1. INVESTOR PERCEPTION ON MUTUAL FUND AND THEIR BEHAVIOR ON
TIME SERIES MODEL
A Project Report Submitted in partial fulfillment of the
requirements for the degree of Master of Business Administration
[MBA]
Major Project
Done by
NAVEENRAJ.R
RegisterNo. 14MBA1070
Under the Guidance of
DR.K.T.RAANGAMANI
Senior Professor,
VIT Business School
September 2015
1

2. CERTIFICATE
This is to certify that the Project Report titled “INVESTOR PERCEPTION ON
MUTUAL FUND BEHAVIOUR ON TIME SERIOUS MODEL” submitted by R.
Registration No. 14MBA1070 to VIT Business School, VIT University,Chennai in
partial fulfillment of the requirements for the degree of Master of Business
Administration is a bonafide record of work carried out by him / her under my
supervision. The contents of this report, in full or in part have not been submitted
in any form to any other institute or university for the award of any degree or
diploma.
ProgramManager Faculty Guide
Internal Examiner External Examiner
ii

3. Declaration
I, R.NAVEENRAJ, aBonafide student of the VIT Business School, VIT
University, Chennai, hereby declare that the project report titled “INVESTOR
PERCEPTION ON MUTUAL FUND AND THEIR BEHAVIOUR ON TIME SERIOUS
MODEL” in partial fulfillment of the requirements of the Degree of Master of
Business Administration of the VIT University, is my original work.
Date:
Place: Chennai
Name & Signature
Reg. No.:14MBA1070
iii

4. Acknowledgement
I am using this opportunity to express my gratitude to everyone who supported me
throughout the course of this project. I am thankful for their aspiring guidance,
invaluably constructive criticism and friendly advice during the project work. I am
sincerely grateful to them for sharing their truthful and illuminating views on a
number of issues related to the project.
I express my warm thanks to Mr.V.VASANTHAN (Branch Manager) for his
support and guidance at HDFC BANK, VELLORE
I would like to express my sincere gratitude to my guide DR.K.T.RANGAMANI
Professor, VIT Business School, for the continuous support and guidance during
the period of my project
Special thanks to RANJAN.D Teller authorizer, HDFC BANK, Vellore for the
support during internship days
iv

5. S.No Contents Page No
1 Chapter 1 – Introduction
1.1 Abstract 1
1.2 Overview 1
1.3 Company profile 2
1.4 Objectives of the Project 2
2 Chapter 2 - Review of literature 3
3 Chapter 3 - ResearchMethodology 6
3.1 Primary data 6
3.2 Secondary data 6
3.3 Variable Selection 7
4 Chapter 4 – Analysis
4.1
Age profile of investors
17
4.2
Occupation Profile of Investor
18
4.3
Objectives to invest in mutual funds
19
The investor prefer to invest
4.4 19
4.5
Factor analysis Result
20
Regression Result
4.6 22
Covariance test
4.7 28
Correlogram
4.8 29
Vector error correction model
4.9 30
Unit root test model
4.10 34
Granger causality/Wald test
4.11 35
5 Chapter 5 – Conclusion 37
6 Chapter 6 –References & Bibliography 38
v

6. LIST OF GRAPHS
S.NO CONTENTS PAGE.NO
4.1 Age profile of investors 17
4.2 Occupation Profile of Investor 18
4.3 Objectives to invest in mutual funds 19
4.4 The investor prefer to invest 19
vi

7. Chapter 1 – Introduction
1.1 ABSTRACT:
The mutual fund investment has gained momentum in the last few years. The aspects of mutual
funds are huge as the schemes of investment are numerous. The article is all about finding the
perception and the awareness level among the customers in terms of mutual funds and tries to
evaluate the performance of debt, equity and balanced mutual funds schemes in India (31.7.14 to
30.6.15) The study uses the daily end Net asset values for 30 mutual fund schemes from equity,
debt and balanced category for a period spanning from (31.7.14 to 30.6.15) The sample mutual
funds schemes were chosen randomly from CRISIL which have high returns for one year and
which have same bench mark index. And how the bench index market effect the NAV for
selected mutual funds scheme
1.2 OVERVIEW:
Mutual funds provide a mechanism to invest in the stock market without knowing the
complexities of stock market. Mutual funds provide the best option to the investors who have no
knowledge of the stock market. Mutual fund is just the connecting bridge or a financial
intermediary that allows a group of investors to pool their money together with a predetermined
investment objective. They are responsible for investing the gathered money into specific
securities (stocks or bonds). They invest their money on the behalf of investors. For this they
charge only nominal fees. When you invest in a mutual fund, you are buying units or portions of
the mutual fund and thus on investing becomes a shareholder or unit holder of the fund. Mutual
funds provide more return with less risk. The main advantage of mutual fund is that it diversifies
the risk because the pooled money is invested in diversified portfolio. Mutual funds have started
in India in 1964. The first scheme was Unit Scheme 1964. In that year UTI has the monopoly
over the mutual fund industry up to 1987. In 1987 government institutes were allowed to start
mutual funds operations. In 1993 it has opened for private sector. The regulations on mutual
funds came in the year 1996. Today there are near about 42 mutual funds companies operated in
1

8. India. Moreover government is doing every effort to promote the mutual funds in India. In 1999
it has exempted the all dividend incomes in the hands of investors fully tax fully
Mutual funds offer close ended and open ended schemes. Close ended schemes have some
stipulated time period that is normally between 3 to 15 years. Open ended schemes are available
for subscription during the all-time period. These are further available in growth, income,
balanced, ELSS, FMCG, ETF, gold fund and sector specific. Mutual fund industry is doing every
effort to attract the investors to invest in mutual funds by offering innovative schemes. Moreover
Investors have great expectations from mutual fund
1.3 COMPANY PROFILE:
HDFC Bank Limited is an Indian banking and financial services company headquartered in
Mumbai, Maharashtra. Incorporated in 1994, it is the fifth largest bank in India as measured by
assets. It is the largest private sector bank in India by market capitalization as of February 2014.
The bank was promoted by the Housing Development Finance Corporation, a premier housing
finance company (set up in 1977) of India. According to the Brand Trust Report 2014, HDFC
was ranked 32nd among India's most trusted brands. HDFC was ranked 45th on the list of top 50
Banks in the world in terms of their market capitalization.
The Housing Development Finance Corporation Limited (HDFC) was amongst
the first to receive an ‗in principle‘ approval from the Reserve Bank of India (RBI) to set up a
bank in the private sector, as part of RBI‘s liberalization of the Indian Banking Industry in 1994.
The bank was incorporated in August 1994 in the name of ‗HDFC Bank Limited‘, with its
registered office in Mumbai, India. HDFC Bank commenced operations as a Scheduled
Commercial Bank in January 1995. HDFC is India‘s premier housing finance company and
enjoys an impeccable track record in India as well as in international markets. Since its inception
in 1977, the Corporation has maintained a consistent and healthy growth in its operations to
remain the market leader in mortgages. Its outstanding loan portfolio covers well over a million
dwelling units. HDFC has developed significant expertise in retail mortgage loans to different
market segments and also has a large corporate client base for its housing related credit facilities.
With its experience in the financial markets, strong market reputation, large shareholder base and
unique consumer franchise, HDFC was ideally positioned to promote a bank in the Indian
environment.
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9. Listings of the company
The equity shares of HDFC Bank are listed on the Bombay Stock Exchange, where it is a
constituent of the BSE SENSEX index, and the National Stock Exchange of India, where it is a
constituent of the CNX Nifty. Its American Depositary Shares are listed on the NYSE. Its Global
Depository Receipts (GDRs) are listed on the Luxembourg Stock Exchange where 2 GDRs
represent one underlying equity share of HDFC Bank
1.4 OBJECTIVES
 To study the investor perception with reference to mutual funds 

