mutual fund is an alternative investment option

8/3/2019 Mutual Fund is an Alternative Investment Option

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PROJECT REPORT

ON

MUTUAL FUND AS AN INVESTMENT OPTION

SUBMITTED FOR THE PARTIAL FULFILLMENT OF

MASTER OF BUSINESS ADMINISTRATION

(INDUSTRY INTEGRATED)

TO

SRUSTI ACADEMY OF MANAGEMENT

UNDER GUIDENCE OF: SUMMITTED BY:

RASMI RANJAN DAS NIRAJ KUMAR SAH


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PREFACE

The successful completion of this project was a unique experience for

me because by visiting many place and interacting various person, I

achieved a better knowledge about the corporate world. The

experience which I gained by doing this project was essential at this

turning point of my career this project is being submitted with content

detailed analysis of the research under taken by me.

The research provides an opportunity to the student to

devote his/her skills knowledge and competencies required during the

technical session.

The research is on the topic Mutual Fund AS An

Investment option


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ACKNOWLEDGEMENT

I would like to express my appreciation and gratitude to various people

who have shared their valuable time and made possible this project

,through their direct indirect cooperation .

My honourable SIR MR.N.S. NANDA (HOD) and MR P.K.SAHOO

(FACULITY) Srusti academy of management, for allowing me to work

on this project and provide necessary help.

I thank my respected faculties ,dear friend & colleagues ,who help me

in every possible ways , support me and encouraged me to explore new

dimensions.

NIRAJ KUMAR SAH

MBA(3RD SEMISTER)

SRUSTI ACADEMYOF MANAGMENT

BHUBANESWAR


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Declaration & N.O.C

I-------------------------------------------------student of 1st year MBA bearing

Registration Number-------------------------------- do here by declare that I have

understood the evaluation parameters of summer project as stipulated by BPUT

properly and undertake that I shall submit my project report from 24.09.11-

30.09.11.

I understand that my physical presence is required for evaluation of my project

report. In case I fail to do so my project may not be evaluated at all and the case

will be referred to the evaluation committee for final decision.

Full Signature of the student Countersigned by Internal Guide


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CONTENTS

1 .INTRODUCTION

2. MUTUAL FUND INDUSTRY ANALYSIS

3. COMPANY PROFILE OF RELIANCE INDUSTRY

4. VARIOUS ASSET CLASSES IN WHICH MUTUAL FUND INVESTED

5. FINDINGS AND SUGGESTIONS

6. CONCLUSION


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INTRODUCTION

There are a lot of investment option available today in the financial market for an

investor with invest able surplus. He can invest in Bank Deposits, Corporate Debentures, and

Bonds where there is low risk but low return. He may invest in Stock of companies where the

risk is high and the returns are also proportionately high. The recent trends in the Stock Market

have shown that an average retail investor always lost with periodic bearish tends. Peoplebegan opting for portfolio managers with expertise in stock markets who would invest on their

behalf. Thus we had wealth management services provided by many institutions. However they

proved too costly for a small investor. These investors have found a good shelter with the

mutual funds.

Like most developed and developing countries the mutual fund cult has been catching on in

India. The reasons for this interesting occurrence are:

1. Mutual funds make it easy and less costly for investors to satisfy their need for capital

growth, income and/or income preservation.2. Mutual fund brings the benefits of diversification and money management to the

individual investor, providing an Opportunity for financial success that was once

available only to a select few.

There are several investment option toward the investors in India . A mutual fund is one of

the investment option to the investors. The following investment option are_________

1 SAVING ACCOUNT

2 FIXED DEPOSITS

3 INSAURANCE4 MUTUAL FUND

5 POST OFFICE,NSC

6 SHARES/DEBENTURES

7 GOLD/SILVER

8 REAL ESTATE

9 PPF

10 PF


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Mutual fund

Mutual funds are the vehicles to mobilize money from the investors, to invest in different

markets and securities in line with the investment objectives agreed upon,

between the mutual fund and the investors.The primary role is to assist investors in earning

an income or building their wealth, by participating in the opportunities available in various

securities and markets.

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 invest by the fund manager in

different type of securities depending upon the objective of the scheme. These could range

from share to debenture to money market instruments. The income earned through these

investments and the capital appreciation realized are shared by its units holders in proportion

the number of unit owned by them. Thus a mutual fund is a most suitable investment for the

common man as it offers an opportunity invest in a diversified, professionally managed

portfolio at a relatively low cost. A Mutual fund is an investment tool that allow small investors

access to a well diversified portfolio of equities , bonds and other securities. Each shareholder

participate in the gain and loss of fund.

