A Study On Investor's Perception Towards Mutual Fund in The City of Bhubaneswar
A Study On Investor's Perception Towards Mutual Fund in The City of Bhubaneswar
A Study On Investor's Perception Towards Mutual Fund in The City of Bhubaneswar
The Indian mutual fund industry is witnessing a Ranganathan Analysed the fund
humongous growth as a result of infrastructural (2006) selection behavior of
development, increase in personal financial assets, and individual investors
rise in foreign direct investments. With the rising towards mutual funds-
income, growing risk appetite and increasing with reference to
awareness, mutual funds in India are becoming a Mumbai City.
preferred investment option compared to other He found that mutual
investment vehicles like postal savings, insurance and funds have become an
fixed deposits though are considered safe, give important investment
comparatively low returns. option for the small
investors as an outcome
REVIEW OF LITERATURE of reforms of industrial
policy, public sector,
Review of literature is an important part of any financial sector and the
research. Literature on performance evaluation of many other
mutual fund is enormous. Some of the research studies developments in the
that substantially influenced the preparation of this Indian money market
study are discussed in this section. and capital market.
Walia and Kiran The study examined
Jaspal Singh and Evaluated two major (2009) investor's perception
Subhash Chander factors, past record and towards risk involved
(2003) growth prospects in mutual funds, returns
influenced the choice of from mutual funds in
scheme. comparison to other
Investors look for financial avenues,
repurchase facility, transparency and
prompt service and disclosure practices.
adequate information in The study found that
mutual funds. majority of individual
For appraisal of mutual investors did not
funds return, portfolio consider mutual fund as
selection and NAV highly risky
were important criteria. investment.
It is indicated in the The study also reported
results that that significant
occupational status and relationship of
age are insignificant interdependence exists
influencing the choice between income level
of scheme. of investors and their
Jaspal Singh and The results show that perception for mutual
Subhash Chander the investors consider funds investments.
(2004) gold to be the most
preferred form of Dr. Nishi Sharma Attempted to
investment, followed (2012) investigate the reasons
by NSC and Post responsible for lesser
Office schemes. recognition of mutual
Investors belonging to fund as a prime
the salaried category, investment option.
and in the age group of It examines the
20-35, years showed investors perception
inclination towards with reference to
close-ended growth distinct features
(equity-oriented) provided by mutual
schemes over the other fund companies to
scheme type. attract them for
80 71
70 66 Age
60
50 From the above analysis it is clear that 42% of the
40 respondents belong to business class prefer to invest in
27 mutual funds followed by 33% of job holders. The chi
30
14 Frequency square result shows a p-value which is less than 0.05
20
(5% level of significance). So it is concluded that there
10 is an association between occupation and preference
0 towards mutual fund investment. As we can see
Less 25-40 40-50 50-60 business class people are more inclined to mutual fund
than investment than any other.
25
Education:
From the above analysis it is clear that 40% of the
respondents who are in the age group of 40-50 prefer to Education Frequency Expected Percentage
invest in mutual funds followed by the age group 25-40 Under
which is 37%. The chi square result shows a p-value Graduate 12 44.5 0.07
which is less than 0.05 (5% level of significance). So it Graduate 71 44.5 0.40
is concluded that there is an association between age
and preference towards mutual fund investment. As we Post Graduate 50 44.5 0.28
grow old the risk taking ability is likely to decrease and Professional
those who are much young less than 25 years of age Degree 45 44.5 0.25
don’t think about investment that seriously. Total 178 178
9.65348E-
p-value 09
Experience:
Investment
Experience Frequency Expected Percentage
Less than 2 years 48 44.5 0.27
2 years to 6
years 47 44.5 0.26
6 years to 10
years 36 44.5 0.20
Above 10 years 47 44.5 0.26
Total 178 178
p-value 0.535943
From the above analysis it is clear that 40% of the
respondents who are graduates prefer to invest in
mutual funds. 7% under graduate also show interest in
mutual investment. The chi square result shows a p-
value which is less than 0.05 (5% level of significance).
So it is concluded that there is a relationship between
education level and preference towards mutual fund
investment.