 To analyze the personal and risk factors have affection on fund benefit 

 To analyze the personal and risk factors have the affection on performance benefit 

 To determine the causal relationship between the bench mark index and difference
scheme 
3

10. Chapter 2 - Review of literature
Singh and Jha (2009) conducted a study on awareness & acceptability of mutual funds and found
that consumers basically prefer mutual fund due to return potential, liquidity and safety and they
were not totally aware about the systematic investment plan. The invertors‘ will also consider
various factors before investing in mutual fund.
Ippolito (1992) states that an investor is ready to invest in those funds or schemes which have
resulted in good rewards and most investors‘ are attracted by those funds or schemes that are
performing better over the worst. Goetzman (1997) opined that investor‘s psychology affects
mutual fund selection for investment and to withdraw from the fund
Anand and Murugaiah (2004) had studied various strategic issues related to the marketing of
financial services. They found that recently this type of industry requires new strategies to
survive and for operation. For surviving they have to adopt new marketing strategies and tactics
that enable them to capture maximum opportunities with the lowest risks in order to enable them
to survive and meet the competition from various market players globally
Senthil (2010) observed that among the different investment avenues available for investors,
mutual fund offer them good investment opportunities. However, mutual funds also carry certain
risks but it is lesser when compared with investments made in stocks. He stressed that the
investors should compare the risks and expected yield while making their investment decisions
also observed that investments made in stocks would yield more return but at the same time
mutual funds are excellent for investor who do not have energy to invest in individual stocks
Grossman and Stiglitz (1980) had revealed that in equilibrium rational investors allocate money
to active and passive strategies in proportions that leads to equal risk-adjusted expected returns to
both strategies
Busse (2001) also shows that the autocorrelation of daily returns introduces a bias in the
estimation of monthly volatility. In light of these results, using daily returns not only seems more
accurate but also changes our assessment of active management in mutual funds.
shailendra kaswan(2009) The topic of project was mutual funds A case study and survey. After the
research works Mr. Shailendra Kaswan concluded that mutual fund industry is enlarging its size in
India investors are willing pour money in mutual funds. Despite some temporary registrants,
4

11. other economic models are in favorable mode. Thus we need proper management of advisory
services more schemes financial advisor and institution to cater the market. Industry need to
revise its business strategy. Investors perception is not prioritized yet instead of completing
target, advisors working under institutions should consider the requirements of the investors. We
need changing pattern of selling mutual funds.
Ferson and Schadt (1996) point out that a profitable investment strategy relying on public
information should not be seen as superior performance by managers. Therefore, traditional
performance measures that assume constant risk may assign abnormal performance to a strategy
based solely on public information. They propose performance measures in which the mutual
fund beta is a linear function of monthly public information as defined by a one-period lag of
macroeconomic variables that have predictive power for future stock returns
Syama Sunder (1998) conducted a survey with an objective to get an in-depth view into the
operations of private sector mutual fund with special reference to Kothari Pioneer. The survey
tells that knowledge about mutual fund concept was unsatisfactory during that time in small
cities like Visakapatanam. It also suggested that agents can help to catalyze mutual fund culture,
open-ended options are much popular than any other schemes, asset management company‘s
brand is chief consideration to invest in mutual fund.
Sujit Sikidar and Amrit Pal Singh (1996) conducted a survey to peep in to the behavioral aspects
of the investors of the North-Eastern region in direction of equity and mutual fund investment.
The survey showed that because of tax benefits mutual funds are preferred by the salaried and
self-employed individuals. UTI and SBI schemes were most preferred in that region of the
country over any other fund and the other funds had been proved archaic during the time of
survey.
Lai & Lau, 2010Capital market indices are strongly related with the long and short-term
performance of equity mutual funds. Further, lower systematic risk leads towards superior
returns
Guasoni, Huberman, & Wang, 2011 when indices of common equity are used as benchmarks, the
alpha generated from frequently trading is substantial and significant. The probability of having
negative alpha is high
5

12. Chapter 3 - ResearchMethodology
3.1 Primary data: questionnaire
A survey was conducted in Vellore city during the period June 2105 to July 2015 a sample of
150 individual mutual fund investors were surveyed through a pre-tested questionnaire. The
investors were selected on the basis of those who have made prior investment in mutual funds
and have some knowledge about the basic terminologies involved with mutual funds. An attempt
has been made to find out the perception of investors regarding mutual fund investment and to
identify the factors considered to be important by the investors before investing in any mutual
fund. The awareness level of investors regarding Monthly Income Plan funds and their benefits
is also studied
3.2 Secondary data: The major sources were reports of Reserve Bank of India, Securities &
Exchange Board of India, and Association of Mutual Funds in India, Net asset value for different
scheme bench mark index for one year
INSTRUMENT:
Factor analysis, Regression and Time serious
HYPOTHESIS
 H0:Personal and risk are factors have significant impact on fund benefit 

 H1:Personal and risk are factors have the significant impact on performance rating 

 H2:Bench mark index and NAV having the causal relationship and vice versa 
LIMITATION:
 Due to limited time countrywide survey was not possible 

 Some people were reluctant to fill the questionnaire. They were not willing to
disclose their investment plans. 
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13. 3.3 VARIABLE SELECTION
PERFORMANCE RATING
The performance rating is based on the Past performance of mutual fund, Current NAV of
mutual fund, rating by a research agency/ Newspaper/ Magazine
PAST PERFORMANCE OF MUTUAL FUNDS:
A fund's past performance is based on its historical returns. While not a guarantee of future
results, understanding how the fund has reacted to economic conditions over time can help you
gauge the effectiveness of its management and how it will likely perform going forward.
Past performance also shows you how the fund has done in comparison to appropriate
benchmarks and whether returns have been consistent year-to-year or if they've fluctuated
wildly. Generally, professionals recommend observing a fund's performance over a period of
five to ten years.
CURRENT NAV:
It is important factor that Current NAV(Net Asset Value). For checking the performance of
funds A mutual fund's price per share or exchange-traded fund's (ETF) per-share value. In both
cases, the per-share dollar amount of the fund is calculated by dividing the total value of all the
securities in its portfolio, less any liabilities, by the number of fund shares outstanding. in the
context of mutual funds, NAV per share is computed once a day based on the closing market
prices of the securities in the fund's portfolio. All mutual funds' buy and sell orders are processed
at the NAV of the trade date. However, investors must wait until the following day to get the
trade price. Mutual funds pay out virtually all of their income and capital gains. As a result,
changes in NAV are not the best gauge of mutual fund performance, which is best measured by
annual total return. Because ETFs and closed-end funds trade like stocks, their shares trade at
market value, which can be a dollar value above (trading at a premium) or below (trading at a
discount). The value of all the securities in mutual funds portfolio is calculated daily..
7

