Summer intership report on idfc mutual fund for MBA

A
Project Study Report On
Training Undertaken at
IDFC AMC ltd, Ahmadabad
“STUDY ABOUT INVESTORS PERCEPTION AND
INVESTMENT PETTERN IN MUTUAL FUND AT IDFC
AMC ltd”
Submitted by: - MANTHAN SONI
(Enr. No: - 137690592115)
MBA PROGRAMME 2013-2015
In partial fulfillment of the requirements for Summer Internship Programme for the award
of the degree of
MASTER OF BUSINESS ADMINISTRATION
SHRI JAIRAMBHAI PATEL INSTITUTE OF BUSINESS MANAGEMENT AND COMPUTER
APPLICATIONS (NICM-MBA)
Submitted to:-
GUJARAT TECHNOLOGICAL UNIVERSITY,
AHMEDABAD

PREFACE
With the growth of rapid industrialization the need of management is felt every where. A
research report provides the most natural condition under which a student can learn and got
success in implementing the theoretically learned in to the practical and current
environment of daily practices done by the people (investor) it helps a student to learn, to
improve, to improvise, to experiment, to find knowledge in all possible ways and to
translate that knowledge into action.
MBA is a foundation stone to the management career. The classroom learning needs to
practical exposure. To develop concrete managerial and administrative skills of potential
manager, it is important that the interaction to the real environment be there.
The project is a real life venture for me. It is a great privilege that you have spread your for
reading this. In forthcoming pages, an attempt has been made to present the different aspect
of my project.
Date: Manthan soni
Place: Gandhinagar (GTU’s Enrollment No: -
137690592115)

Declaration
This project report entitled “Understanding Study of Investors perception and
investment pattern in mutual fund at IDFC” has been submitted to Gujarat
Technological University, Ahmadabad in partial fulfillment for the award of degree of
Master of Business Administration. I, the undersigned hereby declare that this report has
been completed by me under the guidance of Mr.Pankil thakker (Assistant Vise President)
and Prof.Rashesh Patel (Faculty Member, ShriJairambhai Patel Institute of Business
Management & Computer Applications, Gandhinagar.)
The report is entirely the result of my own efforts and has not been submitted either in part
or whole to any other institute or university for any degree.
Manthan soni
(GTU’s Enrollment No: - 137690592115)
Date:
Place: Gandhinagar

ACKNOWLEDGEMENT
“Chain of mistakes leads towards failures, chain of failures leads to experience &
chain of experience leads to success.” That’s what a life’s path is.
I express my heartfelt thanks to Dr. S.O. Junare, Director of NICM for providing me an
opportunity for carrying out this study.
My special thanks to Prof. Rashesh Patel, Assistant Professor, NICM, who had been a
mentor and had supported me by his vast knowledge, experience and wisdom. He had been
a constant support me throughout the completion of the study
I take the opportunity to thank Mr. Hardik, Senior vise president, IDFC, who has
motivated us to achieve new heights and work creatively.
I would also like to thank my guide Mr. Pankil Thakker, Assistant Vise President,
IDFC. Who have immensely guided, supported and helped me in the process of completion
of my Organizational Study through his constant encouragement and suggestions.
I take the opportunity to thank Mrs.Rekha nair, Sales manager, IDFC. Who had been a
constant support throughout the completion of the study?
My sincere and humble thanks to all my faculty members, my beloved parents, my dear
friends and each and everyone who have been never ending source of knowledge,
inspiration and support to me.
Signature of the
Student
Manthan soni
Er.No: - 137690592115

Shri Jairambhai Patel Institute of Business
Management and Computer Applications
(Formerly known as National Institute of Cooperative Management),
Approved by AICTE, New Delhi and Affiliated with Gujarat Technological University
Opposite Amusement Park, Indroda Circle, Gandhinagar - 382 007
Phone: 079 – 23213043, 37 - 38 - 39 Fax : 079 – 23213036
Web: www.nicm.coop E mail: director_mbanicm@yahoo.com
CERTIFICATE
This is to certify that (……Name of the student……), student of MBA
(2012-2014 batch) at Post Graduate Centre of Gujarat Technological University – MBA,
SJPI has prepared a Summer Internship Project Report on “ (….Topic….) ” in partial
fulfillment of two years full-time MBA Programme of Gujarat Technological University,
Ahmedabad. This project work has been undertaken under my supervision and found
satisfactory.
Date : ----------------- (…….NAME OF FACULTY
GUIDE…….)
Place: Gandhinagar Core Faculty – MBA Dept.
&
Project Guide
Dr. S O Junare
Director – Technical Campus
ABSTRACT

Being such a hot and much talked about financial product in the recent times, I take it as a great
opportunity to study and analyze the Indian mutual fund Industry and give my observation on it. It
will not only help building my career but it will also help Mahindra finance in certain aspect.
The Indian Mutual Funds Industry has witnessed a sea change since UTI was first established in
1963. From a single player the number of players has increased to more than 30 and the number of
schemes has spiraled to more than 3500. The last decade has been a period of rapid growth for the
MF industry. The industry is in nascent stage at present. It has come a long way and still has lots of
potential for growth.
My project in IDFC mainly deals with to Understanding Investors perception and investment pattern
in mutual fund at IDFC and also selling through several financial channels available in the market.
And my main aim is to attain profit for the company and give them good business. Fist part of study,
I undertake the research study survey through questionnaire fill up on investment pattern in mutual
fund by Investors. And after that I visited the list of bank given to me Kotak, HDFC, Axis Bank etc.
And Meet with Relationship manager and try to give them knowledge about the product and then try
to sale the product to their client and Understanding of Investors perception and investment pattern
in mutual fund.
And in these project my main aim to see which schemes are giving better returns and at a reasonable
risk. But risk itself is a very subjective terms that depend on person to person. And also how asset
management companies are performing and how their ranking in investment terms is.
And during the course of the project I have not only learnt about mutual fund industry but also try to
Understanding of Investors perception and investment pattern in mutual fund at IDFC the company.

INTRODUCTION
Chapter - 01 INTRODUCTION
1.1 IMPORTANCE OF MUTUAL FUNDS
1.2 NEED & IMPORTANCE OF STUDY
1.3 DESIGN OF STUDY
a. Statement of Problem
b. Objectives
c. Study Methodology
d. Data Analysis & Interpretation
e. Limitation
Chapter- 02 REVIEW OF LITERATURE
Chapter - 03 COMPANY PROFILE
Chapter- 04 Data Analysis & Interpretation
Questionnaire

INTRODUCTION
The one investment vehicle that has truly come of age in India in the past decade is mutual
funds. Today, the mutual fund industry in the country manages around Rs 329,162 crore
(As of Dec, 2006) of assets, a large part of which comes from retail investors. And this
amount is invested not just in equities, but also in the entire gamut of debt instruments.
Mutual funds have emerged as a proxy for investing in avenues that are out of reach of
most retail investors, particularly government securities and money market instruments.
Specialization is the order of the day, be it with regard to a scheme’s investment objective
or its targeted investment universe. Given the plethora of options on hand and the hard-sell
adopted by mutual funds vying for a piece of your savings, finding the right scheme can
sometimes seem a bit daunting. Mind you, it’s not just about going with the fund that gives
you the highest returns. It’s also about managing risk–finding funds that suit your risk
appetite and investment needs.
So, how can you, the retail investor, create wealth for yourself by investing through mutual
funds? To answer that, we need to get down to brass tacks–what exactly is a mutual fund?
Very simply, a mutual fund is an investment vehicle that pools in the monies of several
investors, and collectively invests this amount in either the equity market or the debt
market, or both, depending upon the fund’s objective. This means you can access either the
equity or the debt market, or both, without investing directly in equity or debt.
The essential features of the mutual funds distinguishing from other of the
investments are:-
 The mutual fund is a trust into which many relatively small investors invest their
money to form a large pool of cash which is then invested in securities by the manager of
the trust.

 The price at which units can be bought and sold is governed solely by the value of
the underlying securities held by the MF and dealing in units are on the basis of net market
value of the investment per unit.
 The managers of MF are obliged to redeem any units in issue on demand or certain
specified period.
 All dividend income that the MF receives on its investments is paid out to unit
holders.
 Since the unit held by investor evidences the ownership of the fund’s assets, the
value of an investors part ownership is determined by the NAV of the number of units held.
Concept of a Mutual Fund
A Mutual Fund is a trust that pools the savings of a number of investors who share a
common financial goal. The money thus collected is then invested in capital market
instruments such as shares, debentures and other securities. The income earned through
these investments and the capital appreciation realized is shared by its unit holders in
proportion to the number of units owned by them. Thus a Mutual Fund is the most suitable
investment for the common man as it offers an opportunity to invest in a diversified,
professionally managed basket of securities at a relatively low cost. The flow chart below
describes broadly the working of a mutual fund:-
Figure 1
Savings form an important part of the economy of any nation. With savings invested in

various options available to the people, the money acts as the driver for growth of the
country. Indian financial scene too presents multiple avenues to the investors. Though
certainly not the best or deepest of markets in the world, it has ignited the growth rate in
mutual fund industry to provide reasonable options for an ordinary man to invest his
savings.
Investment goals vary from person to person. While somebody wants security, others might
give more weightage to returns alone. Somebody else might want to plan for his child’s
education while somebody might be saving for the proverbial rainy day or even life after
retirement. With objectives defying any range, it is obvious that the products required will
vary as well.
Investors earn from a Mutual Fund in three ways:
1. Income is earned from dividends declared by mutual fund schemes from time to
time.
2. If the fund sells securities that have increased in price, the fund has a capital gain.
This is reflected in the price of each unit. When investors sell these units at prices
higher than their purchase price, they stand to make a gain.
3. If fund holdings increase in price but are not sold by the fund manager, the fund's
unit price increases. You can then sell your mutual fund units for a profit. This is
tantamount to a valuation gain.
Though still at a nascent stage, Indian MF industry offers a plethora of schemes and serves
broadly all type of investors. The range of products includes equity funds, debt, liquid, gilt
and balanced funds. There are also funds meant exclusively for young and old, small and
large investors. Moreover, the setup of a legal structure, which has enough teeth to
safeguard investors’ interest, ensures that the investors are not cheated out of their hard-
earned money. All in all, benefits provided by them cut across the boundaries of investor
category and thus create for them, a universal appeal.
Investors of all categories could choose to invest on their own in multiple options but opt
for mutual funds for the sole reason that all benefits come in a package.
Conceptual Framework of Mutual Fund

A mutual fund is constituted as a public trust created under the Indian Trust Act, 1882.
SEBI (mutual fund) regulations, 1996 regulate the structure of the mutual funds in India.
As per these regulations should have the following three-tier structure:
i) Sponsor
ii) Trust/trustee
iii) Asset Management Company
Apart from this mutual fund consist of
Figure 2
 Sponsor
Sponsor is the person who acting alone or in combination with another body corporate
establishes a mutual fund. The sponsor establishes the mutual fund and registers the same
with SEBI. Sponsor appoints the Trustees, custodians and the AMC with prior approval of
SEBI and in accordance with SEBI Regulations. Sponsor must have a 5-year track record
of business interest in the financial markets. Sponsor must have been profit making in at
least 3 of the above 5 years. Sponsor must contribute at least 40% of the net worth of the
Investment Managed and meet the eligibility criteria prescribed under the Securities and
Exchange Board of India (Mutual Funds) Regulations, 1996.The Sponsor is not responsible
or liable for any loss or shortfall resulting from the operation of the Schemes beyond the
initial contribution made by it towards setting up of the Mutual Fund.

