A PROJECT REPORT ON PERFORMANCE OF SECTORAL MUTUAL FUNDS WITH RETAIL SECTOR AT INDIAINFOLINE Submitted to department of business Administration, Osmania

University in the partial fulfillment of the requirement for the award of the degree of MASTER OF BUSINESS ADMINISTRATION (In finance) Submitted to

Osmania University Hyderabad By IMRAN KHAN 227209674033 Under the guidance of B. KISHAN (MBA) Professor

SAI PRANAVI PG INSTITUTE OF MANAGEMENT STUDIES (Affiliated to Osmania University) KEESARA(V),KESSARA(M),R.R(DIST).

DECLARATION

I here by declare that this project report entitled PERFORAMNCE OF SECTORAL MUTUAL FUNDS WITH RETAIL SECTOR with reference to RETAIL companies at INDIAINFOLIN comprises of my own work. It has not been submitted fully or partly to this university or any other university for the award of degree of M.B.A or any other degree.

DATE: PLACE: HYDERABAD

IMRAN KHAN

ABSTRACT

The present project work PERFORMANCE OF SECTORAL out in INDIAINFOLINE. The project is categorized into VII chapters.

MUTUAL

FUNDS WITH RETAIL SECTOR with reference to REATIL companies is carried

Chapter1: Deals with Introduction of the topic, Objective Needs, Scope & Importance of the study, Methodology and Limitations.

Chapter2: Deals with theoretical base of the study where information about risk , return and risk return analysis is provided. Chapter3: Deals with the Organization profile and Company profile. Chapter4: Deals with the data analysis and interpretation. Chapter5: Deals with Findings.

Chapter6: Deals with Suggestions Chapter7: Deals with conclusion

ACKNOWLEDGEMENT

I would like to express my gratitude for all the people, who extended unending support at all stages of the project. This report is a product of not only my sincere efforts but also the guidance and morale support given by the management of INDIAINFOLINE LTD Hyderabad. I wish to express my sincere thanks to mamatha. & Guide and also the management and staff of my college for providing the guidance and support. I would like to acknowledge, my sincere thanks to all the executives at INDIAINFOLINE LTD., Hyderabad who have extended helping hand in giving the information and being a part of the study. Last but not least, I express my sincere gratitude to all the employees at INDIAINFOLINE LTD., Hyderabad, who have directly or indirectly contributed to the successful completion of the project.

CONTENTS CHAPTER NUMBER 1 TITLE INTRODUCTION TO TOPIC OBJECTIVES NEED AND SCOPE OF STUDY METHODOLOGY LIMITATIONS 2 3 LITERATURE SURVEY INDUSTRY PROFILE COMPANY PROFILE 4 5 6 DATA COLLECTION DATA ANALYSIS FINIDINGS PAGE NUMBER

SUGGESTIONS CONCULSION

CHAPTER-1

INTRODUCTION TO RETAIL SECTOR FUNDS Mutual Funds are investment institutions set up to manage money pooled in from the public. The advantages of investing in Mutual Funds are the professional expertise they employ coupled with the variations offered on the basis of asset classification and the diversification of the chosen portfolio aimed at optimizing the risk for the required return. The benefits that can be accrued from Mutual Funds are

The schemes could be added to the portfolio with online updates for monitoring the performance of your investments in Mutual Funds.

The comprehensive search, which gets you the fund matching your criteria. The comparison of various schemes of different Mutual Funds based on the critical and most sought after investment criteria.

The analysis of different schemes and the outlook for the same. List of new launches in the market provided continuously.

Basically, Mutual funds are trusts that are formed to mobilize the savings from the people and pool them together to invest within the securities markets. The main advantage of mutual funds is that it is professionally managed. And the general idea is for investors to contribute small amounts into units in the various schemes, which in turn is deployed in the various markets. This way, any investor who is not in a position to directly invest in the markets can take advantage of this route. UTI is the oldest of Indian mutual funds, having entered the arena with the launch of the Unit Scheme - 64 in 1964, hence the alphanumeric name. It was only in 1998 that other public sector banks were allowed to enter into the segment which was followed by a whole range of Asset Management companies including almost all the leading international portfolio managers including Merrill Lynch, Templeton, and Prudential among others.

What is a Sector Fund? As the name implies, a sector fund is a mutual fund that invests in a specific sector of the economy, such as energy or utilities. Sector funds come in many different flavors and can vary substantially in market capitalization, investment objective (i.e. growth and/or income) and class of securities within the portfolio. Sector funds do not fall into a particular category in the Morningstar style box, such as large-cap value or mid-cap growth; instead, Morningstar ranks and analyzes sector funds in the following eight categories. 1.Natural Resources Funds - These funds invest in oil and gas and other energy sources, as well as timber and forestry. These funds are usually appropriate for long-term growth investors.

2 . Real Estate Funds - These funds provide a way for smaller investors to participate in the

gains from real estate without having to actually buy real property. They often provide both growth and income. 3 Financial Funds - These funds invest in the financial industry. Holdings will include securities of investment, insurance, banking, mortgage and accounting firms.

4. Technology Funds - These funds seek to provide exposure in the tech sector. This sector focuses primarily on computers, electronics and other informational technology that is used in a wide range of applications.

5.. Communications Funds - These funds focus on the telecommunications sector, but can include internet-related companies as well.

OBJECTIVE

TO know about the current Mutual funds available in India

TO know how mutual funds are investing the funds in different sector

Giving better suggestions to the investor to invest in good sectors and now good

scope is there for mutual funds in India

To suggest the investor about which mutual fund should be invest in better sector

To study the benefits of investing in different sector of funds

To know how to invest in sectoral funds

NEED OF STUDY
The study covers the concept and details of mutual funds and introduction on equity, derivatives and index. The study also includes returns of equity, mutual funds and relative index of different sectors. Equities year high and low is also included in the study. The project report covers the study of Net Asset Value (NAV) of mutual funds in different sectors. The analysis part includes the Net Asset Value (NAV) charts which gives the clear picture of the present value of the mutual fund company.

SCOPE OF STUDY;-

At the present trend in mutual funds investor are investing in different sectors .it is a good advantage for the investors and also benefit for the investors and investor can reduce risk in mutual fund. In the sectorial funds we have diversified companies and sectors funds of bank .the investor must choose and invest the funds in the different sectors and the companies the finance manager as to suggest the investor there is no relationship between the funds. You can invest in any funds Now a days good scope is their for the mutual funds .the financial managers as to decide whether he as to invest in share stock, bonds and sectors to get the more benefits for funds so invest in good profitability sector. Then the financial manager can reduce the risk from the investors. The scope of study is confirmed to the sectorial funds available in India mutual fund market.

