3.1 billion). The HDFC Group holds 22.1% of the bank's equity and about 19.4% of the equity is held by the ADS Depository (in respect of the bank's American Depository Shares (ADS) Issue). Roughly 31.3% of the equity is held by Foreign Institutional Investors (FIIs) and the bank has about 190,000 shareholders. The shares are listed on. The Stock Exchange, Mumbai and the National Stock Exchange. The bank's American Depository Shares are listed on the New York Stock Exchange (NYSE) under the symbol "HDB".

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HDFC Standard Life Insurance Co. History: HDFC Standard Life Insurance Co. Ltd was incorporated on 14th august 2000. It is a joint venture between Housing Development Finance Corporation Limited (HDFC Ltd.) India and UK based Standard Life Company. Both the joint venture partners being one of the leaders in their respective areas came together in this 81.4:18.6 joint venture to form HDFC Standard Life Insurance Company Limited. The MD and CEO of HDFC Standard Life Mr. Deepak Satwalekar, has given the company new directions and has helped the company achieve the status it currently enjoys. HDFC Standard Life brings to you a whole range of insurance solutions be it group or individual or NAV services for corporations, they can be easily customized as per specific needs. The Bancassurance partners of HDFC Standard Life Insurance Co Ltd are HDFC, HDFC Bank India Limited, Union Bank of India, Indian Bank, Bank of Baroda, Saraswat Bank and Bajaj Capital.

Concept of Unit Linked

Unit Linked Policies are unbundled Unit link polices are separate identification of part investment element, expense administration charges and benefit charges shown separately. Unit Linked Policies make use of Unit linked funds Investment housed in funds divided in units client has choice of funds. Unit Linked Policies are linked Value of policy linked to net assets investment risk and rewards transferred from the insurer to the client. Unit Linked Policies have explicit charges It is the consequence of unbundling. Charges can be subjected to be changed however mortality remains unchanged during the tenure of policy.

ULIP of HDFC
ULIP with insurance ULIP as pure investment

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ULIP with insurance

Unit link young star plus II As a parent, priority is childrens future and being able to meet their dreams and aspiration. Today, providing a good education, establishing a professional career or even a modest wedding is expensive. Costs are increasing fast. Just imagine how much you will need when your children take these important steps in life. HDSFC SL Unit Link Young Star Plus II provides a medium through a parent can help there children in building up a secured financial future. Steps to own a plan Step 1: this is the premium which will continue to pay each year oh the policy. The min regular premium is Rs.12000 per year. Which can be paid yearly, monthly, quarterly or half yearly? Step 2: sum assured minimum 5 times and maximum 40 times. Step 3: can choose double or triple benefit. In case of unfortunate demises during the policy term Double Benefit Company will pay 100% of the entire future regular premiums. And sum assured will be given to the beneficiary Triple Benefit Company will give 50%of the premium to the beneficiary and 50% as regular premium. And the sum assured will be given to the beneficiary. Surrender In the first five years. Surrender is not possible, after 5 years surrender value will be the value of units of the plan, there is no surrender charge after 5years. Charges Fund management charge(FMC) HDFC SL enjoys the lowest FMC rates across the industry i.e. 1.25% of fund value. Allocation charge 1st year 60% 2nd year and onward 1% Allocation how ever increases with increase in premium size thus giving better returns to HNI (high network individual). Policy administration charge: 60rs per month

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All charges other than allocation are being charged on daily basis on the cancellation of units. Tax benefits (based on current tax-law) You will be eligible for tax benefits under section 80ccc of the income tax act, 1961. Under Section 80ccc, you can save up to 33,990 from the tax every year.(calculated on the highest tax bracket) as premium up to a maximum of Rs. 1, 00,000 are allowed as a deduction from your taxable income. The above mentioned tax benefits are subject to change in tax law. ULIP as pure investment to maximize investment returns. HDFC invest the premium of the customer in the chosen fund in the proportion that he/she specifies. At the end of the policy term, he /she will reive the accumulated value of the fund, ehich will provide pension income. In the event of unfortunate demises during the policy term, nominee will receive a cash lump sum to help him or her manage the retirement years. All insurance plans are subjected to different risk factors. Steps to own plan Step 1 Step 2 Choose the retirement age Choose the premium wish to invest based on retirement needs

Step 3

Choose the investment fund or funds he/she desire

Step 1: select any age between 50 years and 75 years. Step 2: this is the premium which will continue to pay each year oh the policy. The min regular premium is Rs.10000 per year. Which can be paid yearly, monthly, quarterly or half yearly? Investor can opt for combination of 6 funds or 1 fund depending upon the need of investor and his ability to take risk. Accessing Customers Money: a) On vesting Policy matures at the end of the policy term customer have chosen and on chosen retirement date, he will get the value of units in policy as per prevailing Govt. regulations He/She can take 1/3 if the funds value as a tax-free cash lump sum and rest must be converted to an annuity.