 Trust
The Mutual Fund is constituted as a trust in accordance with the provisions of the Indian
Trusts Act, 1882 by the Sponsor. The trust deed is registered under the Indian Registration
Act, 1908.
 Trustee
Trustee is usually a company (corporate body) or a Board of Trustees (body of individuals).
The main responsibility of the Trustee is to safeguard the interest of the unit holders and
inter alia ensure that the AMC functions in the interest of investors and in accordance with
the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996, the
provisions of the Trust Deed and the Offer Documents of the respective Schemes. At least
2/3rd directors of the Trustee are independent directors who are not associated with the
Sponsor in any manner.
 Asset Management Company (AMC)
The AMC is appointed by the Trustee as the Investment Manager of the Mutual Fund. The
AMC is required to be approved by the Securities and Exchange Board of India (SEBI) to
act as an asset management company of the Mutual Fund. At least 50% of the directors of
the AMC are independent directors who are not associated with the Sponsor in any manner.
The AMC must have a net worth of at least 10 crore at all times.
 Registrar and Transfer Agent
The AMC if so authorized by the Trust Deed appoints the Registrar and Transfer Agent to
the Mutual Fund. The Registrar processes the application form, redemption requests and
dispatches account statements to the unit holders. The Registrar and Transfer agent also
handles communications with investors and updates investor records.
 Custodian
A custodian is an agent, bank, trust company, or other organization which holds and
safeguards an individual's, mutual funds, or investment company's assets for them.

Advantages of Mutual Funds
1. 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. This
risk of default by any company that one has chosen to invest in, can be minimized by
investing in mutual funds as the fund managers analyze the companies’ financials more
minutely than an individual can do as they have the expertise to do so. They can manage
the maturity of their portfolio by investing in instruments of varied maturity profiles.
2. Diversification
Mutual Funds invest in a number of companies across a broad cross-section of industries
and sectors. This diversification reduces the risk because seldom do all stocks decline at the
same time and in the same proportion. You achieve this diversification through a Mutual
Fund with far less money than you can do on your own.
3. ConvenientAdministration
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.
4. ReturnPotential
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. Apart from liquidity, these funds
have also provided very good post-tax returns on year to year basis. Even historically, we
find that some of the debt funds have generated superior returns at relatively low level of
risks. On an average debt funds have posted returns over 10 percent over one-year horizon.
The best performing funds have given returns of around 14 percent in the last one-year
period. In nutshell we can say that these funds have delivered more than what one expects

of debt avenues such as post office schemes or bank fixed deposits. Though they are
charged with a dividend distribution tax on dividend payout at 12.5 percent (plus a
surcharge of 10 percent), the net income received is still tax free in the hands of investor
and is generally much more than all other avenues, on a post-tax basis.
5. LowCosts
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.
6. 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. Since there is no penalty on pre-
mature withdrawal, as in the cases of fixed deposits, debt funds provide enough liquidity.
Moreover, mutual funds are better placed to absorb the fluctuations in the prices of the
securities as a result of interest rate variation and one can benefits from any such price
movement.
7. Transparency
Investors 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.
8. 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.
9. Affordability
A single person cannot invest in multiple high-priced stocks for the sole reason that his
pockets are not likely to be deep enough. This limits him from diversifying his portfolio as

well as benefiting from multiple investments. Here again, investing through MF route
enables an investor to invest in many good stocks and reap benefits even through a small
investment. 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.
10.ChoiceofSchemes
Mutual Funds offer a family of schemes to suit your varying needs over a lifetime.
11.WellRegulated
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.
12.Tax Benefits
Last but not the least, mutual funds offer significant tax advantages. Dividends distributed
by them are tax-free in the hands of the investor. They also give you the advantages of
capital gains taxation. If you hold units beyond one year, you get the benefits of indexation.
Simply put, indexation benefits increase your purchase cost by a certain portion, depending
upon the yearly cost-inflation index (which is calculated to account for rising inflation),
thereby reducing the gap between your actual purchase cost and selling price. This reduces
your tax liability. What’s more, tax-saving schemes and pension schemes give you the
added advantage of benefits under Section 88. You can avail of a 20 per cent tax exemption
on an investment of up to Rs 10,000 in the scheme in a year.

Disadvantages of mutual funds
Mutual funds are good investment vehicles to navigate the complex and unpredictable
world of investments. However, even mutual funds have some inherent drawbacks.
Understand these before you commit your money to a mutual fund.
1. No assured returns and no protection of capital
If you are planning to go with a mutual fund, this must be your mantra: mutual funds do not
offer assured returns and carry risk. For instance, unlike bank deposits, your investment in
a mutual fund can fall in value. In addition, mutual funds are not insured or guaranteed by
any government body (unlike a bank deposit, where up to Rs 1 lakh per bank is insured by
the Deposit and Credit Insurance Corporation, a subsidiary of the Reserve Bank of India).
There are strict norms for any fund that assures returns and it is now compulsory for funds
to establish that they have resources to back such assurances. This is because most closed-
end funds that assured returns in the early-nineties failed to stick to their assurances made
at the time of launch, resulting in losses to investors. A scheme cannot make any guarantee
of return, without stating the name of the guarantor, and disclosing the net worth of the
guarantor. The past performance of the assured return schemes should also be given.
Indian Equity
Income from
dividends-(investor-
free & DDT-NIL)
Iincome from
capital gains-(short
term-15% & long
term- free)
Others
Income from
dividends-(investor-
free & DDT-individual
& HUL-14.025 &
others-22.440
Income from capital
gains-(short term-
as per tax slab &
long term-10% or
20% with indexation

2. Restrictive gains
Diversification helps, if risk minimization is your objective. However, the lack of
investment focus also means you gain less than if you had invested directly in a single
security. Assume, Reliance appreciated 50 per cent. A direct investment in the stock would
appreciate by 50 per cent. But your investment in the mutual fund, which had invested 10
per cent of its corpus in Reliance, will see only a 5 per cent appreciation.
3. Taxes
During a typical year, most actively managed mutual funds sell anywhere from 20 to 70
percent of the securities in their portfolios. If your fund makes a profit on its sales, you will
pay taxes on the income you receive, even if you reinvest the money you made.
4. Management risk
When you invest in a mutual fund, you depend on the fund's manager to make the right
decisions regarding the fund's portfolio. If the manager does not perform as well as you had
hoped, you might not make as much money on your investment as you expected. Of
course, if you invest in Index Funds, you forego management risk, because these funds do
not employ managers.
TYPES OF MUTUAL FUND SCHEMES
There are a wide variety of Mutual Fund schemes that cater to your needs, whatever your
age, financialposition, risk tolerance and return expectations. Whether as the foundation of
your investmentprogramme or as a supplement, Mutual Fund schemes can help you meet
your financial goals.

TYPES OF MUTUAL FUND SCHEME
Figure 3
(AI) By Structure
 Open-Ended Schemes
These do not have a fixed maturity. You deal directly with the Mutual Fund for your
investments and redemptions. The key feature is liquidity. You can conveniently buy and
sell your units at Net Asset Value ("NAV") related prices.
 Close-Ended Schemes
By structure
By Investment
Objectives
Other Schemes
Open-ended
Schemes
Interval Schemes
Sector specific fund
Index Schemes
Tax saving fund
Small cap fund
Equity SchemesDebt Schemes
Close Ended
Schemes
MM Mutual
fund
Other Debt
Schemes
FMP
Any Other
Equity Fund
Mid cap Fund
Large cap fund

Schemes that have a stipulated maturity period (ranging from 2 to 15 years) are called
close-ended schemes. You can invest directly in the scheme at the time of the initial issue
and thereafter you can buy or sell the units of the scheme on the stock exchanges where
they are listed. The market price at the stock exchange could vary from the scheme's NAV
on account of demand and supply situation, Unit holders' expectations and other market
factors.
One of the characteristics of the close-ended schemes is that they are generally traded at a
discount to NAV but closer to maturity, the discount narrows. Some close-ended schemes
give you an additional option of selling your units directly to the Mutual Fund through
periodic repurchase at NAV related prices. SEBI Regulations ensure that at least one of the
two exit routes are provided to the investor.
 Interval Schemes
These combine the features of open-ended and close-ended schemes. They may be traded
on the stock exchange or may be open for sale or redemption during predetermined
intervals at NAV related prices.
(B) By Investment Objective
 Growth Schemes
Aim to provide capital appreciation over the medium to long term. These schemes
normally invest amajority of their funds in equities and are willing to bear short-term
decline in value for possible futureappreciation. These schemes are not for investors
seeking regular income or needing their money backin the short term.
 Income Schemes

Aim to provide regular and steady income to investors. These schemes generally invest in
fixed income securities such as bonds and corporate debentures. Capital appreciation in
such schemes may be limited.
Ideal for
 Retired people and others with a need for capital Stability and regular income
 Investor who need some income to supplement their earnings.
 Balanced Schemes
Aim to provide both growth and income by periodically distributing a part of the income
and capital gains they earn. They invest in both shares and fixed income securities in the
proportion indicated in their offer documents. In a rising stock market the NAV of these
schemes may not normally keep pace, or fall equally when the market falls.
Ideal for:
 Investors looking for a combination of income and moderate growth.
 Money Market/Liquid Schemes
Aim to provide easy liquidity, preservation of capital and moderate income. These schemes
generally invest in safer, short-term instruments such as treasury bills, certificates of
deposit, commercial paper and inter-bank call money. Returns on these schemes may
fluctuate, depending upon the interest rates prevailing in the market.
Ideal for:
 Corporate and individual investors as a means to park their surplus funds
for short periods or awaiting a more favorable investment alternative.

 Other Schemes
 Tax Saving Schemes
These schemes offer tax rebates to the investors under tax laws as prescribed from time to
time. This is made possible because the Government offers tax incentives for investment in
specified avenues. For example, Equity Linked Savings Schemes (ELSS) and Pension
Schemes. The details of such tax saving schemes are provided in the relevant offer
documents.
Ideal for:
 Investors seeking tax rebates.
 Special Schemes
This category includes index schemes that attempt to replicate the performance of a
particular index such as the BSE Sensex or the NSE 50, or industry specific schemes
(which invest in specific industries) or sectorial schemes (which invest exclusively in
segments such as A Group shares or initial public offerings)
Different Modes of Receiving the Income Earned From
Mutual Fund Investments
Mutual funds offer three methods of receiving income:
Growth Plan:
In this plan, dividend is neither declared nor paid out to the investors but it is built
into the value of the NAV. In the other words, the NAV increases over time due to
such incomes and the investor realizes only the capital appreciation on redemption
of his investment.
Income plan or Dividend Payout Plan:

In this plan, dividends are paid-out to the investors. In other words, the NAV only
reflects the capital appreciation or depreciation in the market price of the underlying
portfolio.
Dividend Reinvestment Plan:
In this plan, dividend is declared but not paid out to the investors. Instead, it is
reinvested back in to the scheme at the then prevailing NAV. In other words, the
investor is given additional units and not cash as dividend.