14. RATING BY AGENCY:
Credit quality ratings are based on the evaluation of funds‘ investment strategy and portfolio
credit risk. It also involves analyzing the credit quality of individual assets, diversification of
portfolio, management quality and operational policies. Ratings help an investor assess the credit
quality of a particular scheme before making an investment. Just like IPO grading, mutual fund
grading looks at the past performance of the scheme. However, it does not talk about the possible
future performance of a fund. Investors can examine the fund risk vis-à-vis their risk appetite. A
common symbol is expected to help investors understand the ratings easily, apart from making
the whole process fair.
For long term long-term debt schemes with the highest degree of safety will be rated as
AAAmfs. AAmf and Amf mean they have high and adequate levels of safety, respectively.
BBBmfs and BBmfs-rated schemes carry moderate risk. A Bmf-rated scheme has high degree of
risk. A scheme with Cmf rating has a very high level of risk. Rating companies can use the ‗+‘
or ‗-‘ symbol, along with the rating, to reflect the comparative standing within the category.
For short term: a rating of A1mfs will be the highest. A2mfs and A3mfs-rated schemes reflect a
strong and moderate degree of safety, respectively. A4mfs-rated schemes have the least degree
of safety.
FUND BENEFIT:
The fund benefit can be calculated by the average of several dependent variable like fund
manager, reputation of the asset management of company, portfolio of the scheme and tax
benefit of the scheme.
FUND MANAGER:
The person(s) responsible for implementing a fund's investing strategy and managing its
portfolio trading activities. A fund can be managed by one person, by two people as co-managers
and by a team of three or more people. Fund managers are paid a fee for their work, which is a
percentage of the fund's average assets under management.
The portfolio management is at the heart of the activity-chain. Portfolio manager, popularly
known as fund manager carries on this function. Each scheme of mutual fund has a designated
8

15. fund manager who is responsible for constructing, managing and protecting portfolios to achieve
pre-defined investment objectives
Investment advisory department/department of securities research provides research support to
the department of fund management. Given the kinds of schemes the mutual fund has, its fund
management department specifies a set of securities that have to be regularly tracked.
For such securities, various reports may be prepared by the research department. Research
analysts study the financials of the companies in detail and prepare valuation reports. They
interact with the management of issuing company; get understanding of the strategies and its
plans for future. They form a risk-return profile of the company and prepare their reports on the
basis of these inputs. This department provides research support not only to the fund
management team but also to the investment-monitoring department.
Each analyst tracks one or more industries on a regular basis. Industry allocation enables the
analyst to develop a better understanding of the critical success factors for a company in that
industry and to assess the performance of the industry in future.
The underlying idea behind securities evaluation is to understand the business strengths of the
company and project the company‘s performance years down the line in terms of the likely
returns to its stockholders. The analysts attempt to understand whether the companies can create
and sustain shareholder value.
The intrinsic worth of the stock is calculated by discounting future cash flows and the current
market price is compared with the intrinsic worth to derive the extent of
undervaluation/overvaluation. Based on this and other qualitative analysis a risk-return profile of
the security is prepared.
9

16. REPUTTION OF THE COMPANY:
The AMC is appointed by trustees for managing fund schemes and corpus. An AMC functions
under the supervision of its own board of directors and also under the directions of trustees and
Sebi. The market regulator has mandated the limit of independent directors to ensure
independence in AMC workings.
The major obligations of AMC include: ensuring investments in accordance with the trust deed,
providing information to unit holders on matters that substantially affect their interests, adhering
to risk management guidelines as given by the Association of Mutual Funds in India and Sebi,
timely disclosures to unit holders on sale and repurchase, NAV, portfolio details, etc
Asset Management Company is the one which will manage the asset (money collected to invest
on company shares) of its customers by appointing a manager under several schemes. Every
scheme will have a specific objective, which is framed at the time of introducing the scheme. A
manager is to be appointed under the scheme to keep up the objectives framed. He should take
care that the investment on specific scheme should not affect the customer's asset. The schemes
being introduced by the Asset Management Companies is known as Mutual Fund Scheme. As
per the Mutual Fund definition, the Asset is the money received towards a collective investment
plan. This will help the small investors to increase their asset with the help of Asset Management
Companies.
Anyhow an investor cannot blame AMC, for it's under performance. We need to have a quick
review on the performance of the fund in which we invest, at least once in 3 months. The AMC
will help in providing the various investment plans. We should select the suitable plan from it
which can meet our requirement. So risks are based on our decisions
Most of the Asset Management Companies are run by private bodies. So we should have certain
awareness on the companies registered with AMFI (The head of all Asset Management
Companies, a non-profitable association). In future any problem occurs with the AMC, we need
to report to AMFI to get our money back. So AMFI is there to safe guard our money invested
through registered AMC. As on 20th March 2012, there are 44 AMCs are registered with AMFI.
The details of the registered AMC can get from the AMFI website under information zone with
10

17. the topic AMFI members. We can get all type of information regarding the AMC from the AMFI
website. So one should have a glance at this website to get time to time updates about the AMC
PORTFOLIO OF THE SCHEME:
The art and science of making decisions about investment mix and policy, matching investments
to objectives, asset allocation for individuals and institutions, and balancing risk against
performance.
Portfolio management is all about strengths, weaknesses, opportunities and threats in the choice
of debt vs. equity, domestic vs. international, growth vs. safety, and many other tradeoffs
encountered in the attempt to maximize return at a given appetite for risk.
Strategies of Portfolio:
A wing-it strategy means that there is no fixed plan or structure, and one goes by randomly
investing, a little here and a little there. Richard Cayne of Meyer International says that it is
basically the most common strategy for mutual fund investments. What are the factors that
decide how much you invest at what price? It is easy to add money to your portfolio if the plan is
clear, but if not, then it is usually a bit of spontaneous investment. Most financial experts like
Richard Cayne of Meyer International would be in agreement that this strategy is likely to be
least successful since there is no consistency without planning.
Market-Timing Strategy The ability to get into the markets sectors at just the right time is called
market timing strategy. The key point in this strategy being, that the purchase is always low and
the sale is always at a higher price. However, it is difficult to predict investor behavior, since
more than logic, it depends on moods and emotions. the investors buy at a higher rate and sell
low. As a result, there is doubt whether this strategy can work effectively, predicting the future
being impossible even for experienced investors
Buy-and-Hold Strategy: The reason why this strategy is preached by experts is that the
probabilities of making a profit are on your side. 75% of the time markets are going up and 25%
they go down. With some perseverance if you can adopt the buy and hold strategy, 75% of the
times you will make profit. Another factor that adds to the popularity of this technique is that it is
pretty simple to employ. It is very simple and effective to buy and hold
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18. BSE_200:
BSE-200 Index was launched on May 27, 1994 on full market capitalization method BSE-200
index represented in currency. The index calculation method shifted to free-float market
capitalization later on. The index base year is 1989-90 and base index value is 100. As the name
indicates, the index has 200 companies in the index which represents wider market capitalization
of the market.
The purpose of the index is to quantify price movements and monitor sensitivity of the market.
The rapid growth in the market created need for a new broad-based index series reflecting the
market trends in a more effective manner and providing a better representation of the increased
equity stocks, market capitalization as also to the new industry groups.
Over the years, the number of companies listed on BSE continued to register a phenomenal
increase; from 992 in to over 3,200 companies by March 1994, with combined market
capitalization rising from Rs.5,421 crore to Rs. 3,98,432 crore as on 31st March, 1994.
Though S&P BSE SENSEX (1978-79=100) was serving the purpose of quantifying the price
movements as also reflecting the sensitivity of the market in an effective manner, the rapid
growth of the market necessitated compilation of a new broad-based index series reflecting the
market trends in a more effective manner and providing a better representation of the increased
equity stocks, market capitalization as also to the new industry groups. As such, BSE launched
on 27th May 1994, two new index series S&P BSE 200 and S&P Dollex 200.
The equity shares of 200 selected companies from the specified and non-specified lists of BSE
were considered for inclusion in the sample for `S&P BSE 200'. The selection of companies was
primarily been done on the basis of current market capitalization of the listed scrips. Moreover,
the market activity of the companies as reflected by the volumes of turnover and certain
fundamental factors were considered for the final selection of the 200 companies.
Companies are selected based on current market capitalization of the listed stocks and the market
activity of the companies - transaction volumes and specific fundamental factors.
Trading Frequency - The stock should have been traded on 90% of the trading days in the last
three months. Exceptions can be made for extreme reasons like stock trading suspension etc.
12