It is an investment vehicle that is made up of a pool of funds collected from many

investors for the purpose of investing in securities such as stocks, bonds, money market

instruments and similar assets. Mutual funds are operated by money mangers, who invest the

fund's capital and attempt to produce capital gains and income for the fund's investors. A mutual

fund's portfolio is structured and maintained to match the investment objectives stated in its

prospectus.

Mutual fund investors make money either by receiving dividends and interest fromtheir 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 .


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ADVANTAGES OF MUTUAL FUND

There are numerous benefits of investing in mutual funds and one of the key reasons for its

phenomenal success in the developed markets like US and UK is the range of benefits they

offer, which are unmatched by most other investment avenues.

Diversification

Using mutual funds can help an investor diversify their portfolio with a minimum

investment. When investing in a single fund, an investor is actually investing in numerous

securities. Spreading your investment across a range of securities can help to reducerisk. A

stock mutual fund, for example, invests in many stocks - hundreds or even thousands. This

minimizes the risk attributed to a concentrated position. If a few securities in the mutual fund

lose value or become worthless, the loss may be offset by other securities that appreciate in

value. Further diversification can be achieved by investing in multiple funds which invest in

different sectors or categories. This helps to reduce the risk associated with a specific industry

or category. Diversification may help to reduce risk but will never completely eliminate it. It ispossible to lose all or part of your investment.

Professional Management:

Mutual funds are managed and supervised by investment professionals. As per the stated

objectives set forth in the prospectus, along with prevailing market conditions and other

factors, the mutual fund manager will decide when to buy or sell securities. This eliminates the

investor of the difficult task of trying to time the market. Furthermore, mutual funds can

eliminate the cost an investor would incur when proper due diligence is given to researching

securities. This cost of managing numerous securities is dispersed among all the investors

according to the amount of shares they own with a fraction of each dollar invested used to

cover the expenses of the fund. What does this mean? Fund managers have more money to

research more securities more in depth than the average investor.

Convenience:

With most mutual funds, buying and selling shares, changing distribution options, and

obtaining information can be accomplished conveniently by telephone, by mail, or online.

Although a fund's shareholder is relieved of the day-to-day tasks involved in researching,buying, and selling securities, an investor will still need to evaluate a mutual fund based on

investment goals and risk tolerance before making a purchase decision. Investors should

always read the prospectus carefully before investing in any mutual fund.
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Liquidity:

Mutual fund sharesare liquid and orders to buy or sell are placed during market

hours. However, orders are not executed until the close of business when the NAV (Net

Average Value) of the fund can be determined. Fees or commissions may or may not be

applicable. Fees and commissions are determined by the specific fund and the institution that

executes the order.

Investment control

Once an investment is made with a mutual fund, they make it convenient for the investor to

make further purchases with very little documentation.

Regulatory control

The regulator, Securities and exchange board of India (SEBI) has mandated strict checks and

balances in the structure of mutual funds and their activities. These are detailed in the

subsequent units.Securities Exchange Board of India (SEBI), the mutual funds regulator has

clearly defined rules, which govern mutual funds. These rules relate to the formation,

administration and management of mutual funds and also prescribe disclosure and accounting

requirements. Such a high level of regulation seeks to protect the interest of investors.

Minimum Initial Investment:

Most funds have a minimum initial purchase of $2,500 but some are as low as $1,000. If

you purchase a mutual fund in an IRA, the minimum initial purchase requirement tends to belower. You can buy some funds for as little as $50 per month if you agree to dollar-cost

average, or invest a certain dollar amount each month or quarter.

Affordability

A mutual fund invests in a portfolio of assets, i.e. bonds, shares, etc. depending upon the

investment objective of the scheme. An investor can buy in to a portfolio of equities, which

would otherwise be extremely expensive.
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LIMITATION OF MUTUAL FUND

No Guarantees

The value of your mutual fund investment, unlike a bank deposit, could fall and be

worth less than the principle initially invested. And, while a money market fund seeks a

stable share price, its yield fluctuates, unlike a certificate of deposit. In addition, mutual

funds are not insured or guaranteed by an agency of the U.S. government. Bond funds,

unlike purchasing a bond directly, will not re-pay the principle at a set point in time.