METHODLOGY A Research work requires a lot of information to be gathered. This information can be gathered through 2 sources. 1. Primary source of data collection: In this method, we collect the data for the first time i.e., first hand information through surveys, observations etc., 2. Secondary source of data collection: In this method , we collect the information which is readily available. The present project work is depending on secondary sources of information gathering. 1. DATA COLLECTION

In the present project work the data as been collected from readily available source that is secondary data like websites newspapers and magazines the sample size taken for study 5 companies THE WEB SITE VISITED o WWW.AMFI.COM. o MONEY.REDIFF.COM. o DATA ANALYSIS The present project work as been analyzed using time series analysis with graphical presentation the formula applied in the calculation or as follows

LIMITATIONS Equity return is not taken from NSE stock exchange. The data of mutual fund companies and equity companies is taken only for 3& 6 months and 1 year due to non availability of data. Due to limitation of time all sectors are not studied, only selected sectors have been

studied. Data for mutual funds available on website is day to day basis data. Data is updated daily. Hence the data is available as on 31 march 2009.

Only growth funds are taken.

Due to non availability of data NSE scrip Tata consultancy information has not taken.

CHAPTER-2

INDUSTRY PROFILE

INDUSTRY OVERVIEW The securities market achieves one of the most important functions of channeling idle resources to productive resources or from less productive resources to more productive resources. Hence in the broader context the people who save and investors who invest focus more towards the economys abilities to invest and save respectively. This enhances savings and investments in the economy, the two pillars for economic growth. The Indian Capital Market has come a long way in this process and with a strong regulator it has been able to usher an era of a modern capital market regime. The past decade in many ways has been remarkable for securities market in India. It has grown exponentially as measured in terms of amount raised from the market, the number of listed stocks, market capitalization, trading volumes and turnover on stock exchanges, and investor population. The market has witnessed fundamental institutional changes resulting in drastic reduction in transaction costs and significant improvements in efficiency, transparency and safety. Stock Exchange: A stock exchange, share market or bourse is a corporation or mutual organization which provides facilities for stock brokers and traders, to trade company stocks and other securities. Stock exchanges also provide facilities for the issue and redemption of securities, as well as, other financial instruments and capital events including the payment of income and dividends. The securities traded on a stock exchange include: shares issued by companies, unit trusts and other pooled investment products and bonds. To be able to trade a security on a certain stock exchange,

it has to be listed there. Usually there is a central location at least for recordkeeping, but trade is less and less linked to such a physical place, as modern markets are electronic networks, which gives them advantages of speed and cost of transactions. Trade on an exchange is by members only. The initial offering of stocks and bonds to investors is by definition done in the primary market and subsequent trading is done in the secondary market. A stock exchange is often the most important component of a stock market. Supply and demand in stock a market is driven by various factors which, as in all free markets, affect the price of stocks (see stock valuation). There is usually no compulsion to issue stock via the stock exchange itself, nor must stock be subsequently traded on the exchange. Such trading is said to be off exchange or over-thecounter. This is the usual way that bonds are traded. Increasingly, stock exchanges are part of a global market for securities.

HISTORY OF MUTUAL FUND INDUSTRY

The mutual fund industry in India started in 1963 with the formation of Unit Trust of India, at the initiative of the Government of India and Reserve Bank the. The history of mutual funds in India can be broadly divided into four distinct phases FIRST PHASE 1964-87 Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It was set up by the Reserve Bank of India and functioned under the Regulatory and administrative control of the Reserve Bank of India. In 1978 UTI was de-linked from the RBI and the Industrial Development Bank of India (IDBI) took over the regulatory and administrative control in place of RBI. The first scheme launched by UTI was Unit Scheme 1964. At the end of 1988 UTI had Rs.6,700 crores of assets under management. SECOND PHASE 1987-1993 (Entry of Public Sector Funds) 1987 marked the entry of non- UTI, public sector mutual funds set up by public sector banks and Life Insurance Corporation of India (LIC) and General Insurance Corporation of India (GIC). SBI Mutual Fund was the first non- UTI Mutual Fund established in June 1987 followed by Canara Bank Mutual Fund (Dec 87), Punjab National Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund (Nov 89), Bank of India (Jun 90), Bank of Baroda Mutual Fund (Oct 92). LIC established its mutual fund in June 1989

while GIC had set up its mutual fund in December 1990. At the end of 1993, the mutual fund industry had assets under management of Rs.47,004 crores. THIRD PHASE 1993-2003 (Entry of Private Sector Funds) With the entry of private sector funds in 1993, a new era started in the Indian mutual fund industry, giving the Indian investors a wider choice of fund families. Also, 1993 was the year in which the first Mutual Fund Regulations came into being, under which all mutual funds, except UTI were to be registered and governed. The erstwhile Kothari Pioneer (now merged with Franklin Templeton) was the first private sector mutual fund registered in July 1993. The 1993 SEBI (Mutual Fund) Regulations were substituted by a more comprehensive and revised Mutual Fund Regulations in 1996. The industry now functions under the SEBI (Mutual Fund) Regulations 1996. The number of mutual fund houses went on increasing, with many foreign mutual funds setting up funds in India and also the industry has witnessed several mergers and acquisitions. As at the end of January 2003, there were 33 mutual funds with total assets of Rs. 1,21,805 crores. The Unit Trust of India with Rs.44,541 crores of assets under management was way ahead of other mutual funds. FOURTH PHASE since February 2003 In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI was bifurcated into two separate entities. One is the Specified Undertaking of the Unit Trust of India with assets under management of Rs.29,835 crores as at the end of January 2003, representing broadly, the assets of US 64 scheme, assured return and certain other schemes. The Specified Undertaking of Unit Trust of India, functioning under an administrator and under the rules framed by Government of India and does not come under the purview of the Mutual Fund Regulations. The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and LIC. It is registered with SEBI and functions under the Mutual Fund Regulations. With the bifurcation of the erstwhile UTI which had in March 2000 more than Rs.76,000 crores of assets under management and with the setting up of a UTI Mutual Fund, conforming to the SEBI Mutual Fund Regulations, and with recent mergers taking place among different private sector funds, the

mutual fund industry has entered its current phase of consolidation and growth. As at the end of September, 2004, there were 29 funds, which manage assets of Rs.153108 crores under 421 schemes. The graph indicates the growth of assets over the years.

FUTURE SCENARIO
The asset base will continue to grow at an annual rate of about 30 to 35 % over the next few years as investors shift their assets from banks and other traditional avenues. Some of the older public and private sector players will either close shop or be taken over. Out of ten public sector players five will sell out, close down or merge with stronger players in three to four years. In the private sector this trend has already started with two mergers and one takeover. Here too some of them will down their shutters in the near future to come. But this does not mean there is no room for other players. The market will witness a flurry of new players entering the arena. There will be a large number of offers from various asset management companies in the time to come. Some big names like Fidelity, Principal, and Old Mutual etc. are looking at Indian market seriously. One important reason for it is that most major players already have presence here and hence these big names would hardly like to get left behind. The mutual fund industry is awaiting the introduction of derivatives in India as this would enable it to hedge its risk and this in turn would be reflected in its Net Asset Value (NAV).

