![Under the study, an effort has been made to sketch the behavioral pattern of retail
investors
towards various investment opportunities. A couple of hypothesis in this regard
have been
selected and tested to reach to conclusions. And the research concludes with some
important
findings that will be valuable for both the investors and the companies having such
investment
opportunities.
1. Investors have not shown very positive sentiments on mutual funds during the
phase of the
study conducted, primarily due to underperformance of the secondary market and
highly volatile
fixed income securities market.
2. Forvarious schemes of mutual funds, study found significant difference in the
opinion of male
and female in case of growth and income funds. The study reveals, female
investors prefers the
income schemes and balance schemes whereas male counterparts prefer Growth
Schemes and
tax saving schemes [Madhusudhan V Jambodekar (1996)].
3. It is has been observed that the safety and liquidity are the most influencing
factors in inducing
most of the investors to opt for the MF schemes. Past return and tax savings is
another major
determinant of the choice [Chalam, (2003)]. Professional management and
reputation of the fund
is also among important determinants in influencing the investment decision.](https://image.slidesharecdn.com/analysisofinvestmentpatternofmutual1-180324173838/85/Analysis-of-investment-pattern-of-mutual-1-20-320.jpg)
![CONCLUSION AND SUGGESTION:
It is widely believed that mutual fund is a retail productdesigned to target
individual investors,
who are intimidated by the stockmarket but, like to take advantage of stockmarket
investing.
Hence, an appropriate crafting of a mutual fund productand expecting a good
responsefrom the
investors is the need of the hour. A successfulfund manager should study investor
saving and
investment behaviour based on the demographic profile and understands their
needs and
expectations, to gear up the performance to meet investor requirements. Since the
investors need
for liquidity is found to be high and showed interest for open ended funds in
various surveys, we
suggest that more of the new schemes opening for subscription be Open-ended.
AMCs should
open more service branches to provide over-the-counter redemption facility. As in
various
empirical researches, it is concluded that Agents play a vital role in spreading the
mutual funds
culture [Syama Sunder (1998)], to accelerate investment in mutual fund, SEBI
should introduce
entry load to motivate the distributers of mutual funds.](https://image.slidesharecdn.com/analysisofinvestmentpatternofmutual1-180324173838/85/Analysis-of-investment-pattern-of-mutual-1-21-320.jpg)
Analysis of investment pattern of mutual 1
- 1. A STUDY ON INVESTMENT PATTERN AND BEHAVIOUR OF INVESTORS A project report on Mutual Fund Investors Submitted by: Amit Kumar Class Roll No. 3808 University Roll No. 3115ACAC170027 DEAPARTMENT OF COMMERCE GOVT. P.G. COLLEGE SOLAN (H.P.) Project Report Guide- Prof. Rajeev Sharma
- 3. Analysis Of Investment Pattern Of Mutual Funds Investors – An Empirical Study In Orissa Abstract: Mutual fund industry in India has developed rapidly and gained a lot of popularity from the past couple of decade, especially after incorporation of Unit Trust of India in 1964. There has concomitantly evolved a rich plausible academic literature consisting of numerous topics related to mutual funds. One of the most frequently addressed topics in the current literature is Investor’s perception and preferences about various mutual funds schemes and the factors which influences different class of investors to invest in mutual funds. With this background, a survey was conducted among 200 mutual fund investors in nine urban and semi-urban cities of Orissa (India).On the basis of literature review, nine factors are chosen and grouped into four major components by applying Principal Component Analysis. Study reveals, safety, past return and liquidity are the most influencing factors in inducing most of the investors to opt for the mutual fund schemes. For the purpose of the study, parametric and non- parametric statistical methods have been employed. From the research point of view, such a study will help in developing and expanding knowledge in this field of personal investment.