Choice Overhead

Over 800 mutual fund schemes offered by 38 mutual funds and multiple options

within those schemes make it difficult for investors to choose between them. Greater

dissemination of industry information through various media and availability of professional

advisors in the market should help investors handle the overload.

Lack of Portfolio customization

Some securities houses offer portfolio management schemes to large investors. In a

portfolio management scheme, the investor has better control over of what securities are

bought and sold on this behalf.


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MUTUAL FUND INDUSTRY ANALYSIS

The Mutual fund industry started in India in 1963 with the formation of unit trust of

India, at the initiative of the government of India and reserve bank. The primary objective at

that time was to attract the small investors and it was made possible through the collective

efforts of the Government of India and the Reserve Bank of India. The history of mutual fund

industry in India can be better understood divided into following phases.

Phase 1. Establishment and Growth of Unit Trust of India - 1964-87

Unit Trust of India enjoyed complete monopoly when it was established in the year 1963

by an act of Parliament. UTI was set up by the Reserve Bank of India and it continued to operate

under the regulatory control of the RBI until the two were de-linked in 1978 and the entire

control was transferred in the hands of Industrial Development Bank of India (IDBI). UTI

launched its first scheme in 1964, named as Unit Scheme 1964 (US-64), which attracted the

largest number of investors in any single investment scheme over the years.

UTI launched more innovative schemes in 1970s and 80s to suit the needs of different

investors. It launched ULIP in 1971, six more schemes between 1981-84, Children's Gift Growth

Fund and India Fund (India's first offshore fund) in 1986, Master share (India's first equity

diversified scheme) in 1987 and Monthly Income Schemes (offering assured returns) during

1990s. By the end of 1987, UTI's assets under management grew ten times to Rs 6700 crores.

Phase II. Entry of Public Sector Funds - 1987-1993

The Indian mutual fund industry witnessed a number of public sector players entering the

market in the year 1987. In November 1987, SBI Mutual Fund from the State Bank of India

became the first non-UTI mutual fund in India. SBI Mutual Fund was later followed by Can bank

Mutual Fund, LIC Mutual Fund, Indian Bank Mutual Fund, Bank of India Mutual Fund, GIC

Mutual Fund and PNB Mutual Fund. By 1993, the assets under management of the industry

increased seven times to Rs. 47,004 crores. However, UTI remained to be the leader with about

80% market share.

Phase III. Emergence of Private Secor Funds - 1993-96

The permission given to private sector funds including foreign fund management companies

(most of them entering through joint ventures with Indian promoters) to enter the mutual fund

industry in 1993, provided a wide range of choice to investors and more competition in the


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industry. Private funds introduced innovative products, investment techniques and investor-

servicing technology. By 1994-95, about 11 private sector funds had launched their schemes.

Phase IV. Growth and SEBI Regulation - 1996-2004

The mutual fund industry witnessed robust growth and stricter regulation from the SEBI after

the year 1996. The mobilisation of funds and the number of players operating in the industry

reached new heights as investors started showing more interest in mutual funds.

Invetors' interests were safeguarded by SEBI and the Government offered tax benefits to the

investors in order to encourage them. SEBI (Mutual Funds) Regulations, 1996 was introduced by

SEBI that set uniform standards for all mutual funds in India. The Union Budget in 1999

exempted all dividend incomes in the hands of investors from income tax. Various Investor

Awareness Programmes were launched during this phase, both by SEBI and AMFI, with an

objective to educate investors and make them informed about the mutual fund industry.

In February 2003, the UTI Act was repealed and UTI was stripped of its Special legal status as atrust formed by an Act of Parliament. The primary objective behind this was to bring all mutual

fund players on the same level. UTI was re-organised into two parts: 1. The Specified

Undertaking, 2. The UTI Mutual Fund.

Phase V. Growth and Consolidation - 2004 Onwards

The industry has also witnessed several mergers and acquisitions recently, examples of which

are acquisition of schemes of Alliance Mutual Fund by Birla Sun Life, Sun F&C Mutual Fund and

PNB Mutual Fund by Principal Mutual Fund. Simultaneously, more international mutual fund

players have entered India like Fidelity, Franklin Templeton Mutual Fund etc. There were 29

funds as at the end of March 2006.This is a continuing phase of growth of the industry through

consolidation and entry of new international and private sector players.


