"Investor Behavior of Victory Portfolio Stock Market": Dr. Usha Nair
"Investor Behavior of Victory Portfolio Stock Market": Dr. Usha Nair
"Investor Behavior of Victory Portfolio Stock Market": Dr. Usha Nair
ON
STUDENT UNDERTAKING
This is to certify that I have completed the Project titled Investor Behavior
Of Victory Portfolio Stock Market under the guidance of Dr. Usha
Nair in partial fulfillment of the requirement for the award of degree of
Bachelor of Business Administration at Maharaja Agrasen Institute of
Management Studies, Delhi. This is an original piece of work & I have not
submitted it earlier elsewhere.
Ritika Garg
09514701711
ACKNOWLEDGEMENT
It gives me immense pleasure having done a project on an interesting and
knowledgeable topic like Investor Behavior Victory Portfolio Stock
Market. This project has not only widened my horizon as far as academics
are concerned but also helped me to enlarge my knowledge bank.
It is a privilege to express a few words of gratitude, through this page to all
those who have guided and inspired me all along.
I would take this opportunity to thank my mentor Dr. Usha Nair under
whose guidance the project took its shape.
I conclude by thanking all the respondents who have helped me collect data,
for their honest participation in the survey and my family and friends for
their constant support throughout the project.
EXECUTIVE SUMMARY
BBA is a three years professional course and I am pursuing it from Maharaja Agrasen
Institute of Management Studies. After completion of fourth semester of this course the
student have to undergo six-eight weeks Industrial training in any reputed organization.
Living in an era of industrialization and automation, a nation is stronger and developed if
it is highly industrialized and mechanized. The economic developments depend upon the
industrial growth as well as agriculture. Agriculture is the life of economy while the
industry is the heart of economy.
During the six weeks summer internship I have been exposed to the labor laws of Tata
Teleservices Limited. Compliances of labor laws are the pillar for the company through
which a company provides all basic facilities to its employees and also by obligating
those compliances it serves the country. Obliviously, these compliances are mandatory
where company has to follow these whether it wants or not to have happy employees i.e.
providing them good culture, extra care to employees need etc.
Labor Laws indicate that laws made to the benefit to the labor. Labor laws act as a shield
to employees in the organization, which provides support to regulate the activities of an
organization .Labor laws provides social security, condition of work, mode of payment to
the employees. Thus organization is bound to provide all the facilities regarding health,
safety and welfare amenities under roof of labor laws.
The aim of Government by making labor laws is to provide protection to employees
against the socio economic and political exploitation.
CONTENTS
STUDENT UNDERTAKING
CERTIFICATE FROM THE INSTITUTE GUIDE
ACKNOWLEDGEMENT
EXECUTIVE SUMMARY
CHAPTER -1
1.0 INTRODUCTION
1.1 Overview of Indian Mutual Fund Industry
1.2 Problems of the Organization
1.3Competitors Information
CHAPTER 2
CHAPTER 3
CHAPTER 4
CHAPTER 5
5.0CONCLUSIONS,LIMITATIONS&
5.1 Limitations
5.2 Suggestions
5.3 Conclusions
ANNEXURES
SUGGESTIONS
Chapter-1
INTRODUCTION
1.1 Overview
An agent that charges a fee or commission for executing buys and sell orders
submitted by an investor. The firm that acts as an agent for a customer, charge
the customer the commission for its service. Roles similar to that of a stockbroker
include investment advisor, financial advisor and probably many others. A
stockbroker may or may not be also an investment advisor.
A stockbroker is a regulated professional broker who buys and sells shares and
other securities through market makers or Agency Only Firms on behalf of
investors.
Typically, a broker who receives an order from a customer will communicate with
a company employee located at a particular exchange, who will execute the
order at the exchange and report details of the transaction to the broker.
Customers typically keep their securities in an account with the broker. Brokers
charge customers commissions for conducting transactions and fees for
maintaining their accounts.
Some of the main characteristics of the brokerage industry include growth in ebroking, decline in brokerage fees and growing derivative market and many
more.