RISK
TYPE OF FUND
Money
Market Fund
Debt Fund
Gilt Fund
Hybrid Fund
Equity Fund
Aggressive
Growth Fund
Flexible Asset
Allocation Fund
Growth Funds
High Yield
Debt Funds
Diversified Equity
Fund
Index Fund
Value Funds
Money Market
Funds
Equity Income
Funds
Focused
Debt Funds
Diversified
Debt Fund
Balanced FundsGilt Funds
RISK HIERARCHY OF MUTUAL FUNDS
Growth and
Income Funds

Mutual Fund Investment Strategies
 Systematic Investment Plan (SIP):
SIPs entail an investor to invest a fixed sum of money at regular intervals in MF scheme
the investor has chosen. This may help you gain from any appreciation in the event of
upside or alternatively, average your cost during downside.
Seeing the present volatility in the market SIP is the best option available to the investor
due to regular entry into the market which causes rupee cost averaging and hence covers
the volatility.
 Systematic Withdrawal Plan (SWPs):
These plans are best suited for people nearing retirement. In these plans investor invest in a
mutual fund scheme and is allowed to withdraw a fixed sum of money at regular intervals
to take care of expenses.
 Systematic Transfer Plan (STP):
They allow the investor to transfer on a periodic basis a specified amount from one scheme
to another with in the same fund family meaning two schemes belonging to the same
mutual fund. A transfer will be treated as redemption of units from the scheme from which
the transfer is made.
METHODOLOGY OF STUDY:
I have prepared questionnaire for the person whom I meet to recognize the factors which they take
into account while investing in mutual fund and then also I see various factors like age , occupation ,
income group , locality and then see how this factor affect while investing in various schemes.

And sometimes I also tried to contact Relationship manager of Bank and try to convince about our
product and if he feels satisfied then we take permission to give corporate presentation to his
employees and then try to convince and then sell the product to there client. We also provide them
after sale service by sending them statement every month and also the factsheet of the various AMC
so they can know there return exactly and also know properly that where their money is invested.
SCOPE OF STUDY :
This project provides me with learning insight about mutual fund and also little bit about equity
market. The Mutual fund industry in India comprises of a large number of fund houses and schemes,
however the project is limited to study of a few fund houses and schemes which are performing well
in the current market scenario. The analysis will mainly be carried on mainly by the data collected
from investors and from the internet
The primary research required going to various employees and speaking to relationship
managers of various banks and customers present in Ahmedabad.
The secondary research required exploring research papers, newspapers, magazines, fact
sheets of various funds and their offer documents.
SCHEDULE:
ACTIVITY TIME PERIOD
Training on mutual fund- learns about the concept of mutual

fund and the different schemes related to different mutual
fund. And also Something about taxation and Financial
planning
09-06-14 to 18-06-14
Then done survey by asking People to fill questionnaire and
Understanding of Investors perception and investment
pattern in mutual fund
19-06-14 to 1-07-14
And after that I visited the list of bank given to me Kotak,
HDFC, Axis Bank etc. And Meet with Relationship manager
2-07-14 to 20-07-14
Submission of project proposal report 21-07-14 to 23-07-14
Submit of project interim report
Submission of project final report
Total project period 09-06-14 to 10-08-14
GROWTH OF MUTUAL FUND INDUSTRY IN INDIA
While the Indian mutual fund industry has grown in size by about 320% from March, 1993
(Rs.470 billion) to December, 2010 (Rs.4505 billion) in terms of AUM, the AUM of the
sector excluding UTI has grown over times from Rs.152 billion in March 1999 to $ 148
billion as at March 2008.
Though India is a minor player in the global mutual fund industry, its AUM as a proportion
of the global AUM has steadily increased and has doubled over its levels in 1999.
The growth rate of Indian mutual fund industry has been increasing for the last few years. It
was approximately 0.12% in the year of 1999 and it is noticed 0.50% in 2010 in terms of
AUM as percentage of global AUM.
Some facts for the growth of mutual funds in India

• 100% growth in the last 6 years.
• Number of foreign AMC’s is in the queue to enter the Indian markets.
• Our saving rate is over 23%, highest in the world. Only channelizing these savings
in mutual funds sector is required.
• We have approximately 29 mutual funds which are much less than US having more
than 800. There is a big scope for expansion.
• Mutual fund can penetrate rural like the Indian insurance industry with simple and
limited products.
• SEBI allowing the MF's to launch commodity mutual funds.
RISKS OF INVESTING IN MUTUAL FUNDS
Market / Interest Risk
Volatility of prices leading to “floating” returns
Largely mitigated with a holding period of over 6 months
Credit Risk
Potential default of bonds on the portfolio
Equity Risk
Possibility of the fund manager not able to meet redemptions
GROWTH OF MUTUAL FUND INDUSTRY IN INDIA
While the Indian mutual fund industry has grown in size by about 320% from March, 1993
(Rs.470 billion) to December, 2010 (Rs.4505 billion) in terms of AUM, the AUM of the
sector excluding UTI has grown over times from Rs.152 billion in March 1999 to $ 148
billion as at March 2008.
Though India is a minor player in the global mutual fund industry, its AUM as a proportion
of the global AUM has steadily increased and has doubled over its levels in 1999.
The growth rate of Indian mutual fund industry has been increasing for the last few years. It
was approximately 0.12% in the year of 1999 and it is noticed 0.50% in 2010 in terms of
AUM as percentage of global AUM.

Some facts for the growth of mutual funds in India
• 100% growth in the last 6 years.
• Number of foreign AMC’s is in the queue to enter the Indian markets.
• Our saving rate is over 23%, highest in the world. Only channelizing these savings
in mutual funds sector is required.
• We have approximately 29 mutual funds which are much less than US having more
than 800. There is a big scope for expansion.
• Mutual fund can penetrate rural like the Indian insurance industry with simple and
limited products.
• SEBI allowing the MF's to launch commodity mutual funds.
• Emphasis on better corporate governance.
• Trying to curb the late trading practices.
• Introduction of Financial Planners who can provide need based advice.
IMPACT OF TECHNOLOGY
Mutual fund, during the last one decade brought out several innovations in their products
and is offering value added services to their investors. Some of the value added services
that are being offered are:
• Electronic fund transfer facility.
• Investment and re-purchase facility through internet.
• Added features like accident insurance cover, med claim etc.
• Holding the investment in electronic form, doing away with the traditional form of
unitcertificates.
• Cheque writing facilities.
• Systematic withdrawal and deposit facility.
ONLINE MUTUAL FUND TRADING

The innovation the industry saw was in the field of distribution to make it more easily
accessible to an ever increasing number of investors across the country. For the first time in
India the mutual fund start using the automated trading, clearing and settlement system of
stock exchanges for sale and repurchase of open-ended de-materialized mutual fund units.
Systematic Investment Plan (SIP) and Systematic Withdrawal Plan (SWP) were options
introduced which have come in very handy for the investor to maximize their returns from
their investments. SIP ensures that there is a regular investment that the investor makes on
specified dates making his purchases to spread out reducing the effect of the short term
volatility of markets. SWP was designed to ensure that investors who wanted a regular
income or cash flow from their investments were able to do so with a pre-defined
automated form. Today the SW facility has come in handy for the investors to reduce their
taxes.
HOW TO INVEST IN MUTUAL FUNDS.
Step One- Identify your investment needs. Your financial goals will vary, based on your
age, lifestyle, financial independence, family commitments, level of income and expenses
among many other factors. Therefore, the first step is to assess your needs.
Step Two- Choose the right Mutual Fund. Once you have a clear strategy in mind, you
now have to choose which Mutual Fund and scheme you want to invest in. The offer
document of the scheme tells you its objectives and provides supplementary details like the
track record of other schemes managed by the same Fund Manager. Some factors to
evaluate before choosing a particular Mutual Fund are:
 The track record of performance over the last few years in relation to the
appropriate yardstick and similar funds in the same category.
 How well the Mutual Fund is organized to provide efficient, prompt and
personalized service.
 Degree of transparency as reflected in frequency and quality of their
communications.

Step Three- Select the ideal mix of Schemes.
Investing in just one Mutual Fund scheme may not meet all your investment needs. You
may consider investing in a combination of schemes to achieve your specific goals.
The following charts could prove useful in selecting a combination of schemes that
satisfy your needs.
Figure 4
This plan may suit
 Investor seeking Income & moderate growth.
 Investor looking for growth & stability with moderate risk
Figure 5
Step Four - Invest regularly.
Step Five- Keep your taxes in mind
Conservative Plan
Growth Scheme
Income Scheme
Money Scheme
Balanced Scheme
Aggressive Plan
Growth Scheme
Income Scheme
Money market Scheme
Balanced Scheme

Step Six- Start early It is desirable to start investing early and stick to a regular investment
plan. If you start now, you will make more than if you wait and invest later. The power of
compounding lets you earn income on income and your money multiplies at a compounded
rate of return.
Step Seven-The final step all you need to do now is to get in touch with a Mutual Fund or
yourAgent/broker and start investing. Reap the rewards in the years to come. Mutual Funds
are suitable for every kind of investor-whether starting a career or retiring, conservative or
risk taking, growth oriented or income seeking.
What fees and commissions will you pay when you invest in mutual
funds?
The fees and commissions you may be charged can vary widely from one fund, and one
dealer, to the next. Some of the charges may be negotiable, but you should make sure that
you understand all of the costs before you invest. There are two main costs to consider –
themanagement and operating expenses that are charged tothe fund each year, and the
sales charges (or loads) that you pay when you buy or sellthe fund.
Management and Operating Expenses are expenses paid each year by the fund and
include such things as the manager’s fees, legal and accounting fees, custodial fees and
bookkeeping costs. The Management Expense Ratio (MER) is the percentage of the
fund’s average net assets that these expenses represent. For example, if a $100 million fund
has $2 million in costs for the year its MER will be 2%. MERs can range from under 1%
per year for some money market funds to almost 3% for some equity funds. The higher the
MER, the greater the impact on the fund’s performance and the return to its investors
because these expenses are removed before the value is reported.
Sales Charges (Loads) are the commissions that you may have to pay when you buy or
redeem units of a fund. Sales charges may be applied when you buy units of the fund
(Afront-end load), when you redeem your units (a back-end load), or there may be no
sales charges at all (no-load).Where front-end loads are charged, the rate can vary
fromdealer to dealer and may be negotiable. Shop around, andremember that every dollar

you pay up-front in commissionis a dollar that does not go to work for you in the
fund.Many funds are sold on a back-end load basis, meaninggenerally that the sales charges
are applied only when youredeem the fund. Back-end load fees are paid by the
fundmanagement company to your mutual fund salesperson – youdo not pay this fee. You
do, however, pay a ‘redemption fee’ ifyou redeem your units in the fund before a certain
time period,typically 7 years. Redemption fees decline each year thatyou hold the
investment.
For example, you might have to paya 6% fee if you redeem the fund after one year, 4% if
youredeem after three years, and no commission if you redeemafter seven years.An
increasing number of funds are being sold on a no-loadbasis, in which investors pay no
sales charges, but beforeyou decide that a no-load fund is right for you, consider thefund’s
performance, its management expense ratio and thelevel of service and advice you will
receive.
Different Avenues of investment
OPTIONS RETURN RISK LIQUIDITY
Savings account Very low Very low High
Fixed Deposits Low Low Low
Direct Equity Very high return Very high High
Insurance Medium Low Low
Company fixed deposits Low High Very low
Debentures Low Medium Medium
Bonds Low Low Low
Mutual funds High Medium High
Post office schemes Low Low Low
Government securities Low Low Low
Real estate High High Low
Currency High High High
Bullion Medium High Medium

STATEMENT OF PROBLEM
Mutual Funds are Financial intermediaries concern with the mobilizing savings of surplus
income & channelisation of these savings in those avenues where there is demand of funds.
The main purpose behind this study of investment preferences in Mutual Funds is to see
that how the investors are employing their resources in a manner to afford, combine
benefits to low risks, steady or consistent returns, high liquidity & capital appreciation
through diversification & Expert Management.
Therefore the activities of mutual funds have both short & long term impact on the savings
& capital market & the national economy. Mutual Funds, thus, assist the process of
financial depending & intermediation.
Objectives of the Study
• To study various investment alternatives and in particular investors
preference towards mutual funds.
• To study the preference of investors in today’s scenario (less risk and more return).
• To assess the risk of investors with reference to diversifiable risk &
non-diversifiable risk.
• To study market potentiality of mutual fund among investors.
• To study whether the investors are considering IDFC a better option or not.
Research Methodology
Research Methodology is a systematic method of discovering new facts or verifying old
facts, their sequence, inter-relationship, casual explanation and the natural laws which
governs them. In it we study the various steps that are generally adopted by a researcher in
the studying his research problem along with the logic behind them.