SEBI is working out the norms for enabling the existing mutual fund schemes to trade in derivatives. Importantly, many market players have called on the Regulator to initiate the process immediately, so that the mutual funds can implement the changes that are required to trade in Derivatives.

History of stock exchanges: In 12th century France the courratiers de change were concerned with managing and regulating the debts of agricultural communities on behalf of the banks. As these men also traded in debts, they could be called the first brokers. Some stories suggest that the origins of the term "bourse" come from the Latin bursa meaning a bag because, in 13th century Bruges, the sign of a purse (or perhaps three purses), hung on the front of the house where merchants met. However, it is more likely that in the late 13th century commodity traders in Bruges gathered inside the house of a man called Van der Burse, and in 1309 they institutionalized this until now informal meeting and became the "Bruges Bourse". The idea spread quickly around Flanders and neighboring counties and "Bourses" soon opened in Ghent and Amsterdam. In the middle of the 13th century, Venetian bankers began to trade in government securities. In 1351, the Venetian Government outlawed spreading rumors intended to lower the price of government funds. There were people in Pisa, Verona, Genoa and Florence who also began trading in government securities during the 14th century. This was only possible because these

The role of stock exchanges:

Stock exchanges have multiple roles in the economy, this may include the following: Raising capital for businesses The Stock Exchange provides companies with the facility to raise capital for expansion through selling shares to the investing public.

Mobilizing savings for investment

When people draw their savings and invest in shares, it leads to a more rational allocation of resources because funds, which could have been consumed, or kept in idle deposits with banks, are mobilized and redirected to promote business activity with benefits for several economic sectors such as agriculture, commerce and industry, resulting in a stronger economic growth and higher productivity levels.

Facilitating company growth

Companies view acquisitions as an opportunity to expand product lines, increase distribution channels, hedge against volatility, increase its market share, or acquire other necessary business assets. A takeover bid or a merger agreement through the stock exchange is one of the simplest and most common ways for a company to grow by acquisition or fusion.

Redistribution of wealth
Stocks exchanges do not exist to redistribute wealth although casual and professional stock investors through stock prices increases (that may result in capital gains for the Investor) and dividends get a chance to share in the wealth of profitable businesses.

Corporate governance
By having a wide and varied scope of owners, companies generally tend to improve on their management standards and efficiency in order to satisfy the demands of these shareholders and the more stringent rules for public corporations imposed by public stock exchanges and the government. Consequently, it is alleged that public companies (companies that are owned by shareholders who are members of the general public and trade shares on public exchanges) tend to have better management records than privately held companies (those companies where shares are not publicly traded, often owned by the company founders and/or their families and heirs, or

otherwise by a small group of investors).

Creating investment opportunities for small investors

As opposed to other businesses that require huge capital outlay, investing in shares is open to both the large and small stock investors because a person buys the number of shares they can afford. Therefore the Stock Exchange provides the opportunity for small investors to own shares of the same companies as large investors.

Government capital-raising for development projects

Governments at various levels may decide to borrow money in order to finance infrastructure projects such as sewage and water treatment works or housing estates by selling another category of securities known as bonds. These bonds can be raised through the Stock Exchange whereby members of the public buy them, thus loaning money to the government..

STOCK EXCHANGE & SHARES

The market or place, where securities, viz. shares are exchange / traded or simply where buying and selling takes place, is called stock exchange or stock market. Presently, the stock market in India consists of twenty three regional stock exchanges and two national exchanges, namely, the National Stock Exchange (NSE) And Over the Counter Exchange of India (OTC). The Bombay Stock Exchange (BSE) is the largest Stock Exchange, in the country, where maximum transactions, in terms of money and shares take place. The other major stock exchanges are Calcutta, Madras and Delhi Stock Exchanges. Other one at Ahmedabad, Jaipur, Bangalore, Kanpur, Rajkot, Hyderabad, Cochin, Pune, Bhubaneshwar, Guwahti, Indore, Mangalore, Ludhiana, Patna, Saurashtra, Vadodara, Coimbatore, Meerut, and Surat.

Laws governing capital market The four main legislations governing the securities market are: (a) The SEBI Act, 1992 which establishes SEBI to protect investors and develop and Regulate the Markets.

(b) The Companies Act, 1956, which sets out the code of conduct for the corporate sector in relation to issue, allotment and transfer of securities, and disclosures to be made in public issues. (c) The Securities Contracts (Regulation) Act, 1956, read with the Securities Contracts (Regulation) Rules, 1957 which provide for regulation of transactions in securities through control over stock exchanges; and (d) The Depositories Act, 1996 which provides for electronic maintenance and transfer of ownership of Demat securities. Regulators SEBI is the primary regulator of the Securities Market and the entities operating therein. The SEBI Act and the Depositories Act are mostly administered by SEBI. The rules under the securities laws are framed by government and regulations by SEBI. All these are administered by SEBI. The powers under the Companies Act relating to issue and transfer of securities and nonpayment of dividend are administered by SEBI in case of listed public companies and public companies proposing to get their securities listed Market Value The current quoted price at which investors buy or sell a share of common stock or a bond at a given time. Also known as "market price The market capitalization plus the market value of debt. Sometimes referred to as "total market value". In the context of securities, market value is often different from book value because the market takes into account future growth potential. Most investors who use fundamental analysis to pick stocks look at a company's market value and then determine whether or not the market value is adequate or if it's undervalued in comparison to its book value, net assets or some other measure. Stock A type of security that signifies ownership in a corporation and represents a Claim on part of the corporations assets and earnings. There are two main types of stock: common and preferred. Common stock usually entitles the owner to vote at shareholders' meetings and to receive dividends. Preferred stock generally does not have voting rights, but has a higher claim on assets and earnings than the common shares. For example, owners of preferred stock receive dividends before common shareholders and have priority in the event that a company goes. Bankrupt and is liquidated. Also known as "shares" or "equity".

Shareholder Any person, company, or other institution that 3 own at least 1 share in a company. A shareholder may also be referred to as a stockholder. Shareholders are the owners of a company. They have the potential to profit if the company does well, but that comes with the potential to lose if the company does poorly. Share A unit of ownership interest in a corporation or financial asset. While owning shares in a business does not mean that the shareholder has direct control over the business's day-to-day operations, being a shareholder does entitle the possessor to an equal distribution in any profits, if any are declared in the form of dividends. The two main types of shares are common shares and preferred shares.

CHAPTER 3

COMPANY PROFILE

COMPANY PROFILE

India infoline. We are a one-stop financial services shop, most respected for quality of its advice, personalized service and cutting-edge technology. Vision Our vision is to be the most respected company in the financial services space. India Infoline Group The India Infoline group, comprising the holding company, India Infoline Limited and its whollyowned subsidiaries, straddle the entire financial services space with offerings ranging from Equity research, Equities and derivatives trading, Commodities trading, Portfolio Management Services, Mutual Funds, Life Insurance, Fixed deposits, GoI bonds and other small savings instruments to loan products and Investment banking. India Infoline also owns and manages the websites www.indiainfoline.com and www.5paisa.com The company has a network of 976 business locations (branches and sub-brokers) spread across 365 cities and towns. It has more than 800,000 customers.

