A

SUMMER TRAINING PROJECT REPORT

ON

“A study to Analyse Investors Behavior Regarding Mutual Funds at

EDELWEISS BROKING LIMITED”

At
Edelweiss Broking Ltd.

Submitted in partial fulfilment for the Award of degree of

Bachelor of Business Administration
2008 – 2011

PREFACE

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Marketing and financing as it is said core corporative activities.

Marketing is the field that deals with getting right thing, at right place, at right time
for the right people. This is where market research came in to the picture.

Today EDELWEISS BROKING LIMITED offers different services. This has helped
it in becoming the undisputed leader in the industry in India.

Thus, the management education is incomplete without practical training.

This helps the students in entering the corporate world with confidence and
enthusiasm.

My research deals with providing the best market scenario to the company and
customer and developing awareness about various other schemes keeping in the mind
the overall marketing objective of the company.

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 DECLARATION

….hereby declare that the present report entitled as” A study to analyze investors
behaviour regarding Mutual Funds at edelweiss broking limited” Is based on my
original work and indebtedness to other work/guidance have been duly acknowledge at
relevant place

Place ------------

Date-------------

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 ACKNOWLEDGEMENT

I would like to express my immense gratitude to Mr. Rocky gupta (Area sales manager,
edelweiss broking ……….(sales manager -retail), for imparting valuable knowledge on
mutual fund market as well as expanding my horizons for edelweiss broking limited and
the distribution channel through which sales are achieved.

I am also thankful to all the staff members of edelweiss broking limited, jaipur. Who have
always guided me whenever I needed

I sincerely thank Dr. Anita Jain who helped me in successful Completion of the project.

I would like to thank my parents without whose kind blessings, support and love I could
not have undergone this project smoothly.

I thank all those who knowingly and unknowingly have helped me in fulfilment of this
project.

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 EXECUTIVE SUMMARY

Mutual Fund is an Investment product designed to target small investors, salaried people
and others who are intimidated by the mysteries of stock market but, never the less, like
to reap the benefits of stock market investing. At the Investment level, investors are
unique and are a highly heterogeneous group. Hence, their fund/scheme selection also
widely differs. Investors demand inter-temporal wealth shifting as he or she progresses
through the life cycle. This necessitates the Asset Management Companies (AMCs) to
understand the fund/scheme selection/switching behaviour of the investors to design
suitable products to meet the changing financial needs of the investors.

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 CONTENT

Preface 2

Declaration 3

Acknowledgement 4

Executive Summary 5

1. Words About the Industry 7

2. Introduction of the Organisation 21

3. Title of the Study 34

4. Research Methodology 36

5. Objectives 37

6. Types of Research 38

7. Sample Size & Method of Selecting Sample 39

8. Scope of the Study 40

9. Limitation of Study 41

10. Analysis & Interpretation 42

11. Conclusion 54

12. Recommendation & Suggestion 55

13. Appendix 56

Bibliography 56

Questionnaire 57

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1. WORDS ABOUT THE INDUSTRY

History of the Indian Mutual Fund Industry in India

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

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comprehensive and revised Mutual Fund Regulations in 1996. The industry now
functions under the SEBI (Mutual Fund) Regulations 1996.

The number of mutual fund houses went on increasing, with many foreign mutual funds
setting up funds in India and also the industry has witnessed several mergers and
acquisitions. As at the end of January 2003, there were 33 mutual funds with total assets
of Rs. 1,21,805 crores. The Unit Trust of India with Rs.44, 541 crores of assets under
management was way ahead of other mutual funds.

Fourth Phase – since February 2003

In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI was
bifurcated into two separate entities. One is the Specified Undertaking of the Unit Trust
of India with assets under management of Rs.29, 835 crores as at the end of January
2003, representing broadly, the assets of US 64 scheme, assured return and certain other
schemes. The Specified Undertaking of Unit Trust of India, functioning under an
administrator and under the rules framed by Government of India and does not come
under the purview of the Mutual Fund Regulations.

The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and LIC. It is
registered with SEBI and functions under the Mutual Fund Regulations. With the
bifurcation of the erstwhile UTI which had in March 2000 more than Rs.76, 000 crores of
assets under management and with the setting up of a UTI Mutual Fund, conforming to the
SEBI Mutual Fund Regulations, and with recent mergers taking place among different
private sector funds, the mutual fund industry has entered its current phase of consolidation
and growth. As at the end of September 2004, there were 29 funds, which manage assets of
Rs.153108 crores under 421 schemes.

Mutual Funds

MUTUAL FUNDS – AN INTRODUCTION

“…. Mutual funds are popular among all income levels. With a mutual fund, we get a
diversified basket of stocks managed by a professional…”
- Barbara Stanny, author of Prince Charming Isn’t Coming &
How Women Get Smart About Money

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“…A mutual fund is a company that brings together money from many people and invests
it in stocks, bonds or other assets. The combined holdings of stocks, bonds or other assets
the fund owns are known as its portfolio. Each investor in the fund owns shares, which
represent a part of these holdings…”
-The U.S. Securities and Exchange Commission

“A mutual fund is a pool of money collected from investors and is invested further
according to their stated investment objectives.”

-Security and exchange board of India

Introduction
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 invested by the fund manager in
different types of securities depending upon the objective of the scheme. These could range
from shares to debentures to money market instruments. The income earned through these
investments and the capital appreciation realized by the scheme is shared by its unit holders
in proportion to the number of units owned by them (pro rata). 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 portfolio at a relatively low cost. Anybody with an
investing surplus of as little as a few thousand rupees can invest in Mutual Funds. Each
Mutual Fund scheme has a defined investment objective and strategy.
The flow chart below describes broadly the working of a mutual
fund.

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 Mutual fund Investment Flow-chart

Performance of Mutual Funds in India

Let us start the discussion of the performance of mutual funds in India from the day the
concept of mutual fund took birth in India. The year was 1963. Unit Trust of India invited
investors or rather to those who believed in savings, to park their money in UTI Mutual
Fund.
For 30 years it goaled without a single second player. Though the 1988-year saw some
new mutual fund companies, but UTI remained in a monopoly position.

The performance of mutual funds in India in the initial phase was not even closer to
satisfactory level. People rarely understood, and of course investing was out of question.
But yes, some 24 million shareholders were accustomed with guaranteed high returns by
the beginning of liberalization of the industry in 1992. This good record of UTI became
marketing tool for new entrants. The expectations of investors touched the sky in
profitability factor. However, people were miles away from the preparedness of risks
factor after the liberalization.