There are several national as well as local players in stock trading services which
are providing various services to their customers like online trading, portfolio
management system, stock broking etc.
They are helping the investors to take decision about where to invest because
there is lots of Investment Avenue available with investors. Some of them are as
follows working at the national level.
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Motilal Oswal Securities - Online trading, live BSE and NSE quotes
Sivan Securities - offers services related investment banking & stock broking
with a focus on South India.
Etc..etc..
Lots of brokerage companies are moving towards consolidation with the smaller
ones becoming either franchisee for the larger brokers or closing operations.
There is an increasing demand for online trading due to consumers growing
preference for Internet as compared to approaching the brokers.
New forms of trading including T+2 settlement system, dematerialization etc. are
strengthening the retail brokerage market and attracting foreign companies to
enter the Indian industry Various alternative forms of investment including fixed
deposits with banks and post offices etc act as substitutes to retail broking
products and services.
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Stock Market
Stock markets refer to a market place where investors can buy and sell stocks.
The price at which each buying and selling transaction takes is determined by the
market forces (i.e. demand and supply for a particular stock).
A stock market is a public market for the trading of company stock and
derivatives at an agreed price; these are securities listed on a stock exchange as
well as those only traded privately.
The size of the world stock market was estimated at about $36.6 trillion USD
at the beginning of October 2008.
The stock market is one of the most important sources for companies to raise
money. This allows businesses to be publicly traded, or raise additional capital
for expansion by selling shares of ownership of the company in a public market.
In fact, the stock market is often considered the primary indicator of a country's
economic strength and development. Rising share prices, for instance, tend to be
associated with increased business investment and vice versa.
In this way, investing in stock market, the stock exchanges also play importance
role. Exchanges also act as the clearinghouse for each transaction, meaning that
they collect and deliver the shares, and guarantee payment to the seller of a
security. This eliminates the risk to an individual buyer or seller that the
counterparty could default on the transaction. So, here we also understand about
Stock Exchanges as follows.
Stock exchange
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A stock exchange is an entity which provides "trading" facilities for stock brokers
and traders, to trade stocks and other securities.
Stock Exchanges are an organised marketplace, either corporation or mutual
organisation, where members of the organisation gather to trade company stocks
or other securities.
Stock exchanges also provide facilities for the issue and redemption of securities
as well as other financial instruments and capital events including the payment of
income and dividends.
The securities traded on a stock exchange include: shares issued by companies,
unit trusts, derivatives, pooled investment products and bonds. To be able to
trade a security on a certain stock exchange, it has to be listed there. Usually
there is a central location at least for recordkeeping, but trade is less and less
linked to such a physical place, as modern markets are electronic networks,
which gives them advantages of speed and cost of transactions. Trade on an
exchange is by members only. The initial offering of stocks and bonds to
investors is by definition done in the primary market and subsequent trading is
done in the secondary market.
A stock exchange is often the most important component of a stock market.
Supply and demand in stock markets is driven by various factors which, as in all
free markets, affect the price of stocks.
There is usually no compulsion to issue stock via the stock exchange itself, nor
must stock be subsequently traded on the exchange. Such trading is said to be
off exchange or over-the-counter. This is the usual way that derivatives and
bonds are traded. Increasingly, stock exchanges are part of a global market for
securities
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14
15
30", is a widely used market index in India and Asia. Sensex is tracked
worldwide. It constitutes 30 stocks representing 12 major sectors. The SENSEX
is constructed on a 'free-float' methodology, and is sensitive to market
movements and market realities. Apart from the SENSEX, BSE offers 23 indices,
including 13 sectoral indices.
BSE provides an efficient and transparent market for trading in equity, debt
instruments and derivatives.
BSE is the first exchange in India and the second in the world to obtain an
ISO 9001:2000 certifications. It is also the first exchange in the country and
second in the world to receive Information Security Management System
Standard BS 7799-2-2002 certification for its BSE On-line Trading System
(BOLT).
BSE continues to innovate. In 2006, it became the first national level stock
exchange to launch its website in Gujarati and Hindi and now Marathi to reach
out to a larger number of investors.
