Documente Academic
Documente Profesional
Documente Cultură
1. 2. 3. 4. !. &. Acknowledgement Preface Students Declaration Objecti e Pro"osed #et$odolog% 'ackground of a. Standard ($artered b. Standard ($artered A#( ). #utual *und a. +ntroduction b. ($aracteristics of #* c. About #* +ndustr% d. ,egulator% Structure of #* in +ndia e. (once"t - ,ole of #* f. .%"es of #* Sc$emes g. #ajor #utual *unds in +ndia $. ! /as% ste"s to +n est in #utual *und i. ! Pointers to #easure t$e Performance #* j. .a0 rules for #utual *und +n estors k. Ad antages - Disad antages of #* 1. 2$o can in est in #* in +ndia 3. (om"arison of +n estment Products 14.! (ommon #istakes of #* +n estors 11.Data +nter"retation of +n estors 12.Products or Sc$emes offered b% Standard ($artered A#( 13.com"arison of to" 14 o"en ended #*s on ! "arameters 14.'eta calculation of S ( Premier - S ( (lassic *unds 1!.Sna"5s$ot com"arison s$eet 1&.Suggestion on t$e basis of life stages 1).,isk factors in #* 11.'ibliogra"$%
ACKNOWLEDGEMENT
Success comes onl% after an effort6 encouragement and constant guidance. On com"letion of t$is "roject + would like to t$ank #r. Amit Sri asta a 7Area sales manager8 and #r. Ankit Samari%a 7sales officer8 for t$eir aluable guidance during t$e course of t$is "roject and also $el"ed me in t$e marketing of "ro"osed t$ree o"en ended e9uit% funds :i;< 18 S.A=DA,D (>A,./,/D (?ASS+( /@A+.B 28 S.A=DA,D (>A,./,/D P,/#+/, /@A+.B 38 S.A=DA,D (>A,./,/D +#P/,+A? /@A+.B as well as for gi ing me t$e o""ortunit% to work for t$e com"an%. Also + would like to t$ank all t$e ot$er staff members for t$eir co5o"eration and guidance t$at $el"ed me in com"leting t$e "roject. + would also like to t$ank all t$e *acult% members of Badruka Institute of Foreign Trade, !dera"ad for t$eir continuous su""ort and moti ation.
#$EFACE
#utual *unds are going to be amongst t$e most e0citing "la%ers in t$e %ears to come. *und managers of well oiled o"erations and t$eir clients are in for a terrific e0"erience. .$e 9uestion in e er%bod%s mind $owe er is6 C2$enDE 2$en will in estors interest in #utual *unds will reall% "ick u"D 2$en will t$e infatuation of t$e small in estors wit$ "rimar% markets endD And w$en will t$e mutual fund gain t$e t%"e of clout in t$e stock market t$at t$eir counter"arts in t$e Anited States of America enjo%.
.$e +ndian in estor6 belie es in "la%ing t$e market on $is own6 and will continue to do so till t$e time $is "erce"tion c$anges5 w$ic$ t$e% undoubtedl% will. *inancial institutions and mutual funds6 lea ing t$e small in estor wit$ no ot$er o"tion e0ce"t t$e mutual fund to "ut $is sa ings in.6 will ultimatel% dominate t$e markets but for t$is to $a""en6 industr% will $a e to be "atient and "ro e t$at it can "ro e in estors wit$ better returns t$an t$e markets. Plus t$e% will $a e to make t$eir o"erations muc$ more trans"arent and in estor friendl%. 2ell if we look at t$e trend and t$e figure of last one %ear number it seems t$e s$ift $as started to $a""en towards mutual fund s$ifting t$e trend.
ST%DENT&S DECLA$ATION
+ $ere b% declare t$at Summer .raining ,e"ort submitted as a re9uirement of fulfillment of m% #P+' course is m% original work and not submitted for t$e award of an% ot$er degree6 di"loma6 fellows$i" or ot$er similar title or "ri;es.
$o'it D(i)edi
OB*ECTI+E
.$e objecti e of t$is "roject is to suggest t$e customers to in est in mutual fund on t$e basis of t$eir ages b% com"aring t$e to" 14 o"en ended funds w$ic$ are t$e market leaders in t$e mutual fund industr%. .$e "roject would also re eal t$at w$ic$ A#( is t$e market leader and will facilitate in getting t$e better understanding from t$e in estor side. .$is would $el" Standard ($artered A#( in making marketing strategies w$ic$ would $el" eliminate t$e s$ortcomings and become t$e market leader in all t$e "ers"ecti es.
#ro,osed Met'odo-og!
*or t$e accom"lis$ment of t$is "roject following ste"s are recommended< STE# .< A=D/,S.A=D+=F t$e "roduct and detail stud% of t$e conce"t mutual funds. STE# /< .$is ste" is com"rises of meeting wit$ in estors along wit$ t$e Standard ($artered em"lo%ees. STE# 0< *inall% anal%;ing and inter"reting t$e collected data and "re"aring t$e final re"ort.
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.runei, UAE
1958
Standard ($artered #utual *und currentl% manages assets in e0cess of ,s. 13444 crores 7 ASD 2.3 'illion 8 and $as touc$ed t$e li es of more t$an lak$s of in estors residing in more t$an 1444 +ndian towns. A#( is managing currentl% 3 o"en ended funds i;< .2 Standard C'artered C-assi3 E4uit! Fund 5Laun3'ed at 6 Aug /7782:
A8 >ow t$e mone% is in ested under t$is fund< a8 #one% is in ested in a di ersified "ortfolio of com"anies. b8 .$e mone% is in ested across sectors of t$e econom% and arious markets ca"s to take ad antage of t$e o""ortunities t$at e0ist in time. c8 .$ere is strict limit on sectors and com"anies to ensure a trul% di ersidied in estment.
