INDEX Sr.NO. 1 1.1 1.3 1.4 1.5 1.6 1.7 2 2.1 2.2 2.3 2.4 2.5 2.6 3 3.

1 3.2 3.3 3.4 4 4.1 4.2 4.3 5 6 7 8 PARTICULAR. COMPANY DETAIL INTRODUCTION HISTORY OF COMPANY PROFILE OF COMPANY SERVICE OF COMPANY VISION & MISSION AWARDS & REORGANIZATION INTRODUCTON ABOUT MUTUAL FUND CONCEPT EVALUATION OF MUTUAL FUND ORGANIZATION OF MUTUAL FUND TYPES OF MUTUAL FUND BENEFIT OF MUTUAL FUND DISADVANTAGES OF MUTUAL FUND RESEARCH METHODOLOGY CONCEPT OBJECTIVES OF PROJECT RESEARCH IMPORTANCE OF RESEARCH TYPES OF RESEARCH DATA ANALYSIS CONCEPT MARKET SURVEY FORM MUTUAL FUND DETAIL DATA ANALYSIS FINDINGS CONCLUSION BIBLIOGRAPHY ANNEXURE PAGE NO. 2 3 4 5 6 10 11 12 13 15 18 20 25 27 28 29 30 31 32 36 37 38 39 48 50 51 53

COMPANY DETAIL.

INTRODUCTION

JHAVERI SECURITIES PVT. LTD. is located in the 190, MADHAV DARSHAN, WAGHAWADI ROAD, BHAVNAGAR 364001 JHAVERI SECURITIES PVT. LTD. is Gujarats leading broking house with a strong and stable position in the financial markets having experience in the financial services, capital markets, mutual funds distributions and have varied skill set to support and develop the business.

Looking into business opportunity the company is developing in a very aggressive business strategies, goal plan, mission, philosophy etc.

JHAVERI SECURITIES PVT.LTD. also provide financial services to customers like demat account services, mutual funds, ITO, NSE, BSE, Derivatives etc.

HISTORY OF JHAVERI SECURITIES PVT. LTD.

JHAVERI SECURITIES PVT. LTD. is promoted by M.D. KAMLESHBHAI JHAVERI at Baroda. The company is managed by professional and grows remarkably being the last 10 years. At present there are more than 500 trading terminal mark across the state. The company has also acquired the membership of NSE, NSDL (National Securities Depository Limited) BSE (Bombay Stock Exchange) MCX, MCDEX (National Commodity Exchange), F&O.

In April 1989 JHAVERI SECURITIES PVT. LTD. commenced mutual fund and IPO (Initial Public Offer) distribution business. In January 1992 incorporation of JHAVERI SECURITIES PVT. LTD. Now, Jhaveri should be recognized as a market leader and Gujarat`s leading broking hoarse with a strong and stable position in the financial markets.

In February 2008 JHAVERI SECURITIES PVT. LTD. crossed the 250 mark in terms of business associates providing quality customer services.

PROFILE OF JHAVERI SECURITIES PVT .LTD.

o NAME: o ADDRESS OF ADMINISTRATIVE OFFICE:

JHAVERI SECURITIES PVT. LTD.

190, MADHAV DARSHAN, WAGHAWADI ROAD, BHAVNAGAR 364001

o PHONE NO.: o FAX NO.: o YEAR OF ESTABLISHMENT: o NAME AND DESIGNATION OF THE PERSON IN CHARGE: o FORM OF BUSINESS:

0278 3001616, 3001716 0278 3001617

1997

Mr. KAMLESHBHAI JHAVERI

PRIVATE LIMITED

o MEMBERSHIP:

NSE BSE NSDL NCDEX MCX etc

o E MAIL ID: o WEBSITE:

Jsplbvn@gmail.com

Jhaveritrade.com

SERVICES OF JHAVERI SECURITIES PVT LTD

JHAVERI SECURITIES PVT LTD was established in 1989 with a vision to render financial services and guidance to the rational investors ensuring their wealth optimization, future prosperity and social worthiness. Jhaveri believes in complete freedom in doing ones own work and focusing more on end results. JHAVERI SECURITIES PVT. LTD. provides following products and services to their customers,

PRODUCTS

SERVICES

1. Equity Broking. 2. Derivative Trading. 3. Commodities. 4. E Trading 5. Depository Services 6. IPO (Initial Public Offers) 7. Mutual Funds

1. 2. 3.

Daily Telephonic Tops Sms/E Mail Updates Online Market Suggestions Chats etc

4. 5. 6. 7. 8.

Daily Deliveries Strategy Weekly Recommendations Research Reports Wealth Creation Seminars Digital Contract Notes

1)

EQUITY BROKING:- Right information at the right tome is the first

step towards taking right decision Jhaveri`s team of dealers assists the client by efficiently handling his calls and providing him with market related news and company specific research views so that the client is able to take a well informed investment decision.

2)

DERIVATIVE TRADING AND DAILY STRATEGY: - A derivative

includes a security derived from the underlying instrument like stocks, bonds, commodities etc and are increasingly used to manage risk. Some derivatives used in risk management are forwards, future, swaps and options which are used for heading, further derivatives are off balance sheet transactions and they cannot be put on the balance unless the un-dealing assets are bought and paid
6

For instance if an investor buys as option to purchase shares the balance sheet is unaffected until and unless the shares are bought and paid for, a) Financial derivatives b) Credit derivatives Financial derivatives find their utility in risk control and management as well as in the hedging, Banks, Mutual funds and insurance company find derivatives very useful in managing their portfolios effectively.