BSE Vision
The vision of the Bombay Stock Exchange is -
BSE Profile
Address
16
Mumbai-400001, India
Telephone
:-91-22-227212334
Website
:-www.bseindia.com
Trading hours
Securities
Trading System
:-Electronic
MD & CEO
:-Mr.Madhu Kannan
History of BSE
The Bombay Stock Exchange is known as the oldest exchange in Asia. It
traces its history to the 1850s, when stockbrokers would gather under banyan
trees in front of Mumbai's Town Hall. The location of these meetings changed
many times, as the number of brokers constantly increased. The group
eventually moved to Dalal Street in 1874 and in 1875 became an official
organization known as 'The Native Share & Stock Brokers Association'. In 1956,
the BSE became the first stock exchange to be recognized by the Indian
Government under the Securities Contracts Regulation Act.
The Bombay Stock Exchange developed the BSE Sensex in 1986, giving
the BSE a means to measure overall performance of the exchange. In 2000 the
BSE used this index to open its derivatives market, trading Sensex futures
contracts. The development of Sensex options along with equity derivatives
followed in 2001 and 2002, expanding the BSE's trading platform.
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Indices of BSE:
Sensex
BSE 100(This covers Banking Sector)
BSE 200(This covers Capital goods)
BSE 500(This covers Consumer goods)
BSE mid-cap index
BSE small-cap index
BSE mid-cap index covers the FMCG sector and BSE small-cap index
covers the IT, Metal, Oil & gas, Power industry, PSUs, etc.
BSE
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BSE has won the Asia - Pacific HRM awards for its efforts in employer
branding through talent management at work, health management at work
and excellence in HR through technology.
Origins:
The National Stock Exchange of India was promoted by leading Financial
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Markets:
Currently, NSE has the following major segments of the capital market:
Equity
Futures and Options
Retail Debt Market
Wholesale Debt Market
Currency futures
NSE became the first stock exchange to get approval for Interest rate
futures as recommended by SEBI-RBI committee, on 31 August,2009, a futures
contract based on 7% 10 Year GOI bond (NOTIONAL) was launched with
quarterly maturities.
Hours:
NSE's normal trading sessions are conducted from 8:30 am India Time to
3:30 pm India Time on all days of the week except Saturdays, Sundays and
Official Holidays declared by the Exchange (or by the Government of India) in
advance.
The exchange in association with BSE (Bombay Stock Exchange Ltd.,)
thinking to revise its timings from 9.00 am India Time till 5.00 pm India Time.
However, on Dec 17, 2009, after strong protests from brokers, the
Exchange decided to postpone the change in trading hours till Jan 04, 2010.
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NSE new market timing from Jan 04, 2010 is 9:00 am till 3:30 pm India
Time.
NSE Group:
History of N.S.E
Capital market reforms in India and the launch of the Securities and
Exchange Board of India (SEBI) accelerated the incorporation of the second
Indian stock exchange called the National Stock Exchange (NSE) in 1992. After a
few years of operations, the NSE has become the largest stock exchange in
India.
Three segments of the NSE trading platform were established one after
another. The Wholesale Debt Market (WDM) commenced operations in June
1994 and the Capital Market (CM) segment was opened at the end of 1994.
Finally, the Futures and Options segment began operating in 2000. Today the
NSE takes the 14th position in the top 40 futures exchanges in the world.
In 1996, the National Stock Exchange of India launched S&P CNX Nifty
and CNX Junior Indices that make up 100 most liquid stocks in India. CNX Nifty
is a diversified index of 50 stocks from 25 different economy sectors. The Indices
are owned and managed by India Index Services and Products Ltd (IISL) that
has a consulting and licensing agreement with Standard & Poor's.
In 1998, the National Stock Exchange of India launched its web-site and
was the first exchange in India that started trading stock on the Internet in 2000.
The NSE has also proved its leadership in the Indian financial market by gaining
many awards such as 'Best IT Usage Award' by Computer Society in India (in
1996 and 1997) and CHIP Web Award by CHIP magazine (1999).