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'8 *und Strategies< a8 Sector ,otation< .o take ad antage of growt$ o""ortunities in arious sectors of t$e econom%. b8.$eme Selection< .o take ad antage of arious macroeconomic t$emes t$at "la% out in wa%s t$at en$ances cor"orate "rofitabilit% eg. +nfrastructure6 consum"tion etc. c8#arket ca"itali;ation< +n esting in com"anies $a ing a largeImidIsmall ca" to en$ance or "rotect returns de"ending on market conditions. d8 Stock selection< +n esting in com"anies on t$e basis of A#(s in5$ouse researc$6 in order to get an edge on market knowledge. (8 *or w$om is t$is fund rele ant< *or conser ati e in estors w$o $a e a 253 %ear $ori;on. D8 'enc$mark< 'S/ 244 +nde0
/2 Standard C'artered I1,eria- E4uit! Fund5Laun3'ed at .9 Mar /7792: A8 >ow t$e mone% is in ested under t$is fund < a8 #one% is in ested in a "ortfolio of $ig$ 9ualit%6 well known +ndian com"anies. b8 .$e mone% is in ested in com"anies t$at are well recogni;ed6 $a e a "ro en track record6 strong brands6 low financial risk etc. c8.$ese com"anies s$ow t$e "romise of e0$ibiting $ig$ growt$ outside t$e +ndian s$ores and establis$ t$emsel es as global "la%ers. '8 *und Strategies < a8Flobalisation< +ndian (om"anies w$ic$ $a e cross t$e countr%s boundries to be significant "la%ers in t$e global landsca"e. b8 Domestic demand< .ake ad antage of t$e $ig$ growt$ o""ortunities t$at domestic demand offers in t$e backdro" of $ig$ FDP growt$ rates for +ndia. c8 /merging sectors< .ake ad antage of o""ortunities t$at a growing econom% "ro ides b% wa% of emergence of new sectors of "rominence eg.,etailing6 a iation6 telecom etc.
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(8 *or w$om is t$is fund rele ant< *or conser ati e in estors w$o $a e a 153 %ear $ori;on. D8 'enc$mark< 'S/ 244 +nde0.
02 Standard C'artered #re1ier E4uit! Fund5Laun3'ed at /8 Se, /7782: A8 >ow t$e mone% is in ested under t$is fund < a8 .$e fund $as a bias towards a "ortfolio of com"anies w$ic$ are going to undergo transformatonal c$anges in t$eir business "ros"ectus. b8 .$e mone% is in ested in com"anies t$at are at an earl% stage in t$eir life5c%cle and are at t$e start of a "eriod of $ig$ growt$ and "rofitabilit%. c8.$e in estments will attem"t to ca"ture s$ifts in t$e business en ironment wit$ regard to new business o""ortunities6 new tec$nologies6 new trends etc. '8 *und strategies< a8A#( rel% on in5$ouse "rimar% researc$ of com"anies in t$is "ortfolio..$is re9uires meeting u" wit$ to" management6 em"lo%ees6 dealers6 trade bodies etc. b8.$e inde"endent mindset to "ick5u" s"ecific stocks on t$e basis of large amounts of $omework makes t$is fund uni9ue and reflects A#(s belief and e0"ertise. (8 (ould t$ere be risks associated wit$ suc$ a fund< 2$ere t$ere is t$e "ros"ect of great wealt$ to be made t$ere is also t$e realit% of risk. D8 *or w$om is t$is fund rele ant< *or in estors w$o $a e a 35! %ear $ori;on a long term "lan and t$e disci"line to sta% b% it. /8 'enc$mark< 'S/ 244 +nde0
INT$OD%CTION
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#utual *unds are financial intermediaries w$ic$ "ool t$e sa ings of numerous indi iduals and in est t$e mone%6 t$us related in a di ersified "ortfolio of securities6 including e9uit%6 bonds debentures and ot$er mone% market instruments6 t$us s"reading and reducing risk. .$e objecti e of mutual fund is to ma0imi;e t$e return to t$e in estor w$o "artici"ates in e9uit% indirectl% t$roug$ mutual funds. / en t$oug$ t$e mutual fund industr% grown in asset alue from ,s.)444 (rores to 26446444I5 (rores toda%6 t$is is just t$e ti" of t$e iceberg. According to most *und #anagers6 t$e real boom is %et to come. .$e sum of ,s.26446444I5 (rores re"resents just 3J 5 4J of t$e total market ca"itali;ation of 2!6446444 (rore. .$is com"ares "oorl% wit$ t$e AS6 w$ere t$e mutual funds $a e nearl% K &.1 billion of market ca"itali;ation of roug$l% ,s.)4444 (rore6 barel% 3J 5 4J of total market ca"itali;ation. .$is is not e0"ected6 because mutual fund $istor% in +ndia6 w$ic$ dates back to 13&46 w$en t$e first o"en5ended mutual fund sc$eme Anit5&4 was launc$ed b% Anit .rust of +ndia6 is still dominated b% it. .$e focus initiall% was income earning securities6 wit$ onl% 24 J of t$e (or"us going into e9uit%. .$e earl% 14s saw ot$er sc$emes like t$e growing income6 fi0ed income6 and mont$l% income being introduced b% t$e A.+. 'ut it was onl% in 131& t$at t$e first "ure Frowt$ e9uit% sc$eme #aster s$are was launc$ed. 1313534 was anot$er landmark %ear in t$e $istor% of mutual funds. *or t$e fist time6 t$e mono"ol% of A.+ o er t$e industr% was broken. .$e go ernment allowed "ublic sector banks and insurance com"anies to enter t$is sector to bring in some com"etition. 'ut it was onl% in 13336 w$en t$e "ri ate sector was gi en t$e green signal to float mutual funds6 t$at e0citement and com"etition came. =ot onl% did t$e Fo ernment allowed +ndian com"anies to float mutual funds6 it e en allowed foreign funds to set in s$o" in +ndia and float funds. .$us6 in one stroke6 t$is sector was trul% "ri ati;ed. .oda% t$ere are about 12514 "ri ate "la%ers in t$e market including foreign funds suc$ as #organ Stanle%6 besides t$e nine "ublic sector "la%ers and A.+. .oget$er6 t$ese funds $a e mobili;ed around ,s.&!44 (rore from t$e market. .$e collections could $a e been better6 $ad not t$e "ublic sector funds been bus% com"l%ing wit$ t$e S/'+ guidelines "ertaining to t$e formation of asset management com"anies etc. 'ut t$e best is %et to come. A number of com"anies $a e "lans to float mutual funds at arious stages of im"lementation. Some of t$e major names w$ic$ are likel% to come to t$e market are .ata Sons in collaboration wit$ Hleinwort 'enson6 +.( (lassic
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wit$ .$read needle A,6 O""en$eimer of AS6 "lus a $ost of ot$ers. And according to conser ati e guesstimates6 mutual funds are set to collect o er ,s.14444 (rore from t$e market t$is %ear. .$e reason for suc$ confidence is t$at wit$ S/'+ firm about t$e small in estor taking t$e mutual fund route to in estments in t$e stock market6 and t$e regulator% c$anges making it muc$ more difficult to get allotments in "rimar% markets6 small in estors will not be left wit$ man% o""ortunities.