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He/She can but the annuity from the company or any other insurer. Customer is allowed to alter vesting date subject to above age at vesting and policy term limits. b) On death In case of unfortunate demises before the end of policy term, nominee will receive the unit fund value, policy will terminate there after. c) On surrender In the first three years. Surrender is not possible, after 3 years surrender value will be the value of units of the plan, there is no surrender charge after 3 years. Charges Fund management charge(FMC) HDFC SL enjoys the lowest FMC rates across the industry i.e. .8% of fund vaue. Allocation charge 1st year 25% 2nd year 25% 3rd and onward 1% Allocation how ever increases with increase in premium size thus giving better returns to HNI(high network individual). Policy administration charge: 20rs per month All charges other than allocation are being charged on daily basis on the cancellation of units. Tax benefits (based on current tax-law) You will be eligible for tax benefits under section 80ccc of the income tax act, 1961. Under Section 80ccc, you can save up to 33,990 from the tax every year.(calculated on the highest tax bracket) as premium up to a maximum of rs. 1, 00,000 are allowed as a deduction from your taxable income. The above mentioned tax benefits are subject to change in tax law.

FMC a small but handy tool

FMC stands for Fund Management Charges. This is the tool which is vibrantly used by the company to take charges. FMC is applied on the fund while calculating NAV. The maximum FMC in any fund is 2% p.a. subject pot prior approval by the IRDA. Generally people are unaware if this charge. It seems to be very small charge but in reality its a charge which makes the difference between 2 policies. HDFC is the company which

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charges lowest FMC i.e. 0.8% which is generally higher with other companies near about 2%. The effect of FMC can be seen in long term but has a minute effect in short term. Foe illustration:premiu m 50000 50000 50000 50000 50000 50000 50000 50000 50000 50000 50000 50000 50000 50000 50000 6000 15000 9000 at 2% fmc others 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 1000 At 0.8% Fmc HDFC 400 400 400 400 400 400 400 400 400 400 400 400 400 400 400

Years 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Sum of HDFC FMC Sum of others FMC Difference

INTRODUCTION TO MUTUAL FUND:-

The mutual fund industry is a lot like the film star of the finance business.Though it is perhaps the smallest segment of the industry, it is also the most glamorous in that it is a young industry where there are changes in the rules of the game everyday, and there are constant shifts and upheavals. The one investment vehicle that has truly come of age in India in the past decade is mutual funds. Today, the mutual fund industry in the country manages around Rs 100,000 crore of assets, a large part of which comes from retail investors. A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. The money thus collected is invested by the fund manager in different types of securities depending upon the objective of the scheme. These could range from shares to debentures to money market instruments. The

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income earned through these investments and the capital appreciations realized by the scheme are shared by its unit holders in proportion to the number of units owned by them (pro rata). Each Mutual Fund scheme has a defined investment objective and strategy. A mutual fund is the ideal investment vehicle for todays complex and modern financial scenario. Markets for equity shares, bonds and other fixed income instruments, real estate, derivatives and other assets have become mature and information driven. Price changes in these assets are driven by global events occurring in faraway places. A typical individual is unlikely to have the knowledge, skills, inclination and time to keep track of events, understand their implications and act speedily. An individual also finds it difficult to keep track of ownership of his assets, investments, brokerage dues and bank transactions etc. A mutual fund is the answer to all these situations. It appoints professionally qualified and experienced staff that manages each of these functions on a full time basis. The large pool of money collected in the fund allows it to hire such staff at a very low cost to each investor. In effect, the mutual fund vehicle exploits economies of scale in all three areas research, investments and transaction processing. But every coin has a flip side. With mutual funds, you have no control on the investments of the fund; and, more importantly, the downside of diversification is that a fund can hold so many stocks that a tremendously great performance by a stock will make very little difference to a fund's overall performance. Now if you think that the world of Mutual Funds is intimidating, complicated and definitely not for you then think once again.