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Indices of N.S.E
NSE also set up as index services firm known as India Index Services &
Products Limited (IISL) and has launched several stock indices, including:
Mission of N.S.E.
NSE's mission is setting the agenda for change in the securities markets
in India. The NSE was set-up with the main objectives of:
The standards set by NSE in terms of market practices and technology have
become industry benchmarks and are being emulated by other market
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participants. NSE is more than a mere market facilitator. It's that force which is
guiding the industry towards new horizons and greater opportunities
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Nature of ownership
Private foreign
Private Indian
24
Banks
Banks
Banks
Private foreign
Private foreign
Private Indian
Private Indian
Institutions
Institutions
Banks
Private foreign
Private Indian
Private foreign
Private Indian
Private Indian
Institutions
Private foreign
Banks
Private Indian
25
Banks
Private Indian
Private foreign
Private foreign
Private Indian
Private Indian
Private foreign
Institutions
Private foreign
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had to bail out these AMCs by paying large amounts of money as the difference between
the guaranteed and actual returns. The service levels were also very bad. Most of these
AMCs have not been able to retain staff, float new schemes etc. and it is doubtful
whether, barring a few exceptions, they have serious plans of continuing the activity in a
major way.
The experience of some of the AMCs floated by private sector Indian companies was also
very similar. They quickly realized that the AMC business is a business, which makes
money in the long term and requires deep-pocketed support in the intermediate years.
Some have sold out to foreign owned companies, some have merged with others and
there is general restructuring going on.
The foreign owned companies have deep pockets and have come in here with the
expectation of a long haul. They can be credited with introducing many new practices
such as new product innovation, sharp improvement in service standards and disclosure,
usage of technology, broker education and support etc. In fact, they have forced the
industry to upgrade itself and service levels of organizations like UTI have improved
dramatically in the last few years in response to the competition provided by these.
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CHAPTER 2
COMPANY
PROFILE
28
It gives advice based on extensive research to its customers and provides them with
relevant and updated information to help him make informed about his investment
decisions.
VICTORY PORTFOLIO LIMITED offers its customers the convenience of a brokerDP.
It helps the customers meet his pay in obligations on time thereby reducing the
possibility of auctions. And execute the instruction immediately on receiving it and
thereafter the customer can view his updated account statement on Internet.
MISSION
To educate and empower the retail investor to help him/her take better investment
decisions.
VISION
To be the best retail broking brand in the Indian equities market.
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CHAPTER 3
RESEARCH
METHODOLOGY
30
3.1 Significance
Significance of the project is to find out prospect investors of VictoryPortfolio
Limited Mutual Funds investment centers in Delhi and also to provide key
information about the investors perception and preferences by Mutual Fund industry.
The study helps the Victory Portfolio Limited in getting information about their
performance at other distributors as well as at their own investment center or why
people go for VictoryPortfolioLimited Mutual Fund for investments. Study also
helps in finding out the problems related to distribution.
3.3 Objectives
31
In current scenario, the bank rates have been cut down rapidly due to severe
competition, so people are not going for contemporary deposits because that
cannot provide them. The better returns or the desired interest rates. So, they can
look for some other investment options like Mutual Funds, which can provide
them higher returns in short term and can easily meet their financial goals.
To look out for new prospective customers who are willing to invest in Mutual
Funds.
Due to changing economic scenario the small new economic zones are emerging
rapidly, so VICTORY PORTFOLIO LIMITED
zones and can make available their all investment products by opening new
investment centers.
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or cold calls methods. The data used in this project is primary data collected from
the various categories of investors from different areas. Secondary data available
in monthly Mutual Funds review and AMFI latest issues, value research insight
on Mutual Fund and product catalogues was also used in compiling the report.
AMC. The sample size taken for the study was hundred twenty. The
samples were chosen on the basis of random sampling and these investors belonged
to different categories like corporates, agents, and individuals. The surveyed
respondents belonged to the main types of aggressive investors conservative and
moderate type in different age group.