The Assets Under Management of UTI was Rs. 67bn. by the end of 1987. Let me
concentrate about the performance of mutual funds in India through figures. From Rs.
67bn. the Assets Under Management rose to Rs. 470 bn. in March 1993 and the figure
had a three times higher performance by April 2004. It rose as high as Rs. 1,540bn.

The net asset value (NAV) of mutual funds in India declined when stock prices started
falling in the year 1992. Those days, the market regulations did not allow portfolio shifts
into alternative investments. There was rather no choice apart from holding the cash or to
further continue investing in shares. One more thing to be noted, since only closed-end
funds were floated in the market, the investors disinvested by selling at a loss in the
secondary market.

The performance of mutual funds in India suffered qualitatively. The 1992 stock market
scandal, the losses by disinvestments and of course the lack of transparent rules in the
whereabouts rocked confidence among the investors. Partly owing to a relatively weak
stock market performance, mutual funds have not yet recovered, with funds trading at an
average discount of 1020 percent of their net asset value.

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The supervisory authority adopted a set of measures to create a transparent and
competitive environment in mutual funds. Some of them were like relaxing investment
restrictions into the market, introduction of open-ended funds, and paving the gateway for
mutual funds to launch pension schemes.

The measure was taken to make mutual funds the key instrument for long-term saving.
The more the variety offered, the quantitative would be investors.

At last to mention, as long as mutual fund companies are performing with lower risks and
higher profitability within a short span of time, more and more people will be inclined to
invest until and unless they are fully educated with the dos and don’ts of mutual funds.

TYPES OF MUTUAL FUNDS

Mutual Funds are broadly classified into three categories viz. Equity Funds, Debt Funds
and Balanced Funds.

EQUITY FUNDS

These funds invest a major part of their corpus in equities. The composition of the fund
may vary from scheme to scheme and the fund manager’s outlook on various scrip’s. The
Equity Funds are sub-classified depending upon their investment objective, as follows:

• Diversified Equity Funds

• Mid-Cap Funds
• Sector Specific Funds
• Tax Savings Funds (ELSS)

Equity investments are meant for a longer time horizon. Equity funds rank high on the
risk-return matrix.

DEBT FUNDS
These Funds invest a major portion of their corpus in debt papers. Government

authorities, private companies, banks and financial institutions are some of the major

issuers of debt papers. By investing in debt instruments, these funds ensure low risk and

provide stable income to the investors. Debt funds are further classified as:

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 • Gilt Funds: Invest their corpus in securities issued by Government, popularly
known as go debt papers. These Funds carry zero Default risk but are associated
with Interest Rate risk. These schemes are safer as they invest in papers backed by
Government.
• Income Funds: Invest a major portion into various debt instruments such as
bonds, corporate debentures and Government securities.
• MIPs: Invests around 80% of their total corpus in debt instruments while the rest
of the portion is invested in equities. It gets benefit of both equity and debt
market. These scheme ranks slightly high on the risk-return matrix when
compared with other debt schemes.
• Short Term Plans (STPs): Meant for investors with an investment horizon of 3-6
months. These funds primarily invest in short term papers like Certificate of
Deposits (CDs) and Commercial Papers (CPs). Some portion of the corpus is also
invested in corporate debentures.
• Liquid Funds: Also known as Money Market Schemes, These funds are meant to
provide easy liquidity and preservation of capital. These schemes invest in short-
term instruments like Treasury Bills, inter-bank call money market, CPs and CDs.
These funds are meant for short-term cash management of corporate houses and
are meant for an investment horizon of 1day to 3 months. These schemes rank
low on risk-return matrix and are considered to be the safest amongst all
categories of mutual funds.

BALANCED FUNDS
These funds, as the name suggests, are a mix of both equity and debt funds. They invest
in both equities and fixed income securities, which are in line with pre-defined
investment objective of the scheme. These schemes aim to provide investors with the best
of both the worlds. Equity part provides growth and the debt part provides stability in
returns.

Each category of funds is backed by an investment philosophy, which is pre-defined in

the objectives of the fund. The investor can align his own investment needs with the
funds objective and invest accordingly.

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TYPES OF MUTUAL FUNDS
Investors have more mutual funds available to them than there are corporations issuing
stocks and bonds. Mutual funds can be categorized by their investment objectives: growth,
income, balanced or variations of these. They may also be classified by the market in which
it chooses to invest, like stocks or municipal bonds or by industry, such as energy or
technology.
In this tutorial, we will break down mutual funds into their objectives and markets. The
following subjects will be covered:

Objective Oriented
Funds
Market-Oriented Funds
GROWTH FUNDS SPECIALIZED FUNDS
INCOME FUNDS BOND FUNDS
BALANCE FUNDS MONEY MARKET FUNDS
INDEX FUNDS
OTHER TYPES OF MUTUAL FUNDS
Growth funds are a type of stock fund structured to appreciate over time. These funds
invest primarily in common stock of corporations that show high potential for growth.
Growth funds may realize their objectives by choosing businesses with a particular
capitalization (or cap). Small-cap businesses are small companies that grow quickly.
Mutual funds that invest in these businesses are unlikely to pay dividends to their
customers because small-cap businesses stress growing in value as their top priority. Large-
cap businesses are larger, more established companies (many are also blue chip stocks) that
may grow less rapidly. They tend to have large amounts of assets and cash on hand to
protect themselves against economic downturns. Some examples are IBM and General
Electric. The mid-caps are medium-sized companies with good growth potential. Some
have the long history of the large caps. Of the amount charged, a portion may be paid as
compensation to brokers.
Aggressive growth funds are similar to growth funds. The major difference is that
aggressive-growth portfolios are more strongly growth-oriented. Aggressive-growth funds
often choose common stock of small promising companies. They may also use investing
techniques like options writing and frequent trading to maximize their growth possibilities.
The prices of aggressive growth funds can fluctuate greatly. They are popular among those
who tolerate volatility well and who want to leave their money in their funds for a long

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time. Like growth funds, aggressive-growth funds often forego paying dividends so they
can invest their earnings back into the companies they hold.
In contrast to growth stocks, there are stocks that focus on paying dividends to their
customers -- the income stocks.

INCOME FUNDS

Income funds are structured to provide regular income dividends to their investors. They
focus on paying dividends as their top priority while de-emphasizing the growth in value of
their portfolios. Income funds place a large percentage of their funds into preferred stocks
and bonds because these investments yield relatively stable current income. They may also
invest in cash and money market securities. Income funds are popular with investors who
want stable income from their mutual funds.
There are also funds that involve paying income and seeking growth...all in one. Read
below to learn about Balanced Funds.