- 4. INTRODUCTION A Mutual Fund is promoted by a sponsor and run by a trust that pools the savings of a number of retail investors who share a common financial goal. The money collected by selling units of mutual funds is invested by the fund manager in different types of securities depending according to the ojective of the scheme. These could range from shares to debentures to money market instruments. For an individual investors a Mutual Fund offers diversified, professionally managed portfolio at a relatively low cost. Anybody with an investible surplus of as little as a few thousand rupees can invest in Mutual Funds. Each Mutual Fund scheme has a defined investment objective and strategy. From its inception the growth of Indian mutual funds industry was very slow and it took really long years to evolve the modern day mutual funds. Primary motive behind mutual fund investments is to deliver a form of diversified investment solution. Over the years the idea developed and people received more and more choices of diversified investment portfolio through the mutual funds. The credit goes to unit trust of India (UTI) for introducing the first mutual fund in India. Recent years, Indian money and capital market has shown tremendous growth and expanded its reach to wider geographical limits. Indian regulators in money and capital market have actively participated in framing regulations which gives confidence to both individual and institutional Institutions for participation. Progressive reforms have taken place with the initiative of Security Exchange Board of India (SEBI), capital market regulator in India which facilitates savings. As a financial intermediary mutual fund has played a significant role in the development and growth of capital markets in India. 2. LITERATURE REVIEW Mutual funds as an area of knowledge has drawn interest from academic as well as practitioner communities. Literature reviews have been done related to Fund Selection Behaviour. Kahneman and Tversky (1979) found in their work, “Prospect Theory - An Analysis of Decision under Risk”, individuals make decisions based on the potential value of losses and gains rather than the final outcome, and people evaluate these losses and gains using interesting heuristics.
- 5. Phillip (1995) reported changes in financial decision-making and investor behaviour as a result of participating in investor education programs sponsored by employees. In India, SEBI started such awareness program for small investors, which has started giving benefits,in terms of value investing and informed investing from retail investors. Kavita Ranganathan’s (2004) conducted a survey in Mumbai revealed that investors prefers performance records, brand name, expense ratio, portfolio of investment, reputation portfolio manager, withdrawal/exit facility, products with tax benefits and load charges for taking decision on investment. Singh and Chander (2004) study reveals that salaried investors preferdaily disclosure of NAV by funds and also wished for higher tax rebates on investment in Mutual Funds. 3. OBJECTIVE OF THE STUDY: The study has been conducted with the following objectives: 1. To explore the preferred investmentavenue of retail investors. 2. To determine the investor’s preference fordifferentmutual fund schemes. 3. To evaluate fund qualities that affects the selectionof mutual funds. METHOD OF STUDY: The study is empirical in nature. The scope of the study covers nine urban and semi-urban cities Orissa state of India. Various statistical tools like mean, standard deviation, rank correlation, chi- square, factor analysis were applied. Primary data has been collected fora period of January’2012 to June’2012. Explanation of techniques used: a. Chi-Square Test: The Chi-square test is used in this paper with discrete data in the form of frequencies. It is used to check the independence/dependence of demographic profile such as age, occupation and income on saving objectives.
- 6. b. Test of homogeneity has been applied using chi-square to find out the preferences of male and female on various mutual funds schemes c. Factoranalysis: It is a statistical tool, which enables to bring in multiple factors that affect a single variable to a few factors, which had a direct association to the variable(s). In doing so it reduces the number of pointers, which lead to a definitive association to the variables or cases. d. Factoranalysis has been carried out to formulate the coefficient of correlation between each variable. In this study, factor analysis has been used to reveal out of nine selected variables, which affect most in taking investment decision on mutual funds by individual investors. Hypothesis For analyzing the pattern of investment in various schemes of mutual fund on the basis of gender, the following hypotheses are taken into consideration: H0: There is no significant difference in selecting mutual fund schemes as an investments avenue among the male and female investors. H1: There is a significant difference in selecting mutual fund schemes as an investments avenue among the male and female investors, H1a: There is a significant difference in selecting growth mutual fund amongst the male and female investors. H1b: There is a significant difference in selecting balanced mutual fund amongst the male and female investors. H1c: There is a significant difference in selecting tax saving mutual fund amongst the male and female investors. H1d: There is a significant difference in selecting income/debt mutual fund amongst the male and female investors. H1e: There is a significant difference in selecting index mutual fund amongst the male and female investors. H1f: There is a significant difference in selecting money market mutual fund amongst the male and female investors.