Different stages involved in research consists of enacting the problem, formulating a
hypothesis, collecting the facts or data, analyzing the facts and reaching certain conclusion
either in the form of solution towards the concerned problem or in generalization for some
theoretical formulation.
Type of Sample Design: Judgment Sampling
Sample Size: 200
In Research Methodology mainly Data plays an important role.
The Data is divided in two parts:
a) Primary Data.
b) Secondary Data.
Primary Data is the data, which is collected directly by direct personal interview,
Interview, indirect oral investigation, Information received through local agents, Drafting a
schedule, drafting a questionnaire.
Secondary Data is the data, which is collected from:
Various books.
Magazine and material.
Internet
Fact sheets of various MFs
The data which is stored in the organization and provide by the FINANCE people are also
secondary data. The various information is taken out regarding that subject as well other
subject from various sources and stored. The last years data stored can also be secondary
data. This data is kept for the internal use of the organization.
The FINANCE manual is for the internal use of the organization they are secondary data
which help people to gain information. In this report the data plays a very crucial role. For
this report the data was provided to me by FINANCE department and other departmental
head in the organization.

SURVEY ANALYSIS
Sampling Method
The sampling method so as to obtain a representative sample is the Non- Probability
Sampling methods. Under non-probability sampling, we selected the respondents to the
survey on the basis of Judgment sampling with Convenience taken into account.
Research instrument
The research instrument used for this survey is a structured questionnaire. The
questionnaire contains both open-ended and close ended questions. The questionnaire
provides a provision with respect to rating scales.
Assumptions
 The sample selected represents the population fully.
 The data has been collected by administering an open and close ended questionnaire
to sample of end investors andwith the assumption that the primary data collected is
true and reflects the actual preferences of the investors.
 The sample selected has thorough knowledge of the subject.
LIMITATIONS OF THE STUDY
1) Sometime stock market are not performing well so people are not interested to invest
2) Sometime because of negative sentiments in the market people are not ready to invest for e.g.
the subprime crisis in US affected the stock market in India.
3) Many people have good knowledge of the equity market by themselves so they don’t want to
invest in mutual fund

4) Many are looking for the short term benefits for which sometime mutual fund is not the best
option
5) Many people who want to have high risk high return are not suitable for mutual fund
6) Some people are not ready to invest in mutual fund because of the lack of knowledge about the
product
7) Most of the time people are busy in their schedule and so they don’t want to listen to anything on
the telephone calls.
8) In small towns people are not willing to purchase mutual fund because of lack of knowledge they
rather prefer to invest in real state
9) It is also difficult to measure economic factor associated with time constrain
10) Time constrain

LITERATURE REVIEW
Literature on mutual fund performance evaluation is enormous. A few research studies that
haveinfluenced the preparation of this paper substantially are discussed in this section.
Sharpe, William F. (1966) suggested a measure for the evaluation of portfolio performance.
Drawing onresults obtained in the field of portfolio analysis, economist Jack L. Treynor has
suggested a newpredictor of mutual fund performance, one that differs from virtually all
those used previously byincorporating the volatility of a fund's return in a simple yet
meaningful manner.
Michael C. Jensen (1967) derived a risk-adjusted measure of portfolio performance
(Jensen’s alpha) that estimates how much a manager’s forecasting ability contributes to
fund’s returns.
As indicated by Statman (2000), the e SDAR of a fund portfolio is the excess return of the
portfolio overthe return of the benchmark index, where the portfolio is leveraged to have the
benchmark index’sstandard deviation.
NarayanRao,ET. al., evaluated performance of Indian mutual funds in a bearmarket through
relative performance index, risk-return analysis, Treynor’s ratio, Sharpe’s ratio,
Sharpe’smeasure , Jensen’s measure, and Fama’s measure. The study used 269 open-ended
schemes (out of totalschemes of 433) for computing relative performance index. Then after
excluding funds whose returns areless than risk-free returns, 58 schemes are finally used for
further analysis. The results of performancemeasures suggest that most of mutual fund
schemes in the sample of 58 were able to satisfy investor’sexpectations by giving excess
returns over expected returns based on both premiums for systematic riskand total risk.
Bijan Roy, ET. al., conducted an empirical study on conditional performance of
Indianmutual funds. This paper uses a technique called conditional performance evaluation
on a sample ofeighty-nine Indian mutual fund schemes .This paper measures the
performance of various mutual fundswith both unconditional and conditional form of
CAPM, Treynor- Mazuy model and Henriksson-Mertonmodel. The effect of incorporating
lagged information variables into the evaluation of mutual fundmanagers’ performance is
examined in the Indian context. The results suggest that the use ofconditioning lagged

information variables improves the performance of mutual fund schemes, causingalphas to
shift towards right and reducing the number of negative timing coefficients.
Mishra, et al., (2002) measured mutual fund performance using lower partial moment. Inthis
paper, measures of evaluating portfolio performance based on lower partial moment are
developed.
Risk from the lower partial moment is measured by taking into account only those states in
which returnis below a pre-specified “target rate” like risk-free rate. Kshama Fernandes
(2003) evaluated index fundimplementation in India. In this paper, tracking error of index
funds in India is measured .Theconsistency and level of tracking errors obtained by some
well-run index fund suggests that it is possibleto attain low levels of tracking error under
Indian conditions. At the same time, there do seem to beperiods where certain index funds
appear to depart from the discipline of indexation. K. Pendaraki et al.studied construction of
mutual fund portfolios, developed a multi-criteria methodology and applied it tothe Greek
market of equity mutual funds. The methodology is based on the combination of discrete
andcontinuous multi-criteria decision aid methods for mutual fund selection and
composition. UTADISmulti-criteria decision aid method is employed in order to develop
mutual fund’s performance models.
Goal programming model is employed to determine proportion of selected mutual funds in
the finalportfolios.
Zakri Y.Bello (2005) matched a sample of socially responsible stock mutual funds
matchedto randomly select conventional funds of similar net assets to investigate
differences in characteristicsof assets held, degree of portfolio diversification and variable
effects of diversification on investmentperformance. The study found that socially
responsible funds do not differ significantly fromconventional funds in terms of any of
these attributes. Moreover, the effect of diversification oninvestment performance is not
different between the two groups. Both groups underperformed theDomini 400 Social Index
and S & P 500 during the study period.
Michael C. Jensen (1967) derived a risk-adjusted measure of portfolio performance
(Jensen’s alpha) that estimates how much a manager’s forecasting ability contributes to
fund’s returns.

As indicated by Statman (2000), the e SDAR of a fund portfolio is the excess return of the
portfolio over the return of the benchmark index, where the portfolio is leveraged to have
the benchmark index’s standard deviation. S.Narayan Rao,ET. al., evaluated performance of
Indian mutual funds in a bear market through relative performance index, risk-return
analysis, Treynor’s ratio, Sharpe’s ratio, Sharpe’s measure , Jensen’s measure, and Fama’s
measure. The study used 269 open-ended schemes (out of total schemes of 433) for
computing relative performance index. Then after excluding funds whose returns are less
than risk-free returns, 58 schemes are finally used for further analysis. The results of
performance measures suggest that most of mutual fund schemes in the sample of 58 were
able to satisfy investor’s expectations by giving excess returns over expected returns based
on both premiums for systematic risk and total risk.
DEFNITION OF MUTUAL FUNDS
DEFNITION:
A mutual fund, also referred to as an open-end fund, is an investment company that spreads
its money across a diversified portfolio of securities -- including stocks, bonds, or money
market instruments.
Shareholders who invest in a fund each own a representative portion of those investments,
less any expenses charged by the fund.
Mutual fund investors make money either by receiving dividends and interest from their
investments, or by the rise in value of the securities. Dividends, interest and profits from
the sale of any securities (capital gains) are passed on to the shareholders in the form of
distributions. And shareholders generally are allowed to sell (redeem) their shares at any
time for the closing market price of the fund on that day.
DEFNITION:
Mutual funds have been around for a long time, dating back to the early 19th century. The
first modern American mutual fund opened in 1924, yet it was only in the 1990’s that
mutual funds became mainstream investments, as the number of households owning them
nearly tripled during that decade. With recent surveys showing that over 88% of all
investors participate in mutual funds, you're probably already familiar with these
investments, or perhaps even own some. In any case, it's important that you know exactly
how these investments work and how you can use them to your advantage.

A mutual fund is a special type of company that pools together money from many investors
and invests it on behalf of the group, in accordance with a stated set of objectives. Mutual
funds raise the money by selling shares of the fund to the public, much like any other
company can sell stock in itself to the public. Funds then take the money they receive from
the sale of their shares (along with any money made from previous investments) and use it
to purchase various investment vehicles, such as stocks, bonds and money market
instruments. In return for the money they give to the fund when purchasing shares,
shareholders receive an equity position in the fund and, in effect, in each of its underlying
securities. For most mutual funds, shareholders are free to sell their shares at any time,
although the price of a share in a mutual fund will fluctuate daily, depending upon the
performance of the securities held by the fund.
DEFNITION:
A mutual fund is simply a financial intermediary that allows a group of investors to pool
their money together with a predetermined investment objective. The mutual fund wil have
a fund manager who is responsible for investing the pooled money into specific securities
(usually stocks or bonds). When you invest in a mutual fund, you are buying shares (or
portions) of the mutual fund and become a shareholder of the fund.
.
DEFNITION:
An open-ended fund operated by an investment company which raises money from
shareholders and invests in a group of assets, in accordance with a stated set of objectives.
mutual funds raise money by selling shares of the fund to the public, much like any other
type of company can sell stock in itself to the public. Mutual funds then take the money
they receive from the sale of their shares (along with any money made from previous
investments) and use it to purchase various investment vehicles, such as stocks, bonds and
money market instruments. In return for the money they give to the fund when purchasing
shares, shareholders receive an equity position in the fund and, in effect, in each of its
underlying securities. For most mutual funds, shareholders are free to sell their shares at
any time, although the price of a share in a mutual fund will fluctuate daily, depending
upon the performance of the securities held by the fund. Benefits of mutual funds include
diversification and professional money management. Mutual funds offer choice, liquidity,
and convenience, but charge fees and often require a minimum investment. A closed-end
fund is often incorrectly referred to as a mutual fund, but is actually an investment trust.
There are many types of mutual funds, including aggressive growth fund, asset allocation
fund, balanced fund, blend fund, bond fund, capital appreciation fund, clone fund, closed
fund, crossover fund, equity fund, fund of funds, global fund, growth fund, growth and
income fund, hedge fund, income fund, index fund, international fund, money market fund,
municipal bond fund, prime rate fund, regional fund, sector fund, specialty fund, stock
fund, and tax-free bond fund.
DEFNITION:

A security that gives small investors access to a well-diversified portfolio of equities, bonds
and other securities. Each shareholder participates in the gain or loss of the fund. Shares are
issued and can be redeemed as needed
How to Calculate the value of a Mutual Fund:
The investor’s funds are deployed in a portfolio of securities by the fund manager. The
value of these investments keeps changing as the market price of the securities change.
Since investors are free to enter and exit the fund at any time, it is essential that the market
value of their investments is used to determine the price at which such entry and exit will
take place. The net assets represent the market value of assets, which belong to the
investors, on a given date.
Net Asset Value or NAV of a mutual fund is the value of one unit of investment in the fund,
in net asset terms.
NAV= Net Asset of the scheme / Number of Units Outstanding
Where Net Assets are calculated as:-
(Market value of investment + current assets and other assets + Accrued income – current
liabilities and other liabilities – less accrued expenses) / No. of Units Outstanding as at the
NAV date.
NAV of all schemes must be calculated and published at least weekly for closed – end
schemes and daily for open- end schemes.
The major factors affecting the NAV of a fund are :
 Sale and purchase of securities
 Sale and repurchase of units
 Valuation of assets
 Accrual of income and expenses
. NAV-:
Net Asset Value is the market value of the assets of the scheme minus its liabilities. The per unit NAV
is the net asset value of the scheme divided by the number of units outstanding on the Valuation Date.