BALANCED FUNDS

Balanced funds invest in common stock, preferred stock, bonds and cash equivalents to
provide both current income and growth with a minimum of volatility.
The objective of balanced funds is to provide both of these ends together. On the average,
their ratio of stocks to other investments is about 60:40. Managers of balanced funds can,
however, shift this ratio one way or the other to take advantages of high interest rates or
stock market growth. Balanced funds generally have low volatility and are popular with
investors seeking current income with growth potential.

MARKET-ORIENTED FUNDS

Specialized Funds
Bond Funds
Money Market Funds
Index Funds
Other Types of Funds

SPECIALIZED FUNDS

Specialized funds limit their holdings to securities in one industry. They may choose
industries such as health care, the automobile industry, biotechnology or pharmaceuticals.
To be classified as a specialty fund, a fund must put at least 25 percent of its money into
one industry. Specialized funds are also called sector funds. They are considered by many
to be aggressive-growth.

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When a few companies in an industry perform poorly, others may be affected. Trends in an
industry often cut across company lines. That has happened in the past few years with
Internet stocks. This disadvantage may bring down much of the value of the fund. On the
other hand, certain industries will outperform the market as a whole.
Advisors often suggest that investors interested in specialized funds know the sectors they
are choosing.

BOND FUNDS

Bond funds invest primarily in debt securities to provide current income with preservation
of principal. They are generally conservative in nature (except for high-yield bonds) and
focus on paying dividends and preserving principal. Below are the most commonly bought
types of bond funds.
Municipal bond funds invest in municipal debt securities. State and local governments
issue these. Their income dividends are free from federal taxes, although capital gains from
distributions or sales are taxable. Municipal bonds may be short-term, intermediate-term or
long-term.
U.S. government bond funds invest in debt securities of the U.S. government and its
agencies to produce current income with preservation of principal. The federal government
is thought to be a good risk and can pay interest and repay principal quite effectively. These
funds include Treasury bills, Treasury notes, Treasury bonds and mortgage-backed
securities.
Corporate bond funds are made of bonds issued by companies in the private sector. They
are considered less risky than stock funds because of the "corporate guarantee to pay
interest and principal." However, a guarantee is only as good as the financial strength of the
guarantor.
Zero-coupon bond funds are pools of zero-coupon bonds. A zero-coupon bond is a bond
that is sold to an investor at a discount. It does not pay interest. When it matures, the
investor receives the face value of the bond. The difference between the face value and the
discounted purchase prices is treated as "interest." While current income is not the
objective of a zero coupon bond fund, the fund can and may pay dividends if it has any
realized income. When buying shares, the investor pays the current market value of the
fund. The investor can always redeem his or her shares for cash.
International bond funds invest in debt securities of governments and corporations of other
nations. They are attractive to some investors because higher rates may be paid in other
countries. However, changes in currency conversion rates can alter the earnings values of
these bonds.
Convertible securities funds invest in debt securities that allow the fund to convert its bonds
into stock. These funds have the objective of current income and growth with preservation
of principal. Thus, they offer characteristics of stocks and bonds. Additionally, while in
down times stocks can fall to very low prices, convertibles can still earn the income of
bonds.

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MONEY MARKET FUNDS

Money market funds invest in debts with short-term maturities and liquidity. "Short-term,"
in the case of money market investments, means one day to one year. These funds seek to
pay current, stable income. They include certificates of deposit, commercial paper,
repurchase agreements and U.S. Treasury bills.
Money market funds are popular with conservative investors. When the market enters a
downturn, these investors can place their money into these funds for safety until stocks
move upward again.
Read the tutorial on Money Market Mutual Funds to learn more.

INDEX FUNDS

An investor wishing to keep his or her mutual fund's pace in line with a measurement of the
market like the Standard and Poor's 500 may consider index funds. These funds are made
up of the securities that comprise major market indexes. The advantage of index funds is
that they are always in line with the market as a whole. Their downside is that they can't
outperform the market.
Index funds that use the same market index are not the same, however. Some divide their
holdings evenly among the various stocks, and some divide them by dollar amounts so that
bigger companies comprise a larger share.
Read the tutorial on Index Mutual Funds to learn more.

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

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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.

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

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

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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.

TRANSPERANCY

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.

SWITCHING FACILITY:

Mutual funds belong to a larger family of funds. That is, a mutual fund will offer several
products, such as a growth fund, a balanced fund, a bond fund, a money market fund, etc.
An investor can usually switch his investment from one fund to another, within the same
family at little or no charge. This gives the investor the option to switch funds if their
objectives change.

TERMS FREQUENTLY USED IN MUTUAL FUND INDUSTRY

 Net Asset Value (NAV)

The performance of a particular scheme of a mutual fund is denoted by Net Asset Value
(NAV). Net Asset Value is the market value of the assets of the scheme minus its
liabilities. Since market value of securities changes every day, NAV of a scheme also
varies on day-to-day basis. Per unit NAV is the net asset value of the scheme divided by
the number of units outstanding on the Valuation Date. For example, if the market value
of securities of a mutual fund scheme is Rs 500 Lakhs and the mutual fund has issued 10
Lakh units of Rs.10 each to the investors, then the NAV per unit of the fund is Rs.50.

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NAV is required to be disclosed by the mutual funds on a regular basis - daily or weekly -
depending on the type of scheme.

 Calculation of NAV

The most important part of the calculation is the valuation of the assets owned by the
fund. Once it is calculated, the NAV is simply the net value of assets divided by the
number of units outstanding. The detailed methodology for the calculation of the asset
value is given below.

 Asset Value

= Sum of market value of shares/debentures

+ Liquid assets/cash held, if any

+ Dividends/interest accrued

- Amount due on unpaid assets

- Expenses accrued but not paid

Net Asset Value (per unit)

= Asset Value (as calculated above) / Total Number of Units Issued

For liquid shares/debentures, valuation is done on the basis of the last or closing market
price on the principal exchange where the security is traded.

For illiquid and unlisted and/or thinly traded shares/debentures, the value has to be
estimated. For such shares, this could be the book value per share or an estimated market
price if suitable benchmarks are available.

For debentures and bonds, value is estimated on the basis of yields of comparable liquid
securities after adjusting for liquidity. The value of fixed interest bearing securities
moves in a direction opposite to interest rate changes Valuation of debentures and bonds
is a big problem since most of them are unlisted and thinly traded.

Interest is payable on debentures/bonds on a periodic basis say every 6 months. But, with
every passing day, interest is said to be accrued, at the daily interest rate, which is

19
calculated by dividing the periodic interest payment with the number of days in each
period. Thus, accrued interest on a particular day is equal to the daily interest rate
multiplied by the number of days since the last interest payment date.

Expenses including management fees, custody charges etc. are calculated on a daily
basis.

 Sale Price
It is the price paid by the investor when he / she invest in a scheme. It is also called as

Offer Price. It may include a sales load.

