A PROJECT REPORT ON

Need Of Financial Advisors For Mutual Fund Investment

Submitted in partial fulfillment for MASTER OF BUSINESS ADMIMISTRATION
Program me of
GLA INSTITUTE OF MANAGEMENT TECHNOLOGY

MATHURA Batch20I0-2012

Submitted by:Under Guidance:RAVI BHUSHAN MBA( TWO Year Program me) Roll no. Section. Batch 1006730085 B(ITM) (2010-2012)

Mr satendra yadav

Department of Business Management

GLA INSTITUTE OF MANAGEMENT TECHNOLOGY

MATHURA

Acknowledgement

Enumerating and enlisting all the individuals whose contributions went into the making of the project is a very difficult task For me, acknowledgement is a genuine opportunity to express my sincere thanks to all those who have supported and encouraged me in the completion of the project. First of all, my sincere gratitude is extended to Mr.SATENDRA YADAV (PROFESSOR OF FINANCE IN GLA UNIVERSITY MATHURA) my external guide, for his guidance and immense support for the completion of the project. I express my deep sense of regards to whole team of Broking Ltd., AGRA. Finally I express my sincere gratitude to My friends and all those who directly or indirectly helped me in the successful completion of this project. KARVY Stock

RAVI BHUSHAN

DECLARATION
I hereby declare that Research Project Report entitled

Need of financial advisors for mutual by me

fund investment submitted

in partial fulfillment of the requirement for the degree of M.B.A. to

GLA University, Mathura is my own work and the same has not been submitted to any other University/Institution for the award of any degree.

RAVI BHUSHAN

EXECUTIVE SUMMARY
In few years Mutual Fund has emerged as a tool for ensuring ones financial well being. Mutual Funds have not only contributed to the India growth story but have also helped families tap into the success of Indian Industry. As information and awareness is rising more and more people are enjoying the benefits of investing in mutual funds. The main reason the number of retail mutual fund investors remains small is that nine in ten people with incomes in India do not know that mutual funds exist. But once people are aware of mutual fund investment opportunities, the number who decide to invest in mutual funds increases to as many as one in five people. The trick for converting a person with no knowledge of mutual funds to a new Mutual Fund customer is to understand which of the potential investors are more likely to buy mutual funds and to use the right arguments in the sales process that customers will accept as important and relevant to their decision. This Project gave me a great learning experience and at the same time it gave me enough scope to implement my analytical ability. The analysis and advice presented in this Project Report is based on market research on the saving and investment practices of the investors and preferences of the investors for investment in Mutual Funds. This Report will help to know about the investors Preferences in Mutual Fund means Are they prefer any particular Asset

Management Company (AMC), Which type of Product they prefer, Which Option (Growth or Dividend) they prefer or Which Investment Strategy they follow (Systematic Investment Plan or One time Plan). This Project as a whole can be divided into two parts. The first part gives an insight about Mutual Fund and its various aspects, the Company Profile, Objectives of the study, Research Methodology. One can have a brief knowledge about Mutual Fund and its basics through the Project. The second part of the Project consists of data and its analysis collected through survey done on 200 people. For the collection of Primary data I made a questionnaire and surveyed of 200 people. I also taken interview of many People those who were coming at the KARVY STOCK AGRA Branch where I done my Project. I visited other AMCs in AGRA to get some knowledge related to my topic. I studied about the products and strategies of other AMCs in AGRA to know why people prefer to invest in those AMCs. This Project covers the topic .Need

of financial advisors for mutual fund

investment The data collected has been well organized and presented. I hope the research
findings and conclusion will be of use.

Table of content
Acknowledgement Declaration Executive Summary Chapter - 1 Chapter - 2 Chapter - 3 Chapter - 4 Chapter - 5 Chapter - 6 Chapter - 7 COMPANY PROFILE INTRODUCTION OBJECTIVES AND SCOPE RESEARCH METHODOLOGY DATA ANALYSIS INTERPRETATION FINDINGS AND CONCLUSIONS SUGGESTIONS & RECOMMENDATIONS

BIBLIOGRAPHY:QUESTIONNAIRE:-

Chapter - 1

Company Profile: Introduction:

1Success is a journey, not a destination. If we look for examples to prove this quote then we can find many but there is none like that of karvy. Back in the year 1981, five people created history by establishing karvy and company which is today known as karvy, the largest financial service provider of India. 2 Success sutras of karvy: The success story of karvy is driven by 8 success sutras adopted by it namely trust, integrity, dedication, commitment, enterprise, hard work and team play, learning and innovation, empathy and humility. These are the values that bind success with karvy. 3 Vision of karvy: To achieve & sustain market leadership, Karvy shall aim for complete customer satisfaction, by combining its human and technological resources, to provide world class quality services. In the process Karvy shall strive to meet and exceed customer's satisfaction and set industry standards.

4 Mission statement:Our mission is to be a leading and preferred service provider to our

customers, and we aim to achieve this leadership position by building an innovative, enterprising , and technology driven organization which will set the highest standards of service and business ethics.

5 Karvy was established as karvy and company by five chartered accountants during the year
1979-80, and then its work was confined to audit and taxation only. Later on it diversified into financial and accounting services during the year 1981-82 with a capital of rs.150000. it achieved its first milestone after its first investment in technology. Karvy became a known name during the year 1985-86 when it forayed into capital market as registrar.