3)

COMMODITIES:- The commodity exchange is public market forum

and anyone can play in these vital commodity markets nowadays investors looking for a fast paced dynamic market with excellent liquidity can now trade in commodity future market. JHAVERI SECURITIES PVT LTD is registered Training-Cum-Clearing members of NCDEX/MCX. In the commodity exchange two types of dealing is done, cash market for cash dealing and future markets for dealing in future settlement period of 2 or 3 months. Customers can also do business in international market and other benefits that customers gets 1. 2. 3. Easy account opening process Live quotes Online outstanding positions etc E TRADING: - With Jhaveri Online Trading Account, customer

4)

can buy and sell shares in an instant, anytime and anywhere at their convenience. SALIENT FEATURE OF ONLINE TRADING Access to three markets namely

BSE (CASH) NSE (CASH) NSE (F&O)

Online intraday tops. Demat account status available online. Access to account status online. Funds transfer facility. Competitive brokerage rates. Auto pay in facility.
7

5)

DEPOSITORY SERVICES: - An efficient way of guarding all your

shares and other eligible securities by holding then in the electronic forms, Jhaveri is a depository participant with the NSDL (National Securities Depository Limited) NSDL keeps a complete record of your account in a central data base in addition to a similar record with your D.P. Jhaveri`s auto pay in facilities is useful to solve lot of problems customer can transact from anywhere reduces our auction cost maintenance and soon. The best advantage is full proof secure system. Jhaveri is a depository participant with the NSDL and also provides depository services to their clients. Jhaveri`s demat teams ensure smooth efficient transfer of shares. Jhaveri also provide IPO forms to the customer and back office access online for convenience of our clients. Jhaveri also provides facility to view demat status, transactions and demat bills online for both individual and family wise. Hassle free trading without writing the delivery instruction slips. Jhaveri also provide auto paying and auto payout facility. No A/C opening charges. Document charges 100/Annual maintenance charges 250/- or 350/- for no auto pay in customers, Rematerialization 50/-, Inter depository 30/-, Market trade 25/-, off market with JPL 25/-, off market with other 30/-

6)

MUTUAL FUNDS: -Mutual funds chits are investment vehicle that

provide a means of participation in the stock market for people who have neither the time nor the money nor perhaps the expertise to undertake direct investment in equities successfully. The advantage is that the investor in a mutual funds is taking much less of a risk than a direct equity investors, it provides specialist investment experts which should ensure greater success than the in-expertise or inexperience investors can achieve on his own and it reduces the administrative burden of investment.
8

Jhaveri mutual funds team is in close contact with various fund houses AMC`s (Assets Management Company) and interactive session are held with fund manager and also provides regular updates on new products and new schemes. Tax benefits U/S 80C. Open ended scheme. Closed ended scheme. Diversified portfolio scheme. Income funds. Government securities funds. Systematic investment plan (SIP).

The fund and scheme selection is done after an in depth research on parameters like risk adjusted returns, rolling return, volatility in the market and portfolio churn etc.

7)

ONLINE MARKET SUGGESTION/CHART: -

Jhaveri`s highly qualify team will update you with latest national, international market news, fundamental company results in past as well as present and many more news about the financial market, suggestions, charts etc.

8)

IPO (Initial Public Offering): -

Old companies can offer their shares to the investors in the primary market. This of tapping the saving is called an IPO or initial public offering SEBI regulation the way in which companies can make this offering companies can make an IPO if they meet SEBI guidance in this regard, the size of the initial issue, the exchange on which it can be listed the merchant bankers responsibilities the nature and contact of the disclosures in the prospectus, procedures for all these are laid down by SEBI and have to be strictly complied with. Some of the IPO`s have been available for subscription online were bids are made in real time and the information is made available on an instantaneous basis on the screen it is possible to subscribe for IPO shares in demat form through DP`s.
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VISION & MISSION

VISION : -

Vision refers to the goals that are broadest, most general and all inclusive. A vision describes aspirations for the future. The most effective visions are those that inspire and this inspiration often takes the form of asking for the best, the most or the greatest. Jhaveri shall be recognized as a market leader and to build unique organization of those who think different rules. Jhaveri believes in complete freedom in doing ones own work and focusing more on end results. JHAVERI SECURITIES PVT. LTD. to go ahead challenging the horizons of the services industry in providing benchmark services create wealth of customers enabling them to be competitive and differences themselves on the market place.

MISSION : -

A vision becomes tangible as mission statement. Mission identifies what is unique about the character of the organization. The mission of JHAVERI SECURITIES PVT. LTD. is as under To be the best broking house by offering world class financial services. To transform customers experience into a fruitful and enjoyable one. By using latest and modern technology for efficient and effective delivery of all financial services. To build around confidence, trust, intellect and an efficient and effective team and it will continue to believe in the same.

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AWARDS AND REORGANIZATION

JHAVERI SECURITIES PVT. LTD. is a Gujarat leading broking house with a strong and stable position in the financial market and having experience in financial services, capital markets, mutual fund distribution and has varied skill set to business. At the level of performance JHAVERI SECURITIES PVT.LTD. is recognized by the CRISIL. Crisil is one of the countrys most respected rating agencies and get the award.

Account opening wise among top 10. Number of sub broker wise 20th rank. This rating indicates High Level of Credit Worthiness

JHAVERI SECURITIES PVT. LTD. is also recognized by D & B (Dun and Bradstreet). Dun and Bradstreet India reached out of almost 300 equity and commodity broking firms located across India.

11

INTRODUCTON ABOUT MUTUAL FUND.