India Infoline Ltd India Infoline Limited is listed on both the leading stock exchanges in India, viz. the Stock Exchange, Mumbai (BSE) and the National Stock Exchange (NSE) and is also a member of both the exchanges. It is engaged in the businesses of Equities broking, Wealth Advisory Services and Portfolio Management Services. It offers broking services in the Cash and Derivatives segments of the NSE as well as the Cash segment of the BSE. It is registered with NSDL as well as CDSL as a

depository participant, providing a one-stop solution for clients trading in the equities market. It has recently launched its Investment banking and Institutional Broking business.

A SEBI authorized Portfolio Manager; it offers Portfolio Management Services to clients. These services are offered to clients as different schemes, which are based on differing investment strategies made to reflect the varied risk-return preferences of clients. India Infoline Media and Research Services Limited. The content services represent a strong support that drives the broking, commodities, mutual fund and portfolio management services businesses. Revenue generation is through the sale of content to financial and media houses, Indian as well as global. It undertakes equities research which is acknowledged by none other than Forbes as 'Best of the Web' and 'a must read for investors in Asia'. India Infoline's research is available not just over the internet but also on international wire services like Bloomberg (Code: IILL), Thomson First Call and Internet Securities where India Infoline is amongst the most read Indian brokers. India Infoline Commodities Limited.

India Infoline Commodities Pvt Limited is engaged in the business of commodities broking. Our experience in securities broking empowered us with the requisite skills and technologies to allow us offer commodities broking as a contra-cyclical alternative to equities broking. We enjoy memberships with the MCX and NCDEX, two leading Indian commodities exchanges, and recently acquired membership of DGCX. We have a multi-channel delivery model, making it among the select few to offer online as well as offline trading facilities. India Infoline Marketing & Services India Infoline Marketing and Services Limited is the holding company of India Infoline Insurance Services Limited and India Infoline Insurance Brokers Limited. (a) India Infoline Insurance Services Limited is a registered Corporate Agent with the Insurance Regulatory and Development Authority (IRDA). It is the largest Corporate Agent for ICICI Prudential Life Insurance Co Limited, which is India's largest private Life Insurance Company. India Infoline was the first corporate agent to get licensed by IRDA in early 2001. India Infoline Insurance Brokers Limited India Infoline Insurance Brokers Limited is a newly formed subsidiary which will carry out the business of Insurance broking. We have applied to IRDA for the insurance broking licence and the clearance for the same is awaited. Post the grant of license, we propose to also commence the general insurance distribution business.

(b)

India Infoline Investment Services Limited Consolidated shareholdings of all the subsidiary companies engaged in loans and financing activities under one subsidiary. Recently, Orient Global, a Singapore-based investment institution invested USD 76.7 million for a 22.5% stake in India Infoline Investment Services. This will help focused expansion and capital raising in the said subsidiaries for various lending businesses like loans against securities, SME financing, distribution of retail loan products, consumer finance business and housing finance business. India Infoline Investment Services Private Limited consists of the following step-down subsidiaries a) India Infoline Distribution Company Limited (distribution of retail loan products) b) Money line Credit Limited (consumer finance) c) India Infoline Housing Finance Limited (housing finance) IIFL (Asia) Pte Limited

IIFL (Asia) Pte Limited is wholly owned subsidiary which has been incorporated in Singapore to pursue financial sector activities in other Asian markets. Further to obtaining the necessary regulatory approvals, the company has been initially capitalized at 1 million Singapore dollars The Management Mr. Nirmal Jain Chairman & Managing Director India Infoline Ltd. Nirmal Jain, MBA (IIM, Ahmedabad) and a Chartered and Cost Accountant, founded Indias leading financial services company India Infoline Ltd. in 1995, providing globally acclaimed financial services in equities and commodities broking, life insurance and mutual funds distribution, among others. Mr. Jain began his career in 1989 with Hindustan Levers commodity export business, contributing tremendously to its growth. He was also associated with InquireIndian Equity Research, which he co-founded in 1994 to set new standards in equity research in India.

Mr. R Venkataraman Executive Director India Infoline Ltd. R Venkataraman, co-promoter and Executive Director of India Infoline Ltd., is a B. Tech (Electronics and Electrical Communications Engineering, IIT Kharagpur) and an MBA (IIM Bangalore). He joined the India Infoline board in July 1999. He previously held senior managerial positions in ICICI Limited, including ICICI Securities Limited, their investment banking joint venture with J P Morgan of USA and with BZW and Taib Capital Corporation Limited. He was also Assistant Vice President with G E Capital Services India Limited in their private equity division, possessing a varied experience of more than 16 years in the financial services sector.

The Board of Directors

MR. NILESH VIKAMSEY INDEPENDENT DIRECTOR INDIAINFOLINEPVT.LTD

MR.SAT PAL KHATTAR

NON-EXECUTIVE DIRECTOR

INDIAINFOLINEPVT.LTD

MR.KRANTI SINHA

INDEPENDENT DIRECTOR

INDIAINFOLINE PVT.LTD

MR.ARUN

INDEPENDENT DIRECTOR

INDIAINFOLINE PVT.LTD

Privacy Policy This privacy statement is applicable to Indiainfoline.com. Indiainfoline.com does not collect personal information about individuals except when such individuals specifically provide such information on a voluntary basis. For example, such personal information may be gathered for contest registration, the registration process for subscription sites or services and in connection with content submissions, community postings (e.g., message boards), suggestions, and voting/polling activities. Personal information on individual users will not be sold or otherwise transferred to unaffiliated third parties without the approval of the user at the time of collection. At such points of collection, the user will have the opportunity to indicate whether he or she would like to "opt out" of receiving promotional and/or marketing information about other products, services and offerings from Indiainfoline.com and/or any third parties. Indiainfoline.com reserves the right to perform statistical analyses of user behavior and characteristics in order to measure interest in and use of the various areas of the site and to inform advertisers of such information as well as the number of users that have been exposed to or clicked on their advertising banners. Indiainfoline.com will provide only aggregated data from these analyses to third parties. Also, users should be aware that Indiainfoline.com may sometimes permit third parties to offer subscription and/or registration-based services through a Indiainfoline.com site. Indiainfoline.com is not responsible for any actions or policies of such third parties and users should check the applicable privacy policy of such party when providing personally identifiable information Users are also being aware that non-personal information and data may be automatically collected through the standard operation of Indiainfoline.com's internet servers or through the use of "cookies." "Cookies" are small text files a web site can use to recognize repeat users, facilitate the user's ongoing access to and use of the site and allow a site to track usage behavior and compile aggregate data that will allow content improvements and targeted advertising.