6 Evolution of KARVY:
It is well said that success is a journey not a destination and we can see it being proved by karvy. Under this section we will see that how this karvy and company of 1980 became karvy of 2008. Karvy blossomed with the setting up of its first branch at Mumbai during the year 198788. The turning point came in the year 1989 when it decided to enter into one of the not only

emerging rather potential field too i.e; stock broking. It added the feather of stock broking into its cap. At the same time it became the member of Hyderabad Stock Exchange through associate firm karvy securities ltd and then karvy never looked back..it went on adding services one after another, it entered into retail stock broking in the year 1990. Karvy investor service centers were set up in the year 1992. Karvy which already enjoyed a wide network through its investor service centers, entered into financial product distribution services in the year 1993. One year more and karvy was now dealing into mutual fund services too in the year 1994 but it didnt stopped there, it stepped into corporate finance and investment banking in the year 1995.Karvys strategy has always been being the first entrant in the market. Karvy again hit the limelight by becoming the first registrar in the country to be awarded ISO 9002 in the year 1997. Then it stepped into the other most happening sector i.e; IT enabled services by establishing its own BPO units and at a gap of just 1 year it took the path of e-Business through its website www.karvy.com . Then it entered into insurance services in the year 2001 with the launch of its retail arm karvy- the finapolis: your personal finance advisor. Then in the year 2002 it launched its PCG(Private Client Group) which looks after its High Networth Individuals .and maintain their portfolio and provides them with other financial services. In the year 2003, it commenced secondary debt and WDM trading. 8 It was a decade which saw many Indian companies going global..so why the largest

financial service provider of India should lag behind? Hence, karvy launched karvy global services limited after entering into a joint venture with Computershare, Australia in the year 2004.the year 2004 also saw karvy entering into commodities marketing through karvy comtrade.Year 2005 saw karvy establishing a separate branch for its insurance services under the head karvy insurance broking ltd and in the same year, after being impressed with the rapid growth of karvy stock broking limited, PCG group of Hong Kong acquired 25% stake at KSBL. In the year 2006, karvy entered into one of the hottest sector of present time i.e real estate through Karvy realty& services (India) ltd. hence , we can see now karvy being established as the lagest financial service provider of the country.

Now karvy group consists of 7 highly renowned entities which are as follow:

1. : The first securities registry to receive ISO 9002 certification in India. Registered with SEBI as Category I Registrar, is Number 1 Registrar in the Country. The award of being Most Admired Registrar is one among many of the acknowledgements we received for our customer friendly and competent services.

2. : karvy stock broking ltd. Consists of five units namely stock broking servics, depository participant, advisory services, distribution of financial products, advisory services and private client goups.

3. : it is registered with SEBI as a category 1 merchant banker. Its clientele includesinclude leading corporates, State Governments, foreign institutional investors, public and private sector companies and banks, in Indian and global markets.

4. : karvy insurance broking ltd is also a part of karvy stock broking ltd. At Karvy Insurance Broking Limited both life and non-life insurance products are provided to retail individuals, high net-worth clients and corporates.

5. : The company provides investment, advisory and brokerage services in Indian Commodities Markets. And most importantly, it offer a wide reach through our branch network of over 225 branches located across 180 cities.

6. : Karvy Global is a leading business and knowledge process outsourcing Services Company offering creative business solutions to clients globally. It operates in banking and financial services, inurance, healthcare and pharmaceuticals, media , telecom and technology. It has its sales and business development office in New York, USA and the offshore global delivery center in Hyderabad, India

7 : it is a joint venture between Computershare, Australia and Karvy Consultants Limited, India in the registry management services industry. Organization structure of karvy: talking about the organization structure of karvy, we have the board of directors as the supreme governing body , the chairman being Mr. C parthasarthy, mr. m yugandhar as the managing director, mr ms ramakrishna and mr. Prasad v. potluri as directors.The board of diretors head the karvy group, karvy computershares limited, karvy investors services ltd., karvy comtrade, karvy stock broking ltd., and karvy global services ltd. Karvy group being the flagship company looks after the functional departments such as corporate affairs, group human resources, finance & accounting, training & development, technology services and corporate quality.Karvy computershare private limited facilitates mutual fund services, share registry and issue registry whereas merchant banking is looked after by karvy investor services ltd. Karvy stock broking ltd heads its another branch too ie. Karvy insurance broking ltd. The services offered by KSBL are: stock broking, depository, research, distribution, personal client group and institutional desk. And finally the BPO services are managed by karvy global services ltd.Summarizing it in a diagram, it can be presented as:

Spectrum of services offered by karvy: Karvy being the top registrar and transfer agent, functions as registrar in most of the issues in the country. Talking about the mutual fund services offered by karvy, we can get the products of 33 AMCs over here. it deals in both closed ended funds as well as open ended too. Now one must

be thinking why to get the mutual funds from karvy instead of getting it directly from AMCs??? we have great reasons for it: the first one being ; if we avail the services of karvy then we can get the information about all the AMCs and their products at a single place along with expert recommendations whereas at an AMC we can get information about the products of that specific AMC only. And the second being wide network of karvy.nowadays we can find karvy offices at remote areas too.Along with these, karvy is very well handling the role of depository participant. Being registered with both the depositories i.e.; NSDL (national securities depository ltd) and CDSL (central depository services ltd), karvy can have access to both. Its wide network also facilitates it in distribution of retail financial products. Karvy believes in being updated always. So it is always ready to use latest technologies so that its clients always be in touch with the latest happenings along with karvy. It offers e-business through internet through its website: www.karvy.com . Other than it, it also provides its various services through SMSes.Karvys services are not limited to its investors only rather its offerings are for its corporate clients and distributors too. it is very well aware of the fact that in this era of neck to neck competition, we cant ignore any of the aspects of our business.so theres a offering for everybodyeveryones welcome at karvy. Why should investors choose for karvy? Excellence is next to nothing.and here at karvy everybody tries their best to offer excellent services to its clientele through its offerings maintaining the karvy culture which includes: 1. Controlled and low cost service culture: karvy is there to serve its client at the minimum possible cost. it controls cost by its various cost- cutting techniques and minimization of avoidable costs. 2. Large volume processing capability: being the largest financial service provider in the country, it has the unique distinction of operating its activities on a large scale which benefits all the parties cordially. 3. Adherence to strict time schedule: karvy knows that time is money and tries it best to finish the task within the stipulated time schedule. 4. Expertise in coordinating multi-location responses: karvy has got a wide network and hence one can find its branches at most of the places in India. Thus it enjoys its presence everywhere and coordinates among itself in solving the queries and in responding to any situation. 5.Expertise in managing independent entities such as banks, post-office etc.: the work culture of karvy and the ethics followed inside karvy makes its workforce compatible with everybody, so the karvy people establishes good coordination with independent entities too. 6. Pooling of group resources: karvy group consists of eight subsidiaries, so it can easily pool up its resources for accomplishment of its goals, whenever needed. The groups can help eachother whenever there are peaks and lows, and even in the case when they have huge targets just as we saw few years back, Tata group pooling its resources to acquire Corus. How karvy achieved it? The core competency of karvy lies in the following points due to which it enjoys a competitive