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.$e structure of mutual fund in +ndia is go erned b% S/'+ 7#A.AA? *A=D8 regulations 133&. .$ese regulations make it mandator% for mutual funds to $a e a t$ree5 tier structure of SPO=SO,5.,AS.//5ASS/. #A=AF/#/=. (O#PA=B 7A#(8.
A Mutua- Fund is common "ool of mone% into w$ic$ +n estor "lace t$eir contributions t$at are to be in ested in accordance wit$ a stated objecti e. .$e owners$i" of t$e *und is t$us joint or CmutualEL t$e fund belongings to all in estors. A single in estors owners$i" of t$e fund is in t$e same "ro"ortion as t$e amount of t$e contribution made b% $im or $er bears to t$e total amount of t$e fund.
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A #utual fund uses t$e mone% collected from in estors to bu% t$ose assets6 w$ic$ are s"ecificall% "ermitted b% its stated in estment objecti e. .$us6 an /9uit% *und would bu% mainl% /9uit% assets5ordinar% s$ares6 "reference s$ares6 warrants etc. A bond fund would mainl% bu% debt instruments suc$ as debentures6 bonds or go ernment securities. +t is t$ese assets6 w$ic$ are owned b% t$e in estors in t$e same "ro"ortions as t$ere contribution bears to t$e total contribution of all in estors "ut toget$er. 2$en an in estor subscribes to a mutual fund6 $e or s$e bu%s a "art of t$ese assets or t$e "ool of funds t$at are outstanding at t$at time. +ts no different from bu%ing Cs$aresE of a joint stock com"an%6 in w$ic$ case t$e "urc$ase makes t$e in estor a "art owner of t$e com"an% and its assets. +n fact6 in t$e ASA6 a #utual fund is constituted as an in estment com"an% and an in estor Cbu%s into t$e fundE6 meaning $e bu%s t$e s$ares of t$e fund. +n +ndia6 a mutual fund is constituted as a .rust and t$e in estor subscribes to t$e Cunits C issued b% t$e fund6 w$ic$ is w$ere t$e term unit .rust comes from.
Sc$emes floated b% t$e arious mutual funds are essentiall% of two t%"es6 namel% o"en5 ended and close5ended. .$e basic c$aracteristics of t$ese two t%"es of mutual fund sc$emes are gi en below<
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CLOSE;ENDED SC EMES
.$ese are o"en for subscri"tion onl% during a s"ecified "eriod. Fenerall% t$e redem"tion dates are also s"ecified w$en t$e in estor can redeem t$eir units. .$e duration of t$is sc$eme aries< normall% it is !5) %ears. ,e"urc$ase during t$e inter ening "eriod ma% or ma% not be allowed. Some of t$e sc$emes t$oug$ $a e a re"urc$ase facilit% after a certain "eriod. #an% of t$ese sc$emes are listed in stock e0c$anges6 e0ce"t for some of t$e close5ended income sc$emes .
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E4uit! Oriented S3'e1es < .$ese sc$emes6 also commonl% called Frowt$ Sc$emes6 seek to in est a majorit% of t$eir
funds in e9uities and a small "ortion in mone% market instruments. Suc$ sc$emes $a e t$e "otential to deli er su"erior returns o er t$e long term. >owe er6 because t$e% in est in e9uities6 t$ese sc$emes are e0"osed to fluctuations in alue es"eciall% in t$e s$ort term. /9uit% sc$emes are $ence not suitable for in estors seeking regular income or needing to use t$eir in estments in t$e s$ort5term. .$e% are ideal for in estors w$o $a e a long5term in estment $ori;on. .$e =A: "rices of e9uit% fund fluctuates wit$ market alue of t$e underl%ing stock w$ic$ are influenced b% e0ternal factors suc$ as social6 "olitical as well as economic. >D*( Frowt$ *und6 >D*( .a0 sa er and >D*( +nde0 *und are e0am"les of e9uit% sc$emes. De"t Based S3'e1es: .$ese sc$emes6 also commonl% called +ncome Sc$emes6 in est in debt securities suc$ as cor"orate bonds6 debentures and go ernment securities. .$e "rices of t$ese sc$emes tend to be more stable com"ared wit$ e9uit% sc$emes and most of t$e returns to t$e in estors are generated t$roug$ di idends or stead% ca"ital a""reciation. .$ese sc$emes are ideal for conser ati e in estors or t$ose not in a "osition to take $ig$er e9uit% risks6 suc$ as retired indi iduals. >owe er6 as com"ared to t$e mone% market sc$emes t$e% do $a e a $ig$er "rice fluctuation risk and com"ared to a Filt fund t$e% $a e a $ig$er credit risk. INCOME SC EMES < .$ese sc$emes "ro ide returns in t$e form of di idends. .$e returns ma% be cumulati e or non5cumulati e on a mont$l%6 9uarterl%6 or %earl% basis. #utual *unds carr% market risks and are "ro$ibited b% S/'+ from declaring an% guaranteed rate of returns. .$e mone% under suc$ sc$emes are "redominantl% in ested in fi0ed income securities like debentures6 bonds6 Fo ernment securities etc.
