EXECUTIVE SUMMARY

Kotak Mahindra is one of India's leading financial institutions, offering

complete financial solutions that encompass every sphere of life. From
commercial banking, to stock broking, to mutual funds, to life insurance, to
investment banking, the group caters to the financial needs of individuals
and corporates.

The group has a net worth of around Rs.3,200 crore and employs around
10,800 employees across its various businesses servicing around 2.6 million
customer accounts through a distribution network of branches, franchisees,
representative offices and satellite offices across 300 cities and towns in
India and offices in New York, London, Dubai, Mauritius and Singapore.

Kotak Mahindra Asset Management Company Limited (KMAMC), a

wholly owned subsidiary of KMBL, is the Asset Manager for Kotak
Mahindra Mutual Fund (KMMF). KMAMC started operations in December
1998 and has over 4 Lac investors in various schemes. KMMF offers
schemes catering to investors with varying risk - return profiles and was the
first fund house in the country to launch a dedicated gilt scheme investing
only in government securities.

It is sponsored by Kotak Mahindra Bank Limited, one of India's fastest

growing banks, with a pedigree of over twenty years in the Indian Financial
Markets. Kotak Mahindra Asset Management Co. Ltd., a wholly owned
subsidiary of the bank, is our

1
 INDEX

S.NO PARTICULARS PAGE NO.

1 INTRODUCTION 1

2 OBJECTIVE & METHOLOGY 4

2.1 Objective 5

2.2 Research methodology 6

3 DATA ANALYSIS 7

3.1 Company Profile 8

3.2 Mutual funds and types 9

3.3 Global scenario 29

3.4 Products 33

3.5 Awards 43

4 SUGGESTIONS 47

5 CONCLUSIONS 50

6 BIBLIOGRAPHY 52

2
CHAPTER 1:
INTRODUCTION

3
1.1 INTRODUCTION
“The more savings and investments, the more growth”
-An oft – quoted maxim in Development economics

The importance of savings and investment in development process

cannot be overemphasized. The rate of capital accumulation is a key
determinant of economic growth in developing countries like India.
Capital accumulation can be defined as
“The continuous acquisition and growth of capital stock
through the saving and investment process”
Thus savings forms an important part of economy of any nation. With
savings invested in various options available to the people, the
money act as the driver for growth of the country. Indian financial
scene too presents multiple avenues to the investors.

Mutual funds: Universal appeal

Investment goals vary from person to person. While somebody

requires security, others may give more weightage to return alone.
Somebody else might want to plan for their child’s education while
somebody might be saving or the proverbial rainy days or even lie
after retirement. With objective defying any range, it is obvious that
the product required will vary as well.
Though still at the nascent stage, Indian mutual fund industry offers a
plethora of schemes and serves broadly all types of investors. The
range of products includes equity, debt, liquid gift and balanced fund.
There are mutual funds meant exclusively for young and old, small
and large investors. Moreover, the setup of legal structure, which has
enough teeth to safeguard investor’s interest, ensures that the
investors are not cheated out of their hard earned money. All in all,
benefits provided by them cut across the boundaries of investor’s
category and thus create for them, a universal appeal.

4
The Indian Mutual Fund Industry: An Overview

The mutual fund industry in India began with the setting up of the unit
trust of India (UTI) in 1964 by the government of India. During the last
41 years UTI has grown to be a dominant player in the industry. The
UTI is governed by a special legislation, the unit trust of India 1963. In
1987 public sector banks and insurance companies were allowed to
setup mutual fund and accordingly since 1987, 6 private sector banks
have setup mutual fund. Also two insurance companies LIC and GIC
established mutual funds. Security exchange board of India (SEBI)
formulated the mutual fund (regulation) 1993, which for the first time
established a comprehensive regulatory framework for the mutual
fund industry. Since than many mutual fund have been set up by the
private and joint sector.

5
CHAPTER 2:
OBJECTIVE AND
METHODOLOGY

6
2.1 OBJECTIVE

The objectives of the project are:

• To understand the types of products.

• To define and understand mutual funds and
its types from the company’s point of view.
• To notice the awards won by the company.
• Analyze briefly the performance of the
company.

7
2.2 RESEARCH METHODOLOGY

The data collected for the project mainly pertains to secondary

sources i.e. issued by the company or by associations or
government.

Secondary Sources

Information regarding the financial market was extracted from the

internet, various books authored by noted financial thinkers,
magazines, prospectus of different companies and newspapers. This
data served as a platform on which the later parts of the project were
built up. This provided an overview and understanding of the financial
markets, and various trends in the industry also came to the fore.
Taking lead from the information gained through these sources,
analysis of the perceptions of the respondents became all the more
comprehensive.
More specially, following pieces of information were garnered using
the secondary sources:
• History of mutual funds in the international market and in India.
• International and national developments that had a bearing
upon these markets.
Details regarding various indices and comparable mutual funds,
which were holistically contrasted.

8
CHAPTER 3:
DATA ANALYSIS

9
3.1 COMPANY PROFILE

Kotak Mahindra is one of India's leading financial institutions,

offering complete financial solutions that encompass every sphere of
life. From commercial banking, to stock broking, to mutual funds, to
life insurance, to investment banking, the group caters to the financial
needs of individuals and corporates.

The group has a net worth of around Rs.3,200 crore and employs
around 10,800 employees across its various businesses servicing
around 2.6 million customer accounts through a distribution network
of branches, franchisees, representative offices and satellite offices
across 300 cities and towns in India and offices in New York, London,
Dubai, Mauritius and Singapore.

10
3.2 MUTUAL FUNDS: DEFINITION AND TYPES

Mutual Fund: What Are Mutual Funds?

The Definition

A mutual fund is simply a financial intermediary that allows a group of

investors to pool their money together with a predetermined
investment objective. The mutual fund will have a fund manager who
is responsible for investing the pooled money into specific securities
(usually stocks or bonds). When you invest in a mutual fund, you are
buying shares (or portions) of the mutual fund and become a
shareholder of the fund.

Mutual funds are one of the best investments ever created because
they are very cost efficient and very easy to invest in (you don't have
to figure out which stocks or bonds to buy).

By pooling money together in a mutual fund, investors can purchase

stocks or bonds with much lower trading costs than if they tried to do
it on their own. But the biggest advantage to mutual funds is
diversification.