How is NAV calculated?
The value of all the securities in the portfolio in calculated daily. From this, all expenses are deducted
and the resultant value divided by the number of units in the fund is the fund’s NAV.
Expense Ratio
AMCs charge an annual fee, or expense ratio that covers administrative expenses, salaries,
advertising expenses, brokerage fee, etc. A 1.5% expense ratio means the AMC charges Rs1.50 for every
Rs100 in assets under management.
A fund's expense ratio is typically to the size of the funds under management and not to the returns
earned. Normally, the costs of running a fund grow slower than the growth in the fund size - so, the more
assets in the fund, the lower should be its expense.
Entry load and an exit load
Some Asset Management Companies (AMCs) have sales charges, or loads, on their funds (entry
load and/or exit load) to compensate for distribution costs. Funds that can be purchased without a sales charge
are called no-load funds. Entry load is charged at the time an investor purchases the units of a scheme. The
entry load percentage is added to the prevailing NAV at the time of allotment of units. Exit load is charged at
the time of redeeming (or transferring an investment between schemes). The exit load percentage is deducted
from the NAV at the time of redemption (or transfer between schemes). This amount goes to the Asset
Management Company and not into the pool of funds of the scheme.
How does "entry load" affect the investment returns?
A 2.25% entry load sounds small. But it still bites a chunk off the returns over a long period of time.
For instance, Rs 1 lakh invested directly in the no-load option of an equity fund that grows at a rate of
15% over a period of 20 years yields around Rs 16.36 lakh against Rs 15.99 lakh that a load fund
would return—a difference of Rs 36,820. This is because even a small sum of 2.25% gets
compounded over the years.

The pinch remains the same even in a systematic investment plan (SIP). As SIPs entail investments on
a regular basis, say every month, you end up paying entry loads on all your investment installments.
Assume you had invested Rs 5,000 in Reliance Vision Fund (RVF) on January 1, 2003 through a
monthly SIP. If you had withdrawn your entire investment after five years, on December 31, 2007,
you would have got back Rs 11.52 lakh in the no-load option and Rs 11.25 lakh in a load option, a
difference of a cool Rs 25,914.
Are investments in mutual fund units risk-free or safe?
This depends on the underlying instrument that a mutual fund invests in, based on its investment
objectives. Mutual funds that invest in stock market-related instruments cannot be termed “risk-free
or safe” as investment in shares are inherently risky by nature, whereas funds that invest in fixed-
income instruments are relatively safe and those that invest only in government securities are the
safest.
Why Mutual Funds are an investment option?
Firstly, we are not all investment professionals. We go to a doctor when we need medical advice or a
lawyer for legal guidance, similarly mutual funds are investment vehicles managed by professional
fund managers. And unless you rate highly on the Investment IQ Quiz, we recommend you use this
option for investing. Mutual funds are like professional money managers, however a key factor in
their favor is that they are more regulated and hence offer investors the ability to analyze and
evaluate their track record.
Secondly, investing is becoming more complex. There was a time when things were quite simple -
the market went up with the arrival of the first monsoon showers and every year around Diwali.
Since India started integrating with the world (with the start of the liberalization process), complex
factors such as an increase in short-term US interest rates, the collapse of the Brazilian currency or
default on its debt by the Russian government, have started having an impact on the Indian stock
market. Although it is possible for an individual investor to understand Indian companies (and
investing) in such an environment, the process can become fairly time consuming. Mutual funds
(whose fund managers are paid to understand these issues and whose asset management company
invests in research) provide an option of investing without getting lost in the complexities.

Lastly, and most importantly, mutual funds provide risk diversification: Diversification of a portfolio
is amongst the primary tenets of portfolio structuring (see The Need to Diversify). And a necessary
one to reduce the level of risk assumed by the portfolio holder. Most of us are not necessarily well
qualified to apply the theories of portfolio structuring to our holdings and hence would be better off
leaving that to a professional. Mutual funds represent one such option.
How to select a mutual fund scheme?
What's strategy got to do with selecting a mutual fund? Shouldn't you just go and invest in the best
performing fund? The answer is no. Mutual fund investing requires as much strategic input as any
other investment option. But the advantage is that the strategy here is a natural extension of your
asset allocation plan (use our Asset Allocator to understand what your optimum asset allocation plan
should be, based on your personal risk profile). The following processes are important to select a
mutual fund scheme.
 Identify funds whose investment objectives match your asset allocation needs
Just as you would buy a computer that fits your needs and budget, you should choose a mutual fund
that meets your risk tolerance (need) and your risk capacity (budget) levels (i.e. has similar
investment objectives as your own). Typical investment objectives of mutual funds include fixed
income or equity, general equity or sector-focused, high risk or low risk, blue-chips or turnarounds,
long-term or short-term liquidity focus. The investment objectives match yours are
 Evaluate past performance, look for consistency. Although past performance is no guarantee of
future performance, it is a useful way of assessing how well or badly a fund has performed in
comparison to its stated objectives and peer group. A good way to do this would be to identify the
five best performing funds (within your selected investment objectives) over various periods, say 3
months, 6 months, one year, two years and three years. Shortlist funds that appear in the top 5 in
each of these time horizons as they would have thus demonstrated their ability to be not only good
but also, consistent performers. .
Are investments in mutual fund units risk-free or safe?
This depends on the instrument mutual fund invests in, based on its investment objectives. Mutual
funds that invest in stock market-related instruments cannot be termed “risk-free or safe” as
investment in shares are inherently risky by nature, whereas funds that invest in fixed-income
instruments are relatively safe and those that invest only in government securities are the safest.

Role of a Fund Manager:
Fund managers are responsible for implementing a consistent investment strategy that reflects the
goals and objectives of the fund. Normally, fund managers monitor market and economic trends and
analyze securities in order to make informed investment decisions.
How are mutual funds regulated?
All Asset Management Companies (AMCs) are regulated by SEBI and or the RBI (in case the AMC
is promoted by a bank). In addition, every mutual fund has a board of directors that represents the
unit holders’ interests in the mutual fund.

COMPANY PROFILE-
IDFC have been an integral part of the country's development story since 1997, when our
company was formed with the specific mandate to build the nation.
Since 2005, we have built on our vision to be the 'one firm' that looks after the diverse needs
of infrastructure development. Whether it is financial intermediation for infrastructure
projects and services, adding value through innovative products to the infrastructure value
chain or asset maintenance of existing infrastructure projects, we focus on supporting
companies to get the best return on investments.
Our growth has been driven by the substantial investment requirements of the infrastructure
sector in India combined with the growth in the Indian economy over the last several years.
Our ability to tap global as well as Indian financial resources makes us the acknowledged
experts in infrastructure finance. This, coupled with a strong synergy between the company
management and key shareholders, and a dedicated team of over 550 people makes us an
organization that is committed to improving the face of India's infrastructure sector.
At IDFC, our commitment to building India's infrastructure goes beyond business. We work
closely with government entities and regulators to advise and assist them in formulating
policy and regulatory frameworks that support private investment and public-private
partnerships in infrastructure development.
Mission
“To be the leading knowledge-driven financial services company, creating enduring
value, promoting infrastructure and nation building”
Values
Integrity
We engage in honest and straight forward communication with all stakeholders and adhere
to the highest ethical standards in everything we do. Our reputation is paramount. We will
act in the best interests of our clients but without compromising our values and principles.
Nurturing Humility
We are modest enough to know that we can be wrong and smart enough to learn from our
mistakes. We treat everyone as an equal— no task is beneath us.
Stewardship

We act as custodians of our firm and accept the charge of passing on a better business than
the one we inherited. Our actions will be guided by rules and ethical principles creating long
term value with due care for society and environment.
Partnership
We emphasize a ONE FIRM culture. We foster mutual respect and proactively collaborate
with each other, with clients, and with partners keeping just one thing in mind – to be the
best at what we do.
Initiative
We encourage new ideas and independent action within a culture that fosters sharing
knowledge and information, critical debate and constructive dissent.
Responsibility
We take complete ownership for our actions, emphasizing a results-oriented and problem-
solving approach to business. We are personally accountable to the communities that we
serve.
Excellence
We constantly strive to raise industry standards, be the employer of choice, and work to be
the best rather than the biggest. Dedication to excellence results in superior execution and
generates creative, imaginative and innovative outcomes.
Board Committees
Audit
Committee
: Mr. S. H. Khan
Chairman
Dr. Omkar Goswami
Mr. Gautam Kaji
Ms. Marianne Økland
Ms. Snehlata
Shrivastava
Nomination &
Remuneration
Committee
: Dr. Omkar Goswami
Chairman
Dr. Rajiv B. Lall
Mr. Gautam Kaji
Mr. Donald Peck
Stakeholders'
Relationship
Committee
: Mr. S. H. Khan
Chairman
Dr. Rajiv B. Lall
Mr. Vikram Limaye
Corporate
Social
Responsibility
Committee
: Dr. Rajiv B. Lall
Chairman
Dr. Omkar Goswami
Mr. Vikram Limaye

Executive
Committee
: Dr. Rajiv B. Lall
Chairman
Mr. S. S. Kohli
Mr. S. H. Khan
Dr. Omkar Goswami
Mr. Donald Peck
Mr. Vikram Limaye
Risk
Committee
: Mr. Gautam Kaji
Chairman
Mr. S. H. Khan
Dr. Rajiv B. Lall
Ms. Marianne Økland
Mr. Vikram Limaye
History & Timelines
Our Group was born out of the need for a specialized financial intermediary for
infrastructure. Incorporated on January 30, 1997 in Chennai, our company was set up on the
recommendations of the 'Expert Group on Commercialisation of Infrastructure Projects'
under the Chairmanship of Dr. Rakesh Mohan.
Since then, we have been a leading catalyst for providing private sector infrastructure
development in India. We focus on developing and leveraging our knowledge base in the
infrastructure space to devise and provide appropriate financing solutions to our customers.
Our strong capitalization reflects the crucial role that we play in infrastructure development.
1997
 IDFC is founded on the recommendations of the 'Expert Group on Commercialization of
Infrastructure Projects' under the Chairmanship of Dr. Rakesh Mohan. The group is
conceptualized to channel private capital into commercially viable projects.
1999
 Is notified as a Public Financial Institution under Section 4A of the Companies Act.
2000
 Gets registered with SEBI as a merchant banker.
2001
 Gets registered with SEBI as a debenture trustee.
 Sets up Infrastructure Development Corporation (Karnataka) Limited (iDeCK)
2002
 Sets up IDFC Private Equity as an investment manager for private equity funds.
 Sets up Uttaranchal Infrastructure Development Company Limited (UDEC).