 Repurchase Price
It is the price at which a close-ended scheme repurchases its units and it may include a

back-end load. This is also called as Bid Price.

 Redemption Price
It is the price at which open-ended schemes repurchase their units and close-ended
schemes redeem their units on maturity. Such prices are NAV related.

 Sales Load
It is a charge collected by a scheme when it sells the units to the investor. It is also called
as ‘Front-End’ Load. Schemes that do not charge a load are called ‘No Load’ schemes.

 Repurchase or ‘Back-End’ Load

It is a charge collected by a scheme when it buys back the units from the unit holders.

 Systematic Investment Plans (SIP)

In case of Systematic Investment Plans, instead of a lump sum amount, investor invests a
pre-specified amount in a scheme at pre-specified intervals at the then prevailing NAV.

 Systematic Withdrawal Plans (SWP)

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Many mutual funds offer withdrawal programs whereby shareholders receive payments
from their investments. These payments are usually drawn from the fund’s dividend
income and capital gain distributions, if any, and from principal only when necessary.

2. INTRODUCTION OF THE ORGANISATION

Edelweiss, a rare flower found in Switzerland. You will discover in our identity: A
graphic flower that represents ideas. Around it, the protective arms of the letter ‘e’: We
believe ideas create wealth, but values protect it.

It is the practice of this core thought that has led to Edelweiss becoming one of the
leading financial services company in India. Its current businesses include investment
banking, securities broking, and investment management. We provide a wide range of
services to corporations, institutional investors and high net-worth individuals.

Edelweiss Capital Limited is one of India’s largest integrated investment banking

companies. The Group’s businesses include investment banking, institutional equities,
private client broking, asset management, wealth management, mutual funds, wholesale
financing and financial products distribution. Till recently, we have been successfully
providing these services to clientele ranging from corporations and institutional investors
to high net-worth individuals. And we are now extending our comprehensive services
portfolio to the vast Individual investor base through our network of Independent
Financial Advisors.

Edelweiss:

Committed to wealth through values

At Edelweiss, we believe great ideas help create wealth, but it takes values to protect that
wealth. Our logo expresses the corporate philosophy, with a graphical representation of
the rare Swiss flower Edelweiss. The logo depicts an Edelweiss flower symbolizing
unique and precious ideas, and the protective arms around the E of Edelweiss represent
our values that protect the wealth. Over the years, this philosophy has enabled us to foster
a culture that is entrepreneurial and result oriented on one hand and on the other, it

21
emphasizes relationship building and intellectual rigour. It seeks to synchronize the finest
of the rational and emotional parts of the financial business.

If this philosophy touches a chord within you, we would like to welcome you to the
Edelweiss family as an Independent Financial Advisor and explore our exclusive service
standards and personalized approach.

Approach

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Client Focus

Edelweiss is driven by the emphasis we place on building long-term relationships with our
clients. We work closely with our clients to equip them with the ability to address large, fast-
growing market opportunities. Our emphasis on long-term relationships also means that we
have a significant ongoing involvement with almost all of the clients that we work with.

Execution Orientation

We focus obsessively on delivering high quality execution through our experienced team of
professionals. Each team is led by senior personnel and is highly research and ideas driven. We
place strong emphasis on confidentiality and integrity in a sensitive business environment.

Culture

Edelweiss fosters a culture that is entrepreneurial and results-driven and that emphasizes
teamwork and intellectual rigour. Our team is encouraged to display higher levels of initiative,
drive, and hunger for learning and taking on additional responsibility.
Professional Integrity

We place a strong emphasis on confidentiality, honesty and integrity in our business dealings.
We expect our people to maintain high ethical standards, both in their professional and
personal lives. We strive to be fair in all our dealings. We respect our competitors.

Research Driven

All our businesses are built on a research and analytics foundation. Our understanding of
underlying market trends and strong analytical expertise has resulted in a demonstrated ability
to identify emerging trends and themes early. We seek to provide the highest quality research
and investment opinions to our clients.

Board of Directors

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Mr. Rashesh Shah

Chairman, CEO and Founder of Edelweiss. Mr.Rashesh Shah has previously worked for
ICICI (now ICICI Bank, India’s largest private sector financial conglomerate) where he
handled a World Bank aided program for export-oriented projects. He was subsequently
with Prime Securities as Head of Research. Mr. Shah’s relentless focus is on organization
building and human capital development. He has been featured in a variety of
publications, including The Far Eastern Economic Review, Business India, Business
World and The Economic Times. Mr. Shah earned an MBA from the Indian Institute of
Management, Ahmedabad and a Bachelor’s degree in Science from the University of
Bombay.
Mr. Venkat Ramaswamy

Executive Director and Head of Investment Banking and Co-Founder of Edelweiss. Mr.
Venkat Ramaswamy has previously worked with the Spartek Emerging Opportunities
Fund and ICICI, where he worked on project-based lending to large corporates, analyzing
and evaluating investment decisions. He subsequently managed the Spartek Fund that
focused on making equity investments in small and emerging companies. He brings
significant experience and expertise on client relationships to Edelweiss. Mr.
Ramaswamy holds an MBA from the University of Pittsburgh and is an Electronics
Engineer.

Mr. Narendra Jhaveri

Mr. Jhaveri, on his return from U.K., after a brief stint with NCAER as Senior
Economist, joined the Economics Dept. of the Reserve Bank of India in 1965. He shifted
to ICICI in 1974 as Chief Economist and then moved to project finance. Mr. Jhaveri has
served as an Independent Director on the Boards of several leading Indian companies
besides acting as an advisor to several of them on diverse matters related to business. He
also serves as the Chairman of the IMC Economic Research and Training Foundation.
Over a span of his long professional career Mr. Jhaveri, apart from giving frequent
lectures on subjects related to Indian Financial System, Capital Market, Economic
Development and Corporate Governance, has contributed a large number of articles in
Indian Economic dailies and specialized journals. He holds a Masters Degree in
Economics from Gujarat University. He has also obtained M.Sc. in Economics from the
London School of Economics, specializing in public finance and with 40 years of
experience.