Li4uid In3o1e S3'e1es: Similar to t$e +ncome sc$eme but wit$ a s$orter maturit% t$an +ncome sc$emes. An e0am"le of t$is sc$eme is t$e >D*( ?i9uid *und. Mone! Market S3'e1es: .$ese sc$emes in est in s$ort term instruments suc$ as commercial "a"er 7C(PE86 certificates of de"osit 7C(DE86 treasur% bills 7C.5'illE8 and o ernig$t mone% 7C(allE8. .$e sc$emes are t$e least olatile of all t$e t%"es of sc$emes because of
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t$eir in estments in mone% market instrument wit$ s$ort5term maturities. .$ese sc$emes $a e become "o"ular wit$ institutional in estors and $ig$ net wort$ indi iduals $a ing s$ort5term sur"lus funds.
Gi-t Funds: .$is sc$eme "rimaril% in ests in Fo ernment Debt. >ence t$e in estor
usuall% does not $a e to worr% about credit risk since Fo ernment Debt is generall% credit risk free. >D*( Filt *und is an e0am"le of suc$ a sc$eme.
<B$ID SC EMES : .$ese sc$emes are commonl% known as balanced sc$emes. .$ese sc$emes in est
in bot$ e9uities as well as debt. '% in esting in a mi0 of t$is nature6 balanced sc$emes seek to attain t$e objecti e of income and moderate ca"ital a""reciation and are ideal for in estors wit$ a conser ati e6 long5term orientation. >D*( 'alanced *und and >D*( ($ildrens Fift *und are e0am"les of $%brid sc$emes. Inter)a- S3'e1es: .$ese sc$emes combine t$e features of o"en5ended and closed5ended sc$emes. .$e% ma% be traded on t$e stock e0c$ange or ma% be o"en for sale or redem"tion during "re5determined inter als at =A: based "rices. *rom t$e in estments "oint of iew t$e e0isting sc$emes can be furt$er di ided into 4 major categories < 1. G$OWT SC EMES < .$ese are usuall% close5ended sc$emes. .$e aim of suc$ sc$emes is to "ro ide ca"ital a""reciation to t$eir in estors and accordingl% a substantial "art of t$e (or"us is in ested in e9uities an con ertible debentures. Suc$ sc$emes are usuall% listed in t$e major stock e0c$anges and t$e ca"ital 2. a""reciation is reflected in t$eir market alue i.e. =A:. .$e% ma% or ma% not declare di idends e en t$oug$ t$e declaration of annual di idends re"resents t$e $ealt$ of a sc$eme. 3. E=%IT<;LINKED SC EMES 5ELSS2 : .$ese are "o"ularl% known as ta05 "lanning sc$emes . .$e% are essentiall% close5ended growt$ sc$emes in nature. .$e% are floated b% almost all t$e "ublic sector mutual funds in t$e last 9uarter of eac$ financial %ear6 some of t$e essential c$aracteristics are < a. +n estment u" to a ceiling of ,s.16446444I come under Section 14( of t$e +ncome .a0 Act. b. ,e"urc$ase is allowed after a s"ecified "eriod5 usuall% 3 %ears.
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c. During t$e lock5in "eriod of 3 %ears t$eir units cannot be traded6 "ledged or transferred. +AL%E;ADDED SC EMES : t$e% are in addition to t$e growt$Iincome sc$emes. Some of t$e mutual funds sc$emes $a e "ro ision for M alue addition. .$is is usuall% in t$e nature of "ersonal insurance co er for accidents6 etc. F+( #utual *und was t$e first to introduce t$is conce"t.
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1&8 #organ Stanle% #utual *und +ndia 1)8 /scorts #utual *und 11 Alliance (a"ital #utual *und 138 'enc$mark #utual *und 248 (anbank #utual *und 218 ($ola #utual *und 228 LIC Mutual Fund 23) IC Mutual Fund
8 Eas! Ste,s to In)est in Mutua- Funds 18 Sear3': >2$ere to look for if we want to in est in #*E
a8 (ontacting an +n estment ad isor in a bank or a brokerage $ouse or an +nde"endent *inancial Ad isor is t$e first ste" to gat$ering information. b8 #utual funds units can also be boug$t o er t$e +nternet. c8 #utual funds are muc$ like an% ot$er "roduct6 in t$at t$ere are manufacturers w$o "ro ide t$e "roduct and t$ere are dealers w$o sell t$em.
/2 E)a-uation: >/ aluation< c$oosing t$e rig$t mutual fund for %ou
As an in estor one ma% a8 for t$e s$ort term or long term want to in est b8 want regular income or growt$ c8 want to target lower risk or $ig$er returns d8 be con inced of a "articular sector and want to in est in it
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02 #ur3'ase:
a8 S!ste1ati3 In)est1ent #-an 5SI#2: Allows %ou to sa e a "art of %our income regularl%. Also used to reduce risk w$en in esting in sc$emes targeting aggressi e growt$. b8 S!ste1ati3 Wit'dra(a- #-an 5SW#2: Allows %ou to wit$draw a "art of %our in estment regularl%. Ased w$en %ou want to wit$draw %our in estment for a s"ecific regular "a%ment6 like insurance "remium "a%ments of mont$l%I9uarterl% fre9uenc%. c8 Auto1ati3 de"it: Sa es t$e $assle of writing a c$e9ue w$en making an in estment. Bour account is debited automaticall% for t$e amount in ested. d8 Di)idend #-an : A8 Di idend Pa%out< Ander t$is "lan in estor can redeem $isI$er di idend at s"ecific times. '8 Di idend ,ein estment< Ander t$is "lan in estors di idend is rein ested back to its "rinci"al amount w$ic$ t$erefore increase t$e number of units in estor is $olding. e8 Gro(t': Ander t$is "lan income generated from in estment will "ut back to its in ested amount w$ic$ t$erefore increases t$e alue of eac$ unit customer is $olding.
