Thesis( Mutual Fund

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Study of working of mutual fund & identify the various factors considered by the customer while going for investment in Mutual Fund

A report submitted towards the partial fulfillment of the requirements of the two years full-time MBA

Under the Supervision of Mrs. Yashika Aggarwal Faculty LMTSOM Submitted by Sumit Gandhi MBA (Manufacturing) Roll No: 50702045

[2007-09]

[LM THAPAR

SCHOOL OF

MANAGEMNT]

Table of content
TOPIC EXECUTIVE SUMMARY ABSTRACT LIST OF FIGURE ACKNOWLEDGEMENT CERTIFICATE OBJECTIVE INTRODUCTION LITERATURE REVIEW RESEARCH METHODOLOGY ANALYSIS & FINDINGS CONCLUSION RECOMMENDATIONS LIMITATIONS REFERENCES BIBLIOGRAPHY ANNEXURE PAGE NO 3 4 5 6 7 8 9 11 23 29 36 37 38 39 41 42

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EXECUTIVE SUMMARY

The project talks about “the various factors considered by the customers while going for investment in mutual fund”. The first This is few pages talk about the introduction and objectives of the study. followed by literature review with details about mutual funds.

Next comes the survey, the purpose of which is to study the working of mutual funds, the characteristics of mutual funds that attract the investor and what an investor should consider for safe investment and better returns. The last part consists of analysis, finding, recommendations, , conclusion, limitations and bibliography. The questionnaire has been annexed to the report.

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ABSTRACT

Growth, both in terms of size and choice, in the mutual fund industry among emerging markets has been impressive. However, mutual fund research in emerging markets hardly exists. This paper intends to fill this gap. In particular, the paper surveys the relative importance of factors considered important in the selection of mutual funds by investors & financial advisors in emerging markets. Our survey focuses on Punjab (India) where the mutual industry started in the 1963 but only gained importance in the 1987 when there were players outside the UTI, who entered the industry. Our analysis results in clubbing of all the eight factors into three major components. Component 1 comprise of factors - Risk diversification, Cost of transaction, flexibility. The Component 2 comprise of managed by professional, Affiliation of fund & Experience of fund manager. Performance of previous funds& Return on investment fall in Component 3. All these factors are important & must be taken care whenever the investment decision is to be made in Mutual Funds. We find that apart from the return & risk diversification past performance, and cost of transaction are important factors in a mutual fund. Investors & financial advisors are looking for consistent growth of funds over the long term. They also prefer managers who are experienced and professionally qualified. As for funds, there is greater affinity for funds which are large and linked to a government agency. The fund management company should also provide a variety of funds at lower transaction costs. It is a matter of time before the financial markets in emerging economies like India are opened to foreign fund companies. Our findings show that customers in emerging markets look for consistent long-term growth. As mutual funds in established markets also face the same challenge in their own domestic front, similar investment strategies may be in order. Transaction costs may prove to be a different challenge. The initial costs of setting up operations in emerging markets, understanding the local political, social and economic environment may involve additional costs.

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LIST OF FIGURES
Figure 1 Figure 2 Figure 3 Figure 4 Figure 5 Figure 6 Figure 7 Figure 8 Figure 9 Figure 10 Figure 11 Figure 12 Figure 13 24 25 25 26 26 27 28 29 29 30 31 32 32

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ACKNOWLEDGEMENT
I would like to express my sincere thanks...
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