Mr. Kunna Chinniah

Mr. Kunna Chinniah is Executive Vice President with GIC Special Investments ("GIC

24
SI"). GIC SI is the private equity arm of the Government of Singapore Investment
Corporation ("GIC"). Mr Chinniah oversees the Asian private equity business for GIC SI.
Mr Chinniah began his career in 1982 as a Senior Field Engineer with Schlumberger
Wireline Services in the Middle East. He joined GIC in 1989 and between 1989
and 1997, he held various positions with the Special Investments Department of GIC in
the North America and Europe Divisions including the position of Regional Manager, on
separate occasions, for Europe and North America, overseeing private equity investments
in both regions. He was also GIC's representative in Frankfurt. He was based in Frankfurt
from March 1992 to February 1995 and in San Francisco from November 1989 to April
1991 and from March 1995 to November 1997. His last position prior to his return to
Singapore in November 1997 was Regional Manager, North America Division of the
Special Investments Department. Mr Chinniah is a Chartered Financial Analyst. He
obtained his Bachelor of Engineering (Electrical) degree from the National University of
Singapore in 1982 and completed a Master of Business Administration in 1989 from the
University of California (Berkeley). In 1997, he attended the World Bank Executive
Programme conducted by Harvard University.

Mr. P.N. Venkatachalam

Mr. P.N. Venkatachalam has over 40 years of experience in the banking sector in India
and abroad. Mr. Venkatachalam joined the State Bank of India as a probationary officer
on April 1967 and retired on March 2004 as a managing director. He served briefly as
member of the Interim Pension Fund Regulatory Authority of India, New Delhi in 2004
and has served as a director on the board of Small Industries Development Bank of India.
Mr. Venkatachalam is presently the Chairman of Laser Soft Infosystems Limited and a
director of Khazana Jewellery Private Limited. He holds a Masters of Arts degree in
Economics and is a Certified Associate from the Indian Institute of Bankers.Mr.
Venkatachalam joined our Board on August 9, 2007.

Mr. Berjis Desai

Mr. Berjis Desai, is an Independent Director on the Board of Directors of the Company.
Mr. Desai is the Managing Partner, J. Sagar & Associates, one of India's leading law
firms. He holds a Masters in Law. He is an Advocate and a Solicitor. He has been in
practice for 30 years and has rich and varied experience in the legal field, with particular
emphasis on corporate law and legislation related to Merger & Acquisition, derivatives,
securities & financial laws, international business laws and international commercial
arbitration. Mr. Desai is also on the Board of various listed companies as an Independent
Director.

Senior Management Team

25
 Rashesh Shah Venkat Ramaswamy
Chairman & CEO Executive Director

Deepak Mittal Himanshu Kaji

CEO, Edelweiss Tokio Life Insurance CFO & Group COO
Company Limited
Rujan Panjwani
Naresh Kothari
President & Head, Treasury
President & Head, Equities Capital
Market Ravi Bubna
Vikas Khemani Head, Wholesale Financing
Head, Institutional Equities

VISION OF EDELWEISS BROKOING LTD

To be a dominant player in the Indian mutual fund space recognized for its
high levels of ethical and professional conduct and a commitment towards
enhancing investor interests

“IDEAS CREATES VALUES PROTECT.”

ORGANIZATIONAL STRUCTURE OF MUTUAL FUND

26
 Sponsor Company Established MF as the trust
(For eg. Tata Mutual Fund) Register the MF under SEBI

Managed by the board of

trustee
Hold unit –holders fund in
MF
Mutual Fund Enter into an agreement
with SEBI and ensure
compliance
Float MF funds,
AMC Manages the fund as
(eg: edelweiss AMC) SEBI

Guidelines and AMC

agreement
Provides custodial
CUSTODIAN
services

Provides registrar and

REGISTERAR
transfer service

Provides the network for

DISTRIBUTORS distribution of the
schemes to the investor

COMPETITORS OF EDELWEISS MUTUAL FUND

Major Mutual Fund Companies in India

27
• ABN AMRO Mutual Fund
• Birla Sun Life Mutual Fund
• Bank of Baroda Mutual Fund (BOB Mutual Fund)
• Reliance Mutual Fund
• HSBC Mutual Fund
• ING Vysya Mutual Fund
• HDFC Mutual Fund
• Sahara Mutual Fund
• State Bank of India Mutual Fund
• Tata Mutual Fund
• Kotak Mahindra Mutual Fund.
• Unit Trust of India Mutual Fund
• Standard Chartered Mutual Fund
• Franklin Templeton India Mutual Fund
• Morgan Stanley Mutual Fund India
• Escorts Mutual Fund
• Alliance Capital Mutual Fund
• Benchmark Mutual Fund
• Canbank Mutual Fund
• Chola Mutual Fund
• LIC Mutual Fund
• GIC Mutual Fund

Wealth Management

At Edelweiss, Wealth Management is a Practice

28
It is a specialized profession where our experts combine their efforts to meet the wealth
planning, investment, and financial management needs of individuals, families, family
offices, or corporates.

More than just Financial Services

Edelweiss Wealth Management takes one step closer to you, by providing an "all-in-one
approach”.

Customised Financial Solutions

Advice on asset allocation and thereby creating customized financial solutions for
HNWIs, NRIs, Trusts and Corporates

Wide range of Innovative Advisory services

We offer advisory services on Structured Products, Portfolio Management, Mutual

Funds, Insurance, Derivative Strategies, Direct Equity, IPOs, Real Estate Funds and Art
Funds.

Based on our holistic investment approach we advise you, using a mix of asset classes &
innovative products.

A Dedicated Edelweiss Wealth Manager (EWM) working for You

Financing

Edelweiss Housing Finance Limited (EHFL) is a Housing Finance Company

incorporated under the aegis of the National Housing Bank (NHB). It is part of the
Edelweiss Group of Companies.

EHFL has an array of loan solutions which can be tailored to your requirements. If you’re
looking for a Home Loan, do apply to EHFL for the highest loan amount in the shortest
time.

Overview

The Private Client Services Group at Edelweiss is focused on providing products,

strategies and services to High Networth Individuals and Corporate Clients. We have

29
geographic reach through our Branches, Channel Partners & Investment Consultants in
over 19 locations in India. The PCG team has highly trained equity professionals, who
act as your Equity Advisor. Our ESL Equity Advisor proactively helps you take informed
investment decisions and build a healthy portfolio.

We draw on our strong presence and industry leadership to develop a portfolio of

offerings designed to serve the spectrum of financial needs.

Our main objective is to provide clients with all the tools and services they need to reduce
the administrative burdens of managing money and focus on what you do best -
maximizing your trading performance, building your business, and attracting new sources
of capital.

Our investment philosophy is rooted in the following :

• Capital preservation is key - Capital gains follow from a well-thought out

investment strategy.
• Invest in stocks with a long term view.
• Use a combination of top-down and bottom-up approach to arrive at a basket of
investment worthy stocks
•

• Maintain discipline in booking profits and use index futures to manage short term
volatility.
Offerings

Our Private Client Group is customized to meet each High Net worth Individual’s needs
and is delivered through an Edelweiss Relationship Manager. He brings together a wide
range of financial solutions and tools, research capabilities and investment expertise,
besides being a single point contact for all products and services.