19. Final Rank - The stock should be in the top 350 companies listed by final rank. The final rank is
calculated at by assigning 75% weightage to the rank on the basis of three-month average full
market capitalization and 25% weightage to the liquidity rank based on three-month average
daily turnover & three-month average impact cost.
Industry - Stock selection would generally take into account a balanced industry representation
of the listed companies in BSE.
Track Record - The Company‘s track record should be acceptable by BSE Index Committee.
EQUITY FUNDS:
A stock fund or equity fund is a fund that invests in stocks, also called equity securities. [1]
Stock funds can be contrasted with bond funds and money funds. Fund assets are typically
mainly in stock, with some amount of cash, which is generally quite small, as opposed to bonds,
notes, or other securities. This may be a mutual fund or exchange-traded fund. The objective of
an equity fund is long-term growth through capital gains, although historically dividends have
also been an important source of total return. Specific equity funds may focus on a certain sector
of the market or may be geared toward a certain level of risk.
Stock funds can be distinguished by several properties. Funds may have a specific style, for
example, value or growth. Funds may invest in solely the securities from one country, or from
many countries. Funds may focus on some size of company, that is, small-cap, large-cap, et
cetera. Funds which involve some component of stock picking are said to be actively managed,
whereas index funds try as well as possible to mirror specific stock market indices.
13

20. FUNDS TYPES:
INDEX FUNDS:
An index fund (also index tracker) is an investment fund (usually a mutual fund or exchange-
traded fund) that aims to replicate the movements of an index of a specific financial market, or a
set of rules of ownership that are held constant, regardless of market conditions. Tracking can be
achieved by trying to hold all of the securities in the index, in the same proportions as the index.
Other methods include statistically sampling the market and holding "representative" securities.
Many index funds rely on a computer model with little or no human input in the decision as to
which securities are purchased or sold and are thus subject to a form of passive management.
GROWTH FUNDS:
Growth investing is a style of investment strategy focused on capital appreciation. [1] Those
who follow this style, known as growth investors, invest in companies that exhibit signs of
above-average growth, even if the share price appears expensive in terms of metrics such as
price-to- earnings or price-to-book ratios. In typical usage, the term "growth investing" contrasts
with the strategy known as value investing
SECTOR FUNDS:
A fund that invests in one area of industry is called a sector fund. [2] Most sector funds have a
minimum of 25% of their assets invested in its specialty. These funds offer high appreciation
potential, but may also pose higher risks to the investor. Examples include gold funds (gold
mining stock), technology funds, and utility funds.
INCOME FUND:
An equity income fund stresses current income over growth. The funds objective may be
accomplished by investing in the stocks of companies with long histories of dividend payments,
such as utility stocks, blue-chip stocks, and preferred stocks.
Option income funds invest in securities on which options may be written and earn premium
income from writing options. They may also earn capital gains from trading options at a profit.
These funds seek to increase total return by adding income generated by the options to
appreciation on the securities held in the portfolio
14

21. FUNDS OF FUNDS:
"Fund of funds" (FOF) is an investment strategy of holding a portfolio of other investment
funds rather than investing directly in stocks, bonds or other securities. This type of investing is
often referred to as multi-manager investment. A fund of funds may be "fettered", meaning that
it invests only in funds managed by the same investment company, or "unfettered", meaning that
it can invest in external funds run by other managers.
There are different types of FOF, each investing in a different type of collective investment
scheme (typically one type per FOF), for example a mutual fund FOF, a hedge fund FOF, a
private equity FOF, or an investment trust FOF
HEDGE FUNDS:
A hedge fund is an investment vehicle and a business structure that pools capital from a number
of investors and invests in securities and other instruments. [1] It is administered by a
professional management firm, and often structured as a limited partnership, limited liability
company, or similar vehicle. [2][3] Hedge funds are generally distinct from mutual funds as their
use of leverage is not capped by regulators and from private equity funds as the majority of
hedge funds invest in relatively liquid assets
DIVERSFIED:
Investment companies invest in various securities, such as cash, bonds and stocks. Diversified
investment companies, such as mutual funds, usually invest in several asset categories and in
different securities within each category. Non-diversified investment companies usually invest in
one specific asset category or industry, and in a few securities within each industry. Small
business owners and other investors can use diversified and non-diversified investment strategies
for capital appreciation, regular income or a combination
Diversified investment companies usually invest in a wide range of securities. For example, a
diversified stock mutual fund may invest in the technology, industrial and retail sectors, and in
several stocks within each sector. Similarly, a balanced mutual fund may invest in a range of
stocks and bonds, while a bond fund may invest in bonds from the federal government,
municipal government and corporate issuers. Diversification may not guarantee profits, but it
15

22. does ensure that an investment company's performance is not tied to a single company or
industry. In addition to mutual funds, investors can use exchange-traded funds, which track
major market indexes and industry sectors, allowing investors to achieve geographic and sector
diversification at low cost. According to the Investment Company Act of 1940, a diversified
investment company cannot hold more than 5 percent of its assets in a single security and not
more than 10 percent of the securities of a single issuer. Non-diversified investment companies
do not have those restrictions. Diversification cannot eliminate market risk, which is the day-to-
day volatility of stock and bond markets. It cannot protect an investment portfolio from a severe
economic downturn
16

23. Chapter 4 – Analysis
DATA ANALYSIS: For analysis of primary data gathered from questionnaire regression and
factor analysis will be used for analysis and interpretation. Besides graphs and tables are used for
the purpose of presentation
4.1 Age profile of investors
Total
35&<45 10.59%
25&<35 58.82%
Total
18 to <25 30.59%
0.00% 10.00% 20.00% 30.00% 40.00% 50.00% 60.00% 70.00%
Interpretation
The above graph explains that the age of investors is 25 ages to 35(58.82%) age and
followed by 18 to 25(30.59%).This shows that the persons only 25 to 35 are interest in
mutual funds.
17

24. 4.2 Occupation Profile of Investor
Total
60.00%
51.76%
50.00%
40.00%
30.00% 25.88%
22.35% Total
20.00%
10.00%
0.00%
Business Privatesector publicsector
Interpretation
The bar graphs explains that the persons who invest in mutual funds are working in private sector
(51.76%) are highly interest in mutual funds followed by business man (25.88%) and public
sector (22.35%). Most of the public sector people are not willing to take risk
18