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edge over its competitors. The following culture adopted by karvy makes it all time favorite among its clientele: 1. Professionally managed by qualified and trained manpower. 2. Uniquely structured in-house software and hardware department 3. Query handling within 48 hrs. 4. Strong secretarial, accounting and audit systems. 5. Unique work culture of working 7 days a week in 3 shifts. 6. Unmatched network spreading all over India. How Achievements sounds synonymous to karvy: The landmarks achieved by karvy very well define its success story. In the previous pages, we learnt how a company started by five chartered accountants, named as karvy and company turned into todays karvy group, the largest financial intermediary of India. But success didnt came to karvy at a flow, the hard work and dedication of its workforce made it what it is todaygradually it achieved the following landmarks and now it has became what we call the karvy group, now it is: 1.largest independent distributor for financial products. 2.amongst the top 5 stock broker. 3.among the top 3 depository participants. 4.largest network of branches & business associates. 5.ISO 9002 certified operations by DNV. 6.Amongst top 10 investment bankers. 7.adjudged as one of the top 50 IT users in India by MIS south Asia. 8.full- fledged IT driven operation. 9.Indias no.1 registrar & securities transfer agent. Clientele of karvy: Karvys culture has helped karvy in achieving such a distinct position in the market where it can boast of its huge client base. Be it a retail investor investing Rs. 500 in a SIP in Reliance mutual fund or be it the largest corporate house of the country: Reliance industries- everybody is heading towards karvy for their wealth maximization, lets have a look at the clientele of karvy : According to the datas published in year 2007, karvy stock broking ltd. Operates through more than 12000 terminals, more than 290000 accounts are maintained and commands over 3.14% market share of NSE. The distribution services has access to more than Rs. 40 billion Assets Under Management. Karvy being a depository participant with both NSDL and CDSL, manages more than 700000 accounts from more than 380 locations. Talking about the registry services, it manages over 750 public/ right issues.at the same time, it is managing over 16 million portfolios as registrar. If we took a look at some of the top corporate houses availing the services of karvy then we have Reliance, IOC, IDBI,LIC, Hindustan Unilever, Principal Mutual Fund, Due tsche Mutual Fund, Yogokawa, Marico Industries, Patni Computers, Morgan Stanley, Glenmark, CRISIL, 3M, AGRA Mahindra Bank, Bharti Televenture, Infosys Technologies, Wipro, Infotech, IPCL,TATA consultancy services, UTI mutual fund etc. Thus in total karvy serves over 16 million investors and 300 corporates.

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Chapter - 2 Introduction:
INTRODUCTION TO MUTUAL FUND AND ITS VARIOUS ASPECTS.

Mutual fund is a trust that pools the savings of a number of investors who share a common financial goal. This pool of money is invested in accordance with a stated objective. The joint ownership of the fund is thus Mutual, i.e. the fund belongs to all investors. The money thus collected is then invested in capital market instruments such as shares, debentures and other securities. The income earned through these investments and the capital appreciations realized are shared by its unit holders in proportion the number of units owned by them. Thus a Mutual Fund is the most suitable investment for the common man as it offers an opportunity to invest in a diversified, professionally managed basket of securities at a relatively low cost. A Mutual Fund is an investment tool that allows small investors access to a well diversified portfolio of equities, bonds and other securities. Each shareholder participates in the gain or loss of the fund. Units are issued and can be redeemed as needed. The funds Net Asset value (NAV) is determined each day. Investments in securities are spread across a wide cross-section of industries and sectors and thus the risk is reduced. Diversification reduces the risk because all stocks may not move in the same direction in the same proportion at the same time. Mutual fund issues units to the investors in accordance with quantum of money invested by them. Investors of mutual funds are known as unit holders.

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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.

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ADVANTAGES OF MUTUAL FUND Portfolio Diversification Professional management Reduction / Diversification of Risk Liquidity Flexibility & Convenience Reduction in Transaction cost Safety of regulated environment Choice of schemes Transparency

DISADVANTAGE OF MUTUAL FUND No control over Cost in the Hands of an Investor No tailor-made Portfolios Managing a Portfolio Funds Difficulty in selecting a Suitable Fund Scheme

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HISTORY OF THE INDIAN MUTUAL FUND INDUSTRY (AUM) was Rs67 billion. The private sector entry to the fund family raised the Aum to 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. Though the growth was slow, but it accelerated from the year 1987 when non-UTI players entered the Industry. In the past decade, Indian mutual fund industry had seen a dramatic improvement, both qualities wise as well as quantity wise. Before, the monopoly of the market had seen an ending phase; the Assets Under Management Rs. 470 billion in March 1993 and till April 2004; it reached the height if Rs.

1540 billion.The Mutual Fund Industry is obviously growing at a tremendous space with the mutual fund industry can be broadly put into four phases according to the development of the sector. Each phase is briefly described as under.

First Phase 1964-87

Unit Trust of India (UTI) was established on 1963 by an Act of Parliament 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 UTI had Rs.6,700 crores of assets under management. end of 1988

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 Can 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)

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. As at the end of January 2003, there were 33 mutual funds with total assets of Rs. 1,21,805 crores.

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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 schemesThe 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. consolidation and growth. As at the end of

September, 2004, there were 29 funds, which manage assets of Rs.153108 crores under 421 schemes.

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Mutual funds can be classified as follow: Based on their structure: Open-ended funds: Investors can buy and sell the units from the fund, at any point of time. Close-ended funds: These funds raise money from investors only once. Therefore, after the
offer period, fresh investments cannot be made into the fund. If the fund is listed on a stocks exchange the units can be traded like stocks (E.g., Morgan Stanley Growth Fund). Recently, most of the New Fund Offers of close-ended funds provided liquidity window on a periodic basis such as monthly or weekly. Redemption of unit scan be made during specified intervals. Therefore, such funds have relatively low liquidity.