2003
 Successfully raises $200 million for the India Development Fund, the first infrastructure-
focused private equity fund.
2005
 Becomes a public company after listing its shares on NSE and BSE.
2006
 Successfully raises $450 million for its second infrastructure - focused private equity fund.
2007
 Raises Rs. 2,100 crore through QIP.
 Sets up IDFC Project Equity Company Limited as a specialized project finance entity
focused on developing Indian infrastructure projects.
 Establishes IDFC Projects to develop, implement, own and operate projects in the
infrastructure space.
2008
 Successfully raises $930 million through the India Infrastructure Fund to invest equity
capital in infrastructure projects and $700 million in its third private equity fund.
 Enters into asset management by acquiring the AMC business of Standard Chartered Bank
in India.
 Incorporates IDFC Capital (Singapore) Pte Limited, for an emerging markets private equity
fund-of-funds business.
2009
 The company's loan book crosses Rs. 20,000 crore with more than 200 infrastructure
projects funded.
 Establishes IDFC Foundation to focus on capacity building, policy advisory and
sustainability initiatives.
 Becomes part of Nifty 50.
2010
 Raises additional capital of Rs. 26,542 million through a Qualified Institution Placement at
Rs.168.25 per share and CCPS at a conversion price of Rs.176 per share. Government
shareholding reduces to 18%.
 Classified as an Infrastructure Finance Company (IFC).
 Raises Rs. 480 crores in the first tranche of its Long Term Infrastructure Bonds.
2011

 Certified as India's first "Green Data Centre".
 IDFC opens an office in US.
 Sets up IDFC Foundation as a Section 25 Company for all its developmental work.
 IDFC & Natixis Global Asset Management enter into a strategic partnership.
 Raise USD 310 million of ECB's.
 Starts "Partners Program".
2012
 IDFC Completes 15 years with over 1.5 million investors.
 Launches "In Our Hands" an youth engagement initiative, to socialize the policy advocacy
work being done under the aegis of the India Infrastructure Report (IIR).
 Releases a handbook titled "EVOLVING PERSPECTIVES IN THE DEVELOPMENT OF
INDIAN INFRASTRUCTURE", encompassing the policy work done in the last 15 years.
IDFC business
 Corporate Investment
Banking
 Project Finance
 Financial Markets Group
 Securities
 Alternative Asset
Management
 Private Equity
 Infrastructure
 Real Estate
 Public Market
Asset Management
 Mutual Fund
 Foundation
 Government Advisory Services
 Policy Advocacy
 Capacity Building Initiatives
 Community Engagement

Structure of the organization
Company’s structure
Structure of the company consists of following entities:-
 Country head
 State head distribution channel
 Cluster heads of investments
 Individual brokers
 Back office operation
 Sales team
State head looks after all the operation in Karnataka region like Bellary, Mysore and other cities of Karnataka
and coordinates with asset management companies i.e. AMCs and reports to country head, and cluster heads
of investments are responsible for sales team and report to state head distribution channel and sales people
who directly interact with investors for the investments report to cluster head investment. Sales team is
supported by back office operations, like role of back office operation

SWOT analysis of the company and its competitor
STRENGTH
 BRANDNAME
 KNOWN TO BE ETHICAL
 PRESENCE IN ALL OVER INDIA
 EXPERIENCED PEOPLE IN THE
COMPANY
 UNBIASNESS
WEAKNESS
 BRANCHASE OF COMPANY IS LESS
ONLY 27 IN INDIA.
 LACK OF MANPOWER
 NOT HAVING NECESSARY
INFRASTRUCTURE
OPPORTUNITY
 ZERO BASE
 LACK OF PROPER SERVICES
AVAILABLE IN THE MARKET
 ABSENCE OF LEADER IN THE
MARKET, IN DISTRIBUTION (
MUTUAL FUNDS)
 HUGE POTENTIAL OF MUTUAL
FUND MARKET
 GROWTH OF MUTUAL FUND
MARKET
 INCREASE IN INCOME LEVEL OF
PEOPLE
THREATS
 INDIVIDUAL BROKERS
 ITS COMPETITOR’S
PROMOTIOAL ACTIVITIES
 ITS COMPETITOR’NEW BUSINESS
PLANS
 ATTRITION
 LACK OF MANPOWER
 NOT HAVING NECESSARY
INFRASTRUCTURE

Average Assets under Management
Assets under management (AUM) is a financial term denoting the market value of all the
funds being managed by a financial institution (a mutual fund, hedge fund, private equity
firm, venture capital firm, or brokerage house) on behalf of its clients, investors, partners,
depositors, etc.
The average Assets under management of all Mutual funds in India for the quarter Jul-13 to
Sep-13 (in INR billion) is given below:
Sr No Mutual Fund Name Average AUM %
1 HDFC Mutual Fund 1,034.42 12.70%
2 Reliance Mutual Fund 952.28 11.69%
3 ICICI Prudential Mutual Fund 853.03 10.48%
4 Birla Sun Life Mutual Fund 773.44 9.50%
5 UTI Mutual Fund 700.57 8.60%
6 SBI Mutual Fund 595.58 7.31%
7 Franklin Templeton Mutual Fund 448.12 5.50%
8 IDFC Mutual Fund 396.65 4.87%
9 Kotak Mahindra Mutual Fund 352.99 4.34%
10 DSP BlackRock Mutual Fund 304.86 3.74%
11 Tata Mutual Fund 179.66 2.21%
12 Deutsche Mutual Fund 170.59 2.10%
13 L&T Mutual Fund 150.79 1.85%
14 Sundaram Mutual Fund 139.47 1.71%
15 JPMorgan Mutual Fund 132.57 1.63%
16 Religare Invesco Mutual Fund 125.12 1.54%
17 Axis Mutual Fund 123.18 1.51%
18 LIC NOMURA Mutual Fund 79.76 0.98%
19 Canara Robeco Mutual Fund 76.16 0.94%
20 HSBC Mutual Fund 67.18 0.83%

Sr No Mutual Fund Name Average AUM %
21 JM Financial Mutual Fund 62.44 0.77%
22 Baroda Pioneer Mutual Fund 52.63 0.65%
23 IDBI Mutual Fund 47.71 0.59%
24 PRINCIPAL Mutual Fund 43.00 0.53%
25 Goldman Sachs Mutual Fund 41.49 0.51%
26 BNP Paribas Mutual Fund 35.38 0.43%
27 Morgan Stanley Mutual Fund 32.90 0.40%
28 Peerless Mutual Fund 28.35 0.35%
29 Taurus Mutual Fund 27.32 0.34%
30 Pramerica Mutual Fund 21.66 0.27%
31 Union KBC Mutual Fund 19.80 0.24%
32 Indiabulls Mutual Fund 16.06 0.20%
33 ING Mutual Fund 11.05 0.14%
34 PineBridge Mutual Fund 11.03 0.14%
35 BOI AXA Mutual Fund 10.82 0.13%
36 Mirae Asset Mutual Fund 5.08 0.06%
37 Motilal Oswal Mutual Fund 4.37 0.05%
38 Quantum Mutual Fund 3.15 0.04%
39 PPFAS Mutual Fund 2.67 0.03%
40 Escorts Mutual Fund 2.52 0.03%
41 Sahara Mutual Fund 2.33 0.03%
42 IIFL Mutual Fund 2.07 0.03%
43 Edelweiss Mutual Fund 1.94 0.02%
44 Daiwa Mutual Fund 0.51 0.01%
45 IL&FS Mutual Fund (IDF) - 0.00%
46 Shriram Mutual Fund - 0.00%
47 SREI Mutual Fund (IDF) - 0.00%
Grand Total 8,142.68
100.0%

A COMPARATIVE ANALYSIS OF MUTUAL FUND SCHEMES
Equity Diversified Scheme
Scheme NAV 1 year
annualized
3 year
annualized
5 year
annualized
Since
Inception
Birla Sun Life Frontline Equity Fund 58.39 -0.53 26.659 34.53 36.58
DBS Chola Opportunities Fund-
Cumulative
34.98 09.83 25.7 33.17 12.39
DSP Merrill Lynch Equity Fund-
Growth
10.96 05.36 N.A N.A 8.56
DSP Merrill Lynch India T.I.G.E.R
Fund –Growth
37.63 -04.33 29.13 N.A 38.34
DSP Merrill Lynch Top 100 Equity
Growth Fund
69.38 06.92 30.923 37.71 44.36
DWS Alpha Equity Growth Fund 62.76 08.23 29.07 38.283 39.77
DWS Investment Opportunity Fund 31.20 11.23 30.27 N.A 29.07
Fidelity Equity Fund –Growth 23.15 -04.41 23.47 N.A 29.49
HDFC Growth Fund-Growth 60.53 08.61 28.24 34.63 31.77
HSBC Equity Fund- Growth 85.34 08.91 25.19 41.81 46.15
ICICI Prudential Dynamic Plan-Growth 72.81 01.98 27.67 31.78 29.76
ICICI Prudential Infrastructure Fund-
Growth
25.17 17.82 N.A N.A 34.26
IDFC Imperial Equity fund-Growth 16.27 06.82 N.A N.A 17.48
Kodak 30-Growth 81.09 05.78 26.67 39.29 45.02
Kodak Opportunities-Growth 35.71 08.57 26.61 39.28 41.39
Reliance growth fund-growth 331.5 06.97 26.72 47.17 31.91

Reliance Regular Saving Fund-Equity-
Growth
20.86 18.41 26.56 N.A 22.62
SBI Magnum Sector Umbrella-Contra
Fund-Growth
34.73 09.11 16.74 22.78 17.64
Sundaram BNP Paribas CAPEX
opportunities Fund-Growth
19.18 -06.67 N.A N.A 20.18
Sundaram BNP Paribas Select Focus-
Growth
71.01 13.47 30.40 36.91 40.29
Tata Equity PE Fund-Growth 31.91 02,87 22.71 N.A 32.81
Tata Infrastructure Fund-Growth 29.56 04.78 32.06 N.A 36.26
Templeton India Growth Fund-Growth 82.19 10.51 24.84 N.A 32.63
UTI Dividend Yield Fund-Growth 19.68 06.28 21.49 N.A 22.68
UTI Contra Fund-(G) 10.64 02.12 16.49 N.A 18.82
ELSS
Scheme Name NAV 1 Year
Annualized
3 Year
Annualized
5 Year
Annualized
Since
Inception
DWS Tax Saving Fund 12.34 1.59 N.A N.A 8.52
Fidelity Tax Advantage Fund 14.23 -1.43 N.A N.A 14.48
Franklin India Taxshield-Growth 112.2 08.39 14.23 27.32 26.56
HDFC Long Term Tax Adv. Fund 68.49 05.29 12.38 18.45 24.32
HSBC Tax Saver Equity Fund 12.56 1.62 16.86 N.A 17.86
Kodak Tax Saver Scheme 14.43 -10.13 22.49 N.A 15.64
Principal Personal Tax Saver 82.40 -5.85 24.51 33.74 26.49
Reliance Tax Saver-Growth 17.64 3.06 12.73 N.A 13.45
Sundaram BNP Paribas Tax Saver 32.61 7.63 22.50 40.94 29.56
Tata Tax Advantage Scheme 19.41 3.57 13.57 17.83 17.78
Balance