25. 4.3 Objectives to invest in mutual funds
Total
15.19%
27.85% Liquidity
13.92% Lower Risk
Returns
43.04%
Tax Saving
Interpretation
The pie chart explains that the most of investors are mainly invest in mutual funds for their
Returns (43.04%) and for the second thing is tax saving (27.85%) followed by liquidity (15.19%)
and lower risk (13.92%)
4.4 The investor prefer to invest
Total
1.18%
Balanced Funds
11.76% Debt schemes
17.65%
Equity based schemes
9.41%
Global/International Funds
14.12%
Growth fund
25.88%
Income fund
16.47%
Money market
Specialty Funds
3.53%
19

26. Interpretation
Most of investors are preferring equity scheme (25.88%) in mutual fund followed by Growth
fund (16.47%) these graphs explain clearly that investors are willing to take risk.
4.5 Factor analysis
Factor analysis is commonly used in the fields of psychology and education6 and is considered
the method of choice for interpreting self-reporting questionnaires.7 Factor analysis is a
multivariate statistical procedure that has many uses, 8-11 three of which will be briefly noted
here. Firstly, factor analysis reduces a large number of variables into a smaller set of variables
(also referred to as factors). Secondly, it establishes underlying dimensions between measured
variables and latent constructs, thereby allowing the formation and refinement of theory. Thirdly,
it provides construct validity evidence of self-reporting scales.
Thirdly, it provides construct validity evidence of self-reporting scales. Suppose we have a set of
observable random variables, with means .
Suppose for some unknown constants and unobserved random variables , where and
, where , we have
Here, the are independently distributed error terms with zero mean and finite variance, which may not
be the same for all . Let , so that we have
In matrix terms, we have
If we have observations, then we will have the dimensions
of and denote values for one particular observation, and matrix
Also we will impose the following assumptions on :
, , and . Each column
does not vary across observations.
1. and are independent.
2.
3. (to make sure that the factors are uncorrelated).
20

27. Any solution of the above set of equations following the constraints for is defined as the factors, and as
the loading matrix.
Suppose . Then note that from the conditions just imposed on , we have
or
or
Note that for any orthogonal matrix , if we set and , the criteria for being factors
and factor loadings still hold. Hence a set of factors and factor loadings is identical only up to orthogonal
transformation
Objectives of Exploratory Factor Analysis
 Reduce the number of variables 

 Examine the structure or relationship between variables 

 Detection and assessment of uni dimensionality of a theoretical construct 

 Evaluates the construct validity of a scale, test, or instrument 

 Development of parsimonious (simple) analysis and interpretation 

 Addresses multi linearity (two or more variables that are correlated) 

 Used to develop theoretical constructs 

 Used to prove/disprove proposed theories 
KMO and Bartlett's Test
Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .641
Bartlett's Testof Sphericity Approx. Chi-Square 70.700
df 10
Sig. .000
21

28. Interpretation:
Kaiser-Meyer-Olkin Measure of Sampling Adequacy - This measure varies between 0 and 1,
and values closer to 1 are better.
Bartlett's Test of Sphericity -This tests the null hypothesis that the correlation matrix is an
identity matrix an identity matrix is matrix in which all of the diagonal elements are 1 and all off
diagonal elements are 0
4.6 Regression:
Regression means retesting the unchanged parts of the application. Test cases are re-executed in
order to check whether previous functionality of application is working fine and new changes
have not introduced any new bugs. This test can be performed on a new build when there is
significant change in original functionality or even a single bug fix. This is the method of
verification. Verifying that the bugs are fixed and the newly added features have not created in
problem in previous working version of software
Testers perform functional testing when new build is available for verification. The intend of this
test is to verify the changes made in the existing functionality and newly added functionality.
When this test is done tester should verify if the existing functionality is working as expected and
new changes have not introduced any defect in functionality that was working before this
change. Regression test should be the part of release cycle and must be considered in test
estimation. Regression testing is usually performed after verification of changes or new
functionality. But this is not the case always. For the release taking months to complete,
regression tests must be incorporated in the daily test cycle. For weekly releases regression tests
can be performed when functional testing is over for the changes.
Regression testing is initiated when programmer fix any bug or add new code for new
functionality to the system. There can be many dependencies in newly added and existing
functionality. It is a quality measure to check that new code complies with old code and
unmodified code is not getting affected. Most of the time testing team has task to check the last
minute changes in the system. In such situation testing only affected application area in
necessary to complete the testing process in time with covering all major system aspects.
22

29. This test is very important when there is continuous change/improvements added in the
application. The new functionality should not negatively affect existing tested code
23

30. Interpretation
Here the fund benefit influence the prefer to invest in mutual funds and experience in mutual
funds remains investment percentage, salary purchase of mutual funds does not influence the
fund benefit .
24

31. 25

32. INTERPERTATION:
Here the salary and prefer to invest will influence the performance rating but other items like
purchase of mutual fund, experience in mutual funds will not influence the performance rating
26

33. SECONDARY VARIABLE:
TIME SERIES:
A time series is a set of statistics, usually collected at regular intervals. Time series data occur
naturally in many application areas
A time series model for the observed data {xt} is a specification of the joint distributions (or
possibly only the means and covariance‘s) of a sequence of random variables {Xt} of which {xt}
is postulated to be a realization
• Economics - e.g., monthly data for unemployment, hospital admissions, etc.
• Finance - e.g., daily exchange rate, a share price, etc.
• Environmental - e.g., daily rainfall, air quality readings.
• Medicine - e.g., ECG brain wave activity every 2−8 sec.
The methods of time series analysis pre-date those for general stochastic processes and Markov
Chains. The aims of time series analysis are to describe and summaries time series data, fit low-
dimensional models, and make forecasts.
Observations made over time can be either discrete or continuous. Both types of observations
can be equally spaced, unequally spaced, or have missing data. Discrete measurements can be
recorded at any time interval, but are most often taken at evenly spaced intervals. Continuous
measurements can be spaced randomly in time, such as measuring earthquakes as they occur
because an instrument is constantly recording, or can entail constant measurement of a natural
phenomenon such as air temperature, or a process such as velocity of an airplane.
Time series are very complex because each observation is somewhat dependent upon the
previous observation, and often is influenced by more than one previous observation. Random
error is also influential from one observation to another. These influences are called
autocorrelation—dependent relationships between successive observations of the same variable.
The challenge of time series analysis is to extract the autocorrelation elements of the data, either
to understand the trend itself or to model the underlying mechanisms.
27

34. Time series reflect the stochastic nature of most measurements over time. Thus, data may be
skewed, with mean and variation not constant, non-normally distributed, and not randomly
sampled or independent. Another non-normal aspect of time series observations is that they are
often not evenly spaced in time due to instrument failure, or simply due to variation in the
number of days in a month.
4.7 Covariance:
The covariance analysis view may be used to obtain different measures of association
(covariance and correlations) and associated test statistics for the series in a group.it is used to
compute measures of association from the following general classes:
•ordinary (Pearson product moment)
•ordinary uncentered
•Spearman rank-order
•Kendall‘s tau-a and tau-b
EViews allows you to calculate partial covariance and correlations for each of these general
classes, to compute using balanced or pairwise designs, and to weight individual observations. In
addition, you may display your results in a variety of formats and save results to the work file for
further analysis.
Interpretation:
The covariance is used to find the varariance different variables
28