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COMPONEY PROFILE OF RELIANCE INDUSTRY

RELIANCE INDUSTRIES LIMITED

Reliance Group Holdings has grown from a small office data-processing equipmentfirm in 1961 into a major insurance and financial-services group in one generation under one

chief.

Reliance's insurance operations constitute the nation's 27th- largest property and

casualty operation. The parent company also includes a development subsidiary in commercial

real estate. Reliance's international consulting group contains several subsidiaries in energy,

environment, and natural resources consulting. A financial arm invests in other businesses,

primarily television stations.

Reliance Insurance started as the Fire Association of Philadelphia in 1817, organized by5 hose and 11 engine fire companies. It became the nation's first association of volunteer fire

departments.

Business got a boost as a result of the Great Chicago Fire of1871.The association soon

developed a field of agents to write policiesacross the country. For the first two years,

shareholders receiveddividends twice a year of $5 a share, which increased gradually to $10 in

1876.

In 1972, the Reliance insurance group divided its pool so that Reliance Insurance

Company and its Subsidiaries handled most standard lines, while United Pacific Insurance

Company handled the nonstandard and other operations.

In 1977, the company moved into real estate, forming Continental Cities Corporation, which

became Reliance Development Group, Inc. This division handled all real estate operations of the

parent company and other subsidiaries.

Reliance Capital Group, L.P. constituted the investment branch of the Reliance

conglomerate.

In December 1989, Reliance Capital sold its investment, Days Corporation, parent company ofDays Inn of America, the world's third- largest hotel chain; it had been purchased in 1984.

Reliance Industries Limited. The Group's principal activity is to produce and distribute plastic

and intermediates, polyester filament yarn, fiber intermediates, polymer intermediates,

crackers, chemicals, textiles, oil and gas. The prefining segment includes production and

marketing operations of the Petroleum refinery. The petrochemicals segment includes


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production and marketing operations of petrochemical products namely, High and Low density

Polyethylene.

Dhirubhai Ambani founded Reliance as a textile company and led its evolution as a global

leader in the materials and energy value chain businesses. He is credited to have brought about

the equity cult in India in the late seventies and is regarded as an icon for enterprise in India. He

epitomized the spirit 'dare to dream and learn to excel'. The Reliance Group is a living

testimony to his indomitable will, single- minded dedication and an unrelenting commitment to

his goals.

RELIANCE MUTUAL FUND

Rel ia n c e Mu t u a l F u n d , a p a r t o f An i l D h i ru b h a i Amb a n i

Group, is one of the fastest growing mutual funds in the country. Reliance mutual fund

was started in 1995. Within 2 days reliance launched two schemes Reliance Vision fund and

Reliance Growth fund.

Reliance Mutual Fund ('RMF'/ 'Mutual Fund') is one of Indias leading

Mutual Funds, with Average Assets Under Management (AAUM) of Rs. 1,01,259 Crores and an

investor count of over 66.90 Lakh folios.

Reliance Mutual Fund, a part of the Reliance Group, is one of the fastest

growing mutual funds in India. RMF offers investors a well-rounded portfolio of products to

meet varying investor requirements and has presence in 159 cities across the country. Reliance

Mutual Fund constantly endeavors to launch innovative products and customer service

initiatives to increase value to investors.

Reliance Capital Ltd. is one of Indias leading and fastest growing private

sector financial services companies, and ranks among the top 3 private sector financial services

and banking companies, in terms of net worth. Reliance Capital Ltd. has interests in asset

management, life and general insurance, private equity and proprietary investments, stock

broking and other financial services.

Reliance Mutual Fund Limited (RCAM) was approved as the Asset

Management Company for the Mutual Fund by SEBI consults their letter no IIMARP/1264/95


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dated June 30, 1995.The Mutual Fund has entered into an Investment Management Agreement

(IMA) with RCAM dated May 12, 1995. RCAM is authorized to act as Investment Manager of

Reliance mutual fund.

Reliance mutual fund schemes are managed by Reliance Capital Asset Management

limited(RCA) a subsidiary of Reliance Capital Limited, which holds 93.37% of the paid-up

capital of RCAM, the balance paid up capital being held by minority share holders.

One of the core objectives of Reliance Capital Asset Management Ltd. is to identify

issues considered sensitive by global corporate standards, and implement policies/guidelines in

conformity with the best practices as an ongoing process.