The research was carried out in the following areas in Delhi:
Patparganj
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CHAPTER 4
DATA ANALYSIS,
INTERPRETATION
& FINDINGS
Investors Perspective
Funds V/S other investment products
Investment objective
Equity
Capital appreciation
Fi Bonds
Income
Corporate debenture
Income
Company FD
Income
Bank FD
Income
PDF
Income
Life insurance
Risk cover
Gold
Inflation hedge
Real estate
Inflation hedge
Risk tolerance
Medium
Low
High-medium-low
High-medium-low
Generally low
Low
Low
Low
Low
Investment horizon
Long term
Medium
Medium
Medium
All terms
Long term
Long term
Long term
Long term
Interpretation
There is very strong approach towards the investment in Mutual Fund as the market is
growing up rapidly in equity plans so around 70% praised Mutual Fund investment; 21%
says good to get safe return from balanced of gilt funds, around 5% said that they had a
bad experience with Mutual Fund investments, very few says that they have worst
experience with Mutual Funds.
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Types of
investors
Aggressive
Conservative
Moderate
Others
Percentages
66%
17%
13%
4%
Type of investors
Interpretation:
Among various categories of investors, 66% are Aggressive which are ready to take the
high risk. 17% of the investors are found to be slightly conservative in respect of Mutual
Fund investments they dont want to take any sort of risk they generally prefer to invest
in gilt funds, 13% are moderate investors i.e. they want good return but without much
risk so they prefer this kind of investments. Rest of them usually shifts to others
frequently.
35
Response
Yes
No
Can't Say
Number of
persons
72
30
18
Interpretation:
In survey, it was found that many investors can shift to other Mutual Fund form
VICTORY PORTFOLIO LIMITED
number of them said that theyll not shift because VICTORY PORTFOLIO LIMITED
Mutual Fund has a better track record for the past period (however past record is not the
bare of selecting any Mutual Fund) it has the largest corpus among all Mutual Fund
Company, few of the investors told that they cannot say, it depends on the better schemes
provided by any Mutual Fund Company.
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Drivers
Services rendered
by floaters
Portfolio
Diversification
Corpus of the fund
Past performance
Agents network
Score
20
55
30
5
10
Interpretation:
After analyzing this question, we come to conclusion that main factor which is behind
any investment is portfolio of any Mutual Fund, well there are other factors also behind
any investment like corpus of that fund, service rendered by distributor and past
performance of that fund through past performance is not the criteria for selecting any
fund. So about 46% of investors look for the portfolio diversification and rest are least
important accordingly.
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Awareness Level
Highly Aware
Aware
Less Aware
Score
95%
3%
2%
Interpretation:
After survey in different category of investors, we found that 95% of the investors are
aware of VICTORY PORTFOLIO LIMITED Mutual Fund. It is surprisingly that there
is no such regarding unawareness of VICTORY PORTFOLIO LIMITED Mutual Fund
38
Parameters
Service
Returns
Networking
Goodwill
Good
65
85
40
95
Satisfactor
y
40
25
60
15
Unsatisfactory
15
10
20
10
various parameters
Interpretation:
During survey, it was found that there dimensions of performance varies at each level and
also depends on investors objective and his expectation level from funds. Returns aspect
39
is on top level where as goodwill also matters a lot, very few client are unsatisfied by the
service at distributor level while networking was satisfactory among good number of
investors.
CHAPTER 5
CONCLUSION,
LIMITATIONS
&
SUGGESTIONS
40
5.1 Limitations
1
The survey was conducted in selective areas because of constraints of time and
resource. Therefore the generalisability of the findings cannot be claimed until
further research has been carried out.
The sample size is 120, which may not reflect a true picture of the investors
objective. Because of these constraints, the analysis may not be accurate and may
vary when tested among different category of investors in different plans among
existing and new investors from different places like industrial as well as
residential sectors.
Details on the precise nature of investors objective was limited. For example the
measures used only captured certain information on standards that individuals had
in mind as acceptable outcomes of their goal directed objective.
Also the research does not alicit subtle goals such as mood repair motives. So the
possibility of personal biases of the respondents may not be precluded.
Thus, though the study is not conclusive in nature, it tends to explore the investors
perception and ideas about the investment services of the VICTORY
PORTFOLIO LIMITED Mutual Fund as a distributor of Mutual Fund.