12

CONCEPT. In a mutual fund, many investors contribute to form a common pool of money. This pool of money is invested in accordance with a stated objective. The ownership of the fund is thus joint or "mutual"; the fund belongs to all investors. A single investor's ownership of the fund is in the same proportion as theamount of the contribution made by him bears to the total amount of the fund. A mutual fund uses the money collected from investors to buy those assets which are specifically permitted by its stated investment objective. Thus, a growth fund would buy mainly equity assets- ordinary shares, preference shares, warrants, etc. An income fund would mainly buy debt instruments such as debentures and bonds. The fund's assets are owned by the investors in the same proportion as their contribution bears to the total contribution of all investors put together. When a person buys "shares" of a joint stock company, the purchase makes the investor a part owner of the company and its assets. In the same way, when an investor subscribes to a mutual fund, he becomes part owner of fund's assets. In India, a mutual fund is constituted as a Trust and the investor subscribes to the "units" of a scheme launched by the fund, which is where the term Unit Trust comes from. An investor can buy the shares from a company only when the company makes a share issue. At other times, a share can be purchased from another investor through the stock exchange if the share is listed. A shareholder can sell the share to the company only when the company announces "share buyback". At other times, he can sell share to another investor through a stock exchange. To ensure that there is fairness, sale and purchase has to take place at fair value of the unit. In other words, each .share or unit that an investor holds needs to be assigned a value. Since the units held by an investor evidence the ownership of the fund's assets, the value of the total assets of the fund when divided by the total number of units issued by the mutual fund, gives us the
13

value of one unit. This is generally called the Net Asset Value (NAV) of one unit or one share. The total value of an investor's part ownership is thus determined by multiplying the NAV with the number of units held. So mutual fund is a pure intern ediary which ertorrns a basic function of buying and selling securities on behalf of its unit holders A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. 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 to 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. The flow chart below describes broadly the working of a mutual fund

Mutual Fund Operation Flow Chart

14

EVOLUTION OF MUTUAL FUND The mutual fund industry in India started in 1963 with the formation of Unit Trust of India, at the initiative of the Reserve Bank and Government of India. The objective then was to attract the small investors and introduce them to market investments. Since then, the history of mutual fund in India can be broadly divided into 6 distinct phases. Phase 1 - 1964-87: Growth of Unit Trust of India In 1963, UTI was established by an Act of Parliament. As it was the only entity offering mutual funds in India,' it was a monopoly. Operationally, UTI was set up by the Reserve Bank of India, but was later de-linked from the RBI. The first scheme, and for long one of the largest, launched by UTI was Unit scheme 1964. Over the years, US-64 attracted the largest number of investors in any single investment. scheme. It was also atleast partially the first open-ended scheme in the country. Phase 2 - 1987-1993: Entry of Public Sector Funds 1987 marked the entry of other public sector mutual funds. With the opening up of the economy, many public sector banks financial institutions were allowed to establish mutual funds. State Bank of India established the first nonUTI mutual fund- SBI Mutual Fund - in November 1987. This was followed by Can bank MF, LIe MF, Indian Bank MF, Bank of India mf, GIC MF and PNB MF. These funds helped in enlarging the investor community and the investible funds. From 1987- 88 to 1992-93, the assets under management increased from Rs. 6,700 cr. to Rs. 47,400 cr., nearly seven times. During this period, investors showed a marked interest in mutual funds, allocating a larger part of their savings to investments in the funds (5.2% in 1992, 3.1 % in 1988). UTI was still the largest segment of the industry, with about 80% market share.

15

GPhase 3 - 1993; 1996: Emergence of Private Funds A new era in the mutual fund industry began in 1993 with the permission granted for the entry of private sector funds. This private funds have brought in with them the latest product innovation, investment management techniques and investor-servicing technology that make the Indian mutual fund industry today a vibrant and growing financial intermediary. During the year 1993-94, five private sector mutual funds launched their schemes followed by six others in 1994-95. Initially, mobilization of funds by the private mutual funds was slow. One influencing factor was the development of SEBI's regulatory framework for the Indian mutual fund industry. Yet another important factor has been the steadily improving performance of several fund houses. Phase 4 - 1996-99: Growth and SEBI Regulation Since 1996, the mutual fund industry in India saw a tighter regulation and higher growth. Measures were taken both by SEBI to protect the investor and by the Government to enhance investors' returns through tax benefits. A comprehensive set of regulations for all mutual funds operating in India was introduced with SEBI (Mutual Fund) Regulations, 1996. The erstwhile LiTI voluntarily adopted SEBI guidelines for its new schemes. Similarly the budget of Union Government in 1999 took big step in exempting all mutual fund dividends from income tax in the hands of investors. Both the 1996 regulations and the 1999 budget must be considered of historic importance, given their far-reaching impact on the fund industry. Phase 5 - 1999-2004: Emergence of a large and uniform industry The other major development in the fund industry has been the creation of a level playing field for all mutual funds operating in India. This happened in February 2003, when the UTI was repealed. Unit Trust of India no longer has a special legal status as a trust established by an Act of Parliament. Instead, it has also adopted the same structure as any other fund in India -a Trust and an Asset
16

Management Company. UTI Mutual Fund is the present name of the erstwhile Unit Trust of India. The emergence of a uniform industry with the same structure, operations and regulations makes it easier for distributors and investors to deal with any fund house in India. Between 1999 and 2005, the size of the industry has doubled in terms of assets under management which have gone from about Rs. 68,000 cr. to over Rs. 150,000 cr. Phase 6 - From 2004 onwards: Consolidation and Growth The industry has lately witnessed a spate of mergers and acquisitions, most recent ones being the acquisition of schemes of Alliance MF by Birla Sun Life, Sun F&C MF by Principal and PNB MF by Principal. At the same time, more international players continue to enter India, including Fidelity, one of the largest funds of the world. The stage is set now for growth through consolidation and entry of new international and private sector players. As at the end of March 2006, there were 29 funds.

17

ORGANISATION OF A MUTUAL FUND There are many entities involved and the diagram below illustrates the organizational set up of a mutual fund:

Explanation:As per above chart the unit holders are the one which owe the units of a company in the form of equity or debentures. A Sponsor is like a promoter of a company as he gets the fund registered with SEBI. A sponsor will form a trust and appoint a board of trustees. They act as an independent body who are the promoter of unit holder's money. A sponsor will also appoint an Asset management company (AMC) as fund managers. They act as an investment manager of the trust as it float and manage different investment schemes. The sponsors, directly or acting through the trustees will also appoint a custodian to hold the fund assets. A custodian is appointed by the board of
18

trustees for safe keeping of physical securities. While the transfer agents are responsible for issuing and redeeming units of mutual funds and providing other related services such as preparation of transfer documents and updating investors records. Securities Exchange Board of India (SEBI) has the power of controlling the activities of all mutual fund companies.