Service offering under PCG

• Cash Equity Advisory

• Derivative Strategies

Advisory services besides Equity would also include Arbitrage and Fixed Income
products. Real Estate investments, Art Investments, PMS and Client asset management &
Depository Services are other services that the group offers in conjunction with other
groups at Edelweiss.

1. Cash Equity Advisory

Providing research based advice on select stocks from across sectors to meet client’s
investment requirement ranging from positional trading to long term investment goals.

30
For our clients we provide ongoing portfolio consultation with a dedicated relationship
manager as one point contact for all day-to-day execution of trades and other service
requirements such as advisory on investments. The Edelweiss Relationship Manager
draws on substantial Edelweiss resources and provides our clients with:

2. Derivatives Strategies

Edelweiss being a pioneer in Quantitative & Alternative Research, we leverage this

strength for our derivatives strategies focused towards short-term / medium investments
of clients in PCG. Derivative Strategy group, through its dedicated research team
provides seamless execution for its clients with trading view.

The stock ideas generated are enhanced by combination of technical view and derivative
strategy along with the statistical data. Based on the Quantitative Research products such
as Pair

Trades & Alpha Trades are also initiated whenever we identify the

pportunity.
Client advisory services

At Edelweiss Client Advisory Services, our team is driven not just by the quality of our
ideas, but also professional ethics and integrity. We take pride in our philosophy of
offering advice which is in the best interest of our clients. Our emphasis on building long
term relationship ensures that we work closely with our clients empowering them to gain
from market opportunities through our online portal www.edelweiss.in

www.edelweiss.in is a product that offers a unique online investment experience that is

intuitive, information rich and a hassle-free way to trade online. It defines the next level
in online trading technology. It enables intelligent investing with market strategies
custom suited to the client’s investment profile and current portfolio.

WHY EDELWEISS?

31
 • Empowering the Independent Financial Advisor: Edelweiss Syndication & Retail
Distribution Desk

• As the Indian capital markets have expanded and matured in the last 5 years, the
retail Indian investor has become increasingly savvy about investments and stock
markets. More and more retail investors are realizing the power of the equity
markets as they seek for ways and means of making their wealth grow.

• Edelweiss Syndication and Retail Distribution

At Edelweiss Syndication & Retail Distribution Desk , our objective is to help our IFAs
provide the individual investors high quality services, analysis and well-planned
investment strategies. The Desk equips the Advisors with advanced service standards and
innovative technology to give them a service edge with their customers.

At Edelweiss, we understand the critical role an IFA plays in helping clients with
investments. Towards empowering them guide the individual investor with the right
information and making key decision, we have a committed key managerial team of
Finance Professionals with years of experience. Their valuable experience in the advisory
business coupled with strong processes and advanced systems, will empower you, to
guide the individual investor with the right information to make key decisions. Edelweiss
helps IFA's translate business strategies into operational reality by applying the right
combination of people, processes, technology, and strategic sourcing. Ensuring the
investor derives optimum values from his investments at all times.

• The Edelweiss SRD Edge

Quality Business Associates: We believe each & every business associate is
special, their business is unique and so is our approach

for their respective businesses. This is unlike many other Financial Products
Distribution firms where a large numbers of inadequately

• trined junior staff are deployed to perform routine services.

High Quality Domain Knowledge: Edelweiss brings a high level of domain expertise and
experienced partner involvement to the engagement with Business Associates. We
believe that for quick results our pace of distribution must match that of global
competition. Edelweiss has a wide range of industry experience; ranging from financial
services to processes to technology. Our diversity of talents and back grounds brings a
perspective and practicality to our work that serves our Business Associates well.

32
 Opportunities

 India: A land of contrasts. A nation of opportunities!

Talk of Indian markets, and business experts across the world will tell you what great
opportunity the nation offers. What for a long time was considered a hindrance to the
nation’s growth, is today its key to marching ahead: its vast population; and more
specifically its huge middle class.

It is this class that aspires for a better quality of life, works hard to save,is committed to
giving the next generation a comparatively higher lifestyle. And though this section of
society has a considerable disposable income, it is sadly lacking in financial knowledge
and expertise. It is in this segment that Edelweiss seeks to make a difference, by
providing India’s vast middle class access to professional financial expertise, guidance
and investment know-how, that will enable them to make their savings grow.

 Creating a network of financial experts

We seek to create a difference by training and nurturing financial advisors from this very
segment of society, uplifting those who have the ability to become entrepreneurs, training
them to be part of the India Shining, and help identify and reach their goals, even as they
assist the middle class investors with personalized services and investment guidance for a
richer tomorrow.

 The Edelweiss Advantage for New and Existing Financial Advisors

As a leading financial services and advisory company, Edelweiss has over the years,
evolved its own system of success for its financial advisors. The system includes:

 Train to be a professional

We have an excellent Training & Development program in place that educates both new
comers and existing advisors on handling financial products, clinching sales and
understanding the products on offer. To list our trainings are:

AMFI Certification Module: Designed for Fresh Business Associates and advisors selling
products other than Mutual Funds.

Sales Training Module: Focused on imparting selling skills

Product Training Module: Helps PIFAs better understand the product and outlines the
target audience for the same

Show and Tell

33
There is nothing quite like showing your clientele all that you are speaking of. We
understand the need for marketing support when our advisors are out in the market, and
we provide it in the form of stationary and product

nature such as visiting cards, information leaflets, brochures, dockets, folders, etc. This
enables the advisors to make each call more impactful and successful.
Update and Upgrade Regularly

Today quick turnaround times, and instant information updates give our advisors the
cutting edge in servicing their clientele. We use the internet to give them the online and
real time advantage. Our technology driven service back-ups include:

Printing Solutions
SMS Service
Free Downloads
Research Reports
Library
Regular Updates

We take care of your back office

Routine paperwork and documentation can eat into your business hours. We help to
outsource every associate’s back office functions at the most affordable costs.
Advance Brokerage Payments
This service differentiator is one of the most significant advantages our advisors get on
partnering us.

Offer More, Earn More

The more you can offer your customer, the more you can sell. The concept that works in
a mall for shopping also works in the financial markets. We provide our advisors access
to a huge portfolio of products, making them one-point solutions for the investor’s many
financial needs.
Be an Expert Financial Planner
At Edelweiss, we are committed to training and evolving every individual into an expert
financial planner. Our training modules, marketing and technology supports and
personalized services will help you to understand, analyse and service your client needs
better.
Grow as an Edelweiss Franchisee
We will provide you the training and the support you need to excel at your business. And
we will back up your expertise with the Edelweiss brand equity that has been built over
the years; equity that investors in various markets have come to rely upon. Join our
family of financial advisors today and prepare to touch new highs of success!

