IRACST International Journal of Commerce, Business and Management (IJCBM), ISSN: 23192828
Vol. 5, No.1, Jan-Feb 2016
A STUDY ON INVESTORS
PERCEPTION TOWARDS MUTUAL
FUND INVESTMENTS (WITH SPECIAL
REFERENCE TO POLLACHI TOWN)
MS.M.KALAISELVI
ASSISTANT PROFESSOR OF B.COM [PA]
SREE SARASWATHI THYAGARAJA
COLLEGE,
POLLACHI, COIMBATORE DISTRICT
TAMILNADU, INDIA
Abstract - This study on Investors perception towards and
recent development and progress of Mutual Fund
investments in Coimbatore city comes under the board area
of service marketing. In the broad concept of service
marketing it exclusively concentrates on the marketing of
financial service namely mutual funds.
With the wider concept of the various functions of service
marketing, product awareness, brand preferences, and
investor`s satisfaction are the specific areas of the study.
The other marketing functions like product development
market segmentation, channels of marketing, product life
cycle, scale promotion strategies and their impact of
Marketing are completely omitted from the preview of this
study. Similarly the availability of substitute product of mutual
fund units and their impact on this service product it also not
included in the study. Even in the mutual fund investors
behavior also the researcher concentrate only the urban
investors and their problem for this research work. The rural
investor`s views are completely excluded from the study.
Key words mutual fund, investors, marketing
INTRODUCTION
All investments whether in shares, debentures or
deposits involve risk. Share value may go down
depending upon the performance of the company, the
industry, state of capital markets and the economy.
Generally however, longer the term, lesser the risk.
Companies may default in payment of interest and
principal on their debenture or bonds or deposits.
While risk cannot be eliminated, skillful management
can minimize risk. Mutual Funds help to reduce risk
through diversification and professional management.
The experience and expertise of Mutual Fund
managers in selecting fundamentally sound securities
and timing their purchases and sales help them to
build a diversified portfolio that minimizes risk and
maximizes returns. Worldwide, the Mutual Fund, or
Unit Trust as it is called in some parts of the world, have
almost overtaken bank deposits and total assets of
insurance funds. As of date, in the US alone there are
over 8,002 Mutual Funds with total assets of over US
$9.36 trillion (Rs.427 lakh crores). In India there are
29 Mutual Funds and over 592 schemes with total
assets of approximately of Rs. 2,31,862 crores (US $
52 Billion). The Securities and Exchange Board of
India (SEBI) regulate all mutual funds in India.
REVIEW OF LITERATURE
D.Senthil and Dr.M.SyedZefar (2005) had
published an Article Mutual
Fund- Investors Perceptions and realities. The main
aim of the study is to find out the investors
perception and realities in the current scenario and
measure extend of satisfaction derived by customer
towards the performance of mutual fund and
willingness to invest in future despite the current
prevailing condition of the market. The main purpose
of the study is to identify the factors which make
them invest and to retain in mutual fund. The study
says that investors prefer mutual fund than share
because high risk is associated with shares.
Sanjay.J.Bhayani and Vishal.G.Patidar (2006)
during the period Mutual Fund can increase in
domestic saving and improve the deployment of
investment through market. The main scope of the
study is performed top five schemes are balanced
fund scheme, Gilt fund scheme, Liquid Money
Market fund scheme, Income fund scheme, Equity
diversified fund scheme, Tax planning fund scheme.
Madhumita Chakra Borty, P K Jain and
VinayKallianpur (2007) evaluated the performance
of mutual fund on the basis of rate of return as well
as risk adjusted methods. The performances of the
mutual funds are compared with the risk-free returns
as well as the benchmark index (BSE 100). The
resuly have to be interpreted from the view that the
study has been conducted for the period 2005-2007
when the economy was growing at a rapid rate (8%
GDP growth).The finding of the study was monthly
reruns have been computed for all 40 mutual funds in
the sample, for BSE 100 index and for 364 day T-bills.
The study concludes regarding the capability of mutual
fund manager is still elusive.
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 IRACST International Journal of Commerce, Business and Management (IJCBM), ISSN: 23192828
Vol. 5, No.1, Jan-Feb 2016