Mutual Funds Concept

A Mutual Fund 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 appreciations realized are shared by its unit

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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. The flow chart below describes broadly the working of a mutual fund:

Mutual Fund Operation Flow Chart Fig 1

Net asset value (NAV) of a scheme

Net asset value denotes the performance of a particular scheme of a mutual fund. Mutual funds invest the money collected from the investors in securities markets. In simple terms, NAV is the market value of the securities held by the scheme. Since market value of securities changes every day, NAV of a scheme also varies on a day-to-day basis. The NAV per unit is the market value of securities of a scheme divided by the total number of units of the scheme on any particular date.

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For example, if the market value of securities of a mutual fund scheme is Rs 200 lakhs and the mutual fund has issued 10 lakh units of Rs 10 each to the investors, then the NAV per unit of the fund is Rs 20. NAV is required to be disclosed by the mutual funds on a regular basis - daily or weekly - depending on the type of scheme.

The intelligent investor's seven rules

Its one thing to understand mutual funds and their working; its another to ride on this potent investment vehicle to create wealth in tune with your risk profile and investment needs. Here are seven must-dos that go a long way in helping you meet your investment objectives. 1. Know your risk profile Can you live with volatility? Or are you a low-risk investor? Would you be satisfied if your fund invests in fixed-income securities, and yields low but sure-shot returns? These are some of the questions you need to ask yourself before investing in a fund. Your investments should reflect your risk-taking capacity. Equity funds might lure when the market is rising and your neighbor is making money, but if you are not cut out for the risk that accompanies it, dont bite the bait. So, check if the funds objective matches yours. Invest only after you have found your match. If you are racked by uncertainty, seek expert advice from a qualified financial advisor. 2. Identify your investment horizon How long you want to stay invested in a fund is as important as deciding upon your risk profile. A mutual fund is essentially a savings vehicle, not a speculation vehicledont get in with the intention of making overnight gains. Invest in an equity fund only if you are willing to stay on for at least two years. For income and gilt funds, have a one-year perspective at least. Anything less than one year, the only option among mutual funds is liquid funds.

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3. Read the offer document carefully This is a must before you commit your money to a fund. The offer document contains essential details pertaining to the fund, including the summary information (type of scheme, name of the asset Management Company and price of units, among other things), investment objectives and investment procedure, financial information and risk factors. 4. Go through the fund fact sheet Fund fact sheets give you valuable information of how the fund has performed in the past. You can check the funds portfolio, its diversification levels and its performance in the past. The more fact sheets you examine, the better. 5. Diversify across fund houses If you are routing a substantial sum through mutual funds, you should diversify across fund houses. That way, you spread your risk. 6. Do not chase incentives Dont get lured by investment incentives. Some financial intermediaries give upfront incentives, in the form of a percentage of your initial investment, to invest in a particular fund. Dont buy it. Your focus should be to find a fund that matches your investment needs and risk profile, and is a performer. 7. Track your investments Your job doesnt end at the point of making the investment. Its important you track your investment on a regular basis, be it in an equity, debt or balanced fund. One easy way to keep track of your fund is to keep track of the Intelligent Investor rankings of mutual

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funds, which are complied on a quarterly basis. These rankings allow you to take note of your funds performance and risk profile, and compare it across various time periods as well as across its peer set. In addition, you should run some basic checks in the fund fact sheets and the quarterly reports you get from your fund. If you come across negative reports of the fund, ask your financial advisor or broker about it, especially if theres a possibility of your investment depreciating in value. If the threat is real, reduce your exposure to the fund.