CHAPTER-4

LITERATURE REVIEW

LITERATURE REVIEW INTRODUCTION OF MUTUAL FUND Mutual fund is a trust that pools money from a group of investors (sharing common financial goals) and invest the money thus collected into asset classes that match the stated investment objectives of the scheme. Since the stated investment objectives of a mutual fund scheme generally form the basis for an investor's decision to contribute money to the pool, a mutual fund can not deviate from its stated objectives at any point of time.

Every Mutual Fund is managed by a fund manager, who using his investment management skills and necessary research works ensures much better return than what an investor can manage on his own. The capital appreciation and other incomes earned from these investments are passed on to the investors (also known as unit holders) in proportion of the number of units they own.

When an investor subscribes for the units of a mutual fund, he becomes part owner of the assets of the fund in the same proportion as his contribution amount put up with the corpus (the total amount of the fund). Mutual Fund investor is also known as a mutual fund shareholder or a unit holder. Any change in the value of the investments made into capital market instruments (such as shares, debentures etc) is reflected in the Net Asset Value (NAV) of the scheme. NAV is defined as the market value of the Mutual Fund scheme's assets net of its liabilities. NAV of a scheme is calculated by dividing the market value of scheme's assets by the total number of units issued to the investors.

ORGANISATION OF A MUTUAL FUND

There are many entities involved and the diagram below illustrates the organisational set up of a mutual fund:

ADVANTAGES OF MUTUAL FUND S. Advantage No. Mutual Funds invest in a well-diversified portfolio of securities which enables Portfolio 1. Diversification investment is big or small). Fund manager undergoes through various research works and has better Professional 2. Management what he can manage on his own. Investors acquire a diversified portfolio of securities even with a small 3. Less Risk investment in a Mutual Fund. The risk in a diversified portfolio is lesser than investing in merely 2 or 3 securities. investment management skills which ensure higher returns to the investor than investor to hold a diversified investment portfolio (whether the amount of Particulars

Low Due to the economies of scale (benefits of larger volumes), mutual funds pay 4. Transaction lesser transaction costs. These benefits are passed on to the investors. Costs An investor may not be able to sell some of the shares held by him very easily 5. Liquidity and quickly, whereas units of a mutual fund are far more liquid. Mutual funds provide investors with various schemes with different investment Choice 6. Schemes correlation between its investment objectives and their own financial goals. These schemes further have different plans/options Funds provide investors with updated information pertaining to the markets 7. Transparency and the schemes. All material facts are disclosed to investors as required by the regulator. Investors also benefit from the convenience and flexibility offered by Mutual Funds. Investors can switch their holdings from a debt scheme to an equity 8. Flexibility scheme and vice-versa. Option of systematic (at regular intervals) investment and withdrawal is also offered to the investors in most open-end schemes. Mutual Fund industry is part of a well-regulated investment environment 9. Safety where the interests of the investors are protected by the regulator. All funds are registered with SEBI and complete transparency is forced. of objectives. Investors have the option of investing in a scheme having a

DISADVANTAGES OF MUTUAL FUND S. No. Disadvantage Particulars

Investor has to pay investment management Costs Control fees and fund distribution costs as a Not 1. Hands of an long as he holds the units), irrespective of the Investor performance of the fund. The portfolio of securities in which a fund invests is a decision taken by the fund manager. Investors have no right to interfere No Customized 2. Portfolios manager, which some investors find as a constraint in achieving their financial in the decision making process of a fund in the percentage of the value of his investments (as

objectives. Many investors find it difficult to select one Difficulty Selecting 3. Suitable Fund may have to take advice from financial Scheme planners in order to invest in the right fund to achieve their objectives. in option from the plethora of

a funds/schemes/plans available. For this, they

BROAD MUTUAL FUND TYPES

1. Equity Funds Equity funds are considered to be the more risky funds as compared to other fund types, but they also provide higher returns than other funds. It is advisable that an investor looking to invest in an equity fund should invest for long term i.e. for 3 years or more. There are different types of equity funds each falling into different risk bracket.

2. Debt / Income Funds Funds that invest in medium to long-term debt instruments issued by private companies, banks, financial institutions, governments and other entities belonging to various sectors (like infrastructure companies etc.) are known as Debt / Income Funds. Debt funds are low risk profile funds that seek to generate fixed current income (and not capital appreciation) to investors. In order to ensure regular income to investors, debt (or income) funds distribute large fraction of their surplus to investors 3. Money Market / Liquid Funds Money market / liquid funds invest in short-term (maturing within one year) interest bearing debt instruments. These securities are highly liquid and provide safety of investment, thus making money market / liquid funds the safest investment option when compared with other mutual fund types. However, even money market / liquid funds are exposed to the interest rate risk. The typical investment options for liquid funds include Treasury Bills (issued by governments), Commercial papers (issued by companies) and Certificates of Deposit (issued by banks).

4. Hybrid Funds

As the name suggests, hybrid funds are those funds whose portfolio includes a blend of equities, debts and money market securities. Hybrid funds have an equal proportion of debt and equity in their portfolio. There are following types of hybrid funds in India 5. Commodity Funds Those funds that focus on investing in different commodities (like metals, food grains, crude oil etc.) or commodity companies or commodity futures contracts are termed as Commodity Funds. A commodity fund that invests in a single commodity or a group of commodities is a specialized commodity fund and a commodity fund that invests in all available commodities is a diversified commodity fund and bears less risk than a specialized commodity fund. "Precious Metals Fund" and Gold Funds (that invest in gold, gold futures or shares of gold mines) are common examples of commodity funds. 6. Real Estate Funds Funds that invest directly in real estate or lend to real estate developers or invest in shares/securitized assets of housing finance companies, are known as Specialized Real Estate Funds. The objective of these funds may be to generate regular income for investors or capital appreciation. 7. Exchange Traded Funds (ETF) Exchange Traded Funds provide investors with combined benefits of a closed-end and an open-end mutual fund. Exchange Traded Funds follow stock market indices and are traded on stock exchanges like a single stock at index linked prices 8. Fund of Funds Mutual funds that do not invest in financial or physical assets, but do invest in other mutual fund schemes offered by different AMCs, are known as Fund of Funds.