- 7. 4.3 Type and sources of data: The study deals with the financial behaviour as well as their preferences towards mutual funds of Individual Investors in the state of Orissa (India). The required data was collected through a pretested questionnaire administered on a combination of simple random and judgment sample of 200 financially literate individual investors. Out of the 200 respondents, 140 were male and rest 60 was female respondents. An individual who has currently invested in any MF scheme and whose yearly income is under Indian rupees ten lakhs has been considered for the study. Respondents included salaried investors, self employed professionals and entrepreneurs, who were screened and inclusion was purely on the basis of their knowledge about financial markets, mutual funds and various savings options. This study covers nine major cities in Orissa which includes Bhubaneswar, Cuttack, Rourkela, Berhampur, Jajpur, Bhadrak, Sambhalpur, Balasore and Jharsuguda as shown in Table 1.1). Primary data has been collected through a personal interview and structured questionnaire between January’2011 and June’2012. Forthe above purpose, respondents are grouped according to their demographic profile as shown in Table no. 1.0 Table No. 1.0: Age, Gender,occupation and Income wise Demographic Pattern of IndividualInvestors. 46 to 60 years 61 years & above 50 25% Occupations
- 8. Demographic category of investor Parameters No. of Representative Total % Gender Male 140 70% Female 60 30% Age Up to 30 years 50 25% 31 to 45 years 50 25% Occupation Self Employed 43 21% Entrepreneur 37 19% Salaried Employed 120 60% AnnualIncome Up to Rs. 3 lakh p.a. 40 20% Rs. 3 to 5 lakh p.a. 70 35% Rs. 5 to 7 lakh p.a. 60 30% More than 7 lakh p.a. 30 15%
- 9. Self employed Professional 43 21% Entrepreneurs 37 19% Salaried employees 120 60% Annual Income up to Rs 3 Lakhs per annum 40 20% Rs 3 – 5 Lakhs per annum 70 35% Rs 5 – 7 lakhs per annum 60 30% more than Rs 7 Lakhs per annum 30 15% Source:compiled Table No. 1.1: Area profile of Respondents Place of Orissa state (India) Number Percentage Bhubaneswar 40 20% Cuttack 36 18% Rourkela 20 10% Berhampur 26 13% Jajpur 18 9% Bhadrak 24 12% Sambhalpur 16 8% Balasore 14 7% Jharsuguda 6 3% 200 100% Source:Compiled
- 10. 4. LIMITATIONS OF THE STUDY: Sample size is limited to 200 educated individual investors. Respondents those who are aware about financial market and investment options and invested in mutual funds have been considered for the study. Sample has been collected only from Bhubaneswar, Cuttack, Rourkela, Berhampur, Jajpur, Bhadrak, Sambhalpur, Balasore and Jharsuguda. Simple Random and judgment sampling techniques is used due to time and financial constraints. This study has not been conducted over an extended period of time having bothups and downs of stockmarket conditions which influences investor’s saving and investing pattern. 5. ANALYSIS AND INTERPRETATION Investment options preference among Individual Investors (gender wise): DrivingOld Car Now = Peace of Mind Later On. One of the key mantra for disciplined investing is not to let those hard earned paychecks slip through our hot little hands. Asset preference pattern of an individual investor provides an insight into the investment attitude of investors, which influences the policy formation for garnering the individual savings. Every individual investor should decide where to invest and how much to invest and when to invest, depending on their risk profile and saving objective they set. To find out preference pattern of investors on selected investment options, Spearman Rank Correlation Test has been used. For the study, ten investment options were selected on the basis of various surveys and literature reviews (NCAER 2010). The selected investment options are, a) secured deposits in commercial banks,