35. 4.8 Corregram:
This view displays the autocorrelation and partial autocorrelation functions up to the specified
order of lags. These functions characterize the pattern of temporal dependence in the series and
typically make sense only for time series data. When you select View/Correlogram..
You may choose to plot the correlogram of the raw series (level) x, the first difference d(x)=x–
x(–1), or the second difference
d(x)-d(x(-1)) = x-2x(-1)+x(-2) of the series.
You should also specify the highest order of lag to display the correlogram; type in a positive
integer in the field box. The series view displays the correlogram and associated statistics
29

36. Interpretation:
In Corellogram AC is a correlation co-efficient. If the correlation coefficient decreases with
increase in lag, it means that it is low order auto regressive process. If the value drops to zero
after a small number of lag, it is a sign that series obeys a low order moving average process. In
partial correlation, the correlation co-efficient should reduce and become very closer to zero
AC is a correlation coefficient. If the correlation coefficient value decreases with
the increase in lag, it means that it is a low order auto regressive process.
If the correlation coefficient value drops to zero after a small number of lag, it is a sign
that series obeys a low order moving average process.
In the partial correlation, the correlation coefficient should reduce and become
closer to zero.
Q-Statistics:
H0: The data are independently distributed.
H1: The data are not independently distributed.
If it is Q-statistics, the co-efficient should be increasing. If P value is zero, it is considered to be
weak stationary data. If Q statistics is in increasing trend and the coefficient falls inside the
spikes.
Auto correlation function will become very small, if the maximum P value is above 5% the data
is considered to be stationary as per null hypothesis.
4.9 Vector correction method:
A vector error correction (VEC) model is a restricted VAR designed for use with non-stationary
series that are known to be co integrated. You may test for co integration using an estimated
VAR object; Equation object estimated using non stationary regression methods, or using a
Group object
The VEC has co integration relations built into the specification so that it restricts the long-run
behavior of the endogenous variables to converge to their co integrating relationships while
allowing for short-run adjustment dynamics. The co integration term is known as the error
correction term since the deviation from long-run equilibrium is corrected gradually through a
series of partial short-run adjustments.
To take the simplest possible example, consider a two variable system with one co integrating
equation and no lagged difference terms. The co integrating equation is:
30

37. (38.22)
The corresponding VEC model is:
In this simple model, the only right-hand side variable is the error correction term. In long run
equilibrium, this term is zero. However, if and deviate from the long run equilibrium, the
error correction term will be nonzero and each variable adjusts to partially restore the
equilibrium relation. The coefficient measures the speed of adjustment of the i-th endogenous
variable towards the equilibrium.
As the VEC specification only applies to co integrated series, you should first run the Johansen
co integration test as described above and determine the number of co integrating relations. You
will need to provide this information as part of the VEC specification.
To set up a VEC, click the Estimate button in the VAR toolbar and choose the Vector Error
Correction specification from the VAR/VEC Specification tab. In the VAR/VEC Specification
tab, you should provide the same information as for an unrestricted VAR, except that:
•The constant or linear trend term should not be included in the Exogenous Series edit box. The
constant and trend specification for VECs should be specified in the Co integration tab (see
below).
•The lag interval specification refers to lags of the first difference terms in the VEC. For
example, the lag specification ―1 1‖ will include lagged first difference terms on the right-hand
side of the VEC. Rewritten in levels, this VEC is a restricted VAR with two lags. To estimate a
VEC with no lagged first difference terms, specify the lag as ―0 0‖.
•The constant and trend specification for VECs should be specified in the Co integration tab.
You must choose from one of the five Johansen (1995) trend specifications as explained in
―Deterministic Trend Specification‖. You must also specify the number of co integrating
relations in the appropriate edit field. This number should be a positive integer less than the
number of endogenous variables in the VEC.
31

38. •If you want to impose restrictions on the co integrating relations and/or the adjustment
coefficients, use the Restrictions tab. ―Imposing Restrictions‖ describes these restrictions in
greater detail. Note that the contents of this tab are grayed out unless you have clicked the Vector
Error Correction specification in the VAR/VEC Specification tab.
Once you have filled the dialog, simply click OK to estimate the VEC. Estimation of a VEC
model is carried out in two steps. In the first step, we estimate the integrating relations from the
Johansen procedure as used in the integration test. We then construct the error correction terms
from the estimated co integrating relations and estimate a VAR in first differences including the
error correction terms as repressors.
The VEC estimation output consists of two parts. The first part reports the results from the first
step Johansen procedure. If you did not impose restrictions, EViews will use a default
normalization that identifies all co integrating relations. This default normalization expresses the
first variables in the VEC as functions of the remaining variables, where is the
number of co integrating relations and is the number of endogenous variables. Asymptotic
standard errors (corrected for degrees of freedom) are reported for parameters that are identified
under the restrictions. If you provided your own restrictions, standard errors will not be reported
unless the restrictions identify all co integrating vectors.
The second part of the output reports results from the second step VAR in first differences,
including the error correction terms estimated from the first step. The error correction terms are
denoted CointEq1, CointEq2, and so on in the output. This part of the output has the same format
as the output from unrestricted VARs as explained in ―VAR Estimation Output‖, with one
difference. At the bottom of the VEC output table, you will see two log likelihood values
reported for the system. The first value, labeled Log Likelihood (is computed using the
determinant of the residual covariance matrix (reported as Determinant Residual Covariance),
using small sample degrees of freedom correction. This is the log likelihood value reported for
unrestricted VARs. The Log Likelihood value is computed using the residual covariance matrix
without correcting for degrees of freedom. This log likelihood value is comparable to the one
reported in the co integration test output.
32

39. GRAPH
33

40. Interpretation:
The result shows that, Cointeq1 is a Co-integration equation 1. It has a system of equation
where all the variables can be solved simultaneously. Here D (BSE_200) is the difference of
BSE_200, D(ELSS) is the difference of , D(ELSS) is the difference of ELSS,
D(DIVERSIFED) is the difference of DIVERFIED, whereas D(BSE_200(-1)) is Lag
1,D(ELSS(-2)) is Lag 2, D(DIVERSIFED(-3)) is Lag 3, Here the negative value denotes the
long run and the positive value denotes the short run of data.
4.10 UNIT ROOT TEST
A unit root test is a statistical test for the proposition that in a autoregressive statistical model
of a time series, the autoregressive parameter is one. In a data series y(t), where t a whole
number, modeled by:
y(t+1) = ay(t) + other terms
Where a is an unknown constant, a unit root test would be a test of the hypothesis that a=1,
usually against the alternative that |a| is less than 1.
34