You can make money from a mutual fund in three ways:

1) Income is earned from dividends on stocks and interest on bonds.
A fund pays out nearly all income it receives over the year to fund
owners in the form of a distribution.
2) If the fund sells securities that have increased in price, the fund
has a capital gain. Most funds also pass on these gains to investors
in a distribution.
3) If fund holdings increase in price but are not sold by the fund
manager, the fund's shares increase in price. You can then sell your
mutual fund shares for a profit.
Funds will also usually give you a choice either to receive a check for
distributions or to reinvest the earnings and get more shares.

11
History of The Indian Mutual Fund Industry

The mutual fund industry in India started in 1963 with the formation of
Unit Trust of India, at the initiative of the Government of India and
Reserve Bank the. The history of mutual funds in India can be
broadly divided into four distinct phases

First Phase – 1964-87

Unit Trust of India (UTI) was established on 1963 by an Act of

Parliament. It was set up by the Reserve Bank of India and
functioned under the Regulatory and administrative control of the
Reserve Bank of India. In 1978 UTI was de-linked from the RBI and
the Industrial Development Bank of India (IDBI) took over the
regulatory and administrative control in place of RBI. The first scheme
launched by UTI was Unit Scheme 1964. At the end of 1988 UTI had
Rs.6,700 crores of assets under management.

Second Phase – 1987-1993 (Entry of Public Sector Funds)

1987 marked the entry of non- UTI, public sector mutual funds set up
by public sector banks and Life Insurance Corporation of India (LIC)
and General Insurance Corporation of India (GIC). SBI Mutual Fund
was the first non- UTI Mutual Fund established in June 1987 followed
by Canbank Mutual Fund (Dec 87), Punjab National Bank Mutual
Fund (Aug 89), Indian Bank Mutual Fund (Nov 89), Bank of India (Jun
90), Bank of Baroda Mutual Fund (Oct 92). LIC established its mutual
fund in June 1989 while GIC had set up its mutual fund in December
1990. At the end of 1993, the mutual fund industry had assets under
management of Rs.47,004 crores.

Third Phase – 1993-2003 (Entry of Private Sector Funds)

With the entry of private sector funds in 1993, a new era started in the
Indian mutual fund industry, giving the Indian investors a wider choice
of fund families. Also, 1993 was the year in which the first Mutual
Fund Regulations came into being, under which all mutual funds,
except UTI were to be registered and governed. The erstwhile Kothari
Pioneer (now merged with Franklin Templeton) was the first private
sector mutual fund registered in July 1993. The 1993 SEBI (Mutual
Fund) Regulations were substituted by a more comprehensive and
revised Mutual Fund Regulations in 1996. The industry now functions

12
under the SEBI (Mutual Fund) Regulations 1996. Kotak group made
its mark in mutual fund space with Kotak Mutual Funds in 1998. The
number of mutual fund houses went on increasing, with many foreign
mutual funds setting up funds in India and also the industry has
witnessed several mergers and acquisitions. As at the end of January
2003, there were 33 mutual funds with total assets of Rs. 1,21,805
crores. The Unit Trust of India with Rs.44,541 crores of assets under
management was way ahead of other mutual funds.

Fourth Phase – since February 2003

In February 2003, following the repeal of the Unit Trust of India Act
1963 UTI was bifurcated into two separate entities. One is the
Specified Undertaking of the Unit Trust of India with assets under
management of Rs.29,835 crores as at the end of January 2003,
representing broadly, the assets of US 64 scheme, assured return
and certain other schemes. The Specified Undertaking of Unit Trust
of India, functioning under an administrator and under the rules
framed by Government of India and does not come under the purview
of the Mutual Fund Regulations. The second is the UTI Mutual Fund
Ltd, sponsored by SBI, PNB, BOB and LIC. It is registered with SEBI
and functions under the Mutual Fund Regulations. With the
bifurcation of the erstwhile UTI which had in March 2000 more than
Rs.76,000 crores of assets under management and with the setting
up of a UTI Mutual Fund, conforming to the SEBI Mutual Fund
Regulations, and with recent mergers taking place among different
private sector funds, the mutual fund industry has entered its current
phase of consolidation and growth. As at the end of September,
2004, there were 29 funds, which manage assets of Rs.153108
crores under 421 schemes. The graph indicates the growth of assets
over the years. GROWTH IN ASSETS UNDER MANAGEMENT

13
Note:
Erstwhile UTI was bifurcated into UTI Mutual Fund and the Specified
Undertaking of the Unit Trust of India effective from February 2003.
The Assets under management of the Specified Undertaking of the
Unit Trust of India has therefore been excluded from the total assets
of the industry as a whole from February 2003 onwards.

14
 Benefits of investing in Mutual Funds
Professional Management

Mutual Funds provide the services of experienced and skilled

professionals, backed by a dedicated investment research team that
analyses the performance and prospects of companies and selects
suitable investments to achieve the objectives of the scheme.

Diversification

Mutual Funds invest in a number of companies across a broad cross-

section of industries and sectors. This diversification reduces the risk
because seldom do all stocks decline at the same time and in the
same proportion. You achieve this diversification through a Mutual
Fund with far less money than you can do on your own.

Convenient Administration

Investing in a Mutual Fund reduces paperwork and helps you avoid

many problems such as bad deliveries, delayed payments and follow
up with brokers and companies. Mutual Funds save your time and
make investing easy and convenient.

Return Potential

Over a medium to long-term, Mutual Funds have the potential to

provide a higher return as they invest in a diversified basket of
selected securities.

Low Costs

Mutual Funds are a relatively less expensive way to invest compared

to directly investing in the capital markets because the benefits of
scale in brokerage, custodial and other fees translate into lower costs
for investors.

15
Liquidity

In open-end schemes, the investor gets the money back promptly at

net asset value related prices from the Mutual Fund. In closed-end
schemes, the units can be sold on a stock exchange at the prevailing
market price or the investor can avail of the facility of direct
repurchase at NAV related prices by the Mutual Fund.

Transparency

You get regular information on the value of your investment in

addition to disclosure on the specific investments made by your
scheme, the proportion invested in each class of assets and the fund
manager's investment strategy and outlook.

Flexibility

Through features such as regular investment plans, regular

withdrawal plans and dividend reinvestment plans, you can
systematically invest or withdraw funds according to your needs and
convenience.

Affordability

Investors individually may lack sufficient funds to invest in high-grade

stocks. A mutual fund because of its large corpus allows even a small
investor to take the benefit of its investment strategy.

Choice of Schemes

Mutual Funds offer a family of schemes to suit your varying needs

over a lifetime.

Well Regulated

All Mutual Funds are registered with SEBI and they function within
the provisions of strict regulations designed to protect the interests of
investors. The operations of Mutual Funds are regularly monitored by
SEBI.