34
 3.TITLE OF THE STUDY
Introduction

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 invested by the fund manager in
different types of securities depending upon the objective of the scheme. These could range
from shares to debentures to money market instruments. The income earned through these
investments and the capital appreciation realized by the scheme is shared by its unit holders
in proportion to the number of units owned by them (pro rata). 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 portfolio at a relatively low cost. Anybody with an
investing surplus of as little as a few thousand rupees can invest in Mutual Funds. Each
Mutual Fund scheme has a defined investment objective and strategy.
The flow chart below describes broadly the working of a mutual
fund.

Mutual fund Investment Flow-chart

35
 Performance of Mutual Funds in India

Let us start the discussion of the performance of mutual funds in India from the day the
concept of mutual fund took birth in India. The year was 1963. Unit Trust of India invited
investors or rather to those who believed in savings, to park their money in UTI Mutual
Fund.
For 30 years it goaled without a single second player. Though the 1988-year saw some
new mutual fund companies, but UTI remained in a monopoly position.

The performance of mutual funds in India in the initial phase was not even closer to
satisfactory level. People rarely understood, and of course investing was out of question.
But yes, some 24 million shareholders were accustomed with guaranteed high returns by
the beginning of liberalization of the industry in 1992. This good record of UTI became
marketing tool for new entrants. The expectations of investors touched the sky in
profitability factor. However, people were miles away from the preparedness of risks
factor after the liberalization.

BANKS V/s MUTUAL FUNDS

PARTICULARS BANKS MUTUAL FUNDS

Returns Low Better
Administrative Exp. High Low
Risk Low Moderate
Investment Options Less More
Network High penetration Low but improving
Liquidity At a cost Better
Quality of Assets Not transparent Transparent
Interest Calculation Minimum balance between 10th & 30th of every month Everyday
Guarantee Maximum Rs.1 Lakh on deposits None

36
 4. RESEARCH & METHODOLOGY
RESEARCH : -

Research is a scientific and systematic research for permanent information and specific

topic.

RM is the way to systematically solve the research problem. It may be understood as a

science of studying how research is done scientifically. The study of RM gives the

student necessary training in techniques for the collection of data to particular problem.

Research Design :-
A research design is true arrangement of conditions for collection and analysis of data in
a manner that aims to combine relevance to the research purpose with economy in
procedure.

RESEARCH METHODOLOGY

The research methodology is of exploratory type since data has been collected and
market has been explored to understand the investor’s perception and behaviour.The
research has been done in a step wise method and the step-wise procedure which I
followed is given as follows:

37
 5.OBJECTIVES
Objectives :-

The research was undertaken with the objective to know about the investor’s perception
and behavior of Jaipur city under the guidance of edelweiss Sales Manager of Jaipur
branch. Understanding the investor perception is very important for the investment
agencies, this report will be helpful to the edelweiss as an investment company to know
about the requirement of the investors and in turn to increase there market share. This
will enhance my knowledge in learning the customer behavior towards investments.
Every research is performed to fulfill certain objectives, which are generally pre-
determined after setting goals, researcher decides on various course of action through
which she can ascend the ladder & reach the Zenith.

Thus the main objectives of the research are given as follows:

• To know about people investment behaviour.
• To find the reason behind their investment.
• To find out their expectations regarding returns.
• To Know about Income of the customer.
• To tell about the benefits of mutual funds.

38
 6.TYPES OF RESEARCH
Types of Research:-

• Descriptive v/s Analytical

• Applied v/s fundamental

• Quantitative v/s Qualitative

• Conceptual v/s Empirical

39
 7.SAMPLE SIZE & METHOD OF
SELECTING SAMPLE
The sample selecting method is of exploratory type since data has been collected and
market has been explored to understand the investor’s perception and behaviour.The
research has been done in a step wise method and the step-wise procedure which I
followed is given as follows:

Project title: - “A study to analyze investors behaviour regarding

Mutual Funds at edelweiss broking limited”

Universe: - edelweiss broking limited, jaipur

Sample Frame: -C Scheme, Vaishali Nagar, Ram Bagh circle (Jaipur)

Sample Unit: - Customer

Sample Size: - 100

Data Collection: Schedule.

Sample Method: Area Random Sampling.

Research Type: - The research type selected here was exploratory

research.

40
 8. SCOPE OF THE STUDY
Edelweiss Broking Ltd. is one of the leading integrated financial services institutions of
India. The company offers a large and diverse bouquet of services ranging from equities,
Mutual fund , to wealth advisory, portfolio management services, personal finance
services, online banking and institutional broking services.

Edelweiss Broking Limited is the holding company for all its businesses, structured and
being operated through various subsidiaries. This study was conducted to know the
Mutual fund. It helps in identify the terms of share market and know the practical
knowledge of finance companies and get work experience.

41
 9.LIMITATION OF THE STUDY
Limitations:-

• The most important limitation faced was the limited knowledge of people about
edelweiss broking limited.

• The paucity of time was also one constraint.

• There is a lot of unawareness and misconception about private insurance

companies.

• Unavailability of prospects at the scheduled time.

• Govt.institutions (LIC) is more reliable than private insurance institution.

42
 10.ANALYSIS & INTERPRETATION

Investment Behaviour
Behaviour Finance approach takes into account rational and irrational motives of the investors in
defining the long run price formation in the financial markets. The root of investor psychology
has MONEY as its centrepiece. And the main aim of every investor is to accumulate wealth. But
still investment goal is the driving force, which influences an investor towards the investment
path. Now, on this investment goal there is an impact of some demographic factors such as age,
gender, educational qualifications, income group etc.so to understand the investment behaviour
of the investors it is important to analyze the impact of all these factors on the investment goals.

Apart from this it is also important to know the impact of the tax benefits, as it is also one of the
driving forces for investments. Influence of the peer group, risk taking ability, time horizon is yet
other parameters, which influences the investment style and pattern.

So, keeping all the above in mind a schedule was prepared by the investment behavior and me
was analyzed accordingly. A sample size of 50 was taken; the target group was the investors
coming to the branch for investments. (The no. Of investors who were interrogated were more
than the sample size but just for the purpose of simplification of analysis the size is taken as 50,
this does not affect the results). Method of data collection was monitoring and interrogative.

The analysis techniques were a combination of both exploratory data techniques, which provides
a good diagnosis by emphasizing visual representations of the data, and Behavior observation
approach.

43
Q1. What is your Educational Qualification?

Scale Response

Intermediates 2

Undergraduate 5

Graduate 15

Postgraduate 30

Professional 48

Educational Qualification

48% 5%
2% Intermediate
15%
Undergraduate
Graduate
Postgraduate
Professional
30%

Interpretation:-

Majority of respondents found they were professionals.