DERIVATIVES Measuring performance of Mutual Fund

1. Relative to benchmark method Under this method a comparison is made between the returns given by a market index, and the fund over a given period of time. If the returns generated by the fund as measured by changes in NAV over that given period of time are greater than those generated by the benchmark then the fund is deemed to have outperformed the market portfolio. 2. Risk-Return Method The Relative-to-Benchmark measure is very simplistic, as it does not incorporate any measure of risk in its calculation. An investor would naturally be interested in finding out the return generated for the risk undertaken, as, in a bid to generate super normal return, the fund may go overboard on the risk parameter. Therefore, risk adjusted measures of return are needed to measure the performance of funds. There are several such measures prominent among which are the Sharpe ratio, the Treynor ratio, and Alpha-: a) Sharpe ratio

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This measure uses standard deviation as a measure to evaluate a fund's risk-adjusted returns. Mathematically, it is arrived at by deducting the risk free returns from the returns generated by the fund and dividing the residual figure by the standard deviation of the fund's returns. One thing that has to be kept in mind while using this measure is that the ratio is not an absolute figure. Its real utility lies in inter scheme comparison. b) Treynor's ratio The other measure Treynor's ratio also has the same attributes with the difference that the residual figure in this case is divided by beta rather than the standard deviation, thus reflecting only the systematic risk. Beta of the fund is a volatility measure that quantifies sensitivity of the fund's return to the benchmark index's returns i.e. given the movements of the benchmark how much the fund will move. It does not give representation to unsystematic risk under the assumption that the fund manager can easily wipe out the unsystematic risk by diversifying across a large number of stocks. c) Alpha Basically, alpha is the difference between the return that would be warranted by its beta (expected return) and the return that is actually generated by the fund. If a fund returns more than what is anticipated by beta, it has a positive and favorable alpha, and if it returns less than the amount predicted by beta, the fund has a negative alpha. Mathematically, Alpha= fund return - [Risk free rate + Beta of fund (Benchmark return Risk free return)]

Risks involved in investing in Mutual Funds

1. Market risk If the overall stock or bond markets fall on account of macro economic factors, the value of stock or bond holdings in the fund's portfolio can drop, thereby impacting the NAV.

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2. Non-market risk Bad news about an individual company can pull down its stock price, which can negatively affect funds holding a large quantity of that stock. This risk can be reduced by having a diversified portfolio that consists of a wide variety of stocks drawn from different industries.

3. Interest rate risk Unit prices and interest rates move in opposite directions. When interest rates rise, bond prices fall and this decline in underlying securities affects the NAV negatively. How bad the damage will be is dependant on factors such as maturity profile, liquidity etc. 4. Credit risk Bonds are debt obligations. So when the funds invest in corporate bonds, they run the risk of the corporate defaulting on their interest and principal payment obligations and when that risk crystallizes, it leads to a fall in the value of the bond causing the NAV of the fund to take a beating

Types of Mutual Fund

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Fig 3 Mutual fund schemes may be classified on the basis of its structure and its investment objective:-

1. By Structure: a) Open-ended Funds

An open-end fund is one that is available for subscription all through the year. These do not have a fixed maturity. Investors can conveniently buy and sell units at Net Asset Value ("NAV") related prices. The key feature of open-end schemes is liquidity. b) Closed-ended Funds A closed-end fund has a stipulated maturity period which generally ranging from 3 to 15 years. The fund is open for subscription only during a specified period. Investors can invest in the scheme at the time of the initial public issue and thereafter they can buy or sell the units of the scheme on the stock exchanges where they are listed. In order to provide an exit route to the investors, some close-ended funds give an option of selling back the units to the Mutual Fund through periodic repurchase at NAV related prices. SEBI Regulations stipulate that at least one of the two exit routes is provided to the investor. c) Interval Funds

26

Interval funds combine the features of open-ended and close-ended schemes. They are open for sale or redemption during pre-determined intervals at NAV related prices.

2. by Investment Objective:
a) Equity Oriented Schemes These schemes, also commonly called Growth Schemes, seek to invest a majority of their funds in equities and a small portion in money market instruments. Such schemes have the potential to deliver superior returns over the long term. However, because they invest in equities, these schemes are exposed to fluctuations in value especially in the short term.

Fig 4

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Fig 5 b) Debt Based Schemes These schemes, also commonly called Income Schemes, invest in debt securities such as corporate bonds, debentures and government securities. The prices of these schemes tend to be more stable compared with equity schemes and most of the returns to the investors are generated through dividends or steady capital appreciation. These schemes are ideal for conservative investors or those not in a position to take higher equity risks, such as retired individuals. However, as compared to the money market schemes they do have a higher price fluctuation risk and compared to a Gilt fund they have a higher credit risk.