Risk Heirarchy of Different Mutual Funds:-. The graphical representation hereunder provides a clearer picture of the relationship between mutual funds and levels of risk associated with these

funds:

COMPARISON OF BANKS, MUTUAL FUNDS, EQUITY & DERIVATIVES BANKS Returns Administrat ive exp. Risk Investment options Network High Low High Low Less penetration MUTUAL FUNDS Better Low Moderate More Low but improving Better Transparent Everyday EQUITY Better Low High More High penetration Better Transparent NA DERIVATIVES Better Low High Less High penetration Better NA

Liquidity At a cost Quality of Not transparent assets Interest Minimum balance calculation between 10th. & 30th. Of every month

Guarantee Maximum Rs.1 lakh on deposits

None

NA

NA

RECENT TRENDS IN MUTUAL FUND INDUSTRY The most important trend in the mutual fund industry is the aggressive expansion of the foreign owned mutual fund companies and the decline of the companies floated by nationalized banks and smaller private sector players. Many nationalized banks got into the mutual fund business in the early nineties and got off to a good start due to the stock market boom prevailing then. These banks did not really understand the mutual fund business and they just viewed it as another kind of banking activity. Few hired specialized staff and generally chose to transfer staff from the parent organizations. The performance of most of the schemes floated by these funds was not good. Some schemes had offered guaranteed returns and their parent organizations had to bail out these AMCs by paying large amounts of money as the difference between the guaranteed and actual returns. The service levels were also very bad. Most of these AMCs have not been able to retain staff, float new schemes etc. and it is doubtful whether, barring a few exceptions, they have serious plans of continuing the activity in a major way.

PROBLEMS & PROSPECTS OF MUTUAL FUNDS

1) Wrong positioning : The mutual funds in India have been quite wrongly promoted as an alternative to equity industry. Thus creating very high expectations in the minds of the investors. In a falling market, these expectations have been belied. Only the pure equity schemes can be compared with the stock market index. However pure equity schemes are few in India, further, investment is not purely linked to a particular index. Therefore returns form mutual funds cannot really be compared with stock market index. 2) Limited product range: Indian mutual funds have remained centered around a limited product range basically income, income-cum-growth and tax saving schemes. Efforts to develop and expand the market through innovative new products have been negligible. These have happened due to the tendency to avoid risk, inability to understand future market developments, and change in investor preference.

3) Confused market situation: probably the introduction and implementation of new regulatory norms has contributed in some measure to market sluggishness, as the emerging market was, initially, not able to respond to the regulatory objectives. 4) Absence of Innovative Marketing Network: The absence of product diversification and a confused market situation has been made worse by the absence of an innovative marketing network for mutual funds. The agent oriented network has largely been failure because most of the agents have not been specifically trained to sell mutual funds products, 5) Lack of adequate research infrastructure: the passive approach of some mutual funds in managing investors funds is compounded by the lack of adequate research infrastructure. Consequently, returns commensurate with the market movement could not be realized by many schemes, which has tended to show up Indian mutual funds in a bad light.

CHAPTER-5 DATA ANALYSIS & INTERPRETATION

1. Statement showing returns and risk of ING VYSYA Retail fund

ING VYSYA date NAV 3/1/201 1 16.5 4/1/201 1 16.45 5/1/201 1 16.44 6/1/201 1 16.4 7/1/201 1 16.27 10/1/20 11 16.54 11/1/20 11 16.47 12/1/20 11 16.52 13/1/20 11 16.59 return avera s ge differen ce D2

-0.78 -0.06 -0.24 -0.79 1.66 -0.42 0.30 0.42

-0.01 -0.01 -0.01 -0.01 -0.01 -0.01 -0.01 -0.01

-0.77 -0.05 -0.23 -0.78 1.67 -0.41 0.31 0.43

0.599 0.003 0.054 0.613 2.787 0.171 0.098 0.188

14/1/20 11 17/1/20 11 18/1/20 11 19/1/20 11 20/1/20 11 21/1/20 11 24/1/20 11 25/1/20 11 26/1/20 11 27/1/20 11 28/1/20 11 31/1/20 11

16.46 16.38 16.42 16.17 16.19 16.13 16.12 15.88 16.04 16.27 16.4 16.52

-0.78 -0.49 0.24 -1.52 0.12 -0.37 -0.06 -1.49 1.01 1.43 0.80 0.73

-0.01 -0.01 -0.01 -0.01 -0.01 -0.01 -0.01 -0.01 -0.01 -0.01 -0.01 -0.01

-0.77 -0.48 0.25 -1.51 0.13 -0.36 -0.05 -1.48 1.02 1.44 0.81 0.74

0.598 0.227 0.065 2.288 0.018 0.130 0.003 2.187 1.035 2.085 0.655 0.550 14.35 3

Average Return = -0.01 Risk = d2/ (n-1) =14.353/20 =0.8471

INTERPRETATION: The above table shows the calculations of return and risk of ING VYSYA Retail fund for the scheme of dividend for the month of MAY 2010. The highest

NAV is 16.59 on 13-05-2010 and lowest NAV is 15.58on25-05-2010 the average return is -0.01 and the risk is 0.8471.

2. Statement showing returns and risk of UTI Retail fund

date 3/1/201 1 4/1/201 1 5/1/201 1 6/1/201 1 7/1/201 1 10/1/20 11 11/1/20 11 12/1/20 11 13/1/20 11 14/1/20 11 17/1/20 11 18/1/20 11 19/1/20 11 20/1/20 11 21/1/20 11 24/1/20 11 25/1/20 11 26/1/20 11 27/1/20 11 28/1/20

UTI NAV 22.76 22.55 22.51 22.43 22.18 22.65 22.52 22.57 22.72 22.58 22.49 22.53 22.08 22.11 21.97 21.98 21.57 21.78 21.97 22.18

return s

avera ge

differen ce

D2

-0.92 -0.18 -0.36 -1.11 2.12 -0.57 0.22 0.66 -0.62 -0.40 0.18 -2.00 0.14 -0.63 0.05 -1.87 0.97 0.87 0.96

-0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1 -0.1

-0.82 -0.08 -0.26 -1.01 2.22 -0.47 0.32 0.76 -0.52 -0.30 0.28 -1.90 0.24 -0.53 0.15 -1.77 1.07 0.97 1.06

0.677 0.006 0.065 1.029 4.924 0.225 0.104 0.585 0.266 0.089 0.077 3.600 0.056 0.284 0.021 3.116 1.153 0.945 1.115

11 31/1/20 11

22.29

0.50

-0.1

0.60

0.355

18.69 3 Average Return = -0.1 Risk = d2/ (n-1) =18.693/20 =0.9667

INTERPRETATION: The above table shows the calculations of return and risk of UTI Reatil fund for the scheme of dividend for the month of MAY 2010. The highest NAV is 22.76 on 3-05-2010 and lowest NAV is 21.57on25-05-2010 the average return is -0.1 and the risk is 0.9667.