19

MUTUAL FUND TYPES Funds are generally distinguished from each other by their investment objectives and types of securities they invest in. We now look at the major types that are available under the general classifications as discussed above. (1) Money Market/Liquid Funds: Often considered to be at the lowest rank in the order of risk level, Liquid funds invest in debt securities of a short-term nature, which generally means securities of less than one-year maturity. (2) Gilt Funds: Gilts are government securities with medium to long-term maturities, typically of over one year (under one-year instruments being money market securities). Gilt funds face interest rate risk. (3) Debt Funds (or Income Funds): Next in order of risk level, we have the general category Debt Funds. Debt funds invest in debt instruments issued not only by governments, but also by private companies, banks and financial institutions and other entities such as infrastructure companies. (a) Diversified Debt Funds: A debt fund invests in all available types of debt securities, issued by entities across all industries and sectors are a properly diversified debt fund. (b) Focused Debt Funds: Some debt funds have a narrower focus, with less diversification in its investments. The central point to note is that all there narrow-focus funds have greater risk than diversified debt funds. (c) High Yield Debt Funds: High yield debt funds that seek to obtain higher, interest returns by investing in debt instruments that are considered "below investment grade".

20

(d) Assured Return Funds - an Indian Variant: UTI and other funds had offered "assured return" schemes to investors. In assured return schemes the shortfall, if any, is borne by the sponsors/AMCs. Assured return debt funds certainly reduce the risk to the investor as compared to all other debtor equity funds, but only to the extent that the guarantor hats the required financial strength. (e) Fixed Term Plan Series - Another Indian Variant: Fixed Term Plans are essentially closed-end in nature, in that the mutual fund AMC issues a fixed Number of units for each series only once and closes the issue after an initial offering period, like a closed-end scheme offering. (4) Equity Funds: As investors move from Debt fund category to Equity funds, they face increased risk. Equity funds invest a major portion of their corpus in equity shares issued by companies, acquired directly in initial public offering or through the secondary market. Equity funds NAV fluctuate with all these price movements. Equity funds are generally considered at the higher end of the risk spectrum among all funds available in the market. (a)Aggressive Growth Funds: Aggressive growth funds target maximum capital appreciation, invest in less researched or speculative shares and may adopt speculative investment strategies to attain their objective of high returns for the investors. (b) Growth Funds: Growth funds invest in companies whose earnings are expected to rise at an above average rate. (c) Specialty Funds: These funds have a narrow portfolio orientation and invest in only companies that meet pre-defined criteria. Clearly, concentrated specialty funds tend to be more volatile than diversified funds.

21

(i). sector funds - sector funds portfolios consist of investments in only one industry or sector of the market. (ii). Foreign securities funds these funds invest in one or more foreign countries thereby achieving diversification across the country's border. (iii). Mid-Cap or Small-Cap Equity Funds - These funds invest in shares of companies with relatively lower market capitalization than that off big, blue chip companies. (iv). Option Income Funds - These funds do not yet exist in India, but option income funds write options on a significant part of their portfolio. (d) Diversified Equity Funds: A fund that seeks to invest only in equities for a very small portion in liquid money market securities, but is not focused on anyone or few sectors or shares, may be termed a diversified equity fund. (i). Equity Linked Savings Schemes - an Indian vibrant - In India, investors have been given tax concessions to encourage them to invest in equity markets trough these special schemes. Investment in these schemes entitles the investor to claim an income tax rebate, but usually has a lock-in period. As the name suggests, there are no specific restrictions on the investment objective for the fund, managers. (e) Equity Index Funds: An index fund tracks the performance of a specific stock market index. The objective is to match the performance of the stock market by tracking an index that represents the overall market. (f) Value Funds: Value funds try to seek out fundamentally sound companies whose shares are currently under-priced in the market. Value funds will add only those shares to their portfolios that are selling at low price-earnings ratios, low market to book value ratios and are believed to be undervalued compared to their true potential.

22

(g) Equity Income or Dividend Yield Funds: Equity income fund would invest largely in power/utility companies shares of established companies that pay higher dividends and whose price does not fluctuate as much as other shares. (5) Hybrid Funds - Quasi Equity/Quasi Debt: These are funds that seek to have a relatively balanced holding of debt and equity securities in their portfolios. (a) Balanced Funds: A balanced fund is one that has a portfolio comprising debt instruments, convertible securities, and preference and equity shares. (b) Growth and Income Funds: These funds seek to strike a balance between capital appreciation and income for the investor. (c) Asset Allocation Funds: Asset allocation fund could be riskier. The proportion of money to be invested in a particular class of asset is predefined and so it can be said that their "asset allocation" is predetermined to a large extent. (6) Commodity Funds: These funds specialize in investing in different commodities directly or through shares of commodity companies or through commodity futures contrasts. (7) Real Estate Funds: These would invest in real estate directly, or may fund real estate developers, or lend to them, or buy shares of housing finance or may even buy their securitized assets.

23

(8) Exchange Traded Funds: It combines the best feature of open end and closed end structure. It tracks a market index and trades like a single stock on the stock exchange. (9) Fund of Funds: it invests in other mutual funds. Just as normal MF invest in a portfolio of securities such as debt or equity, a fund of funds invests in a portfolio of the units of other mutual fund schemes.

24

BENEFIT OF MUTUAL FUND INVESTMENT

(1) Professional Management:The primary advantage of funds (at least theoretically) is the professional management of your money. Investors purchase funds because they do not have the time or the expertise to manage their own portfolios. A mutual fund is a relatively inexpensive way for a small investor to get a full-time manager to make and monitor investments.

(2) Diversification:Investments are spread across a wide cross-section of industries and sectors and so the risk is reduced. Diversification reduces the risk because all stocks dont move in the same direction at the same time. One can achieve this diversification through mutual fund with far less money than one can on his own.