16
 Drawbacks Of Investing In Mutual Funds
Fluctuating Returns

Mutual funds are like many other investments without a guaranteed

return. There is always the possibility that the value of your mutual
fund will depreciate. Unlike fixed-income products, such as bonds
and Treasury bills, mutual funds experience price fluctuations along
with the stocks that make up the fund.

Diversification

Although diversification is one of the keys to successful investing,

many mutual fund investors tend to overdiversify. The idea of
diversification is to reduce the risks associated with holding a single
security; overdiversification (also known as diworsification) occurs
when investors acquire many funds that are highly related and so
don't get the risk reducing benefits of diversification.
At the other extreme, just because you own mutual funds doesn't
mean you are automatically diversified. For example, a fund that
invests only in a particular industry region is still relatively risky.

Cash, Cash and More Cash

As you know already, mutual funds pool money from thousands of

investors, so everyday investors are putting money into the fund as
well as withdrawing investments. To maintain liquidity and the
capacity to accommodate withdrawals, funds typically have to keep a
large portion of their portfolio as cash. Having ample cash is great for
liquidity, but money sitting around as cash is not working for you and
thus is not very advantageous.

Costs

Mutual funds provide investors with professional management;

however, it comes at a cost. Funds will typically have a range of
different fees that reduce the overall payout. In mutual funds the fees
are classified into two categories: shareholder fees and annual fund-
operating fees. The shareholder fees, in the forms of loads and
redemption fees, are paid directly by shareholders purchasing or
selling the funds. The annual fund operating fees are charged as an
annual percentage - usually ranging from 1-3%. These fees are
assessed to mutual fund investors regardless of the performance of

17
the fund. As you can imagine, in years when the fund doesn't make
money these fees only magnify losses.

Evaluating Funds

Another disadvantage of mutual funds is the difficulty they pose for

investors interested in researching and evaluating the different funds.
Unlike stocks, mutual funds do not offer investors the opportunity to
compare the P/E ratio, sales growth, earnings per share, etc. A
mutual fund's net asset value gives investors the total value of the
fund's portfolio less liabilities, but how do you know if one fund is
better than another? Furthermore, advertisements, rankings and
ratings issued by fund companies only describe past performance.

Types Of Mutual Fund

Mutual fund schemes may be classified on the basis of its structure
and its investment objective.

By Structure:

Open-ended Funds

An open-end fund is one that is available for subscription all through

the year. These do not have a fixed maturity. Investors can
conveniently buy and sell units at Net Asset Value ("NAV") related
prices. The key feature of open-end schemes is liquidity.

Closed-ended Funds

A closed-end fund has a stipulated maturity period which generally

ranging from 3 to 15 years. The fund is open for subscription only
during a specified period. Investors can invest in the scheme at the
time of the initial public issue and thereafter they can buy or sell the
units of the scheme on the stock exchanges where they are listed. In
order to provide an exit route to the investors, some close-ended
funds give an option of selling back the units to the Mutual Fund
through periodic repurchase at NAV related prices.

18
Interval Funds

Interval funds combine the features of open-ended and close-ended

schemes. They are open for sale or redemption during pre-
determined intervals at NAV related prices.

By Investment Objective:

Growth Funds

The aim of growth funds is to provide capital appreciation over the

medium to long- term. Such schemes normally invest a majority of
their corpus in equities. It has been proven that returns from stocks,
have outperformed most other kind of investments held over the long
term. Growth schemes are ideal for investors having a long-term
outlook seeking growth over a period of time.

Income Funds

The aim of income funds is to provide regular and steady income to

investors. Such schemes generally invest in fixed income securities
such as bonds, corporate debentures and Government securities.
Income Funds are ideal for capital stability and regular income.

Balanced Funds

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. In a rising stock market,
the NAV of these schemes may not normally keep pace, or fall
equally when the market falls. These are ideal for investors looking
for a combination of income and moderate growth.

Money Market Funds

The aim of money market funds is to provide easy liquidity,

preservation of capital and moderate income. These schemes
generally invest in safer short-term instruments such as treasury bills,
certificates of deposit, commercial paper and inter-bank call money.

19
Returns on these schemes may fluctuate depending upon the interest
rates prevailing in the market. These are ideal for Corporate and
individual investors as a means to park their surplus funds for short
periods.

Load Funds

A Load Fund is one that charges a commission for entry or exit. That
is, each time you buy or sell units in the fund, a commission will be
payable. Typically entry and exit loads range from 1% to 2%. It could
be worth paying the load, if the fund has a good performance history.

No-Load Funds

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

Other Schemes:

Tax Saving Schemes

These schemes offer tax rebates to the investors under specific

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

Special Schemes:

Industry Specific Schemes

Industry Specific Schemes invest only in the industries specified in

the offer document. The investment of these funds is limited to
specific industries like InfoTech, FMCG, and Pharmaceuticals etc.

Index Schemes

Index Funds attempt to replicate the performance of a particular index

such as the BSE Sensex or the NSE 50

20
Sectoral Schemes

Sectoral Funds are those, which invest exclusively in a specified

industry or a group of industries or various segments such as 'A'
Group shares or initial public offerings.

Mutual Funds: Choosing a Fund

There are thousands of funds to choose from, but there are some
general guidelines that can help you choose a fund.

• Define your investment time horizon and financial goals.

Meeting a long-term goal (e.g., starting a college fund for a
newborn) will require different investments than in meeting a
short-term goal (e.g., accumulating money to purchase a car).

• Understand your risk tolerance and the risk of different mutual

funds. Risk tolerance is based on your comfort level in the
fluctuation of price, which will affect your investment principal.
Once this is determined, you can match fund types that have
historically shown commensurate price movement. Keep in
mind, however, that past performance is no guarantee of future
results.

• Combine your goals, time horizon and risk tolerance and find a
fund category that matches these objectives. This will help in
deciding what types of funds you may want to consider. You will
find that there are still many funds to choose from within a
specific category. Your Prudential financial professional will be
able to perform a comparative analysis of the individual funds to
find the most appropriate choice.