- 11. b) endowment policies floated by insurance companies which are linked to equities and debt, c) State or central government of India sponsored saving schemes such as public provident fund, employees provident fund, various pension schemes etc. d) bonds debentures, public deposits by corporate, e) equity stocks, preference stocks, f) mutual funds, unit liked saving schemes (ULIP), equity linked saving schemes (ELSS), g) gold, silver, ornaments, precious stones or utensils etc., h) real estate includes purchase of land and building for personal use or for investment purpose, i) Indian postal saving schemes for small individual investors, which includes various time deposits and recurring deposits, Kisan Vikas Patra (KVP), National Saving Certificate (NSC) etc., floated by Indian Postaldepartment, j) Other, includes various forms of Art, handicraft etc. Respondents were requested to rank each of the 10 selected investment options on ten point scale as 1 be the most preferred and 10 be the least preferred option. The raw scores are converted to ranks and the differences between the ranks of each observation on the two variables have been calculated. Calculated value of rank correlation coefficient between male and female on various saving options is 0.5545, which shows that there is a moderate similarity between the ranks given by male and female. It can be concluded that the investment decision on various investment avenues on which the rank was sought (Table no 3.0), shows equal strength of direction and there is not much difference between rank preference given by mail and female respondents. Table no.3.0: Showing the ranks given my male and female on various investmentoptions Investment options
- 12. Rank given by male respondents Rank given by female respondents 1. Secured Deposits (Fixed Deposits etc) 1st rank (14.07%) 3rd rank (15.03%) 2. LIC Policies 5th rank (10.03%) 5th rank (9.78%) 3. Public Provident fund / EPF / Pension schemes 6th rank (9.9%) 7th rank (8.21%) 4. Bonds / Debentures 9th rank (7.28%) 9th rank (4.75%) 5. Equity Shares 4th rank (10.54%) 8th rank (8.15%) 6. Mutual funds / ULIP / ELSS 3rd rank (11.92%) 4th rank (9.78%) 7. Bullion (gold, silver, ornaments) 8th rank (9.15%) 1st rank (16.33%) 8. Real Estate 2nd rank (13.96%) 2nd rank (16.24%) 9. Postalsavings schemes 7th rank (9.58%) 6th rank (9.69%) 10. Others 10th rank (2.8%) 10th rank (2.12%) Source:Calculated Graph G-1: Showing preference for investment options by Investors (category: self-employed) Source:compiled from survey Self employed males investors are preferring to invest more in real estate, term deposit in banks and also in endowment insurance plans, whereas female self-employed investors keeping more faith in bank term deposits, investing in real estate and bullion (Graph G-1). Graph G-2: Showing preference for investment options by Investors (category: entrepreneurs) Source:compiled from survey Male investor under entrepreneur category has ranked investment in real estate as no.1 and also shown almost equal interest in bullion and equity related instruments, whereas female investors under this category investment in bullion as their top choice and simultaneously shown interest in real estate, equity shares and mutual funds. Graph G-3: Showing preference for investment options by Investors (category: salaried class) Source:compiled from survey Salaried employees both male and female have given real estate as their first choice and unlike
- 13. male counterparts female investors are relying more in bullion. But in this category, male and female are trusting fixed deposits, LIC endowments plans including ELSS, ULIP and pension plans as options to invest their hard earned incomes. 6.1: Mutual Fund Scheme Preference among Individual Investor: Study attempts to find out the investor’s preferences on various schemes of mutual funds (table 2.0). For this study, six different types of fund have been selected. Growth schemes, Income schemes, Balance schemes, Index schemes, Tax saving schemes, money market schemes. For each schemes, chi-square test of homogeneity has been applied to determine the respondent’s (gender wise) preferences. Table no.2.0: Genderwise preferences for differentschemes of mutualfunds RATINGS Growth / Equity Schemes Balanced Schemes Tax Saving Schemes Income / Debt Schemes Index Schemes Money Market Schemes M F M F M F M F M F M F Highly Favourable (Rating-1) 55 9 46 28 63 14 30 27 5 2 13 16 Favourable