(3)Economies of scale:Because a mutual fund buys and sells large amounts of securities at a time, its transaction costs are lower than what an individual would pay for securities transactions.

(4) Liquidity:Just like an individual stock, a mutual fund allows you to request that your shares be converted into cash at any time. Mutual fund provides greater liquidity.

(5)Provide Better Yields:The pooling of funds from a large number of customers enables the fund to have large funds at its disposal. Due to these large funds, mutual funds are able to buy cheaper and sell dearer than the small and medium investors. Thus, they are able to command better market rates and lower rates of brokerages. So, they provide better yields to their customers. They also enjoy the economies of large scale and can reduce the cost of capital market participation.

25

(6) Offering Tax Benefit:Certain funds offer tax benefits to its customers. Thus, apart from dividends, interest and capital appreciation, investors also stand to get the benefit of tax concession.

(7) Convenient Administration Return Potential:Returns in the mutual fund are generally better than any other option in any other avenue over a reasonable period of time. People can pick their investment horizon and stay put in the chosen fund for the duration. Equity funds can perform most other investments over long period by placing long term calls on fundamentally good stocks. The debt fund too will outperform other option such as banks. Though they are affected by the interest rate risk in general, the returns generated are more as they pick securities with different duration that have different yields and so are able to increase the overall returns from the portfolio.

(8) Greater Affordability:Even a very small investor can afford to invest in Mutual Fund. They provide an attractive and cost effective alternative to direct purchase of shares.

26

DISADVANTAGES OF MUTUAL FUND

(1) Fees and Commissions:All funds charge administrative fees to cover their day-to-day expenses. Some funds also charge sales commission or loads to compensate brokers, financial consultants or financial planners. Even if you dont use broker or other financial advisor, who will pay sales commission if you buy shares in a load fund. (2) No Guarantees:No investment is risk free. If the entire stock market declines in value, the value of mutual fund shares will go down as well, no matter how balanced the portfolio. Investors encounter fewer risks when they invest in mutual funds than when they buy and sell stocks on their own. However, anyone who invests through a mutual fund runs the risk of loosing money. (3) Taxes:During a typical year, most activity managed mutual funds sell anywhere from 20% to 70 % of the securities in the portfolios. If your fund makes a profit on its sales, you will pay taxes on the income you receive, even if you reinvest the money you made. (4) Management Risk:When you invest in mutual fund, you depend on the funds manager to make the right decision regarding the funds portfolio. If the management does not perform as well as you had hoped, you might not make as much money on your investment as you expected.

27

RESEARCH METHODOLOGY

28

RESEARCH METHODOLOGY

Research is a logical and systematic search for new and useful information on a particular topic. It is an investigation of finding solutions to scientific and social problems through objective and systematic analysis. It is a search for knowledge, that is, a discovery of hidden truth. Here knowledge means information about matters. The information might be collected from different sources like experience, human beings, books, journals, nature, etc. A research can lead to new contributions to the existing knowledge. Only through research is it possible to make progress in a field. Research is done with the help of study, experiment, observation, analysis, comparison and reasoning. Research is in fact ubiquitous. For example, we know that cigarette smoking is injurious to health; heroine is addictive; cow dung is a useful source of biogas; malaria is due to the virus protozoan plasmodium; AIDS (Acquired Immuno Deficiency Syndrome) is due to the virus HIV (Human Immuno deficiency Virus).How did we know all these? We became aware of all these information only through research. More precisely, it seeks predictions of events and explanations, relation-ships and theories for them.

29

OBJECTIVE OF PROJECT RESEARCH

As my subject is finance I have to take my field work topic as related to finance. I have many alternative in front of me as subject of finance, but among them I have to chose only one and initially I was very confused that which one should be selected and at last I have taken mutual fund 8S my field project. The main objective of the study is as follows:

Analyzing rationale behind choosing some mutual funds and their attractiveness to individual investors. The factors affecting the perception of investors on mutual fund.

To ascertain the market viability of mutual funds by determines the market response to investors.

30

IMPORTANCE OF RESEARCH

Research is important both in scientific and non-scientific fields. In our life new problems, events, phenomena and processes occur every day. Practically implemental solutions and suggestions are required for tack-ling new problems that arise. Scientists have to under-take research on them and find their causes, solutions, explanations and applications. Precisely, research assists us to understand nature and natural phenomena. Some important avenues for researches are: (1) A research problem refers to a difficulty which a re-searcher or a scientific community or an industry ore government organization or a society experiences. It may be a theoretical or a practical situation. It calls for a thorough understanding and possible solution. (2) Research on existing theories and concepts help us identify the range and applications of them. (3) It is the fountain of knowledge and provides guidelines for solving problems. (4) Research provides basis for many government policies. For example, research on the needs and desires of the people and on the availability of revenues to meet the needs helps a government to prepare a budget. (5) It is important in industry and business for higher gain and productivity and to improve the quality of products (6) Mathematical and logical research on business and industry optimizes the problems in them. (7) It leads to the identification and characterization of new materials, new living things, new stars, etc.

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TYPES OF RESEARCH

GENERALLY THERE ARE TWO TYPES OF RESEARCH: PRIMARY RESEARCH:Primary research consists in research to collect original primary data. It is often undertaken after the researcher has gained some insight into the issue by collecting secondary data. This can be through numerous forms, including questionnaires, direct observation and telephone interviews amongst others. Advantages:

Primary research Secondary research

Addresses specific research issues as the researcher controls the search design to fit their needs

Great control; not only does primary research enable the marketer to focus on specific subjects, it also enables the researcher to have a higher control over how the information is collected. Taking this into account, the researcher can decide on such requirements as size of project, timeframe and goal.

Disadvantages:

Compared to secondary research, primary data may be very expensive in preparing and carrying out the research. Costs can be incurred in producing the paper for questionnaires or the equipment for an experiment of some sort.

In order to be done properly, primary data collection requires the development and execution of a research plan. It takes longer to undertake primary research than to acquire secondary data.