Based on their investment objective: Equity funds: These funds invest in equities and equity related instruments. Withfluctuating
share prices, such funds show volatile performance, even losses. However, short term fluctuations in the market, generally smoothens out in the long term, there by offering higher returns at relatively lower volatility. At the same time, such funds can yield great capital appreciation as, historically, equities have outperformed all asset classes in the long term. Hence, investment in equity funds should be considered for a period of at least 3-5 years.

It can be further classified as: i) Index funds- In this case a key stock market index, like BSE Sensex or Nifty is tracked.
Their portfolio mirrors the benchmark index both in terms of composition and individual stock weightages. ii) Equity diversified funds- 100% of across different sectors and stocks. iii|) Dividend yield funds- it is similar to the equity diversified funds except that they invest in companies offering high dividend yields. iv) Thematic funds- Invest 100% of the assets in sectors which are related through some theme.e.g. -An infrastructure fund invests in power, construction, cements sectors etc. v) Sector funds- Invest 100% of the capital in a specific sector. e.g. - A banking sector fund will invest in banking stocks. the capital is invested in equities spreading

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vi) ELSS- Equity Linked Saving Scheme provides tax benefit to the investors.Balanced fund: Their investment portfolio includes both debt and equity. As a result, on mutual funds vehicle for investors who prefer spreading their risk across various instruments.

Following are balanced funds classes: i)Debt-oriented funds -Investment below 65% in equities.
ii) Equity-oriented funds -Invest at least 65% in equities, remaining in debt.Debt fund: Theyinvest only in debt instruments, and are a good option for investors averse to idea of taking risk associated with equities. Therefore, they invest exclusively in fixed-income instruments like bonds, debentures, Government of India securities; and money market instruments such as certificates of deposit (CD), commercial paper horizon and needs.i) Liquid funds- These funds invest 100% in money market instruments, a large portion being invested in call

money mark ii)Gilt funds ST- They invest 100% of their portfolio in government securities of and T-bills. iii) Floating rate funds - Invest in short-term debt papers. Floaters invest in debt instruments which have variable coupon rate. iv) Arbitrage fund- They generate income through arbitrage opportunities due to mis-pricing between cash market and derivatives market. Funds are allocated to equities, derivatives and

money markets. Higher proportion (around 75%) is put in money markets,in the absence of arbitrage opportunities. v) Gilt securities. vi) Income funds LT- Typically, such funds invest a major portion of the portfolio in longterm debt papers. vii) MIPs- Monthly Income Plans have exposure of 10%-30% to equities. viii) FMPs- fixed monthly plans invest in debt papers whose maturity is in line with that of the fund. INVESTMENT STRATEGIES 1. Systematic Investment Plan: under this a fixed sum is invested each month on a fixed date of a month. Payment is made through post dated cheques or direct debitfacilities. The investor gets fewer units when the NAV is high and more units when the NAV is low. This is called as the benefit of Rupee Cost Averaging (RCA) an exposure of 70%-90% to debt and an

funds LT- They invest 100% of their portfolio in long-term government

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2. Systematic Transfer Plan: under this an investor invest in debt oriented fund and give instructions to transfer a fixed sum, at a fixed interval, to an equity scheme of the same mutual fund. 3. Systematic Withdrawal Plan: if someone wishes to withdraw from a mutual fund then he can withdraw a fixed amount each month.

ADVANTAGES OF MUTUAL FUNDS There are numerous benefits of investing in mutual funds and one of the key reasons for its phenomenal success in the developed markets like US and UK is the range of benefits they offer, which are unmatched by most other investment avenues. We have explained the key benefits in this section. The benefits have been broadly split into universal benefits, applicable to all schemes, and benefits applicable specifically to open-ended schemes.

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Universal Benefits Affordability: A mutual fund invests in a portfolio of assets, i.e. bonds, shares, etc. depending upon the investment objective of the scheme. An investor can buy in to a portfolio of equities, which would otherwise be extremely expensive. Each unit holder thus gets an exposure to such portfolios with an investment as modest as Rs.500/-. This amount today would get you less than quarter of an Infosys share! Thus it would be affordable for an investor to build a portfolio of investments through a mutual fund rather than investing directly in the stock market. Diversification The nuclear weapon in your arsenal for your fight against Risk. It simply means that you must spread your investment across different securities (stocks, bonds, money market instruments, real estate, fixed deposits etc.) and different sectors (auto, textile, information technology etc.). This kind of a diversification may add to the stability of your returns, for example during one period of time equities might under perform but bonds and money market instruments might do well enough to offset the effect of a slump in the equity markets. Similarly the information technology sector might be faring poorly but the auto and textile sectors might do well and may protect your principal investment as well as help you meet your return objectives. Variety Mutual funds offer a tremendous variety of schemes. This variety is beneficial in two ways: first, it offers different types of schemes to investors with different needs and risk appetites; secondly, it offers an opportunity to an investor to invest sums across a variety of schemes, both debt and equity. For example, an investor can invest his money in a Growth Fund (equity scheme) and Income Fund (debt scheme) depending on his risk appetite and thus create a balanced portfolio easily or simply just buy a Balanced Scheme. Professional Management: Qualified investment professionals who seek to maximize returns and minimize risk monitor investor's money. When you buy in to a mutual fund, you are handing your money to an investment professional who has experience in making investment decisions. It is the Fund Manager's job to (a) find the best securities for the fund, given the fund's stated investment objectives; and (b) keep track of investments and changes in market conditions and adjust the mix of the portfolio, as and when required. Tax Benefits: Any income distributed after March 31, 2002 will be subject to tax in the assessment of all Unit holders. However, as a measure of concession to Unit holders of openended equity-oriented funds, income distributions for the year ending March 31, 2003, will be taxed at a concessional rate of 10.5%.In case of Individuals and Hindu Undivided Families a deduction up to Rs. 9,000 from the Total Income will be admissible in respect of income from investments specified in Section 80L, including income from Units of the Mutual Fund. Units of the schemes are not subject to Wealth-Tax and Gift-Tax.Regulations: Securities Exchange Board of India (SEBI), the mutual funds regulator has clearly defined rules, which govern mutual funds. These rules relate to the formation, administration and management of mutual funds and also prescribe disclosure and accounting requirements. Such a high level of regulation seeks to protect the interest of investors

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Benefits of Open-ended Schemes: Liquidity: In open-ended mutual funds, you can redeem all or part of your units any time you
wish. Some schemes do have a lock-in period where an investor cannot return the units until the completion of such a lock-in period.