Universal Appeal Of Mutual Funds

Mutual funds are globally accepted investment and enjoy universal
appeal cutting across investor classes. Investors of all categories
could choose to invest on their own in multiple options but opt for
mutual funds for the sole reason that all benefits come in a package

21
Risk-Averse Investors

An investor normally prioritizes his investment needs before his

undertaking an investment. So different goals will allocate different
proportions of the total disposable amount. Some investors find their
way into the debt market as a risk reduction of prime importance. This
is the area for the risk-averse investors and here, mutual funds are
generally the best option. The reasons are not difficult to see. One
can avail of the benefits of better returns with added benefits of
anytime liquidity by investing in open ended debt funds at lower risk.
Many people have suffered heavy losses by investing in the fixed
deposits of companies who were assuring high returns but have gone
bust time leading to distraught investors as well as pending cases in
Company Law Board.
This risk of default of any company that one has chosen to invest in
can be minimized by mutual funds as fund managers analyze the
company’s finances. They can manage the maturity of their portfolio
by investing in instruments of varied maturity profiles. Since there is
no penalty in pre mature withdrawal, as in case of fixed deposits, debt
funds provide enough liquidity. Mutual funds are also better placed to
absorb the fluctuations in price of securities.

These funds also provide very good post tax returns on tear to year
basis. Even historically, debt funds have generated higher returns at
relatively low level of risk. Debt funds have posted a returns of over
10% over 1 year horizon.

Minimum Risk Takers

There are people who would like to take risks and invest in equity
funds. However, since their apatite for risk is limited, they would
rather have some exposure to debt as well. For them, balance funds
provide an easy route. Armed with expertise of investment
techniques, they can invest in equity as well as good quality debt
thereby reducing risks and providing the investor with better returns
than he could otherwise manage. They are expected to generate
moderate returns even in pessimistic market conditions.

22
High Risk Takers

By their nature, these people would be averse to investing in high risk

avenues. Capital market catch their fancy more often than not,
because they have historically generated better returns than any
other investments., even the risk involved is on the higher side.
Capital markets interest people, albeit not all because there are
several problems associated with them. First issue is that of
expertise. For investing directly into capital markets, one has to be
analytical enough to judge the valuation of the stock and understand
the complex undertones of the stock. It is very difficult for a small
investor to keep track of the movements of the market. Entrusting the
jobs to experts, who watch the trend of the market and analyze the
valuation of the stock will solve the problems of the investor. Mutual
funds specialize in the identification of stock through dedicated
experts in the field and enable them to pick stocks in the right
moment. Sector funds provide an edge and generate good returns if
the particular sector is doing well.

Risk Return Grid

Risk tolerance/ Focus Suitable Benefits offered

Return Products by MFs
expected

Low Debt Bank/corporate Liquidity;

FDs; Debt based Better returns
funds

Medium Partial debt, Liquidity; Better

Partial equity returns; Better
management;
Diversification
High Equity Capital market; Diversification;
Equity funds Liquidity; Expertise
(diversified as in stock picking;
well as sectoral) Tax free dividends

Small Investors

23
Next problem is of funds and money. A person can’t invest in multiple
high priced stocks for lack of funds. This limits him from diversifying
his portfolio as well as benefiting from multiple investments. Here
again, investing through mutual funds enables him to in many good
stocks and reap benefits even through small investments. This not
only diversifies the portfolio and helps in generating returns from a
number f sectors but reduces the risk as well. Though identification of
a mutual fund might not be an easy task, availability of good
investment consultant and counselors will help investor take informed
decisions.

24
Institutional And Big Investors

Besides the small retail investors, the industry attracts investments

from institutional and big investors as well. Liquidity funds offer
liquidity as well as better returns than banks. Many funds provide
anytime withdrawal which is an additional feature.

Investments for Specific Goals.

Specific goals like planning for children and retirement plans are also
catered to by mutual funds. Children funds have found their way in a
big way with many of the fund houses already having launched a
children fund.

Essentially debt oriented, these schemes invite investments, which

are locked till the child attains majority and requires money for higher
education. One may invest today and assure financial support for
their children when they require them. The schemes have given very
good returns of around 14% in the last 1 year period. These returns
are also designed to provide tax efficiency. The income generated by
these funds are classified as capital gains and taxed at concession
rates.

Special Legal Structures Of Mutual Funds

Mutual Funds have a specific legal structure which determines the
rights and responsibilities of the fund’s constituents i.e. sponsors,
trustees, custodians, transfer agents and the fund and the asset
management company. the legal structure also derives the
interrelationships between them.

In India, open and closed end funds operate under the same
regularity structure and are constituted along the same unique
structure, as unit trust. A mutual fund may have several different
schemes under it i.e. under one unit trust, at any point of time. The
structure that is required to be followed by the mutual fund is laid
down under SEBI Regulations, 996.

25
The Role Of SEBI

SEBI act was passed in 1992. the role of SEBI is to protect the
interest of investors in securities and to promote the development of
and to regulate the securities market.

SEBI formulates the policies and regulates the mutual funds to

protect the interest of the investors. SEBI notified the regulations fr
mutual funds in 1993. Thereafter, mutual funds sponsored by private
sector entities were allowed to enter the capital market. The
regulations were fully revised in 1996 and have amended a few times
since then. SEBI has also issued guidelines to the mutual funds from
time to time to protect the interest of the investors.

All mutual funds, whether promoted by public sector or private sector

entities including those governed by the foreign entities are governed
by the same set of regulations. They are all subject to monitoring and
inspection by SEBI. The risks associated with the schemes launched
by the mutual funds are also of similar type.

26
The Role of AMFI

AMFI, the apex body of all the registered Asset Management

Companies was incorporated on August 22, 1995 as a non profit
organization. All the 34 AMC’s that have launched their mutual funds
are its members.AMFI works under the guidance and supervision of
the board of directors. Various comities generally carry out the
activities of the association.

Its objectives are to define and to maintain high professional and

ethical standards in all areas of operation of Mutual Funds and to
represent the Government, the RBI and the SEBI on all matters
concerning the Mutual fund industry. It also disseminates the
information on the MF industry and undertakes nationwide investor’s
awareness programs so as to promote proper understanding of the
concept and working of mutual funds

Organization of A Mutual Fund

There are many entities involved in the organization of a mutual fund.

A mutual fund is set up in the form of a trust, which has sponsor,
trustees, Asset management Companies (AMC) and the custodian.
The trust is established by a sponsor or more than one sponsors who
are like promoters of a company. The trustees of the mutual fund hold
its profit for the benefit of the unit holders. Asset management
company (AMC) approved by the SEBI manages the fund by making
investments in various types of securities. Custodian, who is
registered by the SEBI, holds the securities of various schemes of the
fund in its custody. The trustees are vested with general power of
superintendence and direction over AMC. They monitor the
performance and compliance of SEBI regulations by the mutual
funds. SEBI regulations require that at least two thirds of the directors
of the Trustee Company or board of trustees must be independent.
Also, 50% of the directors of AMC must be independent. All mutual
funds require themselves to be registered with the SEBI before they
launch any scheme.