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5.2 SUGGESTIONS
1
mutual fund should try to provide best customer services than other
As far as New Delhi is concerned, it was found that they were aware about
Prudential ICICI Mutual fund, HDFC Mutual fund, etc. but being established as
the first private sector mutual fund, people should be awarded of, the scenario is
on the contrary. The same can be corrected by the creating awareness by using
right kind of media for right Target.
such a sector, where people are directly involved, where the insurance agent
directly interacts with the prospective customer, which in turn unravels many a
fact which are not yet known to the customer. This fact also illustrates that
advertising plays a vital role in creating awareness.
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43
customers every month, so that they can know the actual position of their
investment.
5.3 CONCLUSIONS
No pain, No gain in the stock market The recent recession has affected all countries
around the world in an almost synchronous way. Interestingly, not only has it hit
countries with bad macroeconomic fundamentals, but also those with AAA rating. The
degree to which countries have been affected by the crisis, on the other hand, has differed
and, quite surprisingly, countries with a higher income per capita have experienced the
most severe output loss. The crisis is escalating market condition is still worsening. Job
market is still weakening. Productivities are still declining. Governments of the western
countries are struggling to find ways to end this catastrophic crisis. Speakers outlined the
challenges that policy makers face in the coming year, and offered suggestions for
solutions. The global nature of the recession and cross country heterogeneity in the depth
od the downturn give the researcher a unique opportunity to identify the link between the
44
structural characteristics of economic and institutional systems before the crisis and their
resilience with respect to the global recessionary shock.
GLOSSARY
Advisor
The organization employed by a mutual fund to give professional advice on the fund's
investments and to supervise the management of its assets.
Asked or Offering Price
The price at which a mutual fund's shares can be purchased. The asked or offering price
means the current net asset value (NAV) per share plus sales charge, if any. For a no-load
fund, the asked price is the same as the NAV.
Asset Allocation Fund
A fund that spreads its portfolio among a wide variety of investments, including domestic
and foreign stocks and bonds, government securities, gold bullion and real estate stocks.
This gives small investors far more diversification than they could get allocating money
on their own. Some of these funds keep the proportions allocated between different
sectors relatively constant, while others alter the mix as market conditions change.
Automatic Reinvestment
A service offered by most mutual funds whereby income dividends and capital gain
distributions are automatically invested into the fund by buying additional shares and thus
building up holdings through the effects of compounding.
Balanced Fund
45
A mutual fund that maintains a balanced portfolio, generally 60% bonds or preferred
stocks and 40% common stocks.
Bid or Sell Price
The price at which a mutual fund's shares are redeemed (bought back) by the fund. The
bid or redemption price means the current net asset value per share, less any redemption
fee or back-end load.
Bond Fund
A mutual fund whose portfolio consists primarily of corporate or Government bonds.
These funds generally emphasize income rather than growth.
Bond Rating
System of evaluating the probability of whether a bond issuer will default. Various firms
analyze the financial stability of both corporate and government bond issuers. Ratings
range from AAA or Aaa (extremely unlikely to default) to D (currently in default). Bonds
rated BBB or below are not considered to be of investment grade. Mutual funds generally
restrict their bond purchases to issues of certain quality ratings, which are specified in
their prospectuses.
Capital Appreciation Fund
A mutual fund that seeks maximum capital appreciation through the use of investment
techniques involving greater than ordinary risk, such as borrowing money in order to
provide leverage, short-selling and high portfolio turnover.
Capital Gains Distributions
Payments (usually annually) to mutual fund shareholders of gains realized on the sale of
portfolio securities.
46
Capital Growth
A rise in market value of a mutual fund's securities, reflected in its net asset value per
share. This is a specific long-term objective of many mutual funds.
Certificate of Deposit
Interest-bearing, short-term debt instrument issued by banks and thrifts.
Closed-End Investment Company
An investment company that offers a limited number of shares. They are traded in the
securities markets, usually through brokers. Price is determined by supply and demand.
Unlike open-end investment companies (mutual funds), closed-end funds do not redeem
their shares.