82 E@IT:
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/ er% A#( ad ice t$at e er% in estor s$ould monitor t$e $isI$er units =A: "eriodicall% but A#( also recommend t$eir unit $olders to not get swa%ed b% s$ort term considerations in deciding t$eir e0it. $ede1,tion: +n case of o"en ended funds in estor can redeem $isI$er in ested amount. #ost funds take 153 da%s to credit %our account wit$ %our redem"tion "roceeds.
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STANDA$D DE+IATION
Standard De)iation a--o(s to e)a-uate t'e )o-ati-it! of t'e fundC T'e standard de)iation of a fund 1easures t'is risk "! 1easuring t'e degree to ('i3' t'e fund f-u3tuates in re-ation to its 1ean returnC Beta is a fair-! 3o11on-! used 1easure of riskC It "asi3a--! indi3ates t'e -e)e- of )o-ati-it! asso3iated (it' t'e fund as 3o1,ared to t'e "en3'1arkC $; s4uare 1easures t'e 3orre-ation of a fund&s 1o)e1ent to t'at of an indeAC $;s4uared des3ri"es t'e -e)eof asso3iation "et(een t'e fundGs )o-ati-it! and 1arket riskC A-,'a is t'e differen3e "et(een t'e returns one (ou-d eA,e3t fro1 a fundH gi)en its "etaH and t'e return it a3tua--! ,rodu3esC It a-so 1easures t'e uns!ste1ati3 risk C
BETA
$;S=%A$E
$;s4uared )a-ues range "et(een 7 and .H ('ere 7 re,resents no 3orre-ation and . re,resents fu-- 3orre-ationC
AL# A
A-,'a is ,ositi)e E returns of sto3k are "etter t'en 1arket returnsC A-,'a is negati)e E returns of sto3k are (orst t'en 1arketC A-,'a is Iero E returns are sa1e as 1arketC T'e 'ig'er t'e S'ar,e ratioH t'e "etter a funds returns re-ati)e to t'e a1ount of risk takenC
S A$#E $ATIO S'ar,e $atioE Fund return in eA3ess of risk free returnJ Standard de)iation of FundC S'ar,e ratios are idea- for 3o1,aring funds t'at 'a)e a 1iAed asset 3-assesC
24
TDS
A-- S3'e1es
E4uit! S3'e1 es
Li4uid S3'e1es
Ot'er S3'e1es
$esident Indi)iduaJ %F
.7L
NIL
AS #E$ SLAB
NIL
TA@ F$EE
NIL
/MC0/L 5/8L N.7Lsur3 'argeNedu 3ation 3ess2 /MC0/L 5/8L N.7Lsur3 'argeNedu 3ation 3ess2 /MC0/L 5/8L N.7Lsur3 'argeNedu 3ation 3ess2 /MC0/L 5/8L N.7Lsur3 'argeNedu 3ation 3ess2 /MC0/L 5/8L N.7Lsur3 'argeNedu 3ation 3ess2
.?C.9L 5./C8L N.7Lsur3 'argeN0L edu3ation 3ess2 //C99L 5/7L N.7L sur3'arge N0L edu3ation 3ess2 //C99L 5/7L N.7L sur3'arge N0L edu3ation 3ess2 //C99L 5/7L N.7L sur3'arge N0L edu3ation 3ess2 .?C.9L 5./C8L N.7Lsur3 'argeN0L edu3ation 3ess2
#artners'i, Fir1s
.7L
NIL
07L
NIL
TA@ F$EE
NIL
AO#JBOI
.7L
NIL
AS #E$ SLAB
NIL
TA@ F$EE
NIL
Do1esti3 Co1,anies
.7L
NIL
07L
NIL
TA@ F$EE
NIL
N$Is
.7L
NIL
AS #E$ SLAB
STCG; TA@ F$EE 07LL TCG; /7LAf ter ,ro)idi ng for indeAa t
NIL
2!
#OINTS:
#ortfo-io Di)ersifi3ation N #utual *unds normall% in est in a well5di ersified "ortfolio or securities w$ere t$e in estor can $old a di ersified in estment "ortfolio e en wit$ a small amount of in estment. #rofessiona- Manage1ent N .$e in estors does not $a e t$e skills and t$e resources of t$eir own to succeed in toda%s fast mo ing6 global and so"$isticated markets. .$ereb% t$e% benefits from t$e "rofessional management skills broug$t in b% t$e fund in t$e management of in estors "ortfolio. Di)ersifi3ation of $isk; Since t$e in estor ac9uires a di ersified "ortfolio6 it reduces a risk of loss as com"ared to in esting directl% in one or two s$ares or debentures or ot$er instruments. 2$ile in esting in a "ool of funds wit$ ot$er in estors an% loss6 on one or two securities is also s$ared wit$ ot$er in estors. .$is risk reduction is one
of t$e most im"ortant benefits of a collecti e in estment e$icle like t$e mutual fund.