Reliance Capital Limited is a Non- Banking Finance Company. Reliance Capital

Limited is one of the Indias leading and fastest growing financial services companies, and ranks

among the top three private sector financial services and banking companies, in terms of net

worth. Anil Dhirubhai Ambani Group firm Reliance Mutual Fund on Wednesday 27 may 2011,

announced a dividend of up to 50% for its two schemes: Reliance Regular Savings Fund andReliance Equity Opportunities Fund. The company would pay a dividend of 50% or Rs5 per unit

and 30% or Rs3 per piece under the equity and balanced options of Reliance Regular Savings

Fund, respectively, it said in a statement. The fund house has also announced a dividend of 20%

or Rs2 per unit under the retail a dend.

Theoretical Background of Reliance Mutual Fund

Reliance Capital Asset management limited,(RCAM) a company registered

under the companies Act, 1956 was appointed to act as the Investment Manager of Reliance

Mutual Fund.

Reliance Capital Asset management limited was approved as the Asset

management Company for the mutual fund by SEBI with their letter ni

IIMARP/1264/95. On june30,1995.

The Mutual Fund has entered into an Investment Management Agreement

(IMA) with RCAM on May 12, 1995 and was amended on August 12, 1997 in line with SEBI. It

has launched 35 schemes till date.

Reliance Mutual fund at a glance

1. At the end of June 2011, Reliance Mutual Fund has a corpus of over Rs1,08,332crore for

over 71 lakh investors.

2.It has investor base of over 8.5 Million as on March 31 2010.

3.Accelerated growth in investor base-66.89% year on year.


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4.Reliance Mutual fund has over 10 years of extensive market experience over 26schemes

combined with a strong performance track around.

5.It has footprint in over 118 cities.

6.It has wide portfolio of 26 well rounded products to meet varying investor requirements.

7.Reliance Mutual Fund is amongst the few mutual funds in the industry to offer subscription ,Redemption and Switch through online transactions.

8.Reliance Equity fund has over NFO (6thfeb-7thmarch 2006), the largest ever collection of Rs

5579(1.29 billion dollars)min the history of the indian Mutual fund.

India's Best Offering: Reliance Mutual Fund

Investing has become global. Today, a lot of country are waking up to the reality that in

order to gain financial growth, they must encourage their citizens to not only save but also

invest. Mutual funds are fast becoming the mode of investment in the world. In India, a mutualfund company called the Reliance Mutual Fund is making waves. Reliance is considered India's

best when it comes to mutual funds. Its investors number to 4.6 billion people. Reliance Capital

Asset Management Limited ranks in the top 3 of India's banking companies and financial sector

in terms of net value. The Anil Dhirubhai Ambani Group owns Reliance; they are the fastest

growing investment company in India so far. To meet the erratic demand of the financial

market, Reliance Mutual Fund designed a distinct portfolio that is sure to please potential

investors. Reliance Capital Asset Management Limited manages RMF.

VISION AND STATEMENT

Reliance Mutual Fund is so popular because it is investor focused. They show their dedication

by continually dishing out innovative offerings and unparalleled service initiatives. It is their

goal to become respected globally for helping people achieve their financial dreams through

excellent organization governance and customer care. Reliance Mutual fund wants a high

performance environment that is geared at making investors happy. RMF aims to do businesslawfully and without stepping on other people. They want to be able to create portfolios that

will ensure the liquidity of the investment of people in India as well as abroad. Reliance Mutual

Fund also wants to make sure that their shareholders realize reasonable profit, by deploying

funds wisely. Taking appropriate risks to reach the company's potential is also one of Reliance

mutual funds objectives.


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Some of the achievements for Reliance Mutual Funds

1. Best Mutual Fund debt 2011

2. Winner for the Best Mutual Fund House and

3. Runner up for the Best Equity Fund House 2010

4. CNBC TV18 - CRISIL Mutual Fund of the Year Award for 2009/2007

5. Liper fund award India 20076.Liper fund award Gulf 2007

Management Team

Board of Directors

Kanu Doshi

Sushil Tripathi

Manu Chadha

Soumen Ghosh

Management Team

Sundeep Sikka - CEO

Himanshu Vyapak - Deputy CEO

Sunil B. Singhania Head - Equity Investments

Amitabh Mohanty Head - Fixed Income

Equity Fund Managers

Shailesh Raj Bhan Ashwani Kumar Krishan Daga


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Omprakash S. Kuckian Govind Agrawal