Annualized
3 Year
Annualized
5 Year
Annualized
Since
Inception
Birla Sun Life Balanced Fund 29.34 -2.82 14.42 21.39 13.21
DSP Merrill Lynch Balanced
Fund-Growth
46.82 7.19 22.72 22.72 18.38
FT India Balanced Fund-
Growth
36.62 0.36 18.52 25.78 18.62
HDFC Balanced Fund-Growth 34.27 5.61 14.72 21.62 17.82
Kodak Balance Fund 20.53 2.75 17.78 28.43 17.77
Tata Balanced Fund-Growth 56.82 0.08 18.79 26.78 19.72
UTI Children’s Career Balanced 12.45 1.24 09.57 16.84 15.22
MIP
Annualized
3 Year
Annualized
5 Year
Annualized
Since
Inception
Baroda Pioneer MIP Fund 14.96 5.67 12.78 N.A 12.93
Birla Sun Life Savings MIP 2
Savings-Growth
14.54 13.54 22.37 N.A 18.59
DBS Chola MIP Regular-
Growth
15.55 5.54 10.74 14.43 10.89
FT India Monthly Income Plan 22.46 3.84 7.72 9.22 09.73
HSBC MIP Savings-Growth 1.4 3.56 8.78 N.A 10.99
LICMF MIP-Growth 27.67 7.65 10.67 09.78 09.49
Principal MIP-MIP Growth 15.36 9.67 11.64 N.A 08.96
Reliance MIP 15.68 8.11 10.76 19.89 16.56
Tata Monthly Income Fund (G) 21.45 5.61 13.41 17.41 17.72
Gilt Fund
Annualized
3 Year
Annualized
5 Year
Annualized
Since
Inception

Birla Sun Life Gilt Plus Regular
Plan – Growth
31.40 07.33 10.68 14.78 12.93
DSP Blackrock G Sec Plan A
Long Duration – Growth
31.98 06.91 11.28 13.65 12.06
DWS Gilt Fund - Regular –
Growth
10.99 08.11 16.67 26.41 21.02
Fidelity Flexi Gilt Fund –
Growth
11.87 08.98 15.99 29.10 26.09
ICICI Prudential Gilt Fund
Investment Plan - Growth
31.65 05.82 11.67 18.54 12.91
Mirae Asset Gilt Fund -
Investment Plan - Provident
Fund
10.36 9.61 18.51 24.61 19.71
Reliance Gilt Securities Fund -
Retail – Growth
11.92 10.17 19.71 32.76 29.62
Templeton India Govt.
Securities Fund - Composite
Plan –Growth
32.66 08.45 13.41 18.34 14.72
Debt (Income) Fund
Annualized
3 Year
Annualized
5 Year
Annualized
Since
Inception
Birla Sun Life Income Fund -
Growth
33.11 06.47 09.89 10.78 10.18
Birla Sun Life Income Plus -
Growth
41.41 05.68 09.18 11.68 11.28
Canara Robeco Income
Scheme - Growth
18.99 09.73 09.87 10.78 10.20
ICICI Prudential Income Fund
–Growth
29.42 06.44 09.74 08.99 09.18
IDFC Dynamic Bond Fund -
Plan A - Growth
18.71 07.61 07.99 09.98 09.64
Kotak Bond Regular Plan –
Growth
25.64 08.61 10.61 11.45 10.23

Reliance Income Fund - Retail
- Growth Plan – Growth
30.89 07.81 09.78 11.28 10.93
CHRONICLE ORDER OF COMPANIES GIVING MOST RETURN.
Fund Category 5 Yr
Return
DSPML T.I.G.E.R. Fund Equity: Diversified 45.45
Tata Infrastructure Equity: Diversified 44.92
Magnum Contra Equity: Diversified 44.81
Kodak Opportunities Equity: Diversified 44.57
UTI Infrastructure Equity: Diversified 43.14
Reliance Growth Equity: Diversified 42.88
Magnum Multiplier Plus Equity: Diversified 42.76
Sundaram BNP Paribas Select Midcap Equity: Diversified 40.64

HDFC Top 200 Equity: Diversified 39.29
BoB Growth Equity: Diversified 38.57
Principal Child Benefit Hybrid: Equity-oriented 36.79
Magnum Balanced Hybrid: Equity-oriented 31.24
HDFC Prudence Hybrid: Equity-oriented 29.68
Birla Sun Life Income Debt: Medium-term 8.29
ABN AMRO Flexi Debt Plan Debt: Medium-term 7.78
ICICI Prudential Long-term Debt: Medium-term 7.55
Birla Dynamic Bond Retail Debt: Medium-term 7.51
Kotak Flexi Debt Debt: Medium-term 7.47
Sundaram BNP Paribas S... Equity: Diversified 43.35
ICICI Prudential Dynamic Equity: Diversified 43.26
DWS Investment Opportunity Equity: Diversified 43.07
DSPML Equity Fund Equity: Diversified 42.89
DSPML Top 100 Equity Reg Equity: Diversified 41.96
Kotak 30 Equity: Diversified 41.33
IDFC Premier Equity fund Equity-oriented 29.67
RANKING OF THE COMPANY
By looking at this table we can rank various asset management companies on the basis of asset under
management. They are as follows:
1) Reliance mutual fund
2) ICICI prudential mutual fund
3) UTI mutual fund

4) BIRLA sun life mutual fund
5) SBI mutual fund
By looking at this rank we can say that in India people prefer to invest in
reliance scheme and they are having great faith on Reliance Company.
SCHEMES OF IDFC
Scheme: IDFC Advantage Fund
Type Open ended growth scheme
Investment 70% in equity & 30% in Debt
pattern
Fund Objective Long term growth of capital
Investment Min of one year
horizon
Scheme: IDFC Dividend Yield plus
Type Open ended Growth Scheme
Investment 100% in equity
pattern
Fund objective Capital growth & income
Investment Min of one year
horizon
Scheme: IDFC Equity plan
Type Open ended equity linked savings schemes
Investment 80% in equity & 20% in short term, money market &
liquid instruments
Fund objective Long term growth of capital along with income tax
relief for investment
Investment Minimum of 3years
horizon

Scheme: IDFC Index Fund
Type Open ended index Linked Scheme
Investment 100% in Securities
pattern
Fund Objective Generate Returns
Investment Min of one Year
Horizon
Scheme: IDFC opportunities Fund
Investment 70-100% in equity, 30% in cash & money market
pattern instruments
Fund objective Long term growth of capital
Investment Minimum of one year
horizon
Scheme: IDFC Mid Cap Fund
Investment 65-100% in equity related companies with market
pattern capitalization of Rs.150 crores to Rs.1,500 crores
35% in equity related companies with a market
capitalization.
Fund Objective Long term growth of capital
Investment Minimum of 1 year
horizon
Scheme: IDFC Balance Fund
Type Open ended balanced scheme
Investment 50 to 75% in equity 25-50% in debt
pattern
Fund object To balance income requirements with long term growth
of capital
horizon

Scheme: IDFC Asset Allocation Fund
Type Open ended fund of funds
Investment Aggressive plan 70-80% in equity 20-25% indebt
pattern Moderate plan 40-60% in equity 40-60% indebt
Conservative plan 20-25% in equity 75-80% indebt
Fund objective Income & capital Application with diversification in
equity & debt schemes in line with risk profile of
investor
horizon
Scheme: IDFC Gilt Plus
Type Open ended governments securities schemes
Investment 100% in securities permitted by RBI
pattern
Fund objective To generate in income & capital appreciation through
investments in government securities.
Investment Least 6 months to 1 year
horizon
Scheme: IDFC Dynamic Bond Fund
Type Open ended income scheme
Investment 50-65% in Government securities, 25-35% in corporate
pattern bonds, 0-25% in cash liquid instruments.
Fund objective To generate optimal returns with high liquidity
horizon
Scheme: IDFC Income Plus
Type Open ended income scheme
Investment 100% in debt & money market
pattern
Fund objective To generate consistent income
Investment Minimum of 1 year
horizon

TABLE -1:
AGE WISE CLASSIFICATION OF RESPONDENTS
AGE NO. OF RESPONDENTS PERCENTAGE
BELOW 20 NIL NIL
20-29 69 34.5
30-39 13 6.5
40-49 34 17
50-59 35 17.5
ABOVE 60 49 24.5
TOTAL 200 100
A G E W I S E N O O F R E S P O N D E N T S
4 9 2 0 - 2 9
6 9 3 0 - 3 9
4 0 - 4 9
3 5
1 3
5 0 - 5 9
A B O V E 6 0
3 4
Interpretation:
According to the survey the respondents were of different age groups. There are
no respondents of age below 20 are in no number. The investors of age 20-29 are 69 in
number with 34.5%. The investors of age 30-39 are 13 with 6.5%, 40-49 there are 34
investors with 17% and in between 50-59 there are 35 investors with 17.5% and above 60
there are 49 investors with 24.5%.

TABLE-2:
GENDER OF THE RESPONDENTS
GENDER NO. OF RESPONDENTS PERCENTAGE
MALE 158 79
FEMALE 42 21
TOTAL 200 100
GENDER OF THE RESPONDENTS
/
180
OFRESPONDENTS
160
PERCENTAGE
140
120 NO. OF
100 RESPONDENTS
80 PERCENTAGE
60
40
NO.
20
0
MALE FEMALE
GENDER
Interpretation:In the survey number of male respondents are more in number that
is about 79% & the next position has been occupied by female respondents they are
about 21% of the sample so, mainly men are preferring to go for investments.

TABLE-3:
OCCUPATION OF THE RESPONDENTS
OCCUPATION NO. OF RESPONDENTS PERCENTAGE
HOUSE HOLD 9 4.5
BUSINESS 46 23
SERVICE 84 42
PROFESSIONAL 30 15
RETIRED 15 7.5
STUDENT 16 8
TOTAL 200 100
OCCUPATION OF THE RESPONDENTS
16 9
HOUSE HOLD
15
46 BUSINESS
30 SERVICE
PROFESSIONAL
RETIRED
84
STUDENT
Interpretation:
According to the survey the respondents were of different occupations. Most of
respondents are from service sector is about 42% of the sample. Respondents from the
business are occupying 23%, then comes professional with 15%, students occupy 8%,
retired people occupy 7.5%, with house hold occupying 4.5%.