Commercial Paper
Short-term, unsecured promissory notes with maturities no longer than 270 days. They
are issued by corporations, to fund short-term credit needs.
Common Stock Fund
An open-end investment company whose holdings consist mainly of common stocks and
usually emphasize growth.
Confirm Date
The date the fund processed your transaction, typically the same day or the day after your
trade date.
Contingent Deferred Sales Charge (CDSC)
A fee (or back-end load) imposed by certain funds on shares redeemed within a specific
period following their purchase. These charges are usually assessed on a sliding scale,
47
such as four percent to one percent of the amounts redeemed, with the fee reduced each
year the units are held.
Custodian
The bank or trust company that maintains a mutual fund's assets, including its portfolio of
securities or some record of them. Provides safekeeping of securities but has no role in
portfolio management.
Daily Dividend Fund
This term applies to funds that declare their income dividends on a daily basis and
reinvest or distribute monthly.
48
periods of lower securities prices and fewer shares in periods of high prices. In this way,
investing risk is spread over time.
Exchange Privilege (Or switching privilege)
The right to transfer investments from one fund into another, generally within the same
fund group, at nominal cost.
Ex-Dividend Date
The date on which a fund's Net Asset Value (NAV) will fall by an amount equal to the
dividend and/or capital gains distribution (although market movements may alter the
fund's closing NAV somewhat). Most publications which list closing NAVs place an "X"
after a fund name on its ex-dividend date.
Expense Ratio
The ratio of total expenses to net assets of the fund. Expenses include management fees,
the cost of shareholder mailings and other administrative expenses. The ratio is listed in a
fund's prospectus. Expense ratios may be a function of a fund's size rather than of its
success in controlling expenses.
Fiscal Year
An accounting period consisting of 12 consecutive months.
Global Fund
A fund that invests in both Indian. and foreign securities.
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Growth Fund
A mutual fund whose primary investment objective is long-term growth of capital. It
invests principally in common stocks with significant growth potential.
Income Dividend
Payment of interest and dividends earned on the fund's portfolio securities after operating
expenses are deducted.
Income Fund
A mutual fund that primarily seeks current income rather than growth of capital. It will
tend to invest in stocks and bonds that normally pay high dividends and interest.
Index Fund
A mutual fund that seeks to mirror general stock-market performance by matching its
portfolio to a broad-based index, most often the S&P CNX Nifty index.
International Fund
A fund that invests in securities traded in markets outside India.
Investment Company
A corporation, partnership or trust that invests the pooled monies of many investors. It
provides greater professional management and diversification of investments than most
investors can obtain independently. Mutual funds, or "open-end" investment companies,
are the most popular form of investment company.
Investment Objective
The financial goal (long-term growth, current income, etc.) that an investor or a mutual
fund pursues.
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Junk Bond
A speculative bond rated BB or below."Junk bonds" are generally issued by corporations
of questionable financial strength or without proven track records. They tend to be more
volatile and higher yielding than bonds with superior quality ratings. "Junk bond funds"
emphasize diversified investments in these low-rated, high-yielding debt issues.
Load
A sales charge or commission assessed by certain mutual funds ("load funds,") to cover
their selling costs. The commission is generally stated as a portion of the fund's offering
price, usually on a sliding scale from one to 8.5%.
Load Fund
A mutual fund that levies a sales charge up to 6%, which is included in the offering price
of its shares, and is sold by a broker or salesman. A front-end load is the fee charged
when buying into a fund; a back-end load is the fee charged when getting out of a fund.
Low-Load Fund
A mutual fund that charges a small sales commission, usually 3.5% or less, for the
purchase of its shares.
Management Fee
The amount a mutual fund pays to its investment adviser for services rendered, including
management of the fund's portfolio. In general, this fee ranges from .5% to 1% of the
fund's asset value.
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fund.
Portfolio Turnover Rate
The rate at which the fund's portfolio securities are changed each year. If a fund's assets
total Rs100mn and the fund bought and sold Rs100mn worth of securities that year, its
portfolio turnover rate would be 100%. Aggressively managed funds generally have
higher portfolio turnover rates than do conservative funds that invest for the long term.