Q2. What is your Occupation?

44
 Scale Response

Business 50

Service 30

Govt. Employee 15

Others 5

60

50

40

30

20

10

0
Bussiness Service class Govt Others
Man Employee

Interpretation:-

According to my survey maximum people were businessman from different type of

categories.

Q3. What is your Income Group Annually?

45
 Scale Response

Below 1,00,000 5

1,00.000 to 3,00,000 10

3,00,000 to 5,00,000 15

Above 5,00,000 70

70%

Below 1 Lakh
1 Lakh to 3 Lakh
3 Lakh to 5 Lakh
5% Above 5 lakh
15% 10%

Interpretation:-

Majority of people found who have income of more than 5, 00,000 per annum generally
invest in Mutual Funds.

Q4. Are you existing Investor in MF’s?

46
 Scale Response

Yes 30

No 70

70
60
50
40
30 Percentage

20
10
0
Yes No

Interpretation:-

Majority of respondents found that they were not investing in mutual funds.

Q.5.Are you active investor in Share Market?

47
 Scale Response

Yes 20

No 80

80
70
60
50
40
Percentage
30
20
10
0
Yes No

Interpretation:-

Majority of respondents found they don’t have any knowledge about share market.

Q.6. What is your investment goal?

Scale Response

High Return 40

Tax Benefit 30

High Liquidity 20

Capital Appreciation 10

48
 Capital Appreciation

High Liquidity High Return

Tax Benefit

Interpretation:-

Maximum people are investing in mutual fund because they wants higher return from
their investment.

Q.7. Out of Your Total Money, How much would you like invest in Mutual Fund

Scale Response

Less than 25% 60

Between 25- 35% 25

More Than 50% 15

49
 60

50

40

30
Percentage
20

10

0
Less than Between More than
25% 25 to 35% 50%

Interpretation:-

Majority of respondents says that they want to invest only less than 25% of their savings
in mutual funds.

Q.8.What time Horizon are you looking at?

Scale Response

6 months 10

Between 6 months to 1 year 40

1-2 year 40

2-3 Year 10

50
 40
35
30
25
20
15
Percentage
10
5
0
6 Months Between 1 to 2 2 to 3
6 Month year Year
to 1 Year

Interpretation:-

Time horizon is yet an important factor that defines the path of investment, which an
investor follows. Majority of investors (40%) want to park their funds for a period of 1-
2years and 40% investor invest for a time period Between 6 month to 1 year.10% of
investors want to invest for a time period of more than 2 years.10% of the investors want
to invest in for less than 6 months. And around 10% of investors who park their funds for
about a year.

Q.9 what are you expected returns from your investments?

Scale Response

Less than 10% 30

10-15% 50

More Than 15% 20

51
 50

40

30

20 Percentage

10

0
Less than 10 to 15% More than
10% 15%

Interpretation:-

Majority of people wants 10-15% returns from their investments.

Q.10.How Important are tax benefits?

Scale Response

Not Important 10

Average Importance 60

Very Important 30

52
70

60

50

40
Series1
30

20

10

0
Not important Average Very Important
important

Interpretation:-

For maximum people tax benefits have average importance.

Q.11 In which Mutual Fund AMC do you prefer to invest.

Scale Response

ICICI PRU 20

TATA 10

UTI 20
HDFC 5
RELIANCE 40
OTHERS 5

53
 45
40
35
30
25
Series1
20
15
10
5
0

S
RU

I
TA

FC

E
UT

ER
NC
TA
IP

HD

TH
A
IC

LI

O
IC

RE

Interpretation:-

Most of the investors who come in for the investments invest in Reliance and UTI &
ICICI PRU as it is amongst the top performing funds in the market. On an average about
of the investors invest in this fund either in the form of systematic investment or one time
investment.

11.CONCLUSION

 According to this research most of people invest money secures their future and some
of them to save income tax.
 Now a day’s majority of business class people invest in various investments
afterwards professional and service class people invest.
 Majority of people among service class are not aware of mutual fund. Awareness
among business class people is higher than the service class people.

54
 Majority of people wants their investment safe, secure and having good returns.
 Most of the investor invest in Mutual Funds just to get high returns, to so more
consistency in returns is to be shown by the AMC’s.
 Majority of people are not aware from share market.
 Majority of people want to invest in Reliance mutual fund.

12.RECOMMENDATION & SUGGESTION

Recommendations & Suggestions
1. Edelweisss broking limited should provide after sale service- Investors expects that
after investing all necessary documents like bonds, receipts, statement, any important
schemes and information should reach on time. So they can get actual status of their
investment.

55
2. AMC should provide canopy to its marketing team for general awareness and also
various seminars held in the city so that people should gain idea about mutual funds.
Company should organize cultural program so that people can feel it as own company.

3. Provide customer care service – Company should provide customer care service where
every one can complaint there problem and get the satisfactory solution.

4. Special Benefits and offers for regular and loyal customers- AMC should provide
special benefits for its regular and loyal customer for long term relationships.

13. APPENDIX
Bibliography:-

Text Books :-
- AMFI Mutual Fund Advisor Module

- The Product Fact Sheet

56
Websites :-
www.edelweiss.in

www.amfi.com

www.financial-planning.com

www.nsendia.com

www.bseindia.com

www.rbi.org

www.financialexpress.com

www.sebi.com

www.valueresearchonline.com

www.mutualfundindia.com

QUESTIONNAIRE FOR ANALAYZING THE INVESTMENT BEHAVIOUR

NAME:-

AGE:-

SEX:-

ADDRESS:-

PHONE. NO. MOBILE. NO.

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MARRIED STATUS MARRIED UNMARRIED

1. What is your Educational qualification?

Intermediates Undergraduate

Postgraduate Professional

2. What is your Occupation?

Business Service

Govt.Emlpoyee Others

3. What is your Annually Income?

Below 1,00,000 1,00,000 to 3,00,000

3, 00,000 to 5, 00,000 Above 5, 00,000

4. Are You Existing Investor?

Yes no

If yes, which fund have you invested in ---------------------------?

5. Are you an active investor in share market?

Yes No

6. What is your investment goal?

High return Tax benefit

High Liquidity Capital Appreciation

7. What time horizon are you looking at?

6 months between 6mnths-1yr
1-2yrs 2-3yrs.

8. What are your expected returns from your investments?

Less than 10 % More than 15 %

10-15 %

9. How important are tax benefits.?

Not important Average important Very important

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 10. In which Mutual funds AMC do you prefer to invest?

Edelweiss Tata ICICI

HDFC Reliance others……………

Any suggestions on how we could improve our services:

Thank you!!!!!!!!

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