Income Frequency Expected Percentage
Less than
40000 29 44.5 0.16
40000-60000 44 44.5 0.25
60000-80000 64 44.5 0.36
Above 80000 41 44.5 0.23
Total 178 178
p-value 0.002615
Income:
From the above analysis it is clear that experience in
investing in mutual fund doesn’t matter much as a
factor. The chi square result shows a p-value which is
greater than 0.05 (5% level of significance). So it is
concluded that there is no relationship between
experience and preference towards mutual fund
investment.
Media:
Time:
Time of Investment Frequency Percentage
Upto 1 year 20 0.11
1 Year to 3 years 23 0.13
3 Years to 5 Years 60 0.34
More than 5 Years 75 0.42
Total 178
Factors:
Factors Frequency Percentage
Friends/Relatives 67 0.38
The above table and graph shows that most of the
Financial Advisor 52 0.29 respondents opt for a period of minimum 5 years to stay
Personal Analysis 27 0.15 invested in mutual fund.
Return 20 0.11
Scheme:
Safety 5 0.03
Tax benefit 7 0.04 Scheme Frequency Percentage
Total 178 Income 40 0.22
Growth 54 0.30
Balance 53 0.30
Monthly Income Plan 20 0.11
Others 11 0.06
Total 178
The above table and graph shows that the respondents The above table and graph shows that most of the
opt for different schemes as per their requirement. respondents (45%) are dissatisfied with mutual fund
There is no clarity for any specific scheme of mutual investment because of poor after sales service.
fund.
Future:
Satisfaction:
Future Perception Frequency Percentage
Satisfaction Frequency Percentage Bright 70 0.39
Yes 136 0.76 Slow growth 22 0.12
No 42 0.24 Lack of awareness 38 0.21
Total 178 Risky avenue 22 0.12
Dark 18 0.10
No response 8 0.04
Total 178
Dissatisfaction:
Facors of Dissatisfaction Frequency Percentage The above table and graph shows that 39% of the
Low Income 9 0.21 respondents say that the future of mutual fund is bright.
Poor after sales service 19 0.45
Better avenues in the CONCLUSION
market 7 0.17
Longer redeemption It is concluded from the research study that though the
period 7 0.17 number of male investors is more, the difference is not
Total 42 significant from the female investors. So, gender is not
a criteria that affect investment decision in mutual
funds. People in the age between of 25 to 50 likely to
invest more in mutual fund. Business class people
invest in mutual fund more than any other. People who
are more educated have more knowledge in mutual
fund and tend to invest in mutual fund more than any
other avenues of investment. Low income level doesn’t
attract much for mutual fund investment. It is evident
from the study that income more than 40000 INR are
more attracted towards mutual fund. Print and
electronic media attracts more for mutual fund than any
other medium of promotion. Friends and relatives and
financial advisors influence a lot for investment in
mutual fund. Most of the investors want to stay invested
for a minimum of 5 years and they invest in various
schemes available. Most of the people are satisfied with sales service. Most of the respondents say that the
mutual fund where as many people are still not future of mutual fund is bright.
satisfied. The reason for dissatisfaction is poor after
REFERENCES
[1] Dr. Binod Kumar Singh, “A study on investors’
attitudetowards mutual funds as an investment option”,
Issue2, Vol. 2 (March-2012)
[2] Jaspal Singh, and Subhash Chander.(2003).What Drives
the investors towards Mutual Funds: An Empirical
Analysis. The ICFAIJourna/ 0fApplied Finance, Vol.
9(8),pp.38-46.
[3] Dr.Nishi Sharma (2009) “Indian Investors Perception
towards mutual funds”, Business Management
DynamicsVol.2, No.2, Aug 2012, pp.01-09.
[4] Ranganathan, Kavitha (2006), "A Study of Fund Selection
Behaviour of Individual Investors towards Mutual Funds -
with Reference to Mumbai City," Social Science Research
Network, Vol. 5(1).
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analysis of perceptions of investors towards mutual
funds.Finance India, 18(4), pp 1673-1692.
[6] Walla, N., and Kiran, R. (2009), "An Analysis of Investor's
Risk Perception towards Mutual Funds Services",
International Journal of Business Management, Vol.4, No.5.