29-09-2016, 02:59 PM
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EXECUTIVE SUMMARY
Now a day, there is a tough competition in financial avenues due to increase in the investment products. People can get many investment options to invest their savings. Selecting one from the many available options considering many associated factors is a very complex process.
Reliance Mutual Fund is one of India's largest brokerage and securities distribution house in India. It is new to Securities market but still among the top 5 performing company leaving far behind the oldest companies. It is considered to be one of the leading investment broking houses catering to the needs of both institutional and non-institutional investor categories with presence all over the country through franchisees and co-coordinators.
In this project I studied the schemes of Reliance Mutual fund and their returns in various period of time which helped me in knowing how the various schemes are performing and the reasons behind it. I also came to know the risk associated with the various schemes and how risk and returns are related. Hence my topic of study is “Comparative study on performance of Equity Schemes of Reliance Mutual Fund.”
Design of the Study
Need for the Study:
The study will help the organization in knowing how the Equity schemes of the company’s are performing and which schemes are preferred most by the investors.
Objectives of the Study
• To know the Performance of the preferred equity of Reliance Mutual Fund.
• To understand the concept of Mutual Fund its working, mechanism and types traded in India.
• To compare the risk and return associated with the Equity Schemes of Reliance Mutual Fund.
• To know which scheme of Equity of Reliance Mutual Fund is most preferred by the investors and what factors they consider while investing in reliance mutual fund.
• To evaluate the performance Sharpe’s and Treynor’s index are used
Scope of the study
For the study Equity schemes of Reliance Mutual Fund were scanned whose corpus value is more than 500 crores to compare their performance by calculating risk and return associated with these schemes. Also a survey was conducted on Reliance Investors to know the most preferred Equity scheme by the Investors and what factors make them Invest in Reliance mutual Fund
To evaluate the performance of the scheme and funds I have applied sharp’s index & Treynor’s index .
Limitations of the study:
The data collection was strictly confined to secondary sources. Primary data was associated with only the survey conducted on the investors.
Collecting historical NAV is very difficult.
Selection of schemes for study is very difficult because lot of Varieties in equity Schemes
Techniques of analysis:
1. Return:
Return on a typical investment consists of two components. The basic is the periodic cash receipts (or income) on the investment, either in the form of interest or dividends. The second component is the change in the price of the assets-commonly called the capital gain or loss. This element of return is the difference between the purchase price and the price at which the assets can be or is sold; therefore, it can be again or a loss.
The return has been calculated as under:
NAVt – NAVt-1
Portfolio return: Rit =---------------------------------
NAV t-1
Where Rit is the difference between Net Asset Values for two consecutive days dividend by the NAV of the preceding day.
INTRODUCTION
An investment means employment of funds on assets (i.e. securities or mutual funds or any of the investment avenues) with the aim of earning of income as well as capital appreciation. There are mainly two attributes while investing to any of the means, i.e. time and risk. There are mainly four objectives, which the investments activities will carry on those are :
• Return
• Risk
• Liquidity
• Hedge against inflation
• Safety
There are many alternatives which investment avenues are open to the investors to suit their needs and nature .The selection of investment alternatives are depends up on the required level of return and the risk tolerance level. These alternatives range from financial securities to traditional non-securities investment.
Following are the various investment alternatives.
Negotiable and fixed income securities
• Equity shares
• Preference share
• Debentures
• Bonds
• Indira vikas patra &Kisan Vikas patra
• Government securities
• Money market securities (i.e. treasury bill, commercial paper, certificate of
Deposit etc)
Non-negotiable securities
• Bank deposit
• Post office deposit
• NBFC deposit
• Tax saving schemes
• Public provident fund scheme
• National saving scheme
• Life insurance
• Mutual funds
• Real estate