Convenience: An investor can purchase or sell fund units directly from a fund, through a
broker or a financial planner. The investor may opt for a Systematic Investment Plan (SIP) or a Systematic Withdrawal Advantage Plan (SWAP). In addition to this an investor receives account statements and portfolios of the schemes.

Flexibility: Mutual Funds offering multiple schemes allow investors to switch easily between
various schemes. This flexibility gives the investor a convenient way to change the mix of his portfolio over time.

Transparency: Open-ended mutual funds disclose their Net Asset Value (NAV) daily and
the entire portfolio monthly. This level of transparency, where the investor himself sees the underlying assets bought with his money, is unmatched by any other financial instrument. Thus the investor is in the know of the quality of the portfolio and can invest further or redeem depending on the kind of the portfolio that has been constructed by the investment manager.

RISK FACTORS OF MUTUAL FUNDS The Risk-Return Trade-off: The most important relationship to understand is the risk-return
trade-off. Higher the risk greater the returns/loss and lower the risk lesser the returns/loss. Hence it is up to you, the investor to decide how much risk you are willing to take. In order to do this you must first be aware of the different types of risks involved with your investment decision.

Market Risk: Sometimes prices and yields of all securities rise and fall. Broad outside
influences affecting the market in general lead to this. This is true, may it be big corporations or smaller mid-sized companies. This is known as Market Risk. A Systematic Investment Plan (SIP) that works on the concept of Rupee Cost Averaging (RCA) might help mitigate this risk. Credit Risk: The debt servicing ability (may it be interest payments or repayment of principal) of a company through its cashflows determines the Credit Risk faced by you. This credit risk is measured by independent rating agencies like CRISIL who rate companies and their paper. A AAA rating is considered the safest whereas a D rating is considered poor credit quality. A well-diversified portfolio might help mitigate this risk. Inflation Risk: Things you hear people talk about: "Rs. 100 today is worth more than Rs. 100 tomorrow." "Remember the time when a bus ride costed 50 paise?""Mehangai Ka Jamana Hai."The root cause, Inflation. Inflation is the loss of purchasing power over time. A lot of times people make conservative investment

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decisions to protect their capital but end up with a sum of money that can buy less than what the principal could at the time of the investment. This happens when inflation grows faster than the return on your investment. A well-diversified portfolio with some investment in equities might help mitigate this risk.

Interest Rate Risk: In a free market economy interest rates are difficult if not impossible to
predict. Changes in interest rates affect the prices of bonds as well as equities. If interest rates rise the prices of bonds fall and vice versa. Equity might be negatively affected as well in a rising interest rate environment. A well-diversified portfolio might help mitigate this risk. Political/Government Policy Risk: Changes in government policy and political decision can change the investment environment. They can create a favorable environment for investment or vice versa.

Liquidity Risk: Liquidity risk arises when it becomes difficult to sell the securities that one has
purchased. Liquidity Risk can be partly mitigated by diversification, staggering of maturities as well as internal risk controls that lean towards purchase of liquid securities.Various investment options in Mutual Funds offer To cater to different investment needs, Mutual Funds offer various investment options. Some of the important investment options include: Growth Option: Dividend is not paid-out under a Growth Option and the investor realises only the capital appreciation on the investment (by an increase in NAV).

Dividend Payout Option: Dividends are paid-out to investors under the Dividend Payout
Option. However, the NAV of the mutual fund scheme falls to the extent of the dividend payout. Dividend Re-investment Option: Here the dividend accrued on mutual funds is automatically reinvested in purchasing additional units in open-ended funds. In most cases mutual funds offer the investor an option of collecting dividends or re-investing the same. Retirement Pension Option: Some schemes are linked with retirement pension. Individuals participate in these options for themselves, and corporates participate for their employees. Insurance Option: Certain Mutual Funds offer schemes that provide insurance cover to investors as an added benefit.

Systematic Investment Plan (SIP): Here the investor is given the option of preparing a predetermined number of post-dated cheques in favour of the fund. The investor is allotted units on a predetermined date specified in the offer document at the applicable NAV.

Systematic Withdrawal Plan (SWP): As opposed to the Systematic Investment Plan, the
Systematic Withdrawal Plan allows the investor the facility to withdraw a pre-determined amount / units from his fund at a pre-determined interval. The investor's units will be redeemed at the applicable NAV as on that day. Future of Mutual Funds in IndiaBy December 2004, Indian mutual fund industry reached Rs 1,50,537 crore. It is estimated that by 2010 March-end, the total assets of all scheduled commercial banks should be Rs 40,90,000 crore.The annual composite rate of growth is expected 13.4% during the rest of the decade. In the last 5 years we have seen annual growth rate of 9%. According to the current growth rate, by year 2010, mutual fund assets will be double.

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VALUATION OF MUTUAL FUND The net asset value of the Fund is the cumulative market value of the assets Fund net of its liabilities. In other words, if the Fund is dissolved or liquidated, by selling off all the assets in the Fund, this is the amount that the shareholders would collectively own. This gives rise to the concept of net asset value per unit, which is the value, represented by the ownership of one unit in the Fund. It is calculated simply by dividing the net asset value of the Fund by the number of units. However, most people refer loosely to the NAV per unit as NAV, ignoring the per unit. We also abide by the same convention. Calculation of NAV The most important part of the calculation is the valuation of the assets owned by the Fund. Once it is calculated, the NAV is simply the net value of assets divided by the number of units outstanding. The detailed methodology for the calculation of the net asset value is given below.The net asset value is the actual value of a unit on any business day. NAV is the barometer of the performance of the scheme. The net asset value is the market value of the assets of the scheme minus its liabilities and expenses. The per unit NAV is the net asset value of the scheme divided by the number of the units outstanding on the valuation date.Equity or Growth SchemeThese schemes, also commonly called Growth Schemes, seek to invest a majority of their funds in equities and a small portion in money market instruments. Such schemes have the potential to deliver superior returns over the long term. However, because they invest in equities, these schemes are exposed to fluctuations in value especially in the short term. In this equity or growth scheme segment I selected the following schemes in the selected AMCs Balanced Scheme The aim of Balanced Funds is to provide both growth and regular income. Such schemes periodically distribute a part of their earning and invest both in equities and fixed income securities in the proportion indicated in their offer documents. This proportion affects the risks and the returns associated with the balanced fund - in case equities are allocated a higher proportion, investors would be exposed to risks similar to that of the equity market. Balanced funds with equal allocation to equities and fixed income securities are ideal for investors looking for a combination of income and moderate growth. In this balanced fund scheme segment I selected the following schemes in the selected AMCs