2&
$edu3tion of Transa3tion Costs OW$en going t$roug$ a fund t$e in estor $as t$e benefit of economies of scale6 funds "a% lesser cost because of larger olumes6 and t$is benefit is "assed onto its in estors. Li4uidit!5 +n estment in a mutual fund is more li9uid as an in estor can li9uidate t$e in estment6 b% selling t$e unit to t$e fund if o"en5end6 or selling t$em in a market if t$e fund is close5end and collect funds at t$e end of t$e "eriod s"ecified b% t$e mutual fund or t$e stock market. Con)enien3e and F-eAi"i-it! O #utual *und management com"anies offer man% in estor ser ices w$ere in t$e in estor can easil% transfer t$eir $oldings from one sc$eme to t$e ot$er6 get u"dated market information6 and so on.
28 38 48 !8 &8 )8
+ndian (om"anies +ndian .rustsI($aritable +nstitutions 'anks =on5'anking *inance (om"anies +nsurance (om"anies Pro ident *unds
b8 =on ,esidents including 18 =on5,esident +ndians6 and 28 O erseas (or"orate 'odies 7O('s8 and c8 *oreign entities6 i;L 18 *oreign +nstitutional +n estors 7*++s8 registered wit$ S/'+. Foreign 3itiIensJ entities are 'o(e)er not a--o(ed to in)est in Mutua- funds in IndiaC
21
23
34
31
F%ND NAME
LOADS
SC CLASSIC E=%IT< F%ND FLE@I CA# SC IM#E$IAL E=%IT< F%ND LA$GE CA# SC #$EMIE$ E=%IT< F%ND G$OWT F%ND
Entr! Load; /C/8L EAit Load;NIL Entr! Load; /C/8L EAit Load;.L For . !ear Entr! Load; /C/8L EAit Load;.L For . !ear
$sC .777C77 Entr! -oad;NIL Min:9 1nt's EAit Load; .L For . !ear $sC .777C77 Entr! -oad;NIL Min:9 1nt's EAit Load; .L For . !ear $sC /777C77 Entr! -oad; Min:9 1nt's /C/8L EAit Load; .L For . !ear
$sC8777C77
$sC/8777C77
32
33
$eakne""#
Inability to fully cover the outstation mar et !ac of manpower. "vershadowing of #ome !oans.
%pportunit&#
$ne%plored& outstation mar et. 'arget e%port segment aggressively
34
< !K 2AC5'<!
#utual *unds and Securities in estment are subject to market risks and t$ere can be assurance or guarantee t$at t$e sc$eme objecti es will be ac$ie ed. As wit$ an% in estment in securities6 t$e =et Asset :alue of Anit issued under t$e Sc$eme ma% go u" or down de"ending on t$e arious factors and farces affecting t$e ca"ital markets. Past "erformance of t$e S"onsors and t$eir affiliates I A#( I #utual *und and its sc$eme do not indicate t$e future "erformance of t$e sc$emes of t$e #utual *und. .$e S"onsors are not res"onsible or liable for an% loss or s$ortfall resulting from t$e o"erations of t$e sc$eme be%ond t$e contribution of ,s 1 lak$ eac$ made b% t$em towards t$e cor"us of t$e #utual *und. As "er S/'+ circular ref. S/'+I+#DI(+, =o. 14I22)41I43 dated December 126 2443 read wit$ circular ref S/'+I+#DI(+, =O. 1I42!23I4! dared Oune 146 244!6 it is s"ecified inter alias t$at eac$ "ortfolio under a sc$eme s$ould $a e a minimum of 24 in estors and no single in estor s$ould account for more t$an 2!J of t$e cor"us of suc$ "ortfolio.
3!
3&
F%ND NAME
E@#C $ATIO L /C /?
#O$TFOLIO MANAGE$ #$ATEEK MANAGE$ K N SI+A S%B$AMANIAM #$AS ANT *AIN #$AS ANT *AIN DE+EN SANGOI
TEN%$E5<$S2
.C 6.
/C /8
8777
.?
.C M6
/C /8
8777
.0
.C 60
/C /8
8777
ICICI #$% SE$+ICE IND%ST$< $ELIANCE G$OWT S C CLASSIC E=%IT< S C #$EMIE$ E=%IT< S%NDA$AM BN# #A$IBAS SELECT MIDCA# TATA E=%IT< O##O$T%NITIES
/C /9
/C /8
8777
.C M?
/C /8
8777
/C /?
/C /8
8777
/C 0M
/C /8
/8777
.C 6M
/C /8
8777
NA
/C /9
/C /8
8777
M +EN%GO#AL
IN+ESTMENT G$A#
3)
5'* 11 2U7=!
DESC$I#TON:
12 >ig$ e0"ense ratio means it will affect t$e returns negati el%. 28 ?ong .enure means *und is more trusted.
STATEMENT:
On t$e basis of abo e descri"tion we can state t$at S.A=DA,D (>A,./,/D P,/#+/, /@A+.B *A=D $as $ig$ e0"ense ratio 72.318 and small tenure.2$ile *,A=H?+= +=D+A P,+#A and >D*( P,AD/=(/ $as low e0"ense ratio and long tenure.
F%ND NAME
T%$NO+E$
ASSETS5$sCCr2
NA
08/C 8
/MC /6
/9./C 6K
.88C 7/
.869C .?
/KC 9/
0.C 6?
?KK6C 88
.8MC 9M
/8//C ?6
//C 6M
0.C //
/9K99C /?
M7C M9
.6K.C 7.
/8C K/
ICICI #$% SE$+ICE IND%ST$< $ELIANCE G$OWT S C CLASSIC E=%IT< S C #$EMIE$ E=%IT< S%NDA$AM BN# #A$IBAS SELECT MIDCA# TATA E=%IT< O##O$T%NITIES
08C76
?K?/C 6/
NA
9.8C 8.
.MC 66
/6CKM
8097C .M
9.CK8
06/0C 6
.MC 68
0.C /?
/7M..C K/
NA
098C .
/KC 90
?0C 80
.M/.C 86
NA
/8?C /K
/0C 7M
09C 66
/090C 86
8C..
/.8.C 8.
.0C 8?
0?C 0?