Debt Fund Managers

Amit Tripathi Prashant Pimple

Head Of Departments

Pradeep Andrade - Infrastructure & Admin Milind Gandhi - Chief Financial Officer Rajesh Derhgawen - Head- HR, Admin & Infrastructure Vinay Nigudkar -Information Technology Bhalchandra Joshi - Head- Service Delivery & Operations Excel Geeta Chandran -Operations & Settlement Muneesh Sud - Legal, Secretarial & Compliance Sanjay Kumar Singh - Head - Product Development


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OBJECTIVES

1.STUDY OF MUTUAL FUND IS AN ALTERNATIVEOPTION

2.TO GIVE AN IDEA ABOUT MUTUAL FUND3. TO GIVE AN IDEA OF MUTUAL FUND INVESTED IN

VARIOUS ASSETS


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VARIOUS ASSET CLASSES IN WHICH MUTUAL FUND INVESTED

1 EQUITY FUND

2 DEBT FUND

3 GOLD FUND

EQUITY FUND

Mutual funds pool the monies of individual investors to help them diversify their investments

and gain greater returns over time. Equity mutual funds deal only in companies that are publicly

traded, buying and selling stock using active or passive management. Equity funds typically are

categorized by market capitalization. Market cap is the value of a company based on the share

price multiplied by the number of outstanding shares. Large-cap funds purchase stock in

companies with market caps hovering around $10 billion. At the opposite end of the spectrum,

small-cap funds invest in companies with market caps below $1 billion.

FEATURES

1 . A stock or any other security representing an ownership interest.

2. On a company's balance sheet, the amount of the funds contributed by the owners (the

stockholders) plus the retained earnings (or losses). Also referred to as "shareholders' equity".

3. In the context of margin trading, the value of securities in a margin account minus what has

been borrowed from the brokerage.

4. In the context of real estate, the difference between the current market value of the property

and the amount the owner still owes on the mortgage. It is the amount that the owner would

receive after selling a property and paying off the mortgage.

5. In terms of investment strategies, equity (stocks) is one of the principal asset classes. The

other two are fixed-income (bonds) and cash/cash-equivalents. These are used in asset allocation

planning to structure a desired risk and return profile for an investor's portfolio.

Advantages of investing in equity mutual funds

Liquidity: Mutual funds are highly liquid, meaning that they are easily converted to cashby redeeming theshares with the investment company. Share redemption can be doneas easily as a phone call or online.


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Diversification: A share of a mutual fund represents ownership of a portion of all theholdings owned bythe mutual fund. For example, an investor who owns one share of the sample fundabove owns some of allthe stocks in the fund. By diversifying the assets in a portfolio, i.e., by owning a varietyof financial assets,an investor can reduce the risk associated with investing. This is analogous to not

putting all your eggs inone basket, as the saying goes.

Affordability: While some funds require a sizeable initial investment, many have nosuch requirement.Furthermore, many mutual funds that have a minimum initial investment requirementwaive this requirementfor a retirement account and/or for an account to which regular monthly contributionsare made.Many mutual funds are no-load funds, meaning that there are no transaction costs atthe time of the

investment or upon redemption. It is usually the case that there is no charge for movingmoney from onefund to another within a family of funds, e.g., from one Royce Funds mutual fund to adifferent Royce Fundsmutual fund.

Recordkeeping: The mutual fund company keeps track of how many shares aninvestor has purchased orredeemed and the dates of the transactions. Most mutual fund companies sendinvestors periodic reports inaddition to an annual summary. The annual summary typically reports:

the dollar amount and date of dividend distributions made by the fund (not the stocksheld by the fund)

to the investor during the year, and whether the dividends were reinvested

the dollar amount and date of any redemptions taken by the investor during the year

the cost basis (amount invested) for the shares redeemed and

the holding period for tax purposes (short-term or long-term)

Daily share pricing (NAV): The share price of a mutual fund is determined at the endof each trading dayas described above. This means that regardless of the time of day at which the investor

buys shares of amutual fund, the price per share is set at the close of the trading day .


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Equity Schemes of Reliance Mutual Fund

1. Reliance Equity Fund

2. Reliance Index FundNifty Plan

3. Reliance Index FundSensex Plan4. Reliance Vision Fund

5. Reliance Regular Saving Fund

6. Reliance Equity advantage fund

7. Reliance quant plus fund

8. Reliance equity opportunity fund

DEBT FUND

DEBT funds are specialized types of funds that invest in bonds and other debt instruments.