The roles of the various entities are:

27
Sponsor

Sponsor is defined under SEBI regulations as a person who, acting

alone or in combination with another body corporate, establishes a
mutual fund. The sponsor of a fund is akin to the promoter of the
company as he gets his funds registered with the SEBI. The sponsor
forms a trust and appoints a board of trustees. The sponsor also
generally appoints an Asset Management Company as fund
managers. The sponsor, either directly or acting through the
Trustees, also elect a Custodian to hold the fund assets. All these
appointments are made in accordance with SEBI regulations. As per
the SEBI regulations, for a person to qualify as a Sponsor, he must
contribute at least 40% of the net worth of the AMC possess a sound
financial track record over 5 years prior to registration.

Trust

A mutual fund in India is constituted in the form of a public trust

created under the Indian Trust Acts, 1882. The Fund Sponsors act as
the settler of the trust, contributing to the initial capital and appoints a
Trustee to hold the assets of the trust for benefit of the unit holders,
who are the beneficiaries of the trust.

Trustees

The trust i.e., the mutual fund may be managed by the Board of
Trustees – a body of individuals, or a Trust Company – a corporate
body. Most of the funds in India are managed by the board of
Trustees. While the Board of Trustees is governed by the provisions
of the Indian Trust Act, it would be required to comply with the
provisions of the Companies Act, 1956. The Trustees do not directly
manage the portfolio of securities; hence they appoint an Asset
Management Company. They ensure that the fund is managed by the
AMC as per the defined objectives and in accordance with the trust
deed and SEBI regulations.

Asset Management Company (Amc)

The role of an AMC is to act as the investment manager of the trust.

The AMC so appointed is to be approved by the SEBI. The AMC
works under the supervision of its own Board of Directors and also
under the direction of the trustees and SEBI. The trustees are

28
empowered to terminate the appointment of the AMC by majority and
elect a new AMC with prior approval of the SEBI and the unit holders.
The AMC of the mutual fund must have a net worth of at least Rs. 10
crores at all times. Directors of the AMC, both independent and non
independent should have adequate professional experience in
financial services and should be individuals of high moral standing, a
condition also applicable to other key personnel of the AMC. The
AMC cannot act as a trustee to any other mutual fund. The AMC
must always act in the interest of the unit holders and report to the
trustees with respect to its activities.

Registrar And Transfer Agent

The AMC, if so authorized by the trust deed, appoints the Registrar

and Transfer agent to the mutual fund. The Registrar processes the
application form, redemption requests and dispatches account
statements to the unit holders. The registrar and transfer agent also
handle the communication with investors and updates investor
records.

Trends in Transactions on Stock Exchanges by Mutual

Funds (since January 2000)
Equity (Rs Debt (Rs in
in Crores) Crores)

Net Net
Gross Gross Purchase/ Gross Gross Purchase/
Purchase Sales Sales Purchase Sales Sales

29
Jan 2000-March 2000. 11070.54 11492.19 -421.65 2764.72 1864.29 900.43

April 2000 -March 2001. 17375.78 20142.76 -2766.98 13512.17 8488.68 5023.49

April 2001-March 2002. 12098.11 15893.99 -3795.88 33583.64 22624.42 10959.22

April 2002-March 2003 14520.89 16587.59 -2066.70 46663.83 34059.41 12604.42

April 2003-March 2004 36663.58 35355.67 1307.91 63169.93 40469.18 22700.75

April 2004-March 2005 45045.25 44597.23 448.02 62186.46 45199.17 16987.29

April 2005-March 2006 100435.90 86133.70 14302.20 109804.91 73003.67 36801.24

April 2006 - March 2007 135948.16 126885.82 9062.34 153733.05 101189.59 52543.46

April 2007 (upto 10th) 2346.03 2816.59 -470.56 5438.19 4118.06 1320.13

Total (April '07) 2346.03 2816.59 -470.56 5438.19 4118.06 1320.13

30
3.3 GLOBAL SCENARIO

Some basic facts:

• The money market mutual fund segment has a total corpus of $
1.48 trillion in the U.S. against a corpus of $ 100 million in India.

• Out of the top 10 mutual funds worldwide, eight are bank-

sponsored. Only Fidelity and Capital are non-bank mutual funds
in this group.

• In the U.S. the total number of schemes is higher than that of

the listed companies while in India we have just 277 schemes

• Internationally, mutual funds are allowed to go short. In India

fund managers do not have such leeway.

• In the U.S. about 9.7 million households will manage their

assets on-line by the year 2007, such a facility is not yet of avail
in India.

• On- line trading is a great idea to reduce management

expenses from the current 2 % of total assets to about 0.75 %
of the total assets.

Internationally, on-line investing continues its meteoric rise. Many

have debated about the success of e- commerce and its
breakthroughs, but it is true that this aspect of technology could and
will change the way financial sectors function. However, mutual funds
cannot be left far behind. They have realized the potential of the
Internet and are equipping themselves to perform better.

In fact in advanced countries like the U.S.A, mutual funds buy- sell
transactions have already begun on the net, while in India the Net is
used as a source of Information.

Such changes could facilitate easy access, lower intermediation costs

and better services for all. A research agency that specializes in
internet technology estimates that over the next four years Mutual
Fund Assets traded on- line will grow ten folds from $ 128 billion to $
1,227 billion; whereas equity assets traded on-line will increase
during the period from $ 246 billion to $ 1,561 billion. This will

31
increase the share of mutual funds from 34% to 40% during the
period.

32
Future Scenario
The asset base will continue to grow at an annual rate of about 30 to
35 % over the next few years as investor’s shift their assets from
banks and other traditional avenues. Some of the older public and
private sector players will either close shop or be taken over.

Out of ten public sector players five will sell out, close down or merge
with stronger players in three to four years. In the private sector this
trend has already started with two mergers and one takeover. Here
too some of them will down their shutters in the near future to come.

But this does not mean there is no room for other players. The market
will witness a flurry of new players entering the arena. There will be a
large number of offers from various asset management companies in
the time to come. Some big names like Fidelity, Principal, Old Mutual
etc. are looking at Indian market seriously. One important reason for
it is that most major players already have presence here and hence
these big names would hardly like to get left behind.

In the U.S. most mutual funds concentrate only on financial funds like
equity and debt. Some like real estate funds and commodity funds
also take an exposure to physical assets. The latter type of funds are
preferred by corporate’s who want to hedge their exposure to the
commodities they deal with.