AIMS AND OBJECTIVES OF THE STUDY ANALYSIS

The main objective of the study is to analyze the TABLE 1 INVESTORS OPINION ABOUT THE
performance of mutual fund and investor`s FACTORS INFLUCING INVESTMENT IN
perception towards mutual fund investments. MUTUAL FUNDS
The other objectives of the study are as follows-
-To trace out the growth and development of INVESTORS RESPONSE
Investment in India Most Less
Not
Influence Impor Neutr at all
-To study the investors awareness and preference in Factors importa import Total
tant al impo
mutual fund schemes nt ant
rtant
-To study the factor influencing the investors in Capital No 75 112 38 12 13 250
apprecia
selecting mutual fund schemes tion % 30 44.8 15.2 4.8 5.2 100
-To study the level of satisfaction on the investment High No 150 50 25 13 12 250
of mutual fund investors return
% 60 20 10 5.2 4.8 100
-To assess the problem faced by the mutual fund Tax No 75 100 50 12 13 250
investors saving
% 30 40 20 4.8 5.2 100
RESEARCH METHODOLOGY Liquidit No 75 100 50 12 13 250
Research Design y of
fund % 30 40 20 4.8 5.2 100
The entire process involved in research Safety & No 112 88 12 13 25 250
methodology is called research design. Research Security
design is a plan of study made by a researcher before % 44.8 35.2 4.8 5.2 10 100
undertaking his/her research work. In this study the
Regular No 62 100 50 25 13 250
researcher has adopted descriptive research design to Income
investigate and study the give problem. The major % 24.8 40 20 10 5.2 100
Regular No 62 100 50 25 13 250
goal of descriptive research is to describe the event, Savings
phenomena and situations. Descriptions being made % 24.8 40 20 10 5.2 100
on the bases of scientific observations are explained Risk No 75 112 25 13 25 250
Involved
to be more accurate and precise the other methods. % 30 44.8 10 5.2 10 100
Universe: Diversifi No 50 125 37 13 25 250
cation
The universe of this research is limited to Pollachi % 20 50 14.8 5.2 10 100
Town. Pollachi is one of the biggest down in Easy No 112 88 13 12 25 250
Payment
Coimbatore District. There are about 2500 Small and s % 44.8 35.2 5.2 4.8 10 100
Medium Industries. It is well known for its coir- Source: Primary Data
products, coconut and Spinning Mills. It is poised for From the above table it is clear that 44.8%
a spectacular growth in the near future. Coimbatore, of the respondents have given importance towards
being an industrial area, many public and private sector capital appreciation, 30% of the have given most
mutual fund companies has established his branches important towards capital appreciation, 15.5%, 5.2%
over here. and 4.8% of the respondents have stated their opinion
Sample: is neutral, not at all important and less important.
For the study the sample the study participants are 60% of the respondents have an opinion that high
defined mutual fund investors of Pollachi town. In return from mutual fund is most important, 20% of
total ,the present study covered 5 Mutual fund the respondents considered as important, 10%, 5.2%
investment organization which accommodates 1200 and 4.8% of the respondents opinion are neutral, less
investors among them 25% , 250 respondents were important and not at all important regarding high
selected and interviewed for present study. The return from the mutual fund.
methodology for selecting respondents for this study 50% of the respondents says that important to
convenience sampling method. diversification of mutual fund, 20% of the
Sample size and selection procedure: respondents are considered as most important, 14.8%,
The samples of 250 respondents from the mutual 10% and 5.2% of the respondents opinion is neutral,
fund investors. The investors are selected from not at all important and less important respectively.
various mutual fund distributors, agents and from 44.8% of the respondents says that most important
consultancy. factor regarding easy payment of the mutual fund
The convenience sampling method is used for company, 35.8% of the respondents are says that
selecting sample investors in the study important factor, 10%, 5.2% and 4.8% of them says that
not at all important, neutral, less important respectively.