High portfolio turnover rates generally add to the expenses of a fund.
Prospectus
An official document that each investment company must publish, describing the mutual
fund and offering its shares for sale. It contains information required by the Securities and
Exchange Commission.
Record Date
The date the fund determines who its shareholders are; "shareholders of record" who will
receive the fund's income dividend and/or net capital gains distribution. Frequently the
business day immediately prior to the Ex-Dividend Date.
Redemption Fee
A fee charged by a limited number of funds for redeeming, or buying back, fund shares.
Redemption Price
The price at which a mutual fund's shares are redeemed (bought back) by the less
expensive fund. The redemption price is usually equal to the current net asset value per
share.
Regional Fund
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A mutual fund that concentrates its investments within a specific geographic area, usually
the fund's local region. The objective is to take advantage of regional growth potential
before the national investment community does.
Reinvestment Date (Payable Date)
The date on which a share's dividend and/or capital gains will be reinvested (if requested)
in additional fund shares.
Reinvestment Privilege
A service that most mutual funds offer whereby a shareholder's income dividends and
capital gains distributions are automatically reinvested in additional shares.
Sector Fund
A fund that operates several specialized industry sector portfolios under one umbrella.
Transfers between the various portfolios can usually be executed by telephone at little or
no cost.
Short Selling
The sale of a security which is not owned by the seller. The "short seller" borrows stock
for delivery to the buyer, and must eventually purchase the security for return to the
lender.
Specialty Fund
A mutual fund specializing in the securities of a particular industry or group of industries
or special types of securities.
Systematic Investment Plans
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In case of Systematic Investment Plans, instead of a lump sum amount, investor invests a
pre-specified amount in a scheme at pre-specified intervals at the then prevailing NAV.
Systematic Withdrawal Plans
Many mutual funds offer withdrawal programs whereby shareholders receive payments
from their investments. These payments are usually drawn from the funds dividend
income and capital gain distributions, if any, and from principal only when necessary.
Underwriter
The organization that acts as the distributor of a mutual fund's shares to broker/dealers
and the public.
Variable Annuity
A type of insurance contract that guarantees future payments to the holder, or annuitant,
usually at retirement. The annuity's value varies with that of the underlying portfolio
securities, which may include mutual fund shares. All monies held in the annuity
accumulate tax-deferred.
Voluntary Plan
A flexible plan for capital accumulation, involving no specified time frame or total sum
to be invested.
Yield
Income or return received from an investment, usually expressed as a percentage of
market price, over a designated period. For a mutual fund, yield is interest or dividend
before any gain or loss in the price per share.
Zero Coupon Bond
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Bond sold at a fraction of its face value. It appreciates gradually, but no periodic interest
payments are made. Earnings accumulate until maturity, when the bond is redeemable at
full face value. Nonetheless, interest is taxable as it accrues.
ANNEXURES
INVESTORS QUESTIONNAIRE
Preamble: Im a management student of MAIMS and doing summer training in
VICTORY PORTFOLIO LIMITED Mutual Fund and making a project on it. So I need
your valuable co-operation in this regard.
Name of the Investor
:______________________________
Age
:__________
Sex
Male
Phone
Female
: Office ____________
56
Mobile:_________________
No
3. Name the Mutual Funds in which you are interested?
________________________________
4. In which type of plans/schemes you are interested?
Open Ended
Liquid Plan
Close Ended
Equity Funds
Income Plan
Balanced Funds
5. What are the broad criteria for selecting any Mutual Fund?
Higher returns
Portfolio Management
Safe returns
No. of Plans
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Conservative
Moderate or Balanced
8. Which funds in your opinion are performing well?
Templeton
SBI Mutual Fund
VICTORIA PORTFOLIO LIMITED Mutual Fund
HDFC Mutual Fund
9. If better returns are provided, will you shift to other Mutual Funds?
Yes
No
10. The most important factor that influence you about investing in any Mutual Fund?
Funds Portfolio
Funds Corpus
NAVs
Fact Sheet
Schemes available
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