3. Statement showing returns and risk of TATA Retail Funds

nav return avera differen date tata s ge ce D2 3/1/201 1 48.57 4/1/201 1 48.18 -0.80 0 -0.73 0.537 5/1/201 1 48.2 0.04 0 0.11 0.012 6/1/201 1 47.99 -0.44 0 -0.37 0.134 7/1/201 1 47.16 -1.73 0 -1.66 2.754 10/1/20 11 48.2 2.21 0 2.28 5.177

11/1/20 11 12/1/20 11 13/1/20 11 14/1/20 11 17/1/20 11 18/1/20 11 19/1/20 11 20/1/20 11 21/1/20 11 24/1/20 11 25/1/20 11 26/1/20 11 27/1/20 11 28/1/20 11 31/1/20 11

47.87 48.14 48.64 48.27 48.16 48.19 47.06 47.24 46.89 46.99 45.95 46.59 47 47.48 47.83

-0.68 0.56 1.04 -0.76 -0.23 0.06 -2.34 0.38 -0.74 0.21 -2.21 1.39 0.88 1.02 0.74

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

-0.61 0.63 1.11 -0.69 -0.16 0.13 -2.27 0.45 -0.67 0.28 -2.14 1.46 0.95 1.09 0.81

0.378 0.402 1.229 0.477 0.025 0.018 5.175 0.205 0.450 0.080 4.593 2.140 0.903 1.191 0.656 26.53 6

Average Return =0 Risk = d2/ (n-1) =26.536/20 =1.1518

INTERPRETATION: The above table shows the calculations of return and risk of TATA Retail Funds for the scheme of dividend for the month of MAY 2010. The highest NAV is 48.64 on1 3-05-2010 and lowest NAV is 46.59on26-05-2010 the average return is 0 and the risk is 1.1518.

4. Statement showing returns and risk of SBI Fund house

sbi return avera differen date nav s ge ce D2 3/1/201 1 26.33 4/1/201 1 26.08 -0.95 -0.15 -0.80 0.64 5/1/201 1 26.02 -0.23 -0.15 -0.08 0.01 6/1/201 1 25.9 -0.46 -0.15 -0.31 0.10 7/1/201 1 25.56 -1.31 -0.15 -1.16 1.35 10/1/20 11 26.05 1.92 -0.15 2.07 4.27 11/1/20 11 25.89 -0.61 -0.15 -0.46 0.22 12/1/20 11 25.95 0.23 -0.15 0.38 0.15 13/1/20 11 26.02 0.27 -0.15 0.42 0.18 14/1/20 11 25.79 -0.88 -0.15 -0.73 0.54 17/1/20 11 25.68 -0.43 -0.15 -0.28 0.08 18/1/20 11 25.74 0.23 -0.15 0.38 0.15 19/1/20 11 25.22 -2.02 -0.15 -1.87 3.50 20/1/20 11 25.25 0.12 -0.15 0.27 0.07 21/1/20 11 25.14 -0.44 -0.15 -0.29 0.08 24/1/20 11 25.17 0.12 -0.15 0.27 0.07 25/1/20 11 24.64 -2.11 -0.15 -1.96 3.82 26/1/20 24.91 1.10 -0.15 1.25 1.55

11 27/1/20 11 28/1/20 11 31/1/20 11

25.62 25.38 25.53

2.85 -0.94 0.59

-0.15 -0.15 -0.15

3.00 -0.79 0.74

9.00 0.62 0.55 26.94

Average Return=-0.15 Risk = d2/ (n-1) =26.94/20 =1.1606

INTERPRETATION: The above table shows the calculations of return and risk of SBI fund house for the scheme of dividend for the month of MAY 2010. The highest NAV is 26.33 on1 3-05-2010 and lowest NAV is 24.64 on25-05-2010 the average return is -0.15 and the risk is 1.1606.

5. Statement showing returns and risk of ESCORT Fund house

escort return avera differen date nav s ge ce D2 3/1/201 1 13.88 4/1/201 1 13.73 -1.08 -0.97 -0.11 0.01 5/1/201 186.8 1 11.72 14.64 -0.97 -13.67 5 6/1/201 1 11.64 -0.68 -0.97 0.29 0.08 7/1/201 11.42 -1.89 -0.97 -0.92 0.85

1 10/1/20 11 11/1/20 11 12/1/20 11 13/1/20 11 14/1/20 11 17/1/20 11 18/1/20 11 19/1/20 11 20/1/20 11 21/1/20 11 24/1/20 11 25/1/20 11 26/1/20 11 27/1/20 11 28/1/20 11 31/1/20 11

11.6 11.47 11.52 11.57 11.45 11.38 11.46 11.2 11.21 11.05 11.13 10.91 11.03 11.14 11.26 11.29

1.58 -1.12 0.44 0.43 -1.04 -0.61 0.70 -2.27 0.09 -1.43 0.72 -1.98 1.10 1.00 1.08 0.27

-0.97 -0.97 -0.97 -0.97 -0.97 -0.97 -0.97 -0.97 -0.97 -0.97 -0.97 -0.97 -0.97 -0.97 -0.97 -0.97

2.55 -0.15 1.41 1.40 -0.07 0.36 1.67 -1.30 1.06 -0.46 1.69 -1.01 2.07 1.97 2.05 1.24

6.48 0.02 1.98 1.97 0.00 0.13 2.80 1.69 1.12 0.21 2.87 1.01 4.28 3.87 4.19 1.53 221.9 6

Average Return=-0.97 Risk = d2/ (n-1) =221.96/20 =3.331

INTERPRETATION: The above table shows the calculations of return and risk of ESCORT fund house for the scheme of dividend for the month of MAY 2010. The highest NAV is 13.88 on 3-05-2010 and lowest NAV is 11.03 on26-05-2010 the average return is -0.97 and the risk is 3.331.

6. Statement showing returns and risk of SUNDARAM Fund house

sunduram return avera differen date nav s ge ce D2 3/1/201 1 15.57 4/1/201 1 15.46 -0.71 -0.09 -0.62 0.380 5/1/201 1 15.43 -0.19 -0.09 -0.10 0.011 6/1/201 1 15.43 0.00 -0.09 0.09 0.008 7/1/201 1 15.2 -1.49 -0.09 -1.40 1.962 10/1/20 11 15.45 1.64 -0.09 1.73 3.009 11/1/20 11 15.38 -0.45 -0.09 -0.36 0.132 12/1/20 11 15.33 -0.33 -0.09 -0.24 0.055 13/1/20 11 15.46 0.85 -0.09 0.94 0.880 14/1/20 11 15.32 -0.91 -0.09 -0.82 0.665 17/1/20 11 15.18 -0.91 -0.09 -0.82 0.679 18/1/20 11 15.19 0.07 -0.09 0.16 0.024 19/1/20 11 14.91 -1.84 -0.09 -1.75 3.074 20/1/20 11 14.91 0.00 -0.09 0.09 0.008 21/1/20 11 14.86 -0.34 -0.09 -0.25 0.060 24/1/20 11 14.87 0.07 -0.09 0.16 0.025 25/1/20 11 14.62 -1.68 -0.09 -1.59 2.532 26/1/20 11 14.81 1.30 -0.09 1.39 1.931 27/1/20 14.95 0.95 -0.09 1.04 1.072

11 28/1/20 11 31/1/20 11

15.15 15.29

1.34 0.92

-0.09 -0.09

1.43 1.01

2.039 1.028 19.57 4

Average Return=-0.09 Risk = d2/ (n-1) =19.574/20 =0.9892

INTERPRETATION: The above table shows the calculations of return and risk of SUNDARAM fund house for the scheme of dividend for the month of MAY 2010. The highest NAV is 15.57 on 3-05-2010 and lowest NAV is 14.62 on25-05-2010 the average return is -0.09 and the risk is 0.9892.