Fig 6

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Fig 7 c) Hybrid Schemes These schemes are commonly known as balanced schemes. These schemes invest in both equities as well as debt. By investing in a mix of this nature, balanced schemes seek to attain the objective of income and moderate capital appreciation and are ideal for investors with a conservative, long-term orientation. HDFC Balanced Fund and HDFC Childrens Gift Fund are examples of hybrid schemes.

d) Load Funds A Load Fund is one that charges a commission for entry or exit. That is, each time you buy or sell units in the fund, a commission will be payable. Typically entry and exit loads range from 1% to 2%. It could be worth paying the load, if the fund has a good performance history. e) No-Load Funds

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A No-Load Fund is one that does not charge a commission for entry or exit. That is, no commission is payable on purchase or sale of units in the fund. The advantage of a no load fund is that the entire corpus is put to work.

3. OTHER SCHEMES:
a) Tax Saving Schemes These schemes offer tax rebates to the investors under specific provisions of the Indian Income Tax laws as the Government offers tax incentives for investment in specified avenues. Investments made in Equity Linked Savings Schemes (ELSS) and Pension Schemes are allowed as deduction u/s 88 of the Income Tax Act, 1961. The Act also provides opportunities to investors to save capital gains u/s 54EA and 54EB by investing in Mutual Funds.

b) Special Schemes: i) Industry Specific Schemes Industry Specific Schemes invest only in the industries specified in the offer document. The investment of these funds is limited to specific industries like InfoTech, FMCG, and Pharmaceuticals etc.

ii) Index Schemes Index Funds attempt to replicate the performance of a particular index such as the BSE Sensex or the NSE 50 iii) Sectoral Schemes

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Sectoral Funds are those, which invest exclusively in a specified industry or a group of industries or various segments such as 'A' Group shares or initial public offerings.

Benefits Of Investing In Mutual Funds

1. Professional Management Mutual Funds provide the services of experienced and skilled professionals, backed by a dedicated investment research team that analyses the performance and prospects of companies and selects suitable investments to achieve the objectives of the scheme.

2.Diversification Mutual Funds invest in a number of companies across a broad cross-section of industries and sectors. This diversification reduces the risk because seldom do all stocks decline at the same time and in the same proportion. You achieve this diversification through a Mutual Fund with far less money than you can do on your own.

3. Convenient Administration Investing in a Mutual Fund reduces paperwork and helps you avoid many problems such as bad deliveries, delayed payments and follow up with brokers and companies. Mutual Funds save your time and make investing easy and convenient.

4. Return Potential Over a medium to long-term, Mutual Funds have the potential to provide a higher return as they invest in a diversified basket of selected securities. 5. Low Costs

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Mutual Funds are a relatively less expensive way to invest compared to directly investing in the capital markets because the benefits of scale in brokerage, custodial and other fees translate into lower costs for investors. 6. Liquidity In open-end schemes, the investor gets the money back promptly at net asset value related prices from the Mutual Fund. In closed-end schemes, the units can be sold on a stock exchange at the prevailing market price or the investor can avail of the facility of direct repurchase at NAV related prices by the Mutual Fund. 7.Transparency you get regular information on the value of your investment in addition to disclosure on the specific investments made by your scheme, the proportion invested in each class of assets and the fund manager's investment strategy and outlook. 8. Tax Benefits The taxman has, over the years, been more or less kind to mutual funds! With laws varying from time to time, the overall objective has been to encourage the growth of the mutual funds industry. Currently, a variety of tax laws apply to mutual funds, which are broadly listed below:

1) Capital Gains Units of mutual fund schemes held for a period more than 12 months are treated as longterm capital assets. In such cases, the unit-holder has the option to pay capital gains tax at either 20 % (with indexation) or 10 % without indexation.

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2) Tax Deducted at Source (TDS) For any income credited or paid by a fund, no tax is deducted or withheld at source. The relevant sections in the Income Tax Act governing this provision are Section 194K and 196A. 3) Wealth Tax Mutual fund units are not currently treated as assets under Section 2 of the Wealth Tax Act and are therefore not liable to tax.

4) Income from units Any income received from units of the schemes of a mutual fund specified under section 23 (D) is exempt under Section 10 (33) of the Act. While section 10(23D) exempts income of specified mutual funds from tax (which currently includes all mutual funds operating in India), Section 10(33) exempts income from funds in the hands of the unitholders. However, this does not mean that there is no tax at all on income distributions by mutual funds. 5) Income Distribution Tax As per prevailing tax laws, income distributed by schemes other than open-end equity schemes is subject to tax at 20 % (plus surcharge of 10 %). For this purpose, equity schemes have been defined to be those schemes that have more than 50 % of their assets in the form of equity. Open-end equity schemes have been left out of the purview of this distribution tax for a period of three years beginning from April 1999.