Some research projects, while potentially offering information that could prove quite valuable, may not be within the reach of a researcher.

By the time the research is complete it may be out of date. Low response rate has to be expected.

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SECONDARY RESEARCH:Secondary research can be described as the most widely used method for data collection. This process involves accessing information that is already gathered from either the originator or a distributor of primary research. Secondary research includes collecting information from third-party sources such as company websites, sales and accounting records, magazine articles and marketing research reports. It also includes any previously gathered information used by the marketer from any internal or external source.

Advantages: Low Cost to Acquire The use of secondary data has allowed researchers access to valuable information for little or no cost to acquire. Therefore, this information is much less expensive then if the researchers had to carry out the research themselves. Clarification of Research Question The use of secondary research may help the researcher to clarify the research question. Secondary research is often used prior to primary research to help clarify the research focus.

Disadvantages: Quality of Research There are some disadvantages to using secondary research. The originators of the primary research are largely self-governed and controlled by the marketer. Therefore, the secondary research used must be scrutinized closely since the origins of the information may be questionable. Moreover, the researcher needs to take sufficient steps to critically evaluate the validity and reliability of the information provided.

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Not Specific to Researchers Needs In many cases, secondary data is not presented in a form that exactly meets the researchers needs. Therefore, the researcher needs to rely on secondary data that is presented and classified in a way that is similar to their needs.

Incomplete Information In many cases, researchers find information that appears valuable and promising. The researcher may not get the full version of the research to gain the full value of the study. This is because many research suppliers offer free portions of their research and then charge expensive fees for their full reports.

Not Timely When using secondary research, one must exercise caution when using dated information from the past. With companies competing in fast changing industries, an out-of-date research reports many have little or no relevance to the current market situation.

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MY RESEARCH METHOD PRIMARY RESEARCH:Primary research consists in research to collect original primary data. It is often undertaken after the researcher has gained some insight into the issue by collecting secondary data. This can be through numerous forms, including questionnaires, direct observation and telephone interviews amongst others. SECONDARY RESEARCH:Secondary research can be described as the most widely used method for data collection. This process involves accessing information that is already gathered from either the originator or a distributor of primary research. Secondary research includes collecting information from third-party sources such as company websites, sales and accounting records, magazine articles and marketing research reports. It also includes any previously gathered information used by the marketer from any internal or external source.

I am using primary research method. And I can be through the answer by use questionnaire

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DATA ANALYSIS

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DATA ANALYSIS

Data analysis is the technique one employs to derive or information from the available sources. Such type of information should be analyzed in following two basic ways. (1) Primary Research:Primary research means it contains details in the direct conversation or contact with the concerned person about the respective topic or section. Such people should be executive, staff members, customers, operating heads etc. where the view is to immediately take down data by way of writing or any other form. Here in my report, the data is done by data collection from the investors of JHAVERI SECURITIES and also information collected from MR.CHIRAG TRIVEDI territory manager of JHAVERI SECURITIES Bhavnagar and other employees of JHAVERI SECURITIES. For doing this one has to know each and every thing about mutual fund. I had tried my best to get the knowledge about the concept and place of mutual fund in investors mind. So to get the right information about the knowledge and willingness of investors against mutual fund I do a survey on mutual fund and prepared a questionnaire for this survey. I meet different peoples in JHAVERI SECURITIES. This survey gives me too much knowledge of mutual fund. Form this I learned the attitude, knowledge, investment philosophy of investors against mutual fund. (2) Secondary Research:Secondary research contains the collection of data through various indirect readymade forms like books, journals, magazines, annual report and brochures etc. Here the information is collected form the data available on internet, fact sheets of different mutual funds, mutual fund digest of JHAVERI SECURITIES, indirect talk with investors of JHAVERI SECURITIES.

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MARKET SURVEY FORM MUTUAL FUND

NAME:AGE:OCCUPATION:( 1) WHAT IS YOUR MONTHLY INCOME LEVEL? 10000-20000 30000-50000 ( 2) 20000-30000 50000 and above

WHAT PERCENTAGE OF YOUR INCOME YOU INVEST? Less than 10% 20% - 30% 10%-20% MORE THAN 30%

( 3)

IN WHICH KIND OF INVESTMENT WOULD YOU LIKE TO INVEST? TOTAL RISK SECURITY RISK AND RETURN

( 4)

IN WHICH KIND OF INVESTMENT YOU ARE INVESTING? SHARE MUTUAL FUND FIXED DIPPOSIT POST ASSETS INSURANCE

( 5)

HOW MUCH KNOWLEDGE YOU HAVE ABOUT MUTUAL FUND? VERY HIGH MEDIUM NIL HIGH LOW

( 6) ( 7)

HOW MUCH YOU ARE INVESTING IN MUTUAL FUND FROM YOUR INCOME? %

BEFORE INVESTING YOUR MONEY IN MUTUAL FUND, WHAT DO YOU DO? HAVE YOU STUDY YOUR BROKER OR ADVISOR RECOMMENDED YOU OR
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YOUR SELF AND NVEST

SOMEONE GIVING YOU TIP. ( 8) DO YOU CONSIDER MUTUAL FUND TO BE A BETTER OPTION FOR YOU IN ALL YOUR INVESTMENT AVENUES? YES NO

( 9)

WHICH AMONG THE MUTUAL FUND COMPANIES DO YOU PREFER TO INVEST? PLEASE GIVE THE RANK. MUTUAL FUNDS SBI MUTIAL FUND SUNDARAM MUTIAL FUND PRUDENTIAL ICICI MUTIAL FUND RELIANCE MUTIAL FUND UTI MUTIAL FUND LIC MUTIAL FUND FRANKLIN TEMPELTON MUTIAL FUND STANDERED CHARTERED ASSET MANAGEMENT COMPANY KOTAK MAHINDRA MUTIAL FUND HDFC MUTIAL FUND RANK

THANK YOU PREPARED BY:PAVSIYA CHINTAN BHAVNAGAR.

