ANALYSIS OF MUTUAL FUNDS

By: NISHANK.H

Overview.

• What is Mutual fund?

• Phases of Mutual Fund.

• Types of Mutual Funds.

• Selection Of Top Funds.

• Future Prospects of my study.

What is M.F

• A Mutual Fund is a trust that pools the savings of a number of investors who share a common investment objective.

• First Phase – 1964-87: An Act of Parliament established Unit Trust of India (UTI) on 1963.

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

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

• Fourth Phase – since February 2003.

Types Of M.FType of

Mutual Fund

Schemes

StructureInvestment

Objective

Special

Schemes

Open Ended

Funds

Close Ended

Funds

Interval Funds

Growth Funds

Income Funds

Balanced Funds

Money Market

Funds

Industry Specific

Schemes

Index

Schemes

Sectoral

Schemes

Growth of M.F

AUM Growth

Contribution of AUM To GDP.

Share of M.F in house hold Savings.

Share of saving schemes in India.

Investments Mix

Growth Factors.

• Large Market Potential – High Savings Rate.

• Comprehensive Regulatory Framework

• Favourable Tax Policies

• Introduction of New Products

• Role of Distributors

• Investor Education Campaign

• Performance Record

Tax Benefits.• Debt schemes – The fund pays upfront Dividend Distribution Tax (DDT) @ 14.1% for Individuals and @ 22.66 % for others, before distribution to investors. In case of Money Market / Liquid Funds, DDT is payable @ 28.3%. Dividend so received, is

Tax Free in the hands of the investors.• Investment in Equity oriented Tax saver schemes up to• Rs.1 Lac with lock in period of 3 years is eligible for

deduction from taxable income.• On Equity oriented Mutual Fund Schemes – Short Term

Capital Gains Tax is 10 % and for Long Term it is Nil.

Factors inhibiting growth of M.F

• Lack of awareness and knowledge about Mutual• Funds – only about 8 percent of household savings

are invested in Mutual Funds.• Unwillingness to undertake even minimal risk.• Inadequate reach of Funds / Distributors.• Competition from assured return products from

Government like Government Of India Bonds,• Post Office Monthly Income Schemes, Senior

Citizen Savings Schemes, National SavingsCertificates etc.

Sample Chosen for the study.

Future Prospects

• Analysis of the Sample based on Technical analysis.

• And analysis of sectoral performance.

• Comparative analysis of other investment products.

• Relative study of Macro Economic factors.

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