41. Interpretation
Null: Y has unit root meaning variable is not stationary.
Alternate: Y do not have unit root meaning that it is stationary.
If the test stationary is more than critical value, it is an indicator that P value is < 0.05, we
take 5% significance level. It indicates that Alternate hypothesis has accepted. We take it as
absolute value by removing negative sign.
Akaike AIC: It is said to estimates the quality of each model, relative to each other model.
Schwarz SC: It is a criterion for model selection among a finite set of models; the model with
the lowest BIC is preferred.
Hannan–Quinn information criterion (HQC): It is a criterion for model selection. It is an
alternative to Akaike information criterion (AIC) and Bayesian information criterion (BIC).
Durbin–Watson statistic: It is a test statistic used to detect the presence of autocorrelation in
the residuals from a regression analysis
4.11 GRANGER CAUSALITY/WALD TEST:
The Granger causality test is a statistical hypothesis test for determining whether one time
series is useful in forecasting another, first proposed in 1969.[Ordinarily, regressions reflect
"mere" correlations, but Clive Granger argued that causality in economics could be tested for
by measuring the ability to predict the future values of a time series using prior values of another
time series. Since the question of "true causality" is deeply philosophical, and because of the
post hoc ergo propter hoc fallacy of assuming that one thing preceding another can be used as a
proof of causation, econometricians assert that the Granger test finds only "predictive causality
ranger defined the causality relationship based on two principles: [4][6]
1. The cause happens prior to its effect.
2. The cause has unique information about the future values of its effect.
Given these two assumptions about causality, Granger proposed to test the following
hypothesis for identification of a causal effect of on :
35

42. Where refers to probability,is an arbitrary non-empty set,
and and respectively denote the information available as of time in the entire
universe, and that in the modified universe in which is excluded. If the above hypothesis is
accepted, we say that X Granger causes Y
36

43. Interpretation:
Dependent variable=BSE_200
In the above output shows when bse_200 is dependent variable then the predictor variables ELSS and
diversified are significant because both of their p-values are less than the less than 0.05.so it‘s significant.
Dependent variable=ELSS
In the above output shows when ELSS is dependent variable then the predictor variables BSE_200 and
diversified are significant because both of their p-values are less than the less than 0.05.so it‘s significant
Dependent variable=Diversified
In the above output shows when Diversified is dependent variable then the predictor variables BSE_200 and
ELSS are significant because both of their p-values are less than the less than 0.05.so it‘s significant
CHAPTER 5 – CONCLUSION
Finding: The age of investors is 25 ages to 35(58.82%) age and followed by 18 to
25(30.59%).This shows that the persons only 25 to 35 are interest in mutual funds. the persons
who invest in mutual funds are working in private sector (51.76%) are highly interest in mutual
funds followed by business man (25.88%) and public sector (22.35%). Most of the public sector
people are not willing to take risk
Suggestion: The mutual fund industry is still in a nascent stage in India. Presently it focus
on urban areas, the rural area is still untapped. If the proper attention is given, then it can grow
rapidly. Government should do various efforts and take various steps to promote the mutual
funds in India. In nutshell there is a need to create the awareness among the people regarding the
importance of mutual funds.
Conclusion
The estimated results of both causality tests indicate strong causality movement from futures
market liquidity to spot market volatility. Though non-linear causality results are at variance with
the linear causality results, both tests report the evidence of destabilization effects in the case of
certain scheme of ELSS and diversified. The Granger Causality test results and variance
decomposition of forecast error of VECM model indicate that there exists one-way causality
from Scheme to Indian market in most of the mutual funds. Mutual fund companies help
investors by providing them with a qualified fund manager. Increasingly, in India, fund managers
are acquiring global certifications like CFA and MBA which help them be at the cutting edge of
37

44. the knowledge in the investing world. Since mutual fund company collect money from millions
of investors, they achieve economies of scale. The cost of running a mutual fund is divided
between a larger pool of money and hence mutual funds are able to offer the investor a lower
cost alternative of managing their funds. In India mutual funds are regulated by the Securities
and Exchange Board of India, which helps to provide comfort to the investors. SEBI forces
transparency on the mutual funds, which helps the investor make an informed choice. SEBI
requires the mutual funds to disclose their portfolios at least six monthly, which helps the
investors keep track whether the fund is investing in line with its objectives or not
CHAPTER 6- BIBLIOGRAPHY
1. Daniel, K., Grinblatt, M., Titman, S., & Wermers,R Measuring mutual fund performance
with characteristic-based benchmarks. Journal of Finance,52,. Pp.1035-1058,1997
2. Leite and Cortez, ―Conditional Performance Evaluation: Evidence from the Portuguese
Mutual Fund Market‖, Working paper, University of Minho
3. Boudreaux and Suzanne , Empirical Analysis of International Mutual Fund performance,
International Business & Economics Research Journal, 6, pp.19-22,2007
4. Soongswang Amporn, Open-Ended Equity Mutual Funds, International Journal of
Business and Social Science Vol. 2, No. 17,2009
5. Anand, S. & Murugaiah, V. (2007). Analysis of components of investment performance -
An Empirical study of Mutual funds in India. [Online] Available: http://www.ssrn.com
6. Mutual Fund and the Indian Capital Market, Ramola K.S., June 30, 1992, "Mutual Fund
and the Indian Capital Market, Yojana, Vol. 36, No.11.
7. Mutual Funds: Growth and Development, Dave, S. A., Jan-March, 1992, "Mutual Funds:
Growth and Development", The Journal of the Indian Institute of Bankers.
8. Mutual Funds - Boon to the Common Investors, Vyas, B.A July 16, 1990, ‖Mutual
Funds- Boon to the Common Investors‖ Fortune India
9. Newey,Whitney K. and Kenneth D. West, 1987, A Simple, Positive Semi-definite
Heteroskedasticity and Autocorrelation Consistent Covariance Matrix, Econometric
38

45. . QUESTIONNAIRE
1. NAME:
2. AGE:
i. 18 to 25
ii. 26 to 35
iii. 36 to 45
iv. 46 to 55
v. 56 to 60
vi. Above 60
3. Gender
i. MALE
ii. FEMALE
4. Qualification
i. Martic
ii. Undergraduate
iii. Post grad
iv. Doctorate
v. Other (Pl. Specify)
5. Profession
i. Private sector Employee
ii. Govt. Employee
iii. Business
iv. Professional
6. Mail id_____________________________________
7. Please indicate your annual income b y choosing the correct option?
i. Less than Rs.3lakhs ii.Rs.3lakhs to Rs.5lakhs
iii Rs.5lakhs to iv. Above Rs.8,lakhs
Rs.8lakhs
8. I prefer to invest for (please tick any one option).
i. Up to 1 year ii. 1 to 5 years iii. More than 5 years
9. The reason for choosing investment?
i. Higher studies
ii. Marriage
39

46. iii. Business
iv. others
10. How much do you invest annually b y choosing the correct option?
i. 5% to 10% of your annual income
ii. 10 to 20% of your annual income
iii. 20 to 30% of your annual income
iv. Above 30%
11. how much do you save in a year?
i. 5% to 10% of your annual income
ii. 10 to 20% of your annual income
iii. 20 to 30% of your annual income
iv. Above 30%
12. How do you invest in these options? Please (√) tick on the appropriate one
i. Financial Advisor/ Agent
ii. self
iii. Family and friends
13. Are you invested in capital markets?
i. YES
ii. NO
14. Please tick your current investment options (can choose more than one)
A Fixed Deposits
B Insurance
C PO Savings/NSC
D Gold / E – Gold
E Bonds
F PPF
G Real Estate
H Mutual Funds
I Shares
J Commodities
Other (pl. Specify)________________________________________
Please indicate how do you rate different investment options on the following criteria? Indicate this by
encircling any number between 1 to 5 where 1= Very Low; 2=Low; 3=Moderate; 4=High; 5=Very High
Options Return Risk Liquidity Tax Saving Procedural Diversification
Understanding
15 FixedDeposits 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
16 Insurance 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
18 PO/NSC 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
19 Gold / E-Gold 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
40