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DATA ANALYSIS

Q: 1 WHAT IS YOUR MONTHLY INCOME LEVEL?

INCOME LEVEL
2, 4% 3, 7% 10, 22% 30, 67%

10000-20000 30000-50000

20000-30000 50000 AND ABOVE

Level of Investors Monthly Income: Level Total 10000-20000 20000-30000 30000-50000 50000 and above 30 10 03 02

I have collected the data of 45persons by filling the forms from them and on that basis I found that most of the investors have come under the first income slab i.e. Rs. 10000-20000 per months.

By seeing the above chart I can say that 1. 67% has monthly income of Rs.10000-20000 per month. 2. 22% has monthly income of Rs.20000-30000 per month. 3. 7% has monthly income of Rs.30000-50000 per month. 4. 4% earns Rs.50000 and above per month.

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Q: 2 WHAT PERCENTAGE OF YOUR INCOME YOU INVEST?

INVESTMENT LEVEL
5, 11% 7, 16% 18, 40%

15, 33% LESS THAN 10% 20%-30%

10%-20% MORE THAN 30%

Investment Made By An Investor Form His Income: LESS THAN INVESTMENT TOTAL 10% 18 MORE THAN 10%-20% 20%-30% 30% 15 7 5

The question will give the answer about the percentage of investment made by the investors from his total income. This is shown in the above mention chart. By getting the above chart I can conclude that 1. 40% is investing less than 10% of their total income. 2. 33% is investing 10%-20% of their total income. 3. 16% is investing 20%-30% and 4. 11% is investing more than 30% of their total income. This chart shows that maximum i.e.40% of the investors investing less than 10%of their total income.

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Q: 3 IN WHICH KIND OF INVESTMENT WOULD YOU LIKE TO INVEST?

KIND OF INVESTMENT
21, 47% 10, 22%

TOTAL RISK RISK AND RETURN

14, 31% SECURITY

Kinds of Investments Does An Investor Is Prefer To Invest: KIND OF INVESTMENT TOTAL TOTAL RISK 10 SECURITY 14 RISK AND RETURN 21

I have collected the data of 45persons on the basis of 100% and it gives me information about the attitude of the investors. Means we can understand the risk taking ability of the investors and what type of investment they prefer From the above chart we can say that 1. 22% are preferred to invest in Total Risk means High Risk and High Return. 2. 31% of investors prefer to invest their money in Security it means they prefer Low Risk and Low Return and 3. 47% of investors prefer Risk and Return means they prefer to invest their money in Medium Risk and Medium Return. It shows that maximum person i.e.21 person out of 45 prefer to invest in Risk and Return means Medium Risk and Medium Return.
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Q: 4 IN WHICH KIND OF INVESTMENT YOU ARE INVESTING?

TYPES OF INVESTMENT
3, 7% 2, 4% 6, 13% 5, 11% 13, 29% SHARE POST MUTUAL FUND ASSETS FIXED DIPOSIT INSURANCE 16, 36%

Types of Investment That Investors Prefer To Invest: TYPES SHARE TOTAL 16 MUTUAL FUND 13 FIXED DIPPOSIT 5 POST 6 ASSETS 2 INSURANCE 3

The question will give the answer about the preference of investors i.e. now a day in which types of investment they are prefer to invest. It gives information that which investment is more suitable for them at the current market situation? By seeing above chart I can say that 1. 36% is preferred to invest in Share. 2. 29% is preferred to invest their money in Mutual Fund. 3. 11% is interested to invest in Fixed Deposit. 4. 13% investors preferred to invest their money in security like Post. 5. 4% interested to invest in Assets and 6. 7% is thinking about safety means they invest their money in Insurance sector. From the chart I can say that most of the investors are investing their money in so many sectors but the most preferable investment they preferred to invest is shares i.e. 16 persons out of 45 are interested in Share. While Mutual Fund acquired second position i.e. 13 persons are invested in Mutual Fund.

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Q: 5 HOW MUCH KNOWLEDGE YOU HAVE ABOUT MUTUAL FUND?

KNOWLEDGE OF INVESTORS
5, 11% 6, 13% 2, 4% 10, 22%

22, 50%

VERY HIGH

HIGH

MEDIUM

LOW

NIL

Knowledge of Investors about Mutual Fund: KNOWLEDGE OF INVESTORS. TOTAL VERY HIGH 2 10 22 6 5 HIGH MEDIUM LOW NIL

The question will give the information that how much investors are aware about mutual fund, what type of knowledge they have about mutual fund. Form the above chart I can say that 1. 4% of the investors acquired Very High knowledge regarding mutual fund. 2. 22% has a High knowledge about mutual fund. 3. 50% of the investors possesses Medium knowledge about mutual fund. 4. 13% have Low knowledge about mutual fund and 5. 11% of the investors have dont know anything about mutual fund. From this information I can conclude that most of the investors i.e. 22person have medium knowledge regarding mutual fund for this we can say that mainly they are dependent on the advice of broker of financial advisor.
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Q: 6 HOW MUCH YOU ARE INVESTING IN MUTUAL FUND FROM YOUR INCOME?

PERCENTAGE OF INVESTMENT IN MUTUAL FUND

0, 0% 7, 16% 0, 0% 15, 33%

23, 51% 0% 1%-5% 5%-10% 10%-15% 15% AND ABOVE

Percentage of Investment in Mutual Fund: PERCENTAGE OF INVESTMENT % 1 TOTAL 5 23 7 0 0 0 1%-5% 5%-10% 15% AND 10%-15% ABOVE

This question will give the answer that how much investments are made by investors in mutual fund. From the chart I can analyze that 1. 33% investors are investing nothing from their income means they are contributing 0% towards mutual fund. 2. 51% is investing 1%-5% of their income in mutual fund. 3. 16% investors are investing 5%-10% of their income in mutual fund. 4. I have not found any investors who is investing 10%-15% or 15% above money in mutual fund means there are 0% investors who are investing 10%-15% or 15% above money in mutual fund.