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 IRACST International Journal of Commerce, Business and Management (IJCBM), ISSN: 23192828
Vol. 5, No.1, Jan-Feb 2016

TABLE 2 MONTHLY INCOME OF THE 34.8% and 24.8% of the respondents are satisfied and
RESPONDENTS neutral regarding the liquidity of fund, while 15.2%,
Monthly Income Frequency Percentage 14.8% and 10.4% of the respondents are highly
5000-10000 38 15.2 satisfied, highly dissatisfied and dissatisfied.
10000-15000 62 24.8 Regarding safety and security of the mutual fund,
15000-20000 38 15.2 40% and 24.8% of the respondents are satisfied and
Above 20000 112 44.8 highly satisfied, 20%, 10% and 5.2% of the
Total 250 100 respondents are highly dissatisfied, dissatisfied and
Source: Primary Data neutral opinion.
From the table shows that the 44.8% of the 40% and 24.8% of the respondents have opinion that
respondents earn income of above 20000, 24.8% of regular income from the mutual fund as neutral and
the respondents earn income between10000-15000, highly satisfied, 15.2% of the respondents are
15.2% of the respondents earn income between 5000- satisfied and 10% of the respondents are highly
10000 and 15000-20000. Hence it is clear from the table satisfied and dissatisfied respectively.
that majority of the respondents are comes under the 34.8% and 30% of the respondents are satisfied with
income level of above 20000. regarding the regular savings and neutral, 14.8%,
TABLE 3 INVESTORS SATISFACTION LEVEL 10.4% and 10% of the respondents are highly
OF VARIOUS MOTIVATING FACTORS dissatisfied, highly satisfied and dissatisfied
respectively.
Highly 44.8% and 30% of the respondents says that the risk
Highly
Factors Satisfied Neutral Dissatisfied in the mutual Total
involved Dissatisfied fund investment as satisfied
satisfied
and highly satisfied, 10% of the respondents are have
Capital No 25 100 75 37 both neutral 13 and highly 250dissatisfied. 5.2% of the
appreciation % 10 40 30 14.8 respondents5.2 are dissatisfied
100 regarding risk involved
High return No 137 62 13 13 in the mutual25 fund investments.
250
% 54.8 24.8 5.2 5.2 In the factor
10 of diversification
100 of mutual fund says
Tax saving No 75 87 50 13 that the 70% 25 of the respondents
250 are satisfied, 14.8%
% 30 34.8 20 5.2 and 4.8% 10 of the respondents
100 are neutral and
Liquidity of No 38 87 62 26 dissatisfied.37 5.2% of the 250 respondents are highly
fund % 15.2 34.8 24.8 10.4 dissatisfied and highly satisfied
14.8 100 respectively.
Safety & No 62 100 13 25 54.8% of 50 the respondents 250are satisfied regarding the
Security % 24.8 40 5.2 10 easy payment,20 while 100
24.8% and 10% of the
Regular No 62 38 100 25 respondents25 are highly
250 satisfied and highly
Income % 24.8 15.2 40 10 dissatisfied.
10 5.2% of the respondents are neutral and
100
Regular No 26 87 75 25 dissatisfied
37 with regarding250the easy payments.
Savings % 10.4 34.8 30 10 14.8 100
Risk Involved No 75 112 25 13 25 250
% 30 44.8 10 5.2 10 100
Diversification No 13 175 37 12 13 250
% 5.2 70 14.8 4.8 TABLE 45.2 100
Easy No 62 137 13 13 SOURCE25 OF AWARENESS 250 OF MUTUAL
Payments % 24.8 54.8 5.2 5.2 FUND INVESTMENT
10 100
Source: Primary Data Media Frequency Percentage
From the above table it is clear that 40% and Newspaper & 150 60
30%of the respondents are satisfied and neutral Magazine
regarding the capital appreciation,, 14.8%, 10% and Internet 37 14.8
5.2% of the respondents are dissatisfied, highly
Television 13 5.2
satisfied and highly dissatisfied respectively.
Relatives & Friends 25 10
From the above table it is clear that 54.8% and 24.8%
Agents 25 10
of the respondents are highly satisfied and satisfied to
get a high return. 10% of the respondents are highly Total 250 100
dissatisfied and 5.2% of the respondents are neutral Source: Primary Data
and dissatisfied. Table 4.14 says that 60% of the respondents
34.8% and 30% of the respondents are satisfied and are aware of the mutual fund investment through
highly satisfied the factor of tax saving while invest newspaper and magazine, 14.8% of the respondents
in the mutual fund, 20%, 10% and 5.2% of the are aware through internet, 10% of the respondents
respondents are neutral, highly dissatisfied and are aware through agents and relatives or friends and
dissatisfied with the tax saving factor. 5.2% of the respondents are aware through television.
Majority of the respondents are aware of the mutual
fund investments through newspaper and magazines.