6) Section 80-C The investment in mutual funds designated as Equity Linked Laving Scheme (ELSS) qualifies for rebate under Section 80-C. The maximum amount that can be invested in these schemes is Rs.10,000, therefore the maximum tax benefit available works out to 33

Rs.2000. Apart from ELSS schemes, the benefit of Section 80-C is also available in select schemes of some funds such as UTI ULIP, KP Pension Plan etc

Disadvantages of Mutual Funds

1. The Wisdom of Professional Management. That's right, this is not an advantage. The average mutual fund manager is no better at picking stocks than the average nonprofessional, but charges fees as though she is. 2. No Control. Unlike picking your own individual stocks, a mutual fund puts you in the passenger seat of somebody else's car. 3. Dilution. Mutual funds generally have such small holdings of so many different stocks that insanely great performance by a fund's top holdings still doesn't make much of a difference in a mutual fund's total performance. 4. Buried Costs. Many mutual funds specialize in burying their costs and in hiring salesmen who do not make those costs clear to their clients.

Scope for Development of Mutual Fund Business in India

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. India has a burgeoning population of middle class now estimated 34

around 300 million. A typical Indian middle class family can have liquid savings ranging from Rs.2 to Rs.10 Lakhs today. Investments in Banks are liquid and safe, but with the falling rate of interest offered by Banks on Deposits, it is no longer attractive. At best a part can be saved in bank deposits, but what are the other sources of investment for the common man? Mutual Fund is the ready answer. Viewed in this sense globally India is one of the best markets for Mutual Fund Business, so also for Insurance business. This is the reason that foreign companies compete with one another in setting up insurance and mutual fund business units in India. The sheer magnitude of the population of educated white collar employees provides unlimited scope for development of Mutual Fund Business in India. The Indian capital market has witnessed some significant reforms on the structural, operational and regulatory front over a period of time. The changes such as abolition of controller of capital issues, establishment of market regulator [SEBI], introduction of a nationwide screen-based trading, dematerialization of securities, electronic trading, sophisticated risk-management techniques, derivative trading, rolling settlement, shortening of settlement cycle, ban on deferral products, formation of Clearing Corporation of India and demutualization of stock exchanges have marked a new era in the functioning of the capital market."

Objectives:
Primary objectives: People awareness of charge FMC in both ULIP and Mutual funds Compare of investment in ULIP plans with Mutual Funds Secondary objectives: To study the investment patterns of the consumer in Financial Products. To know the customer awareness about ULIPs and Mutual Funds. RESEARCH METHOLOGY Type of Research Size of sample: Area of research study: Sampling procedure: Exploratory Research 100 respondents Bareilly Convenient sampling

35

METHOD FOR DATA COLLECTION Primary Data: Procedure of data collection: Survey Tools for data collection: Questionnaire Secondary Data: Information Brochures, Web Sites Analysis:
Helps u in making investment decisions Cumulative Percent 4.0 24.0 28.0 30.0 95.0 100.0

Valid

journal refrence group television newspaper broker influencer Total

Frequency 4 20 4 2 65 5 100

Percent 4.0 20.0 4.0 2.0 65.0 5.0 100.0

Valid Percent 4.0 20.0 4.0 2.0 65.0 5.0 100.0

marital status Cumulative Percent 62.0 100.0

Valid

married Single Total

Frequency 62 38 100

Percent 62.0 38.0 100.0

Valid Percent 62.0 38.0 100.0

where do u generaly investur money Frequency Percent 100 100.0 which company is best among life insurance companies Missing System Cumulative Percent 22.0 32.0 62.0 68.0

Valid

Hdfc Aviva Icici Bajaj

Frequency 22 10 30 6

Percent 22.0 10.0 30.0 6.0

Valid Percent 22.0 10.0 30.0 6.0

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Birla tata aig Total

20 12 100

20.0 12.0 100.0

20.0 12.0 100.0

88.0 100.0

Do you like to invest your funds in same company again? Cumulative Percent 15.0 35.0 60.0 100.0