For instance, a cable manufacturer who needs 100 tons of Copper in

the month of January could buy an equivalent amount of copper by
investing in a copper fund. For Example, Permanent Portfolio Fund, a
conservative U.S. based fund invests a fixed percentage of it’s corpus
in Gold, Silver, Swiss francs, specific stocks on various bourses
around the world, short –term and long-term U.S. treasuries etc.

In U.S.A. apart from bullion funds there are copper funds, precious
metal funds and real estate funds (investing in real estate and other
related assets as well.).In India, the Canada based Dundee mutual
fund is planning to launch gold and a real estate fund before the year-
end.

In developed countries like the U.S.A there are funds to satisfy

everybody’s requirement, but in India only the tip of the iceberg has
been explored. In the near future India too will concentrate on
financial as well as physical funds.

33
The mutual fund industry is awaiting the introduction of
DERIVATIVES in the country as this would enable it to hedge its risk
and this in turn would be reflected in it’s Net Asset Value (NAV).

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

34
3.4 PRODUCTS

Equity Scheme
Kotak 30

A large cap diversified scheme, which invests in companies with a

medium to long-term view. The scheme follows a bottom-up
approach to stock selection. The fund has predominantly invested
into blue chip large market capitalization companies. Also small
portion of the funds is invested in medium capitalization companies,
which have the potential to become blue chip companies of
tomorrow. Thus the investment strategy is to take balanced exposure
across sectors while maintaining less than 30% exposure to mid-cap
stocks.

Kotak Mid cap

The key focus of the fund is to identify potential stocks that are likely
and invest in mid-cap companies that will become tomorrow's large-
caps. The essence is to 'spot them young and watch them grow'. It
endeavors to take advantage of the successive waves of opportunity
provided by a transitioning economy. The portfolio would be
diversified across sectors, with adequate flexibility to move within
sectors

Kotak Opportunities

Kotak Opportunities is a diversified equity scheme, with a flexible

investing style. It will invest in sectors, which the Fund Manager
believes would outperform others in the short to medium-term. By
virtue of its flexible investment pattern, the fund is uniquely positioned
to increase concentration sectors which look promising. As markets
evolve and grow, new opportunities for growth keep emerging. Kotak
Opportunities would endeavour to capture these opportunities to
generate wealth for its investors.

35
Kotak Lifestyle

Kotak Lifestyle seeks to capitalize on the growing consumption boom

in India. The key drivers for the lifestyle theme are 4 A's viz
Awareness, Availability, Aspiration and Affordability. This together
facilitates the consumption boom - the basic premise on which the
scheme evolves. The scheme would endeavor to invest across
sectors and companies, which would be the beneficiaries of this
boom

Kotak Contra

Kotak Contra follows a contrarian style of investing. The preference is

for bargain hunting rather than the momentum approach to stock
picking. This would imply that the stock may be undervalued at the
time of investing, but are fundamentally sound and have a good long-
term growth potential.

Kotak Tax saver

Kotak Tax saver offers the investor the dual advantage of potential
capital appreciation as well as tax savings (as applicable) the portfolio
offers a diversified mix across various sectors. As it is a close ended
architecture, the investor has to compulsorily lock in ones fund for 3
years.

Kotak global India

Kotak Global India focuses on Globally Competitive Indian

Companies that are looking at international market for growth. It aims
at capturing potential valuation gains derived from resurgence in
manufacturing sector as well as inherent strength in the service
sector.

Kotak MNC

A scheme diversified across a sector that invests in Multinational

companies having business in India. The scheme follows a bottom-up
approach to stock selection and the investment strategy is to make
aggressive allocation across select sectors. The investment focus is
on companies that have good governance, strong brands, market
leadership and strong parentage.

36
Kotak Tech

It is a sector scheme, investing only in IT sector companies. As it is a

sectoral /thematic fund, investors in this fund will need to have a
relatively longer investment horizon. This is necessary as any sector
has its own peaks and bottoms in a cycle. The fund manager invests
with a long-term perspective and therefore it would be reasonable to
assume that any sector story yields results over a longer period of
time. .

Kotak Emerging Equity Scheme

The investment objective of the scheme is to generate long-term

capital appreciation from a portfolio of equity and equity related
securities, by investing predominantly in mid and small cap
companies. The scheme will predominantly invest in equity and
equity related instruments of mid and small cap companies. The
scheme may also invest in other companies and in Debt and Money
Market Instruments, as per the Investment Pattern.

Debt Scheme

Kotak Bond

The Kotak Bond is a pure debt scheme, with a diversified portfolio,

comprising of government, PSU and corporate bonds and offers two
plans: Deposit Plan & Regular Plan. Kotak Bond aims to generate
reasonable returns at the same time reduce risk by investing in
corporate bonds with credit rating not below AA. Thus the fund has
invested in a variety of debt and money market instruments of various
maturities while maintaining an average duration of 12-18 months in
current market situation.

Kotak Income Plus

Kotak Income Plus invests 80% - 100% in debt and money market
instruments and 0 - 20% in equity related instruments. The scheme
endeavors to provide safety of a debt fund with superior returns of
equity product. To ensure safety of a debt fund the scheme invests in
top rated debt instruments thereby ensuring good credit quality and
liquidity.

37
Kotak Liquid

A money market scheme that seeks to achieve the twin objective of

superior returns coupled with high level of liquidity. Achievement of
objective is ensured through investments in judicious mix of money
market instruments, corporate bonds and sovereign securities. The
scheme is ideally suited for investors looking to park their short-term
surplus funds. Kotak Liquid has four investment plans: Regular Plan,
Sweep Plan, Institutional Plan and Institutional Premium Plan.

Kotak Gilt

Kotak Gilt is a scheme that allows the retail investor to invest in the
otherwise wholesale government securities market. Kotak Gilt invests
in government bonds and treasury bills, giving you a zero credit risk
investment option. It recognizes that for you, safety is prime, giving
you the liquidity of a savings account with attractive returns.

Kotak Flexi Debt

Kotak Flexi Debt is an income scheme and seeks to maximize returns

through active management of a portfolio of Debt and money market
securities. It invests dynamically across asset classes, maturity
spectrum and across the yield curve in order to capitalize on trading
opportunities. The scheme has invested in top rated quality assets
and has relatively lower risk/volatility profile as the mark to market
component is relatively low. It is ideal for investors with medium term
investment outlook who want their portfolio to be managed smartly.