SBI Magnum Balance Fund has not been given any rating by CRISIL but it has been performing well. The investments of the Funds are well diversified in both Equity and Debt. The total Equity Holdings as on April 30th stands at 67.77% of the total assets. It has out performed CRISIL Balanced Fund Index by 45.38% for the 52 weeks period. Principal Balanced Fund has ranked CP3 by CRISAL, which means average in the open-ended balanced Fund category and ranks within the top 70% of the 19 schemes in this category. It has invested 67% in Equity and about 16% in Government Securities. In Equity it invested primarily in Pharmaceuticals, Construction Materials, Automobiles and banks.Franklin Templeton India Balanced Fund invested about 70% of its assets in Equity and 75% in Debts. The recent additions to its portfolio are Reliance

23

Industries, Asian paints and BPCL. It invests primarily in IT consulting, auto parts equipment, Banks, Tele Electrical industrial conglomerates. It invested mainly in the AAA rated Debts. Kotak Balance Fund has invested close to 70% in Equity and about 30% in Debt instruments and Short Term Deposits. The Fund has a well-diversified portfolio of equity with prime investments in BHEL, Siemens EID parry, Bulrampur Chini and SBI. In the debt Instruments it has invested in Railway Bonds and 2003 maturing Government Stock.SBI Magnum Income Fund is performing very well right from the inception with generous payment of dividends has been assigned AAA rating by CRISIL. The Fund invests about 90% in AAA rated securities and more than 60% of its investments have a maturity ranging between 3 to 10 years. I has come with bonuses in Jan 2003 1:3 and September 2003 1:10. However, it under perform vis--vis CRISIL Comp. Bond Fund index by 0.14.Principal Income Fund has ranked CP3 by CRISAL, which means average in the open-ended debt category and ranks within the top 70% of the 21 schemes in this category. The investments have average maturity of 7.3 years with more than 50% investments having a maturity of above 7 years. It has invested close to 50% in Government Securities, above 40% in NCD/Deep Discount Bonds.Franklin Templeton India Income Fund has most of the investments in low risk AAA and sovereign securities. Above 45% of the investments are in Gilt, 25% in PSU/PFI bonds and 24% in corporate Debts. The average maturity of this scheme is at 4.87 years. The performance of the Fund is inline with CRISIL Composite Bond Fund.Kotak Liquid Fund has invested about close to 25% in corporate Debt, 10% in public sector undertakings, about 25% in money market instruments. It has also invested 40% in term deposits. The average maturity of portfolio is 2.3 years. Almost all the instruments are well rated implying they are safe instruments also their investments are highly diversified.

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CHAPTER 3

RESEARCH METHODOLOGY
This report is based on primary as well secondary data, however primary data collection was given more importance since it is overhearing factor in attitude studies. One of the most important users of research methodology is that it helps in identifying the problem, collecting, analyzing the required information data and providing an alternative solution to the problem .It also helps in collecting the vital information that is required by the top management to assist them for the better decision making both day to day decision and critical ones.

Data sources:
Research is totally based on primary data. Secondary data can be used only for the reference. Research has been done by primary data collection, and primary data has been collected by interacting with various people. The secondary data has been collected through various journals and websites.

Duration of Study:
The study was carried out for a period of one semester.

Sampling:
Sampling procedure: The sample was selected of them who are the customers/visitors of karvy stock broking Ltd.Agra Branch, irrespective of them being investors or not or availing the services or not. It was also collected through personal visits to persons, by formal and informal talks and through filling up the questionnaire prepared. The data has been analyzed by using mathematical/Statistical tool.

Sample size:
The sample size of my project is limited to 350 people only. Out of which only 120 people had invested in Mutual Fund. Other 230 people did not have invested in Mutual Fund.

Sample design:
Data has been presented with the help of bar graph, pie charts, line graphs etc.

Limitation:
Some of the persons were not so responsive. Possibility of error in data collection because many of investors may have not given actual answers of my questionnaire. Sample size is limited to 350 visitors of , karvy stock broking Ltd Boring Agra Branch, out of these only 120 had invested in Mutual Fund. The sample. size may not adequately represent the whole market. Some respondents were reluctant to divulge personal information which can affect the validity of all responses. The research is confined to a certain part of Agra.

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Chapter 4
Data Analysis & Interpretation

1.(a) Age distribution of the Investors of AGRA <=30 Age Group 12 No. of Investor 18 30 24 20 16 31-35 36-40 41-45 46-50 >50

35 30 25 20 15 10 5 0 <=30 31-35 36-40 41-45 46-50 >50

Age group of investor Interpretation:

According to this chart out of 120 Mutual Fund investors of Agra he most are in the age group of 36-40 yrs. i.e. 25%, the second most investors are in the age group of 41-45yrs i.e. 20% and the least investors are in the age group of below 30 yrs.

(b). Educational Qualification of investors of Agra.

Educational Qualification Graduate/ Post Graduate Under Graduate Others Total Number of Investors 88 25 7 120

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No. of Investors
Graduate/ Post Graduate 6% Under Graduate Others

21%

73%

Interpretation:
Out of 120 Mutual Fund investors 71% of the investors in Agra are Graduate/Post Graduate, 23% are Under Graduate and 6% are others (under HSC)

c). Occupation of the investors of Dehradoon

Occupation
Govt. Service Pvt. Service Business Agriculture Others

No. of Investors
30 45 35 4 6

Occupation Business

Govt. Service Agriculture 3% 5% 0% 25%

Pvt. Service Others

29%

38%

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Interpretation:
In Occupation group out of 120 investors, 38% are Pvt. Employees, 25% are Businessman, 29% are Govt. Employees, 3% are in Agriculture and 5% are in others.