7. Statement showing returns and risk of HDFC Fund house

hdfc return avera differen date nav s ge ce D2 3/1/201 1 19.02 4/1/201 1 18.91 -0.58 -0.35 -0.23 0.052 5/1/201 1 18.92 0.05 -0.35 0.40 0.162 6/1/201 1 18.9 -0.11 -0.35 0.24 0.060 7/1/201 1 18.62 -1.48 -0.35 -1.13 1.280 10/1/20 11 18.83 1.13 -0.35 1.48 2.184

11/1/20 11 12/1/20 11 13/1/20 11 14/1/20 11 17/1/20 11 18/1/20 11 19/1/20 11 20/1/20 11 21/1/20 11 24/1/20 11 25/1/20 11 26/1/20 11 27/1/20 11 28/1/20 11 31/1/20 11

18.7 18.74 18.9 18.86 18.85 18.96 18.75 18.76 18.62 18.71 18.42 18.58 18.8 18.97 18.91

-0.69 0.21 0.85 -0.21 -0.05 0.58 -1.11 0.05 -0.75 0.48 -1.55 0.87 1.18 0.90 -0.32

-0.35 -0.35 -0.35 -0.35 -0.35 -0.35 -0.35 -0.35 -0.35 -0.35 -0.35 -0.35 -0.35 -0.35 -0.35

-0.34 0.56 1.20 0.14 0.30 0.93 -0.76 0.40 -0.40 0.83 -1.20 1.22 1.53 1.25 0.03

0.116 0.318 1.449 0.019 0.088 0.872 0.574 0.163 0.157 0.694 1.440 1.485 2.353 1.573 0.001 15.04 1

Average Return= -0.35 Risk = d2/ (n-1) =15.041/2 =0.8672

INTERPRETATION: The above table shows the calculations of return and risk of HDFC fund house for the scheme of dividend for the month of MAY 2010. The highest NAV is 19.02 on 3-05-2010 and lowest NAV is 18.42 on25-05-2010 the average return is -0.35 and the risk is 0.8672.

8. Statement showing returns and risk of LIC fund house

return avera differen Date lic nav s ge ce D2 3/1/201 1 11.42 4/1/201 1 11.24 -1.58 -0.29 -1.29 1.654 5/1/201 1 11.27 0.27 -0.29 0.56 0.310 6/1/201 1 11.2 -0.62 -0.29 -0.33 0.110 7/1/201 1 11.08 -1.07 -0.29 -0.78 0.611 10/1/20 11 11.24 1.44 -0.29 1.73 3.007 11/1/20 11 11.08 -1.42 -0.29 -1.13 1.285 12/1/20 11 11.24 1.44 -0.29 1.73 3.007 13/1/20 11 11.08 -1.42 -0.29 -1.13 1.285 14/1/20 11 10.98 -0.90 -0.29 -0.61 0.375 17/1/20 11 11.05 0.64 -0.29 0.93 0.860 18/1/20 11 10.97 -0.72 -0.29 -0.43 0.188 19/1/20 11 10.95 -0.18 -0.29 0.11 0.012 20/1/20 11 11 0.46 -0.29 0.75 0.557 21/1/20 11 10.78 -2.00 -0.29 -1.71 2.924 24/1/20 11 10.77 -0.09 -0.29 0.20 0.039 25/1/20 11 10.69 -0.74 -0.29 -0.45 0.205 26/1/20 11 10.5 -1.78 -0.29 -1.49 2.212 27/1/20 10.62 1.14 -0.29 1.43 2.053

11 28/1/20 11 31/1/20 11

10.74 10.77

1.13 0.28

-0.29 -0.29

1.42 0.57

2.016 0.324 23.03 5

Average Return= -0.29 Risk = d2/ (n-1) =23.035/20 =1.0731

INTERPRETATION: The above table shows the calculations of return and risk of LIC fund house for the scheme of dividend for the month of MAY 2010. The highest NAV is 11.42 on 3-05-2010 and lowest NAV is 10.50 on26-05-2010 the average return is -0.29 and the risk is 1.0731.

MUTUAL FUND PERFORMANCE

s.no

fund house 1 ING VYSYA 2 UTI 3 TATA 4 SBI 5 ESCORT 6 SUNDURAM 7 HDFC 8 LIC

RP -0.01 -0.1 0 -0.15 -0.97 -0.09 -0.35 -0.29

RF 0.67 0.67 0.67 0.67 0.67 0.67 0.67 0.67

SD 0.847 1 0.966 7 1.151 8 1.160 6 3.331 0.989 2 0.867 2 1.073 1

CHAPTER-6

FINDINGS SUGGESTIONS & CONCLUSION

FINDING
The majority of respondents were of the age group below 29 & above 60. Major part of the respondents belong to service sector. Annual income of the respondents between 1-2 lacks prefers more of investments. Respondents irrespective of major investment or small are investing in some or other sources of investments.

 Investors preference when going for an investment in primarily for security. Respondents prefer Bank Deposits as most secured for investment, & then to shares, Bonds / Debentures & then to Mutual Funds. 69% of the respondents are aware of Escort as a distributor for Mutual Funds. Out of total respondents, major of them prefer to mutual fund because of investment strategy. From the survey it is clear that most of the respondents feel Escort,& SBI as a better option for mutual fund. 78% of the Respondents the recommending Escort as a better investment opportunity.

SUGGESTIONS

The present project work has been under taken to study best available mutual fund in the industry and evaluating their performances.

The Mutual funds shows better yields compare to equities.

In FMCG sector Franklin FMCG fund shows negative returns in 6 months. In Pharma sector SBI mutual fund shows negative returns both in short & long term. In FMCG sector in short term DABUR gives negative returns in 3 months. In Pharma sector or child shows negative returns in 6 months.

CONCLUSION:

The present project work has been undertaken to study the different mutual funds which are investing in Retail sector.

The risks and returns of these funds have been studied for a period of 1 year and facts have been identified. After the findings the suggestions are been made regarding to the investment of different mutual funds in retail sectors. Mutual funds dealing in Retail sectors have been taken and out of those Birla Sun Life fund is performing very good. After that others are showing good returns but as well they are having risks also more relating to returns, however the funds are performing satisfactorily.

CHAPTER VII Bibliography

-S KEVIN

PORTFOLIO MANAGEMENT

-V.K BHALLA

SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT.

-FISCHER & JORDON

SECURITY MANAGEMENT AND PORTFOLIO MANAGEMENT

V.K. BHALLA

MUTUAL FUNDS & INVESTMENT

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