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Q: 7 BEFORE INVESTING YOUR MONEY IN MUTUAL FUND WHAT DO YOU DO?

INVESTOR'S PREFERENCE

18, 40% 27, 60%

STUDAY YOURSELF

TAKE ADVICE FROM BROKER

Investor's preference regarding investment: STUDY YOUR NAME SELF TAKE ADVICE FROM BROKER OR RECOMMENDATION FROM FINANCIAL ADVISOR TOTAL 18 27 The question will give information about investors knowledge regarding investment in mutual fund. Means what they are doing before investing in mutual fund what steps they follow. By analyzing the chart we can say that 1. 40% of the investors are study itself about mutual fund and invest their money and 2. 60% of the investors depends on their financial advisors or broker or tip from financial concern to invest in mutual fund. It shows that most of the investors depend on their financial advisor than study by them self. It shows the poor knowledge of investors about mutual fund.

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Q: 8 DO YOU CONSIDER MUTUAL FUND TO BE A BETTER OPTION FOR YOU IN ALL YOUR INVESTMENT AVENUES?

CONSIDERATION OF BETTER OPTION

13, 29%

32, 71%

YES

NO

Mutual Fund to Be a Better Option: OPTION TOTAL YES 32 NO 13

The question will give the information about the how much the investors are aware about mutual fund and their policies. We can able to know the awareness of investors regarding mutual fund. By looking this chart we can say that 1. 71% is saying that they consider mutual fund to be a better option. 2. While still 29% says that mutual fund is not better option.

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FINDINGS
From the first analysis i.e. investors income level I find that most of the investors are of income group of 10000-20000 p.m. are more as compare to other i.e. 20000-30000, 30000-50000 and 50000 and above. So if the investors from the income group of 30000-50000 and 50000 and above are taken into consideration than mutual fund companies and broker would have good profits.

By doing the second analysis I find that most of the investors are investing less than 10% of their income in mutual fund than after 10%-20%, 20%-30% and 30% and above respectively. The reason for this is that the investors that involved in investment are mostly earned 10000-20000 p.m. so the investment would be as per that only. So here the brokers and agents should try to get some investor who can invest more amount of money from their income. If they promote those person who are not doing any kind of investment from their income into the market and also those new investors involved in the market then it can raise investment level in mutual fund.

With the information given in third analysis shows the nature and attitude of investors are different and we can not change the attitude of investors. But for make increase in sale of mutual fund one can try to diversify the investments done by the investor in mutual funds. For this we have to attract that investor who has attitude of taking risk with returns because they are willing to take risk in those investments which have more return. So we have to convert investments of the investors into mutual funds. By analyzing the fourth question we can see that most of the investors are prefer to invest in shares than in mutual funds. Here we can diversify their investment in fixed deposits to mutual fund because this money are remains ideal for so many years while money invested in mutual funds are circulating throughout the years. I find information in 5th question is that most of the investors posses medium knowledge regarding while few investors posses very high knowledge.
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We have to increase awareness of those investors who dont know anything regarding mutual fund and convinced them to make investment in it. We also try to increase the knowledge of those investor who posses medium knowledge. By looking towards question 6th we can say that most of the investors are investing 1%-5% of their income in mutual fund while many of the investor is investing nothing from their income in mutual fund. So the brokers can raise awareness regarding mutual fund in those investors and convince them to invest in mutual fund by familiarizing them with the concept and benefits of mutual fund. By seeing the 7th analysis we can easily understand that most of the investors are waiting for tips from their financial advisor or broker. And these people are giving advice of those funds in which they can get good commission. So investors have to think on their own whether it is beneficial to him to invest or not rather to take advice. I find in the 8th question that many of the investors are saying that mutual fund is best option. I made the survey of 45 peoples on the basis of 100% and on that basis I find that out of 45 peoples 32 peoples says that mutual fund to be a better for investment.

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CONCLUSION

Conclusion means that part which we say after completing our target. So it is brief view of a particular work that has been undergone. In a mutual fund, many investors contribute to form a common pool of money. This pool of money is invested in accordance with a stated objective. The ownership of the fund is thus joint or "mutual"; the fund belongs to all investors. A single investor's ownership of the fund is in the same proportion as the amount of the contribution made by him bears to the total amount of the fund. A mutual fund uses the money collected from investors to buy those assets which are specifically permitted by its stated investment objective. Thus, a growth fund would buy mainly equity assets- ordinary shares, preference shares, warrants, etc. An income fund would mainly buy debt instruments such as debentures and bonds. The fund's assets are owned by the investors in the same proportion as their contribution bears to the total contribution of all investors put together. There is no doubt India has a vast mutual investment potential and the chances are very bright that its potentials will increase in the near future.

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BIBLIOGRAPHY.

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BIBLIOGRAPHY 1. Out Look of Book THE INDIAN FINANCIAL SYSTEM BY: - Vasant Desai 2. Kothari, C.R., Research Methodology, 2nd edition 3. www.moneypore.com www.moneycontrol.com www.sebi.gov.com www.amfindia.com Fact sheet of different mutual funds.

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ANNEXURE

FEW FREQUENTLY USED TERMS

Net Asset Value (NAV):Net asset value is the market value of assets of the scheme minus its liabilities. The per unit NAV is the asset value of the scheme divided by the number of units outstanding on the valuation date.

Sale Price:Sale price is the price that you pay when you invest in the scheme. It is also called offer price. It may include a sales load. Sales Load:-

Sales load is a charge collected by a scheme when it sells the units. And it is also called, Front-end load. Schemes that do not charge a load are called No Load schemes.

Repurchase Price:It is the price at which close ended schemes repurchase its schemes and it may include a back-end load. This is also called bid price.

Redemption Price:It is the price at which open-ended schemes repurchase its units closeended schemes redeem their units on maturity. Such prices are NAV related. Repurchase or Back-end Load:It is a charge collected by a scheme when it buys back the units from the unit holders.

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