9/7KC 08
/C/?
?98C 7?
/.C M6
/++++ .,+++ .++++ -,+++ -++++ ,+++ + 0B* 01R" Fran lin India #(F2 #(F2 'op I2I2I Pru Reliance S 2 2lassic S 2 Premier Sundaram '0'0 E3uity 0ssets 6Rs. 2r7 1ar et 2ap6Rs. 2r7 5'* 11 2U7=!
5'* 11 2U7=!
DESC$I#TON:
*'<52'" ' C'$*A< !'7
44
18 >ig$ PI/ ratio means *und is er% acti el% manage. 28 ?arge #arket (a"itali;ation re eals Organi;ations strong "osition in t$e market as well as Organi;ations long term growt$. 38 ?arge Assets re eals Organi;ations strong financial "osition and S$are$olders Securit%.
STATEMENT:
On t$e basis of abo e mentioned descri"tion we can state t$at S.A.=DA,D (>A,./,/D P,/#+/, /@A+.B *A=D $as $ig$est PI/ ratio but small #arket (a" and Assets.2$ile >D*( P,AD/=(/ $as $ig$ PI/ ratio6 moderate #arket (a" and largest Assets w$ereas A'= A#,O OPPO,.A=+.+/S $as $ig$ PI/ ratio6 largest #arket (a" and low Assets.
F%ND NAME
./C .6
8/J.K9
MC 0.
.0/J.9/
?9C 9M
K9J.9.
KC /0
.MJ.K9
.7C 80
.?J0/
?/C KM
0J.9.
MC ?9
.87J.K9
..C /?
.70J.9?
?0C .9
68J.9.
ICICI #$% SE$+ICE IND%ST$< $ELIANCE G$OWT S C CLASSIC E=%IT< S C #$EMIE$ E=%IT< S%NDA$AM BN# #A$IBAS SELECT MIDCA# TATA E=%IT< O##O$T%NITIES
6C /6
.07J.K9
.?C 6.
8.J.9?
M.C 9?
0J.9.
./C 90
?0J.K9
.MC .6
/?J.9?
97C M/
/.J.9.
./C .
86J.K9
.?C /.
8MJ.9?
??C MK
M?J.9.
.8C .
.MJ.K9
0.C 88
/J.9?
M0C MK
/J.9.
..C K6
9?J.K9
6C.K
./?J.9?
0MC M?
..KJ.9.
..C 8K
9MJ.K9
.9C 89
08J.9?
8.C 86
8/J.9.
0B* 01R" opportunities Fran lin India Prima #(F2 Prudence #(F2 'op .++ I2I2I Pru Service Industry Reliance Growth S 2 2lassic E3uity S 2 Premier E3uity
<E5U<7!
DESC$I#TION:
18 >ig$ returns s$ows Organi;ations $ig$ com"etiti eness - "erformance 28 >ig$ rank s$ows its strong "osition among its com"etitors
43
STATEMENT:
On t$e basis of returns < $ET%$NS
.;MONT IG
O$GANISATION
ABN AM$O O##O$T%NITIES
9;MONT
IG
.; <EA$
IG
S.A=DA,D (>A,./,/D P,/#+/, /@A+.B $as bot$ & mont$s and 15%ear $ig$ returns. 2$ile A'= A#,O OPPO,.A=+.+/S $as a 15mont$ $ig$ returns.
44
F%ND NAME
STANDA$D DE+IATION NA
S A$#E $ATIO NA
BETA
AL# A
$;S=%A$E
NA
NA
NA
9C //
7C 8
OC K9
.C 70
7C ?M
0C 9M
OC K9
7C M9
.C ?K
7C 90
LOW
8C 06
7C 86
7C 6.
7C 9K
7C 6/
ICICI #$% SE$+ICE IND%ST$< $ELIANCE G$OWT S C CLASSIC E=%IT< S C #$EMIE$ E=%IT< S%NDA$AM BN# #A$IBAS SELECT MIDCA# TATA E=%IT< O##O$T%NITIES
NOT $ATED
NA
NA
NA
NA
NA
A+G
9C /M
7C9?
7C M0
.CK0
7C 8K
NOT $ATED
NA
NA
7C6/
0C?7
NA
NOT $ATED
NA
NA
7CM/
8C90
NA
LOW
8CK
7C K/
7C 96
/C.M
7C ?M
ABO+E A+G
9C/K
7C 8?
7C 6K
7C K0
7C KM
4!
STATEMENT:
'ecause of =on5A ailabilit% of figures for some *unds we cannot gi e an% comment under t$is "arameter. >owe er on t$e basis of a ailable data we can conclude t$at *,A=H?+= +=D+A P,+#A - .A.A /@A+.B OPPO,.A=+.+/S are little risk% funds.
4&
F%ND NAME
NA+
AS ON
8/ WEEKS IG /9C 8.
AS ON
8/ WEEKS LOW
AS ON
/9C 8.
*%L< .0H 7K
*%L< .0H 7K
.?C 79
.6;Pu-;79
/09C 7?
*%L< .0H 7K
/09C 7?
*%L< .0H 7K
.?6C ?K
/?;Pu-;79
./MC .?
*%L< .0H 7K
./MC .?
*%L< .0H 7K
M8C MM
.6;Pu-;79
./?C M6
*%L< .0H 7K
./?C M6
*%L< .0H 7K
M.C 86
.6;Pu-;79
ICICI #$% SE$+ICE IND%ST$< $ELIANCE G$OWT S C CLASSIC E=%IT< S C #$EMIE$ E=%IT< S%NDA$AM BN# #A$IBAS SELECT MIDCA# TATA E=%IT< O##O$T%NITIES
.MC ..
*%L< .0H 7K
.MC ..
*%L< .0H 7K
6C 0M
.6;Pu-;79
0/?C 7?
*%L< .0H 7K
0/?C 7?