47. 20 Bonds 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
21 PPF 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
22 Real Estate 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
23 Mutual Funds 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
24 Shares 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
25 Commodities 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
26. from where you purchase mutual fund units? (Please (√) tick the appropriate option)
i. Direct/ Self ii. Through Agent
27. Experience in Mutual funds markets
i. More than one year less than 2 years
ii. Above 2 years less than 5 years
iii. Above 5 years less than 10 years
iv. Above 10 years
28. The reason for investing mutual funds?
i. Build in diversification
ii. Professional management
iii. Easy to buy and sell
iv. Other reason
29. When you invest in mutual funds which mode of investment will you prefer?
i. Systematic investment plan(SIP)
ii. One time investment plan
If SIP, The reason for choosing SIP
30. In which fund offer do you like to invest?
i. New fund offer
ii. Exiting fund offer
Please rate the importance of following charact eristics o f mutual funds while selecting it. Encircle any
number between 1 to 5 where 1 = Very Low; 2 = Low; 3 = Moderate; 4 = High; 5 = Very High
31 Past performance of mutual fund 1 2 3 4 5
32 Current NAV of mutual fund 1 2 3 4 5
33 Rating by a research agency/ Newspaper/ Magazine 1 2 3 4 5
34 Reputation of the mutual fund company 1 2 3 4 5
35 Mutual Fund manager 1 2 3 4 5
36 Portfolio of the scheme (% of investment in different co‘s) 1 2 3 4 5
37 Exit load (fee charged at the time of selling of units) 1 2 3 4 5
38 Availability of tax benefits 1 2 3 4 5
41

48. 39 Turnover of the mutual fund scheme(Sales during the 1 2 3 4 5
period)
40 Asset size/ Total capital of the mutual fund scheme 1 2 3 4 5
41 Whether Fund is Indian or Foreign 1 2 3 4 5
42. Please (√) tick the schemes where you invest.
A Income Please indicate top 3 schemes of your investment,1=highest
B Growth
C Balanced
D ELSS Funds
E Index Funds
F Gold ETF
G Sector Funds
H Other (pl. Specify)
42. After investment, how frequently you monitor the performance of the mutual funds?
i. Weekly ii. Once a month iii. Once a Year iv. Rarely
41. How often you switch the schemes of mutual fund in a year?
i. Never ii. one or two times iii. Three or four times iv. More than four
times
43. Which are your most preferred source for tracking the performance of the mutual funds?
Online reports/ ii. Newspaper/ Report by financial iv. Friend/ family
statement Magazine adviser/ agents member
If any other please specify ___________________________
44. Are you invested in HDFC mutual
funds? I. YES
II. NO
45. If yes, reason for choosing HDFC and rate it from 1 to 5 ,1= Very Low; 2=Low; 3=Moderate;
4=High; 5=Very High
Returns 1 2 3 4 5
Lower Risk 1 2 3 4 5
Credit Rating 1 2 3 4 5
Inflation 1 2 3 4 5
Company 1 2 3 4 5
Lock in Period 1 2 3 4 5
46. In which type of mutual fund schemes you have invested?
42

49. i. Debt schemes
ii. Equity based schemes
47. You have invested for long term or short term in HDFC Mutual Funds?
i. Long term
ii. Short term
48. Which type of schemes do you prefer to invest?
i. Close Ended
ii. Open Ended
50. How do you rate HDFC Mutual Fund on the basis of returns?
i. Highly satisfactory
ii. Satisfactory
iii. Average
iv. Dissatisfactory
v. Highly satisfactory
51. How do you rate HDFC Mutual Fund on the basis of Risk exposure?
i. Highly satisfactory
ii. Satisfactory
iii. Average
iv. Dissatisfactory
v. Highly satisfactory
52. How do you rate HDFC Mutual Funds on the basis of Fund Portfolio?
i. Highly satisfactory
ii. Satisfactory
iii. Average
iv. Dissatisfactory
v. Highly satisfactory
53. How do you rate HDFC Mutual Funds on the basis of Repurchase Price?
i. Highly satisfactory
ii. Satisfactory
iii. Average
iv. Dissatisfactory
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50. v. Highly satisfactory
54. Your overall experience with HDFC Mutual Funds?
i. Highly satisfactory
ii. Satisfactory
iii. Average
iv. Dissatisfactory
v. Highly satisfactory
55. Do you have Plans to reinvest in mutual fund schemes of HDFC Mutual Funds?
i. Yes
ii. No
56. What are the difficulties in HDFC mutual funds?
57. Feedback about HDFC mutual funds?
NON MUTUALFUND INVESTORS
1. NAME:
2. AGE:
i. Less than 30 years
i i . 30 to 40 years
iii. 40 to 50 years
iv. above 50 years
3. Gender
i. MALE
ii. FEMALE
4. Qualification
i. Undergraduate
44

51. ii. Graduate
iii. Post grad
iv. Professional Qualification
v. Other (Pl. Specify).................
5. Profession
i. Private sector Employee
ii. Govt. Employee
iii. Business
iv. Professional
6. I prefer to invest for (please tick any one option).
i. Up to 1 year
ii. 1 to 5 years
iii. More than 5 years
7. Please indicate your annual income b y choosing the correct option?
i. Less than Rs.3,00,000 ii.Rs.3,00,000 to
Rs.5,00,000
iii Rs.5,00,000 to iv. Above Rs.8,00,000
Rs.8,00,000
8. How much do you invest annually b y choosing the correct option?
i. Less than 50,000 ii. Rs. 50,000 to
Rs.1,00,000
iii. Rs. 1,00,000 to iv. Above Rs.
Rs.1,50,000 1,50,000
9. How do you invest in these options? Please (√) tick on the appropriate one.
i. Financial Advisor/ Agent ii. self iii. Family and friends
10. Please tick your current investment options (can choose more than one)
A Fixed Deposits
B Insurance
C PO Savings/NSC
D Gold / E – Gold
E Bonds
F PPF
G Real Estate
H Mutual Funds
I Shares
J Commodities
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52. Please indicate how do you rate different investment options on the following criteria? Indicate this by
encircling any number between 1 to 5 where 1= Very Low; 2=Low; 3=Moderate; 4=High; 5=Very High
Options Return Risk Liquidity Tax Saving Procedural Diversification
Understanding
11 FixedDeposits 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
12 Insurance 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
13 PO/NSC 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
14 Gold / E-Gold 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
15 Bonds 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
16 PPF 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
17 Real Estate 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
18 Mutual Funds 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
19 Shares 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
20 Commodities 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
21.Please rate the importance level of following factors which stops you from investing in Mutual
Funds. Please encircle as 1 = Very Low; 2 = Low; 3 = Moderate; 4 = High; 5 = Very High.
Less Return High Risk Mgmt. Cost No Control Lack in Lack of
over Portfolio Procedural Awareness
clarity
1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5
22. Indicate the steps you would like to be taken by the mutual fund companies which may motivate
you to invest in mutual funds. Indicate this by encircling any number between 1 to 5 where 1 = Very
Low; 2 = Low; 3 = Moderate; 4 = High; 5 = Very High
A Training programme 1 2 3 4 5
B Experts advise 1 2 3 4 5
C Strong regulations 1 2 3 4 5
D Information about government regulations 1 2 3 4 5
E Strong grievance mechanism 1 2 3 4 5
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