Valid

always sometimes Often Never Total

Frequency 15 20 25 40 100

Percent 15.0 20.0 25.0 40.0 100.0

Valid Percent 15.0 20.0 25.0 40.0 100.0

Are you aware about ULIP plans of life insurance companies? Cumulative Percent 58.0 100.0

Valid

Yes No Total

Frequency 58 42 100

Percent 58.0 42.0 100.0

Valid Percent 58.0 42.0 100.0

Are you aware about Mutual Funds? Cumulative Percent 78.0 100.0

Valid

Yes No Total

Frequency 78 22 100

Percent 78.0 22.0 100.0

Valid Percent 78.0 22.0 100.0

Have you ever invested your funds in ULIP? Cumulative Percent 63.0 100.0

Valid

Yes No Total

Frequency 63 37 100

Percent 63.0 37.0 100.0

Valid Percent 63.0 37.0 100.0

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Have you ever invested your funds in Mutual Funds? Cumulative Percent 69.0 100.0

Valid

Yes No Total

Frequency 69 31 100

Percent 69.0 31.0 100.0

Valid Percent 69.0 31.0 100.0

Are you aware of the charge FMC?

Valid

Yes No Total

Frequency 23 77 100

Percent 23.0 77.0 100.0

Valid Percent 23.0 77.0 100.0

Cumulative Percent 23.0 100.0

Do you know FMC is charged under mutual funds? Cumulative Percent 16.0 100.0

Valid

Yes No Total

Frequency 16 84 100

Percent 16.0 84.0 100.0

Valid Percent 16.0 84.0 100.0

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helps u in making investment decisions

journal refrence group television newspaper broker influencer

39

marital status
married single

40

which company is best among life insurance companies

hdfc aviva icici bajaj birla tata aig

41

Do you like to invest your funds in same company again?

always sometimes often never

42

Are you aware about ULIP plans of life insurance companies?

yes no

43

Are you aware about Mutual Funds?

yes no

44

Have you ever invested your funds in ULIP?

yes no

45

Have you ever invested your funds in Mutual Funds?

yes no

46

Are you aware of the charge FMC?

yes no

47

Do you know FMC is charged under mutual funds?

yes no

marital status * Have you ever invested your funds in ULIP? Crosstabulation Count Have you ever invested your funds in ULIP? yes marital status Total married single 39 24 63 no 23 14 37 Total yes 62 38 100

Null Hypothesis: There is no relationship between marital status and investment in ULIPS

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Chi-Square Tests Asymp. Sig. (2-sided) .980 1.000 .980 1.000 .001 100 1 .980 .576 Exact Sig. (2-sided) Exact Sig. (1-sided)

Pearson Chi-Square Continuity Correction(a) Likelihood Ratio Fisher's Exact Test Linear-by-Linear Association N of Valid Cases

Value .001(b) .000 .001

df 1 1 1

a Computed only for a 2x2 table b 0 cells (.0%) have expected count less than 5. The minimum expected count is 14.06. Since, asym. Sig. is greater than 0.5, therefore, hypothesis is rejected. Hence, there is no significant relationship between marital status and investment in ULIPS.

Bar Chart
Have you ever invested your funds in ULIP?
yes no

40

30

Count

20

10

0 married single

marital status

49

marital status * Have you ever invested your funds in Mutual Funds? Cross tabulation Count Have you ever invested your funds in Mutual Funds? Yes marital status Total married single 45 24 69 no 17 14 31 Total yes 62 38 100

Null Hypothesis: There is no relationship between marital status and investment in MUTUAL FUNDS

Chi-Square Tests Asymp. Sig. (2-sided) .323 .444 .325 .376 .968 1 .325 .221 Exact Sig. (2-sided) Exact Sig. (1-sided)

Pearson Chi-Square Continuity Correction(a) Likelihood Ratio Fisher's Exact Test Linear-by-Linear Association

Value .978(b) .587 .968

df 1 1 1

N of Valid Cases 100 a Computed only for a 2x2 table b 0 cells (.0%) have expected count less than 5. The minimum expected count is 11.78.