*%L< .0H 7K
.M0C K8
/?;Pu-;79
.MC .K
*%L< .0H 7K
.MC .K
*%L< .0H 7K
..C 8.
/.;Pu-;79
.KC K/
*%L< .0H 7K
.KC K/
*%L< .0H 7K
6C 79
/?;Pu-;79
.70C 0/
*%L< .0H 7K
.70C 0/
*%L< .0H 7K
9MC 6M
/?;Pu-;79
96C 88
*%L< .0H 7K
96C 88
*%L< .0H 7K
?.C M9
/?;Pu-;79
4)
NA+ 5 8/ WEEKS
5'* 11 2U7=!
DESC$I#TION:
=A:< =et Asset :alue s$ows t$e "er unit alue of a mutual fund unit t$at an in estor is $olding. >ig$I?ow =A: s$ows t$at b% $ow muc$ amount t$e in ested amount is a""reciated or de"reciated.
STATEMENT:
On t$e basis of abo e descri"tion we can state t$at ,/?+A=(/ F,O2.> $as t$e $ig$est all time $ig$ 7!2 weeks $ig$8 =A: 324.44 2$ile S.A=DA,D(>A,./,/D P,/#+/, /@A+.B $as t$e all time low 7!2 weeks low8 =A: 3.4&
41
A2 CO;+A$IANCE E .2 T 5$a;$a 5"ar22B5$P;$P5"ar22Jn;. E 0CM90 /2 T 5$1;$1 5"ar2B5$P;$P5"ar22Jn;. E ?C0?K B2 +A$IANCE 5U/ 2 E 5$P;$P 5"ar2/ 2 TE n;. C2 BETA 5V2 E CO+A$IANCE +A$IANCE .2 STANDA$D C A$TE$ED #$EMIE$ E=%IT< F%ND 5V2 E 7CM/. /2 STANDA$D C A$TE$ED CLASSIC E=%IT< F%ND 5V2 E 7C6/? D2 AL# A 5W2 E .2 STANDA$D C A$TE$ED #$EMIE$ E=%IT< F%ND $a 5"ar2 O V B $P 5"ar2 E 8C906 /2 STANDA$D C A$TE$ED CLASSIC E=%IT< F%ND $1 5"ar2 O V B $P 5"ar2 E 0C?77 E2 STANDA$D DE+IATION 5U2 E 5U2 E S=%A$E $OOT OF +A$IANCE E /C.9M E ?CK70
43
F%ND NAME S C #$EMIE$ E=%IT< F%ND S C CLASSIC E=%IT< F%ND BENC MA$K BSE;/77
+A$IANCE
STANDA$D DE+IATION
?CK70
/C.9M
STATEMENT:
On t$e basis of abo e table we can state t$at S ( Premier /9uit% - S ( (lassic /9uit% fund are less risk% in com"arison to t$eir benc$mark inde0 'S/5244 as t$eir 'eta alues are less t$en 1 as well as t$e% also $a e better returns t$en benc$mark inde0 as t$eir Al"$a alues are "ositi e.
!4
02 A;a)g on ,ara1eter ?2 L;-o( on ,ara1eter H 82 LT; -o(est on ,ara1eterH 92 N$;not rated K2B;"etter t'en ot'ersH M2 X;(orst t'en ot'ersH 62 Y;"est on t'e ,ara1eter
!1
#A$AMETE$S
ABN F$CIND DFC DFC ICICI $ELC S C AM$O #$IMA #$%C TO# SE$+C G$WC CLASSC O##C /77 E=%C
IN+ESTMENT 5E@#C$ATIO2
LT
LT
LT
N$
N$
Y5$ELG$W2 B5F$CIND2
!2
F%ND NAME ABN AM$O O##C F$ANKIN INDIA DFC #$%DENCE DFC TO# .77 ICICI #$%CSE$+ $ELIANCE G$OWT S C CLASSIC S C #$EMIE$ SND BN# SELECT MID CA# TATA E=%IC O##C
LA%NC MA$;78 NO+;60 *AN;6? SE#;69 NO+;78 OCT;68 *%L;78 SE#;78 *%L;7/ MA$;70
DATE
CATEGO$< E4uit!: Di)ersified E4uit!: Di)ersified !"rid:E4uit!: Oriented E4uit!: Di)ersified E4uit!: Di)ersified E4uit!: Di)ersified E4uit!: Di)ersified E4uit!: Di)ersified E4uit!: Di)ersified E4uit!: Di)ersified
NOT $ATED
!3
!4
SEGMENTS OF IN+ESTO$S
IN+ESTO$S
ABN F$CINDIA DFC DFC AM$O #$IMA #$%C TO# O##C /77
88! Q ABO+E
!!
< !K 2AC5'<!
#utual *unds and Securities in estment are subject to market risks and t$ere can be assurance or guarantee t$at t$e sc$eme objecti es will be ac$ie ed. As wit$ an% in estment in securities6 t$e =et Asset :alue of Anit issued under t$e Sc$eme ma% go u" or down de"ending on t$e arious factors and farces affecting t$e ca"ital markets. Past "erformance of t$e S"onsors and t$eir affiliates I A#( I #utual *und and its sc$eme do not indicate t$e future "erformance of t$e sc$emes of t$e #utual *und. .$e S"onsors are not res"onsible or liable for an% loss or s$ortfall resulting from t$e o"erations of t$e sc$eme be%ond t$e contribution of ,s 1 lak$ eac$ made b% t$em towards t$e cor"us of t$e #utual *und.
!&
BIBLIOG$A# < 1. *act and *igures collected b% S.A=DA,D (>A,./,/D 7A#(8. 2. Pam"$lets collected from S.A=DA,D (>A,./,/D 7A#(8. 3. 222.:A?A/,/S/A,(>O=?+=/.(O# 4.Presentation b% S.A=DA,D (>A,./,/D 7A#(8.
!)