Kotak Equity Arbitrage Fund

An open ended arbitrage scheme, that aims to generate income from

investment in debt and money market securitites and by availing
arbitrage opportunities between price of spot and derivatives markets.

Kotak Floater Long Term

Kotak Floater Long Term invests predominantly in floating rate

instruments, money market instruments and fixed rate instruments
with interest rate swap, in order to reduce the interest rate risk

38
associated with investments in fixed rate instruments in a rising
interest rate regime. In order to avoid long duration position the fund
invests in short duration fixed rate debt securities with an outstanding
maturity of one year or more.

Kotak Floater Short Term

Kotak Floater Short Term invests predominantly in floating rate

securities and money market instruments in order to contain interest
rate risk. The scheme has greater exposure to money market
instruments of high credit quality thereby ensuring reasonable returns
and lower mark to market component. The scheme is ideal for an
investment horizon of 1 to 3 months.

Kotak Twin Advantage Series II

Kotak Twin Advantage Series II seeks to generate returns by

investing in Debt & Money Market instruments and emphasize on
capital appreciation by investing in equity index options. The Scheme
will invest predominantly in securities normally maturing in line with
the maturity profile of the Scheme.

Kotak Twin Advantage Series III

Kotak Twin Advantage Series III seeks to generate returns by

investing in Debt & Money Market instruments and emphasize on
capital appreciation by investing in equity index options. The Scheme
will invest predominantly in securities normally maturing in line with
the maturity profile of the Scheme.

Kotak Wealth Builder - I

Kotak Wealth Builder - I is a close - ended debt scheme with 36

months maturity. The scheme has been rated AAA (so) by CRISIL.

Balanced Scheme

Kotak Balance

39
A Scheme, investing in equity, debt and money market instruments.
The investment strategy is to have a 51% - 70% in equity portion and
30% - 50% in non-equity portion.

Kotak Dynamic Asset Allocation

Kotak Dynamic Asset Allocation is Close Ended Balanced Scheme

with 36 months maturity.

40
FOF SCHEME

Kotak Equity FOF

A multi manager FOF scheme that invests 90% - 100% in diversified

equity schemes and rest in liquid schemes. The Scheme invests
across multiple fund houses which invests 65% - 75% of their
portfolio in diversified large cap schemes and 15% - 25% in
diversified aggressive equity schemes.

Kotak Dynamic FOF

A close - ended multi managers FOF scheme, with a maturity period

of three years. The Scheme allocates assets across the diversified
large cap schemes and liquid schemes in a specific proportion, based
on the recommendation received by the designated advisor*.
* Kotak Securities Ltd.

Kotak Flexi FOF

A close - ended multi manager FOF scheme, with a maturity period of

three years. The Scheme allocates assets across equity (diversified
large cap and aggressive scheme) and liquid schemes.

Kotak Flexi FOF Series I

It is suitable for Investors who seek capital appreciation associated

with investment in diversified equity schemes/plan, while substantially
taking lower risk on capital over a 3-year period.

Kotak Flexi FOF Series II

It is suitable for Investors who seek capital appreciation associated

with investment in diversified equity schemes/plan, while substantially
taking lower risk on capital over a 3-year period.

41
42
Some basic facts :
• The money market mutual fund segment has a total corpus of $
1.48 trillion in the U.S. against a corpus of $ 100 million in India.

• Out of the top 10 mutual funds worldwide, eight are bank-

sponsored. Only Fidelity and Capital are non-bank mutual funds
in this group.

• In the U.S. the total number of schemes is higher than that of

the listed companies while in India we have just 277 schemes

• Internationally, mutual funds are allowed to go short. In India

fund managers do not have such leeway.

• In the U.S. about 9.7 million households will manage their

assets on-line by the year 2007, such a facility is not yet of avail
in India.

• On- line trading is a great idea to reduce management

expenses from the current 2 % of total assets to about 0.75 %
of the total assets.

Internationally, on-line investing continues its meteoric rise. Many

have debated about the success of e- commerce and its
breakthroughs, but it is true that this aspect of technology could and
will change the way financial sectors function. However, mutual funds
cannot be left far behind. They have realized the potential of the
Internet and are equipping themselves to perform better.

In fact in advanced countries like the U.S.A, mutual funds buy- sell
transactions have already begun on the Net, while in India the Net is
used as a source of Information. Such changes could facilitate easy
access, lower intermediation costs and better services for all. A
research agency that specializes in internet technology estimates that
over the next four years Mutual Fund Assets traded on- line will grow
ten folds from $ 128 billion to $ 1,227 billion ; whereas equity assets
traded on-line will increase during the period from $ 246 billion to $
1,561 billion. This will increase the share of mutual funds from 34% to
40% during the period.

43
Future Scenario
The asset base will continue to grow at an annual rate of about 30 to
35 % over the next few years as investor’s shift their assets from
banks and other traditional avenues. Some of the older public and
private sector players will either close shop or be taken over.

Out of ten public sector players five will sell out, close down or merge
with stronger players in three to four years. In the private sector this
trend has already started with two mergers and one takeover. Here
too some of them will down their shutters in the near future to come.

But this does not mean there is no room for other players. The market
will witness a flurry of new players entering the arena. There will be a
large number of offers from various asset management companies in
the time to come. Some big names like Fidelity, Principal, Old Mutual
etc. are looking at Indian market seriously. One important reason for
it is that most major players already have presence here and hence
these big names would hardly like to get left behind.

In the U.S. most mutual funds concentrate only on financial funds like
equity and debt. Some like real estate funds and commodity funds
also take an exposure to physical assets. The latter type of funds are
preferred by corporate’s who want to hedge their exposure to the
commodities they deal with.

For instance, a cable manufacturer who needs 100 tons of Copper in

the month of January could buy an equivalent amount of copper by
investing in a copper fund. For Example, Permanent Portfolio Fund, a
conservative U.S. based fund invests a fixed percentage of it’s corpus
in Gold, Silver, Swiss francs, specific stocks on various bourses
around the world, short –term and long-term U.S. treasuries etc.

In U.S.A. apart from bullion funds there are copper funds, precious
metal funds and real estate funds (investing in real estate and other
related assets as well.).In India, the Canada based Dundee mutual
fund is planning to launch gold and a real estate fund before the year-
end.

In developed countries like the U.S.A there are funds to satisfy

everybody’s requirement, but in India only the tip of the iceberg has
been explored. In the near future India too will concentrate on
financial as well as physical funds.