Since, asymp. Sig. is less than 0.5 hence, there is a relationship between marital status and investment in mutual funds. Therefore, null hypothesis rejected. After marriage it is seen person becomes more concern about investment of money and thus they try to invest in various scheme. It is seen still a num of persons try to avoid investment in insurance

50

Bar Chart
Have you ever invested your funds in Mutual Funds?
yes no

50

40

Count

30

20

10

0 married single

marital status

51

LIMITATIONS 1. The sample size is very less, hence the responses of just 100 respondents does not imply for the complete population. 2. There was lack of time and resources that prevented from carrying out an in depth study. 3. The findings of the survey are based on the subjective opinion of the respondents and there is no way of assessing truth of the statements. 4. There is some respondents bias which cannot be removed. 5. Lastly, some amount of error exists in the data filling process because of the following reasons: Influence of others. Misunderstanding of the concept. Hurried filling of the questionnaire. CONCLUSION The ULIP plans of HDFC SLIC are very competitive and have an edge over the plans of other companies as they provide higher returns to there customers. ULIP plans are beneficial from the long term perspective whereas customer should invest in mutual funds if he wants quick returns. Most of the market is still unaware about the ULIP plans and hence by making proper promotional strategy companies can increase there sales.

RECOMMENDATIONS Variety-based Positioning This type of positioning is based on varieties in products and services rather than customer segments. It is a sensible strategy for those companies who have distinctive advantages or strengths in offering certain products and services. In the insurance industry too, it is possible to achieve a unique position by focusing on certain category of products. HDFCSLIC can provide certain distinct services to its customers (such as: providing the information to the clients about there policies over the internet etc.) which will differentiate them from other companies

52

 Needs-based Positioning This is based on the differing needs of different groups of consumers. This can be done successfully if a company has unique strengths to service a group of customer needs better than others The insurance needs of customers vary significantly for different groups of customers. However, in India most of the life insurance companies have a wide variety of products tailored for different customer needs and there is no company focusing on a particular customer need. An example would be a life insurance company that focuses only on High Net-worth Individuals (HNIs). The needs of HNIs would be quite different from those of a general consumer and would require an entirely different marketing mix right from the type of products offered and the way they are distributed, to the promotion methods employed

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Annexure Questionnaire

COMPARATIVE ANALYSIS OF ULIPS OF MAJOR COMPANIES AND WITH MUTUAL FUND IN BAREILLY REGION 1. Sources that helps you in making the investment decisions: Financial journal / business magazines Reference groups Television General / business newspapers Brokers / agents / professional consultant Word of mouth/ influencer 2. Factors that influence your investment decisions in a particular company: Rating response 1 2 3 4 5 High Reputation Good CRM Good Promotion Relationship with agent Rate of return Life insurance cover Attractive schemes Tax benefits Variety of products Better service

54

Pre sales communications 3. Where do you generally like to invest your money? Rating response 1 2 3 insurance Stock Market Mutual fund Bank / Fixed Deposits / Post Office savings Others (Real estate, Gold etc.) 4. According to you who among the following Life insurance companies is best? HDFC STANDARD LIFE AVIVA LIFE INSURANCE ICICI PRUDENTIAL BAJAJ ALLIANZ BIRLA SUN LIFE TATA AIG 4 5

5. Do you like to invest your funds in same company again? Opinion Always Sometimes Often Seldom Never Total Response Percentage

55

6. Are you aware about ULIP plans of life insurance companies? Opinion Yes No Total Response Percentage

7. Are you aware about Mutual Funds? Opinion Yes No Total ResponsePercentage

8. Have you ever invested your funds in ULIP? Opinion Yes No Total ResponsePercentage

9. Have you ever invested your funds in Mutual Funds? Opinion Yes No Total ResponsePercentage

10. (a) Where u would like to reinvest your money ULIP or Mutual Funds?

(b) Why?

11. Are you aware of the charge FMC?

56

Opinion Yes No

Total ResponsePercentage

12. Do you know FMC is charged under mutual funds? Opinion Yes No Total ResponsePercentage

BIBLIOGRAPHY:-

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Susan, S. K. (2006), compensation practices for distribution of mutual funds Journal of Investment Compliance, Vol. IV, Issue 4, pp.. 27-45.

Websites: http://www.amfiindia.com/ http://www.dspml.com http://www.economictimes.com http://www.investopedia.com/university/mutualfunds/default.asp http://news.moneycontrol.com/mf/glossary.php http://www.mutualfundsindia.com/resourcecentre.asp http://www.valueresearchonline.com http://www.hdfcsl.com

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