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 IRACST International Journal of Commerce, Business and Management (IJCBM), ISSN: 23192828
Vol. 5, No.1, Jan-Feb 2016

TABLE 5 TYPE OF FUND HELD BY THE Low Income 3.85 4

RESPONDENTS Unable to aware market 2.9 1
Type of fund Frequency Percentage value
Equity 75 30 Delay in selling unit 3.65 2
Balanced fund 50 20 Fees and Commission 3.7 3
Debt fund 13 5.2 Poor service of broker 4.15 5
Tax planning fund 12 4.8 Poor service of mutual 4.40 6
Bond or gilt fund 13 5.2 fund company
Index fund 12 4.8 Non availability of 4.60 7
Sector and industry 25 10 branch office
fund TABLE 9 FRIDMAN TEST
Money market 50 20 Friedman test has been applied to find out if
fund there is significant relationship between the mean
Total 250 100 rank and the problem Faced by the Mutual Fund
Source: Primary Data Investors
From the table 4.8 it is clear that 30% of the N 250
respondents hold equity fund, 20% of the respondents Chi Square 39.576
hold balanced fund and money market fund, 10% of
the respondents hold sector and industry funds, 5.2% Df 6
of the respondents hold debt fund and bond or gilt Asymp.Sig .000
fund. 4.8% of the respondents are holding tax
Based on the Friedman test, it is clear that all mean
planning and index fund.
rank have significant relationship with the problem
TABLE 6 PURCHASE OF MUTUAL FUND
faced by Mutual Fund Investors at 5% level of
UNITS
significance. Hence the hypothesis is rejected.
Mode of purchase Frequency Percentage
FINDINGS
Buy direct 100 40 Analysis of investors perception towards mutual
purchase fund investments
Through brokers 150 60 Majority of the respondents are male (90%)
Total 250 100 Majority of the respondents are in the age group of
Source: Primary Data 20-30 years (54.8%)
The above table 4.18 shows that 60% of the Majority of the respondents are Undergraduates
respondents purchase the mutual fund units through (40%)
brokers and 40% of the respondents are purchase the Majority of the respondents are Business people
mutual fund units through directly. Majority of the (44.8%)
respondents are purchase the mutual fund unit through Majority of the respondents are under the income
brokers. level of Rs above 20000 per month (44.8%)
Majority of the respondents are save their income
between 30%-40% from their monthly income (31%)
Most of the respondents prefer to invest in bank
TABLE 7 deposits
AWARENESS OF THE RISK INVOLVED IN Majority of the respondents prefer to invest in Private
MUTUAL FUND INVESTMENTS sector mutual fund companies (34.8%)
Awareness Frequency Percentage Majority of the respondents prefer open-ended
Yes 200 80 mutual fund schemes (70%)
No 50 20 Majority of the respondents are aware of the mutual
Total 250 100 funds investments through new paper and
Source: Primary Data Magazines (60%)
The above table shows that 80% of the Majority of the respondents hold the equity type of
respondents are aware of the risk involved in the mutual funds (30%)
mutual fund investment, and remaining 20% of the Majority of the respondents prefer high risk and high
respondents are not aware of the risk involved in returns from their investments (44.8%)
mutual fund. The majority of the respondents are Majority of the respondents purchase the mutual fund
aware of the risk involved in the mutual fund unit through brokers (60%)
investment Majority of the respondents are aware of the risk in
TABLE 8 mutual fund investment (80%)
PROBLEMS FACED BY MUTUAL FUND Majority of the respondents are aware of the market
INVESTORS MUTUAL FUNDS value of units through Newspaper (54.8%)
Problems Mean Final Majority of the sample investors say yes to make future
Rank Rank investment in mutual funds (80%)

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 IRACST International Journal of Commerce, Business and Management (IJCBM), ISSN: 23192828
Vol. 5, No.1, Jan-Feb 2016

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This study has made an attempt to understand the
financial behavior of mutual fund investors in AUTHOR PROFILE
connection with the scheme preference and selection. Ms.M.Kalaiselvi M.Com, M.Phil., is working in Sree
An important element in the success of a marketing Saraswathi Thygaraja College, Pollachi since 2013.
strategy is the ability to fulfill investors expectation.
The results of these studies through satisfactory on
the investors perception about the mutual fund and
the factors determining their investment decision and
preferences. The study will be useful to the mutual fund
industry to understand the investors perception towards
mutual fund investments and the study would also be
informative to the investors.
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