(d). Monthly Family Income of the Investors of Dehradoon.

income group <=10000 10000-15000 15001-20000 20001-30000 >30000 No. of investor 5 12 28 43 32

No. of invester
<=10000 10000-15000 15001-20000 4% 10% 20001-30000 >30000

27%

23%

36%

Income Group of the Investorsn (Rs. in Th.)

Interpretation:
In the Income Group of the investors of Agra out of 120 investors, 36%investors that is the maximum investors are in the monthly income group Rs.20,001 to Rs. 30,000, Second one i.e. 27% investors are in the monthly income group of more than Rs. 30,000 and the minimum investors i.e. 4%are in the monthly income group of below Rs. 10,000

(2) Investors invested in different kind of investments.

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Kind of Investments Saving A/C Fixed deposits Insurance Mutual Fund Post office (NSC) Shares/Debentures Gold/Silver Real Estate

No. of Respondents 195 148 152 120 75 50 30 65

Kind of Investments Insurance Shares/Debentures

Saving A/C Mutual Fund Gold/Silver 4% 8% 0% 23% 14% 18% 18%

Fixed deposits Post office (NSC) Real Estate

6% 9%

Interpretation:
From the above graph it can be inferred that out of 200 people,97.5% people have invested in Saving A/c, 76% in Insurance, 74% in Fixed Deposits, 60% in Mutual Fund, 37.5% in Post Office, 25% in Shares or Debentures, 15% in Gold/Silver and32.5% in Real Estate.

3. Preference of factors while investing

Factors No. of Respondents (a) Liquidity 40 (b) Low Risk 60 (c) High Return 34 (d) Trust 36

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No. of Respondents
(a) Liquidity (b) Low Risk (c) High Return (d) Trust

21%

24%

20% 35%

Liquidity Low Risk High Return Trust

Interpretation:
Out of 200 People, 32% People prefer to invest where there is High Return, 30% prefer to invest where there is Low Risk, 20% prefer easy Liquidity and 18% prefer Trust

4. Awareness about Mutual Fund and its Operations

Response No. of Respondents Yes 135 No 65

No. of Respondents
Yes No

33%

67%

Interpretation:
From the above chart it is inferred that 67% People are aware of Mutual Fund and its operations and 33% are not aware of Mutual Fund and its operations.

5. Source of information for customers about Mutual Fund

Source of information Advertisement Peer Group No. of Respondents 18 25

30

Bank Financial Advisors

30 62

No. of Respondents
Advertisement 13%

Financial Advisors 46%

Peer Group 19%

Bank 22%

Interpretation:
From the above chart it can be inferred that the Financial Advisor is the most important source of information about Mutual Fund. Out of 135 Respondents, 46%know about Mutual fund Through Financial Advisor, 22% through Bank, 19% through Peer Group and 13% through Advertisement.

6. Investors invested in Mutual Fund

Response YES NO Total

No. of Respondents 120 80 200

No. of Respondents
250 200 150 100 50 0 YES NO Total No. of Respondents

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Interpretation:
Out of 200 People, 60% have invested in Mutual Fund and 40% do not have invested in Mutual Fund.

7. Reason for not invested in Mutual Fund

Reason Not Aware Higher Risk Not any Specific No. of Respondents 65 5 10

No. of Respondents
Not Aware Higher Risk Not any Specific Reason

6%

13%

81%

Interpretation:
Out of 80 people, who have not invested in Mutual Fund, 81% are not aware of Mutual Fund, 13% said there is likely to be higher risk and 6% do not have any specific reason.

8. Investors invested in different Assets Management Co. (AMC)

Name of AMC SBIMF UTI HDFC Reliance ICICI Prudential Kotak Others No. of Investors 55 75 30 75 56 45 70

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No. of Investors
Others 70 17% SBIMF 55 14%

Kotak 45 11%

UTI 75 19%

ICICI Prudential 56 14% Reliance 75 18%

HDFC 30 7%

Interpretation:
In Agra most of the Investors preferred UTI and Reliance Mutual Fund. Out of120 Investors 62.5% have invested in each of them, only 46% have invested in SBIMF,47% in ICICI Prudential, 37.5% in Kotak and 25% in HDFC.

9. Reason for invested in Karvy MF

Reason Associated with Karvy Better Return Agents Advice No. of Respondents 35 5 15

No. of Respondents

Agents Advice 27% Associated withKarvy 64%

Better Return 9%

1.Associated with KARVY 2. Better Return 3. Agents Advice

Interpretation:
Out of 55 investors of KARVY MF 64% have invested because of its association with Brand SBI, 27% invested on Agents Advice, 9% invested because of better return.

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10. Reason for not invested in SBIMF

Reason Not Aware Less Return Agents Advice No. of Respondents 25 18 22

No. of Respondents

Agents Advice 34%

Not Aware 38%

Less Return 28%

Not Aware Less Return Agent's Advice

Interpretation:
Out of 65 people who have not invested in SBIMF, 38% were not aware with SBIMF,28% do not have invested due to less return and 34% due to Agents Advice.

11. Preference of Investors for future investment in Mutual Fund

Name of AMC SBIMF UTI 45 HDFC Reliance ICICI Prudential kotak other No. of Investors 76 45 35 82 80 60 75

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No. of Investors
other 16% kotak 13% SBIMF 17% UTI 45 10% HDFC 8%

ICICI Prudential 18%

Reliance 18%

Interpretation:
Out of 120 investors, 18% prefer to invest in Reliance, 18% in ICICI Prudential, 17% in SBIMF, 16% in Others, 13% in Kotak, 10% in UTI and 8% in HDFC Mutual Fund.

12. Channel Preferred by the Investors for Mutual Fund Investment

Channel Financial No. of Respondents Advisor 72 Bank 18 AMC 30

No. of Respondents

AMC 25%

Bank 15%

Advisor 60%

Interpretation:
Out of 120 Investors 60% preferred to invest through Financial Advisors, 25% through AMC and 15% through Bank.