- 14. (Rating-2) 38 14 38 16 50 17 28 15 4 2 14 14 Somewhat favourable (Rating-3) 30 18 30 8 18 21 26 7 36 2 25 12 Not very favourable (Rating-4) 12 10 20 5 6 5 37 8 49 24 30 10 Not at all favourable (Rating-5) 5 9 6 3 3 3 19 3 46 30 58 8 140 60 140 60 140 60 140 60 140 60 140 60 Source: Compiled.(M for male,F for female). Table no.2.1: Showing chi-squareresults on mutualfunds schemes Demographic Profile Degree of freedom Chi-square Value Table value at 5% significance level Significant / Not significant Growth / Equity Schemes 4 20.08 9.49 Significant Balanced Schemes 4 4.71 9.49 Not Significant Tax saving Schemes 4 22.579 9.49 Significant Income / Debt Schemes 4 15.65 9.49 Significant Index Schemes 4 13.67 9.49 Significant Money Market Schemes 4 25.77 9.49 Significant Source: Calculated Null hypothesis Ho1(a):Preferencesof male and femalerespondents regardinggrowth mutual fund schemeare same. Calculated value of chi-square is 20.08 and the table value with a degree of freedom 4 is 9.49. Therefore, null hypothesis Ho1(a) is rejected. So it can be concluded that in
- 15. case of growth mutual fund schemes, preference of male & female is significantly different. Null hypothesis Ho1(b):Preferencesof male and femalerespondents regardingbalancedmutual fund schemeare same. Investors with moderate risk taking capability invest in balanced schemes. The calculated chi-square value on balance scheme for 200 respondents is 4.71 and the table value with 4 df is 9.49 at 5% significance level. Here null hypothesis Ho1(b) is accepted. It is concluded that there is no significant difference of preferences between male and female. Null hypothesis Ho1(c):Preferencesof male and femalerespondents regardingtax savingscheme are same. Tax saving schemes offer tax incentives to the investors under tax laws as prescribed from time to time and promotelong-term investments in equities through Mutual Funds. For tax savings schemes, chi-square value as calculated is 22.579, whereas table value with df of 4 is 9.49 with 5% level of significance. So the null hypothesis Ho1(c) is rejected, and it can be concluded that there is significant difference in opinion among male and female. Null hypothesis Ho1(d):Preferencesof male and femalerespondents regardingincomescheme are same. Income schemes invest in fixed income securities such as bonds and corporate debentures. Such schemes are ideal for Investors who need some income to supplement their earnings. Chi-square value of the responses of male and female is 15.65 whereas the table value with 4 df is 9.49 at 5% significance level. Null hypothesis is Ho1(d) for income scheme is rejected. So it can be concluded that there is significant difference between the preference of male and female on income schemes. Null hypothesis Ho1(e):Preferencesof male and femalerespondents regardingindex scheme are same.Index schemes that attempt to replicate the performance of a particular index. Index fund
- 16. schemes are ideal for investors who are satisfied with a return approximately equal to that of an index. In case of Index scheme, calculated value of chi-square is 13.67 and the table value with 4 df with 5% level of significance is 9.49. So null hypothesis Ho1(e) is rejected. There is significant difference in the preference of male and female with respectto index scheme. Null hypothesis Ho1(f):Preferences of maleand female respondents regardingindex scheme are same.Money market mutual fund schemes aim to provide easy liquidity, preservation of capital and moderate income. Null hypothesis Ho1(f) here is rejected because the calculated chi-square value is 25.77 and the table value with 4 degree of freedom with 5% level of significance is 9.49. So there is significant difference between preference of male and female on money market mutual schemes. 