TABLE-4:
ANNUAL INCOME OF THE RESPONDENTS
ANNUAL NO. OF RESPONDENTS PERCENTAGE
< 1,00,000 53 26.5
1-2 LAKHS 84 42
2-3 LAKHS 48 24
ABOVE 3 LAKHS 15 7.5
TOTAL 200 100
OFRESPONDENTS/
PERCENTAGE
NO.
ANNUAL INCOME OF THE RESPONDENTS
90
80
70
NO. OF60
RESPONDENTS50
40 PERCENTAGE
30
20
10
0
0 S S
HS
00
H H
LAK LAK
K
1,0
0, A
<
2 3 3L
- -
VE1 2
AB
O
ANNUAL
INCOME

Interpretation:
According to the survey, the respondents of the income group of less than 1 lack are
of 26.5%. They were about 42% of the respondents are of the income group between 1-2
lack. 24% of the respondents were of the income group 2-3 lacks. 7.5% respondents were of
the income group more than 3 lacks.
TABLE-5:
DO THE RESPONDENTS INVEST THEIR MONEY
INVESTMENTS NO.OF RESPONDENTS PERCENTAGE
YES 200 100
NO NIL NIL
TOTAL 200 100
RESPONDENTS INVESTING THEIR MONEY
OFRESPONDENTS/
PERCENTAGE
NO.
250
200
150
NO. OF
RESPONDENTS
100 PERCENTAGE
50
0
YES NO
INVESTMENTS

Interpretation:
All the respondents considered in the sample, do invest their savings.
Out of the total sample the respondents going for investments are total in numbers with all
the two hundred respondents considered in sample are going for complete investments with
100%.
TABLE-6:
What percent of your income do you keep aside for different investment
options?
OPTIONS NO. OF RESPONDENTS PERCENTAGE
0% to 5% 24 12
5% to 10% 38 19
10% to 15% 60 30
15% to 20% 34 17
20% to 30% 24 12
Above 30% 20 10
TOTAL 200 100
0
10
20
30
40
50
60
70
0% to
5%
5% to
10%
10% to
15%
15% to
20%
20% to
30%
Above
30%
income keep aside
NO. OF RESPONDENTS

TABLE-7
Important factors to you consider before choosing an investment?
OPTIONS
NO. OF
RESPONDENTS PERCENTAGE
Safety of investment
principle 70 35
Opportunity for
growth 82 41
Liquidity 48 24
TOTAL 200 100
0
10
20
30
40
50
60
70
80
90
Safety of
investment
principle
Opportunity for
growth
Liquidity
Important factors
NO. OF RESPONDENTS

TABLE-8:
INVESTORS PREFERENCE FOR VARIOUS INVESTMENTS
OBJECIVES
OPTIONS
RANK SCORE
SECURITY 1 55
YEILD 2 47
MATURITY 4 35
TAX BENEFITS 5 22
LIQUIDITY 3 40
INVESTMENT OBJECTIVE OF THE INVESTOR
SECURITY
LIQUIDITY 7%
20%
YEILD
SECURITY
13%
YEILD
MATURITY
MATURITY
TAX BENEFITS
LIQUIDITY
TAX BENEFITS 27%
33%
Interpretation:
Different types of investors look forward to different investment objectives. Most of the
investors ranked 1st
to security, 2nd
rank to yield, 3rd
rank has been given to liquidity, 4th
& 5th
ranks for maturity & tax benefits.

INVESTOR PREFERENCE FOR VARIOUS INVESTMENTS
OBJECTIVES
ATTRIBUTES I II III IV V WEIGHTED RANK
AVERAGE
SECURITY 88 64 32 9 7 55 I
YEILD 63 44 46 24 23 47 II
MATURITY 19 24 45 85 27 35 IV
TAX BENEFIT 8 25 5 42 120 22 V
LIQUIDITY 22 43 72 40 23 40 III
MODEL CALCULATION:
= 88*5 + 64*4 + 32*3 + 9*2 + 7*1 / 1 + 2 + 3 + 4 + 5
= 440 + 256 + 96 +18 + 7 / 15
= 817/15
= 55.

TABLE-9:
AWARENESS OF MUTUAL FUNDS
YES 200 100
NO 00 00
TOTAL 200 100
Interpretation:
According to the survey, most investors are aware of mutual funds. It can be
observed from the above table that 100% of respondents are aware of Mutual
TABLE-10:
AWARENESS OF MUTUAL FUNDS IS THROUGH
0
50
100
150
200
250
YES NO
AWARENESS OF MUTUAL FUNDS
NO. OF RESPONDENTS

OPTION NO. OF RESPONDENTS PERCENTAGE
ADVERTISEMENT 52 26
FRIENDS 37 19
FAMILY MEMBERS 19 10
FINANCIAL ADVISORS 66 32
RELATIVES 26 13
TOTAL 200 100
INFLUENCE OF INVESTMENT DECISION IS
THROUGH
ADVERTISEME
RELATIVES NT ADVERTISEMENT13% 26%
FRIENDS
FINANCIAL FAMILY MEMBERS
ADVISORS FRIENDS FINANCIAL ADVISORS
32% FAMILY 19% RELATIVES
MEMBERS
10%
Interpretation:
According to the survey, the respondents are more aware of mutual funds through
Financial Advisors who occupy 32%, followed by Advertisements 26%, Friends 19%,
Relatives 13% & Family Members 10%

TABLE 11:
MUTUAL FUND IS A GOOD INVESTMENT OPTION.
YES 159 79.5
NO 41 20.5
TOTAL 200 100
MUTUAL FUND IS A GOOD INVESTMENT OPTION
/
180
OFRESPONDENTS
160
PERCENTAGE
140
120 NO. OF
100 RESPONDENTS
80 PERCENTAGE
60
40
NO.
20
0
YES NO
OPTIONS
Interpretation:
Many of the individuals are of the view that mutual fund is a good investment
option. Of the total sample survey around 79.5% of the respondents feel that mutual fund is
a good investment option & 20.5% of the respondents feel that it is not a good investment
option.

TABLE 12:
What is your return expectation on your investment in mutual fund?
OPTION
NO. OF
RESPONDENTS PERCENTAGE
Up to
8% 52 26
Betwee
n 8% to 18% 80 40
Above
18% 68 34
TOTAL 200 100
0
10
20
30
40
50
60
70
80
90
Up to 8% Between 8% to
18%
Above 18%
return expectation
NO. OF RESPONDENTS

TABLE 13
How long are you planning to stay invest in mutual fund?
< 1 year 46 23
1 to 3 year 75 37.5
3 to 5 year 50 25
> 5 year 29 15.5
TOTAL 200 100
TABLE-14:
RESPONDENTS PREFFERING IDFC AS A
DISTRIBUTOR OF MUTUAL FUNDS
0
10
20
30
40
50
60
70
80
< 1 year 1 to 3 year 3 to 5 year > 5 year
NO. OF RESPONDENTS
NO. OF RESPONDENTS

IDFC 138 69
OTHERS 62 31
TOTAL 200 100
IDFC AS A DISTRIBUTOR OF
MUTUAL FUNDS
/
160
OF
RESPONDENTS
PERCENTAGE
140
120
NO. OF
100
RESPONDENTS
80
PERCENTAGE
60
40
20
N
O
.
0
IDFC OTHERS
OPTIONS
Interpretation:
According to the survey, 69% of the respondents are aware of idfc as a
distributor of mutual funds & these 69% of the investors would like to invest in idfc
mutual fund option. The rest 31% of the respondents would like to prefer others.
TABLE-15:
TYPE OF FUNDS RESPONDENTS PREFER TO
OPTION NO.OF RESPONDENTS PERCENTAGE
DEBT FUND 42 30.5
EQUITY FUND 78 56.5
HYBRID FUND 18 13

TOTAL 138 100
TYPE OF FUNDS RESPONDENTS PREFER TO
/
90
OF
RESPONDENTS
80
PERCENTAGE
70
60 NO. OF
50 RESPONDENTS
40 PERCENTAGE
30
20
N
O
.
10
0
DEBT FUND EQUITY FUND HYBRID
FUND
OPTIONS
Interpretation:
From the survey conducted the respondents prefer Equity funds more in number
they occupy 56.5%, followed by Debt funds with 30.5% and a very few respondents
prefer to hybrid funds with 13%.
TABLE-16:
TYPE OF SCHEME PREFERED BY RESPONDENT IN DEBT FUNDS
LIQUID FUND 2 5
FLOATE RATE 4 10
GILT FUND 5 12
DYNAMIC BOND FUND 15 35

INCOME PLUS 7 17
BOND INDEX FUND 9 21
TOTAL 42 100
TYPE OF SCHEME PREFERED BY RESPONDENT IN
DEBT FUNDS
5%
LIQUID FUND
21% 10% FLOATE RATE
12% GILT FUND
DYNAMIC BOND FUND
17% INCOME PLUS
35% BOND INDEX FUND
Interpretation:
Based on the survey, it is found that the respondents prefer dynamic bond fund
which occupies 35%, then follows is the bond Index Fund with 21%, thirdly Income Plus
is seen with more percentage with 17, followed by Gilt Fund, Floating Rate Fund, &
Liquid Fund with 12, 10, 5.

TABLE-17:
TYPE OF SCHEME PREFERED IN EQUITY FUNDS
ADVANTAGE FUND 26 33
MID CAP 6 8
EQUITY PLAN 4 5
MNC FUND 5 6
INDEX FUND 3 4
DIVIDEND YEILD PLUS 32 41
INDIA OPPURTUNITIES FUND 2 3
TOTAL 78 100
TYPE OF SCHEME PREFFERED IN EQUITY
FUNDS ADVANTAGE FUND
MID CAP
3%
EQUITY PLAN
33%
MNC FUND
41%
INDEX FUND
4% 6% 5%
8%
DIVIDEND YEILD PLUS
INDIA OPPURTUNITIES
FUND
Interpretation:
Based on the survey, that out of 78 sample size, most of the investors choose

dividend yield plus which occupies 41%, followed by Advantage Fund with 33%, then
MNC fund with 6%, mid cap 8%, Equity plan 5%, India opportunities fund 3%.
TABLE-18:
TYPE OF SCHEME PREFERRED IN HYBRID FUND
MIP I 3 16.7
MIP II 4 22.2
BALANCED FUND 11 61.1
TOTAL 18 100
TYPE OF SCHEME PREFERRED IN HYBRID
FUND
/
OF
RESPONDENTS
70
PERCENTAGE
60
50 NO. OF
40 RESPONDENTS
30 PERCENTAGE
20
10
N
O
.
0
MIP I MIP II BALANCED
FUND
OPTIONS
Interpretation:
Based on the survey, it is found that the respondents prefer to choose balanced
fund with 61.1% of sample, followed by MIP I & MIP II schemes in the Hybrid Fund
Type with 22.2% & 16.7%.

TABLE 19:
RESPONDENTS PREFFERING OTHER BRANDS OF MUTUAL
FUNDS
OPTION NO.OF RESPONDENTS PERCENTAGE
HDFC 12 19
FRANKLIN TEMPLETON 18 29
HSBC 6 10
KOTAK MAHINDRA 11 18
DSP MERYLLICH 5 8
UTI 10 16
TOTAL 62 100
RESPONDENTS PREFFERING OTHER BRANDS
OF MUTUAL FUNDS
HDFC
FRANKLIN
16% 19% TEMPELTON
8% HSBC
KOTAK
MAHINDRA
18% 29%
10% DSP MERYILCH
UTI
Interpretation:
Based on the survey, it is found that the respondents would definitely prefer other
brands of Mutual Funds with Franklin Templeton in the lead with 29%, then HDFC with
18%, UTI in the fourth place with 16%, Kotak Mahindra with 18%, HSBC with 10% &
DSP merllich with 8%.

.
TABLE 20:
RESPONDENT RECOMMENDING IDFC MUTUAL FUND AS A
BETTER INVESTMENT OPPURTUNITY
YES 156 78
NO 44 22
TOTAL 200 100
IS IDFC A BETTER INVESTMENT
/
180
OFRESPONDENTS
160
PERCENTAGE
140
120 NO. OF
100 RESPONDENTS
80 PERCENTAGE
60
40
NO.
20
0
YES NO
OPTIONS
Interpretation:

According to the survey the respondents recommending Birla Sun Life Mutual
Fund as a better investment opportunity is of 78%. & the respondents who do not
recommend idfc as a better investment opportunity are 22%.
TABLE 21:
Tick & Rate IDFC mutual fund as compare to other mutual fund company. (1=
very good & 5= very bad)
1 2 3 4 5
1 120 60
2 32 16
3 24 12
4 16 8
5 8 4
TOTAL 200 100
OPTIONS
0
20
40
60
80
100
120
1 2 3 4 5
OPTIONS
NO. OF RESPONDENTS

TABLE 22:
Express your Experience to invest in mutual fund.
_____________________________________________________________
______________________
_____________________________________________________________
______________________
Questionnaire
Name: - __________________________________________________ Mobile
no.:-________________
Q: (1) AGE:-
BELOW 20
20-29
30-39
40-49
50-59
ABOVE 60
Q: (2) GENDER:-
MALE
FEMALE

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