13. Mode of Investment Preferred by the Investors.

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Mode of Investment No. of Respondents

One time Investment

Systematic Investment Plan (SIP) 78 42

No. of Respondents
Systematic Investment Plan (SIP) 35% One time Investment 65%

Interpretation:
Out of 120 Investors 65% preferred One time Investment and 35 % Preferred through Systematic Investment Plan.

14. Preferred Portfolios by the Investors

Portfolio Equity Debt Balanced No. of Investors 56 20 44

No. of Investors

Balanced 37%

Equity 46%

Debt 17%

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Interpretation:
From the above graph 46% preferred Equity Portfolio, 37% preferred Balance and 17%preferred Debt portfolio.

15. Option for getting Return Preferred by the Investors

Option No. of Respondents Dividend Payout 25 Dividend Reinvestment Growth 10

85

No. of Respondents
Dividend Payout 21%

Dividend Reinvestment 8% Growth 71%

Interpretation:
From the above graph 71% preferred Growth Option, 21% preferred Dividend Payout and 8% preferred Dividend Reinvestment Option.

16. Preference of Investors whether to invest in Sectoral Funds.

Response Yes No No. of Respondents 25 95

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No. of Respondents
Yes 21%

No 79%

Interpretation:
Out of 120 investors, 79% investors do not prefer to invest in Sectoral Fund because there is maximum risk and 21% prefer to invest in Sectoral Fund.

Invested in MF Interested Not Interested Total 65 50 115

Not invested in MF 55 70 125

Total 120 120 240

Null Hypothesis: Statistically, there is no significant difference between Karvy Brokerage firm and other stock broking firm regarding their service provided. Alternative hypothesis: Yes, there is the significant difference between Karvy brokerage firm and other stock broking firm regarding their service provided. Degree of freedom () = (r-1) (c-1) => () = 1 Expectation of C11 = 120*115/240 = 27.5(approx 28)

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So, expected frequency shall be: Invested in MF Interested Not Interested 58 62 120 Not invested in MF 62 58 120 Total 120 120 240

By applying Chi-square Test, we find that Frequencies (O) 65 50 55 70 Frequencies (E) 58 62 62 58 (O-E)2 49 144 49 144 (O-E)2/E 0.08 2.32 0.79 2.48 5.67

For = 1, 2= 0.05 = 3.84 The calculated value of chi square is much more than the table value. The hypothesis is rejected. So, we can say that there is a significant difference between the services provided by karvy brokerage and other firms. By applying chi square test, we find that the value of chi-square test is 5.67which is higher than the table value which is 3.84. So, it indicates that the hypothesis is rejected and we can say that the services provided by Karvy Stock Broking Ltd is significantly different from the other leading companies.

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Findings and Conclusion

Findings
In Agra in the Age Group of 36-40 years were more in numbers. The second most Investors were in the age group of 41-45 years and the least were in the age group of below 30 years. In Agra most of the Investors were Graduate or Post Graduate and below HSC there were very few in numbers. In Occupation group most of the Investors were Govt. employees, the second most Investors were Private employees and the least were associated with Agriculture. In family Income group, between Rs. 20,001- 30,000 were more in numbers, the second most were in the Income group of more than Rs.30,000 and the least were in the group of below Rs. 10,000. About all the Respondents had a Saving A/c in Bank, 76% Invested in Fixed Deposits, Only 60% Respondents invested in Mutual fund. Mostly Respondents preferred High Return while investment, the second most preferred Low Risk then liquidity and the least preferred Trust. Only 67% Respondents were aware about Mutual fund and its operations and 33% were not. Among 200 Respondents only 60% had invested in Mutual Fund and 40% did not have invested in Mutual fund. Out of 80 Respondents 81% were not aware of Mutual Fund, 13% told there is not any specific reason for not invested in Mutual Fund and 6% told there is likely to be higher risk in Mutual Fund. Most of the Investors had invested in Reliance or UTI Mutual Fund, ICICI Prudential has also good Brand Position among investors, karvy MF places after ICICI Prudential according to the Respondents. Out of 55 investors of karvy stock 64% have invested due to its association with the Brand karvy , 27% Invested because of Advisors Advice and 9% due to better return. Most of the investors who did not invested in karvy stock broking MFdue to not Aware of t karvy MF he second most due to Agents advice and rest due to Less Return. For Future investment the maximum Respondents preferred Reliance Mutual Fund, the second most preferred ICICI Prudential, karvy Mf has been preferred after them. 60% Investors preferred to Invest through Financial Advisors, 25% through AMC (means Direct Investment) and 15% through Bank. 65% preferred One Time Investment and 35% preferred SIP out of both type of Mode of Investment. The most preferred Portfolio was Equity, the second most was Balance (mixture of both equity and debt), and the least preferred Portfolio was Debt portfolio. Maximum Number of Investors Preferred Growth Option for returns, the second most preferred Dividend Payout and then Dividend Reinvestment.

40

Most of the Investors did not want to invest in Sectoral Fund, only 21% wanted to invest in Sectoral Fund.

Conclusion Running a successful Mutual Fund requires complete understanding of the peculiarities of the Indian Stock Market and also the psyche of the small investors. This study has made an attempt to understand the financial behavior of Mutual Fund investors in connection with the preferences of Brand (AMC), Products, Channels etc. I observed that many of people have fear of Mutual Fund. They think their money will not be secure in Mutual Fund. They need the knowledge of Mutual Fund and its related terms. Many of people do not have invested in mutual fund due to lack of awareness although they have money to invest. As the awareness and income is growing the number of mutual fund investors are also growing. Brand plays important role for the investment. People invest in those Companies where they have faith or they are well known with them. There are many AMCs in Agra but only some are performing well due to Brand awareness. Some AMCs are not performing well although some of the schemes of them are giving good return because of not awareness about Brand. Reliance, UTI, Karvy, ICICI Prudential etc. they are well known Brand, they are performing well and their Assets Under Management is larger than others whose Brand name are not well known like Principle, Sunderam, etc. Distribution channels are also important for the investment in mutual fund. Financial Advisors are the most preferred channel for the investment in mutual fund. They can change investors mind from one investment option to others. Many of investors directly invest their money through AMC because they do not have to pay entry load. Only those people invest directly who know well about mutual fund and its operations and those have time.

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