44
The mutual fund industry is awaiting the introduction of
DERIVATIVES in the country as this would enable it to hedge its risk
and this in turn would be reflected in it’s Net Asset Value (NAV).

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

45
3.5 AWARDS

Ndtv Awards, 2006

On July 28, 2006, Kotak Mutual Fund was adjudged the Business
Leader in the Mutual Funds category at the "NDTV Profit Business
Excellence Awards".

"NDTV Profit Business Excellence Awards" has been instituted to

award companies that are the best in their respective fields -
companies that have added value for their consumers, investors and
the industry on the whole. The award is the new benchmark and a
platform for recognizing excellence in business for Indian companies.

Lipper Fund Awards India , 2006

Excellence. Honour. Brilliance. Respect. Hard work. Efficiency.

Superiority. These attributes exemplify the executives at Kotak
Mutual Fund. Such qualities combined with excellent work ethics
have resulted in our Kotak Bond Regular Plan - Growth being
awarded the "Best Fund over Five Years in the Bond Category" by
"Lipper Fund Awards India 2006". The Fund has consistently
delivered strong risk adjusted performance relative to its peers. Kotak
Mutual Fund was also awarded the "Best Bond Fund Group over
Three years". These awards simply underscore the exuberance and
professionalism that everyone at Kotak brings to its task.

ICRA Awards , 2006

he entire debt management team of Kotak Mutual Fund celebrated

one such Winning moment at the ICRA Mutual Fund Awards, 2006.
In the award ceremony, 'Kotak Bond Regular Plan' was ranked
ICRA-MFR1. The plan also received the silver award for 'Second
Best Performance' in the category of 'Open Ended Debt Scheme-long
term' for three year period ending December 31,2005. For the team
of Debt Fund Management this was their 8th award in the last 7
years. ICRA is a leading investment information and credit rating
services provider in India.

46
ICRA MFR 1 (December 2004 & December 2005)

Kotak Bond Deposit has been ranked ICRA MFR 1 by ICRA Online in
the category Debt Long Term (name of the category) for its 3 (1 or 3
years) year performance till December 31, 2004. The rank indicates
performance within the top 10% of the stated category, which had a
total of 22 (no. of schemes in the category) similar funds, including
this scheme. The rank is an outcome of an objective and comparative
analysis against various performance parameters, including: risk
adjusted return; fund size, Sector Concentration, and average
maturity. The ranking methodology did not take into account the entry
and exit loads imposed by the Fund. The rank is neither a certificate
of statutory compliance nor any guarantee on the future performance
of Kotak Mahindra Mutual Fund.

OUTLOOK MONEY BEST WEALTH CREATOR DEBT 2003

All fund houses with AUM of at least Rs. 500 cr. As of June 30, 2003
were considered with minimum track record of 3 years for Income
Schemes, 2 years for Gilt Schemes and 2 year for Liquid Schemes.
Key parameter examined was risk adjusted return (bonus point for
outperforming category, average risk adjusted` returns and for top 5
schemes in the respective categories). Weights were also assigned
to factors like nature of schemes and investor services (online
subscription and redemption, SIP and SWP, trigger facility, no loading
switching, communication etc. To arrive at the final result, 14 asset
management companies were considered for awards. Period of the
award: 1st Jan - 31st Dec 2003. Only open-ended schemes were
considered. No loads were considered. The award was based on the
Outlook Money methodology and was also published by Outlook
Money."

CRISIL Best Fund Award, 2006

Ranking Methodology CRISIL: [A] Crisil Best Fund Awards 2003 is

based on the ranking methodology of Crisil Fund Services. These
quarterly rankings took into account the performance and the
portfolios of 19 Open End Income Schemes. [B] The criteria used in
computing the CRISIL Composite CPR are Superior Return Ratio
based on NAVs over the 2-year period for respective quarter ends,
Concentration, Asset Quality, Liquidity and the Asset Size of the

47
scheme. The methodology does not take into account the entry and
exit loads levied by the scheme.

48
CHAPTER 4:
SUGGESTIONS

49
4. SUGGESTIONS

 Many of these well educated high net worth individuals are not
very much aware of the very concept of mutual funds but are
eager to learn about them. Their skepticism will be hard to
remove but consistent and genuine educational programs about
mutual funds can make them think beyond the failure of US 64.
 All the myths that are prevalent not only about the mutual funds
but also about other financial securities can be mitigated using
such programs.
 People with lower and moderately high income levels are more
inclined to save for their retirement and children’s future as
against the people with higher incomes.
 As against the typical conventional, Indian mentality, the
proportion of expenditures in the income is increasing. But they
still don’t want to take any risk and go for the securities that
offer low yield but high security. This perception can be handled
by assuring them that the mutual funds market is not a
gambler’s stem and can be less risky if proper planning is done
prior to the investments right type of securities are chosen and
market fundamentals are considered.
 People in the middle age group were more aware of the various
brands of the mutual funds though among even them, not many
invest in mutual funds. Their knowledge can be leveraged upon
by giving them an extension to their current knowledge about
the mutual funds.
 Younger people are more inclined to take risk but lack proper
knowledge about different avenues in which their investments
can go. They desire high returns and are willing to take higher
risk to accomplish this objective as against the older people
who opt for low risk, low yield investments. That is, different
investment advices are desired for the people belonging to
different age groups.
 A majority of the people carries level heads over their shoulders
and don’t get swayed away by the sporadic changes that take
place in the financial markets. This can work to the advantage
of the investment advisors like the ones present at invest care
as they can persuade such people by rational arguments more
easily.

50
5. CONCLUSIONS

51
CONCLUSIONS

• The company has introduced many products with

many benefits in the last few years.
• Investment in mutual funds as suggested by the
company is strictly a mater of risk
• The company has made a positive image in the
mind of the public.
• The company has won various awards for its
excellent performance over the years.

52
CHAPTER 6:
BIBLIOGRAPHY

53
 BIBLIOGRAPHY

Websites:

• www.investopedia.com
• www.indiainfoline.com
• www.amfiindia.com
• www.valueresearchonline.com
• www.franklintempletonindia.com
• www.reliancemutualfund.com
• www.utimf.com
• www.tatafund.com
• www.mutualfundsindia.com
• in.yahoo.mutualfunds.com
• www.capitalmarket.com
• www.equitymaster.com
• www.finance.indiamart.com
• www.myiris.com
• www.trustnet.com
• www.thehindubusinessline.com
• www.themoneytime.com

Newspapers And Journals

• Business Standard
• Amfi Workbook
• Mutual Fund Insight
• Value Research Scorecard

54