6.5: Scheme Preference by Operation among Individual Investors Analysis of scheme preference by nature of operation reveals the popularity of ‘Open-Ended’ scheme. Out of total respondents 78% across age, occupation and income level have voted for open-ended schemes. Remaining 15% and 7% have opted for close ended & interval schemes respectively. The preference to Open-Ended scheme also gives due importance to ‘Liquidity’. 6.6: Preferential Feature in Mutual Funds influencing the scheme selection by Individual Investors. The information was collected through a designed instrument on a five- point scale where one was taken for strongly disagree and five was taken as strongly agree. FactorAnalysis have been used to look at the nine selected variables that tend to relate to each other and estimate what underlying reasons might cause these variables to be more highly correlated with each other. Forthis study, tool of SPSS was extensively used. Variables were analysed using the
- 17. Varimax with Kaiser Normalization, resulting in constructing and naming of the factors which is largely subjective. Bartlett's test of sphericity and Kaiser-Meyer Olkin (KMO) measure of sampling adequacy were used to examine the appropriateness of factor analysis. The approximate chi-square statistic is 232.768 with 36 degrees of freedom, which is significant at .000 levels. The KMO statistic (0.663) is large (>0.5), hence, factor analysis can be considered for further analysis of data (table3.0). Table no.3.0: KMO and Bartlett's Test Kaiser-Meyer-Olkin Measure of Sampling Adequacy. .663 Bartlett's Test of Sphericity Approx. Chi-Square 232.768 Df 36 Sig. .000 Table no.3.1: Communalities Initial Extraction Safety 1.000 .717 Liquidity 1.000 .669 Flexibility 1.000 .583 good return 1.000 .570 capital appreciation 1.000 .694 professional management 1.000 .680 tax benefit 1.000 .640 diversification benefit 1.000 .811 reputation of the sponsor1.000 .581 Source: calculated. Extraction Method: Principal Component Analysis. Table no.3.2: Communalities,Initial Eigen values,Extraction Sums of Squared Loadings and Rotation Sums of Squared Loadings Compo nent Initial Eigen values Extraction Sums of Squared Loadings Rotation Sums of Squared Loadings Total % of
- 18. Variance Cumulative % Total % of Variance Cumulative % Total % of Variance Cumulative % 1 2.087 23.184 23.184 2.087 23.184 23.184 1.996 22.174 22.174 2 1.394 15.487 38.671 1.394 15.487 38.671 1.336 14.840 37.014 3 1.289 14.320 52.991 1.289 14.320 52.991 1.334 14.817 51.831 4 1.178 13.086 66.078 1.178 13.086 66.078 1.282 14.247 66.078 5 .842 9.357 75.435 6 .778 8.643 84.077 7 .573 6.368 90.445 8 .472 5.248 95.693 9 .388 4.307 100.000 Source: calculated. Extraction Method: Principal Component Analysis. Retaining only the variables with Eigen values greater than one (Kaiser's criterion) (table 3.2), we can infer that 23.184% of variance is explained by factor one; 15.487% of variance is explained by factor two and 14.32% of variance is explained by Factor three and 13.086% by factor four. Together, all the factors contributed to 66.078% of variance. Therefore, Varimax Rotation (table 3.4) was done to obtain factors that can be named and interpreted. Table no.3.3: FactorsAffecting Choice of a Scheme (Rotated ComponentMatrixa) Factors Component 1 2 3 4 Safety .820 .177 -.076 -.089 Liquidity .763 .099 .045 -.275 Flexibility .172 -.120 .526 -.112 Good return -.264 .323 .730 .007 Capital appreciation -.657 .184 -.020 -.201
- 19. Professional management -.050 .080 -.333 .749 Tax benefit -.002 .772 .087 -.192 Diversification benefit -.105 -.107 .528 .514 Reputation of the sponsor.096 .197 -.064 .727 Source: calculated. Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization. a. Rotation converged in 5 iterations. The factor loading measures which variable is involved in which factor, to what degree and in what direction? Interpreting the above in this line (which is close to correlation coefficient) it has been observed that factor one (Secured investment) is a combination of the two original variables which are safety and liquidity. It is heartening to see that, in a volatile market, investors are not ready to take risk. Instead, retail investors want to ensure safety of their initial investments and independency to redeem units of