Since they invest in debt instruments like government bonds, corporate bonds, debuntures etc thereturns are nearly guaranteed and at the same time, since they are safe instruments their returns

are also only equivalent to bank deposits. Around 8-9% per annum.

Debt mutual funds are simply mutual funds that invest in an assortment of debt instruments

like government bonds, fixed deposits and approved private deposits. Debt funds are primarily

focused on getting regular returns. The fund invests in deposits with maturing tenures and

varying interest rates. So when investing in these funds you should take care to match your

individual time frame to that of the fund. The current income is also received in the form of

dividend so the cash flow is generally tax free in the hands of investors.

Debt funds are also highly liquid as they can be converted to cash easily and are useful in

creating a well balanced portfolio. 1 year HDFC Monthly Income Plan and 3 years Reliance

Monthly Income plan are two of the top performing Mutual funds that invest in debt instruments

in India.

A debt fund is an investment product that pools the contributions of a number of investors

for the purpose of buying and holding fixed-income debt instruments. According to Reuters

India, expected returns for debt funds range from 6 to 12 %. Debt funds utilize a variety of debt

instruments to maintain a steady income, including corporate and government bonds, securitized

debt products and money market investment.

A debt mutual fund, also called a bond fund, is a mutual fund portfolio completely

comprised of debt securities, which pay interest and principal at either fixed or variable rates.

Unlike a growth mutual fund, which seeks to secure value for investors primarily through capital

gains, debt mutual funds are designed to generate steady income based on a constant principal


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value. For this reason, debt mutual funds are considered a low-risk option for conservative

investors seeking stable and predictable returns. Debt security is the technical name for a bond.

Any security that pays interest at a fixed or variable rate on a principal amount (par value) for a

specific period qualifies as debt security. These items include, but are not limited to, long-term

(more than one year) corporate and government bonds, short-term (less than one year) money

market items, and collateralized debt securities .

ADVANTAGES OF DEBT FUND

Investment can begin at a small amount No need to track the market daily and decide on what stock to buy and sell We get professional investment expertise because the fund manager who is trading in

stocks with our money is very experienced and the chances of him making a profit out ofour money is considerably higher than our chances.

RELIANCE DEBT FUND ARE1 Reliance monthly income plan2 Reliance Gilt Securities Fund - Short Term Gilt Plan & Long Term Gilt Plan3 Reliance Income Fund4 Reliance Medium Term Fund5 Reliance Short Term Fund6 Reliance Liquid Fund7 Reliance Liquid plus Fund

GOLD FUND

A mutual fund or exchange-traded fund (ETF) that invests primarily in gold-producing

companies or gold bullion. The price of shares within a gold fund should correlate very closely

to the spot price of gold itself, assuming the fund holds the majority of its assets in bullion or in

the stocks and bonds of gold miners and manufacturers.

While many mutual funds focus on manufacturing and production stocks within precious

metals, a few new ETF entries have focused primarily on ownership of gold bullion. Gold fundsare a valuable tool for investors, including speculators (gold can be a very volatile commodity)and those wishing to hedge against geopolitical instability. Gold is also valuable as a bet againsta falling currency. By investing in a gold fund, a retail or institutional investor can gain exposureto this asset without the hassle of taking delivery of physical gold assets, which is often requiredin the commodities market.


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Investing in gold or other precious metals is very popular these days, but precious metals

investing requires special attention to the logistics of the purchase. Gold ETF funds provide a

method for investing in gold that eliminates these issues. The logistics referred to are the

problems of insurance, storage, moving, and reselling, along with many others.

Benefits of Gold as an Investment

Diversification -- Gold belongs to a distinct asset class and may thus be an effectivemeans of portfolio diversification.

Low Correlation -- Gold has a low correlation with the overall U.S. equity markets (asmeasured by the S&P 500). Gold not only diversifies your portfolio but, when includedwith your portfolio of U.S. equities, may help dampen the volatility of your overallportfolio.

Hedge -- Gold has traditionally acted as a hedge against financial assets. So, in uncertaintimes and in periods of high inflation, gold may act as an effective store of wealth.

Demand -- Demand for gold is on the increase, fueled by the jewelry industry as well asby industrial demand.

RELIANCE GOLD FUND ARE

1. RELIANCE GOLD EXCHANGE TRADED FUND2. RELIANCE GOLD SAVING FUND


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RESEARH METHODOLOGY

Research as a care full investigation or enquiry especially through search for new facts in anybranch of knowledge

Research is an academic activity and such as the term should be used in technical sense. Themanipulation of things , concepts or symbols for the purpose of generalizing to extend ,correct orverify knowledge ,whether that knowledge through objective.

The Reliance promotes its product through its distribution channels. The different distributionchannels are Banking, IFA, National Distributor, Institutional etc. I am promoting the product of

Reliance through the Banking division. The research is based on primary as well secondary data,however primary data collection was given more importance since it is overhearing factor inattitude studies. Primary data is collected through interaction with the customers in the bank. Oneof the most important uses of this research methodology is that it helps in identifying theproblem, collecting, analyzing the required information data and providing alternative solution tothe problem .It will also help in collecting the vital information that is required by the topmanagement to assist them for the better decision making both day to day decision and criticalonly data can be used only for the reference. Research will be done by primary data collection,and primary data has been collected by interacting with various people in the bank. Thesecondary data has been collected through various journals and websites.

TYPES OF RESEARH

ANALYTICAL RESERCH

In this project work, analytical research is used. In this project has to use factsor information .Already used available, and analyze these to make a critical evolution of the

material.


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METHODS OF DATA COLLECTION

In this project work primary and secondary data sources of data has been used.

Primary data: Primary data collect through observation, or through direct communication ordoing experiments.

Secondary data: Secondary data means already available through books, journals, magazines,newspaper.

SAMPLING

The sample was selected of them who are the customers/visitors of Bank OfBaroda. It was also collected through personal visits to persons, by formal andinformal talks and through filling up the questionnaire prepared. The Questionnaire

design was necessary for proper analysis of the research work done.

SAMPLE SIZE

The sample size of my project is limited to 100 people only. Out of which only60 people had invested in Mutual Fund. Other 40 people did not have invested inMutual Fund.


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DATA ANALYSIS AND INTERPRETATION

FINDING AND SUGGESTION

FINDING

After completing my project successfully, I am going to conclude whatever I learned during mysummer project as well as training also.

1. Now a days people awareness about mutual fund, but somewhere they lack a properguidance about how they work and how they invested, in what type of fund they shouldinvest.

2. Investors are more interest to invest in equity fund rather than other because equity fundgives good return.

3. Investors scared about the risk factor they need proper guidance about the risk factorhow mutual fund dilute the risk by investing in different companies of different sector.

4. A huge potential market is hidden in rural areas ,people are interested to invest in othersources beside the bank and post office saving scheme but they are not getting the properguidance.

5. Since Rate of Interest on Bank deposit is falling people will be attracted towards

investments in Mutual Funds because of high rate of return.6. There is a great potential for investment in Mutual Fund as people wants to save

for various future obligation.7. People of young age group are ready to take risk and they can be targeted for investment

in mutual fund.


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SUGESSTION

1 Advertisement on television is the main source of attraction so the companymust advertise its products heavily.

2 There should be provision of complain suggestion boxes at each branch.3 Reliance Money has to add some extra features in it with aggressive

marketing promotional strategy.4 People of young age group are ready to take risk and they can be targeted for

investment in mutual fund.5 More awareness among the people must be created about the mutual funds.

There should be better communication channels through which they can get to

know about different schemes and funds.

6 For increasing the clients provide them best service you can give and providethem all kind of facilities which can attract them and they invest more.

7 The people do not want to take risk. The AMC should launch more diversifiedfunds so that the risk minimizes. This will lure more and more people toinvest in mutual funds.


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CONCLUSION

4. A mutual fund is a financial institution that receives money from differentinvestors.

5. Mutual funds are managed by professional fund managers, who manages thefunds of individuals and institution, which may not have such high degree ofexpertise or knowledge

6. Mutual Fund investment is better than other raising fund.7. Reliance Mutual Fund has good returns in investment.8. A good brand is always welcomed over here people are more aware and

conscious for the brand so they go for they are ready to spend some extra bucksfor the quality.

9. At last all cons are concluded by that Reliance Money is still growing industry inIndia and is still exploring its potential and prospects in here.

10.Mutual fund is a good investment option to the investors.


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mutual fund is an alternative investment option

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