mutual funds. Factorloading for the second factor (Tax saving benefit) commands strong preference among male and female. The factor loading for the third factor (Past performance) reveals that individual investors reacted positively to good incremental returns in net asset value (NAV). This is quite telling as we can presume that investors give adequate significance to the trends of past returns while deciding on the investment. Finally, the fourth factor loading (Professionalism and reputation of fund house) is idiosyncratically agreed by investors that reputation of the sponsors and professionalism of AMC is relevant in taking investment decision. FINDINGS:
- 20. Under the study, an effort has been made to sketch the behavioral pattern of retail investors towards various investment opportunities. A couple of hypothesis in this regard have been selected and tested to reach to conclusions. And the research concludes with some important findings that will be valuable for both the investors and the companies having such investment opportunities. 1. Investors have not shown very positive sentiments on mutual funds during the phase of the study conducted, primarily due to underperformance of the secondary market and highly volatile fixed income securities market. 2. Forvarious schemes of mutual funds, study found significant difference in the opinion of male and female in case of growth and income funds. The study reveals, female investors prefers the income schemes and balance schemes whereas male counterparts prefer Growth Schemes and tax saving schemes [Madhusudhan V Jambodekar (1996)]. 3. It is has been observed that the safety and liquidity are the most influencing factors in inducing most of the investors to opt for the MF schemes. Past return and tax savings is another major determinant of the choice [Chalam, (2003)]. Professional management and reputation of the fund is also among important determinants in influencing the investment decision.
- 21. CONCLUSION AND SUGGESTION: It is widely believed that mutual fund is a retail productdesigned to target individual investors, who are intimidated by the stockmarket but, like to take advantage of stockmarket investing. Hence, an appropriate crafting of a mutual fund productand expecting a good responsefrom the investors is the need of the hour. A successfulfund manager should study investor saving and investment behaviour based on the demographic profile and understands their needs and expectations, to gear up the performance to meet investor requirements. Since the investors need for liquidity is found to be high and showed interest for open ended funds in various surveys, we suggest that more of the new schemes opening for subscription be Open-ended. AMCs should open more service branches to provide over-the-counter redemption facility. As in various empirical researches, it is concluded that Agents play a vital role in spreading the mutual funds culture [Syama Sunder (1998)], to accelerate investment in mutual fund, SEBI should introduce entry load to motivate the distributers of mutual funds.
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- 23. 13. Rajeshwari T.R and Rama Moorthy V.E (2002), “Performance Evaluation Of selected Mutual Funds and Investor Behaviour”, PhD Thesis, Sri Sathya Sai Institute of Higher Learning, Prasanthinilayam. 14. Ranganathan, Kavitha, (2006), “A Study of Fund Selection Behaviour of Individual Investors Towards Mutual Funds - with Reference to Mumbai City”. Indian Institute of CapitalMarkets 9th CapitalMarkets Conference Paper. 15. Sujit Sikidar and Amrit Pal Singh, (1996), “Financial Services: Investment in Equity and Mutual Funds – A Behavioural Study”, (in Bhatia B.S., and Batra G.S., ed.), Managementof FinancialServices, Deep and Deep Publications, New Delhi, Chapter 10, 136- 145. 16. Syama Sundar, P.V., (1998), “Growth Prospects ofMutual Funds and Investor perception with special reference to Kothari Pioneer Mutual Fund”, ProjectReport, Sri Srinivas Vidya Parishad, Andhra University, Visakhapatnam. 17. SEBI – NCAER, Survey of Indian Investors,SEBI, Mumbai, 2000.