TABLE OF CONTENTS:

1. Mutual Fund a. Introduction b. Characteristics of MF c. About MF Industry d. Regulatory Structure of MF in India e. Concept & Role of MF f. Types of MF Schemes g. Major Mutual Funds in India h. 5 Easy steps to Invest in Mutual Fund i. 5 Pointers to Measure the Performance MF j. Tax rules for Mutual Fund Investors k. Advantages & Disadvantages of MF 2. Who can invest in MF in India 3. Comparison of Investment Products 4. 5 Common Mistakes of MF Investors 5. Data Interpretation of Investors 6. Products or Schemes offered by Standard Chartered AMC 7. comparison of top 10 open ended MFs on 5 parameters 8. Beta calculation of S C Premier & S C Classic Funds 9. Snap-shot comparison sheet 10. Suggestion on the basis of life stages 11.Risk factors in MF 12.Bibliography

INTRODUCTION

What is Mutual Fund ?

A mutual fund is a form of collective investment that pools money from many investors and invests their money in stocks, bonds, short-term money market instruments, other securities etc. In a mutual fund, the fund manager trades the fund's underlying securities, realizing capital gains or losses, and collects the the dividend or interest income. The investment proceeds are then passed along to the individual investors. A mutual fund is created when investor put their money together. It is therefore a pool of the investors funds. The term mutual means that investors contribute to the pool and also benefit from the pool. There are no other claimants to funds. The pool of funds help mutually by investors is the mutual fund. A mutual fund business is to invest the funds thus collected according to the wishes of the investors who created the pool the invested appoints professional investment mangers, to mange their funds.

IMPORTANT CHARACTERISTICS OF THE MUTUAL FUND

1. 2. 3. 4. A mutual fund actually belongs to the investors who have pooled their funds. The ownership of the mutual fund is in the hand of the investor A mutual fund is managed by investment professional and other service providers who earn a fee for their services from the fund The pool of funds is invested in a portfolio of marketable investments. The value of the portfolio is update every day. The investors share in the fund is denominated by UNIT. The value of the unit changes with changes in the portfolio value every day the value of the unit of investment is called as the Net Assets Value or NAV.

5.

The investment portfolio of the fund is created according to the stated investment objectives of the fund.

About Mutual Fund Industry

Mutual Funds are financial intermediaries which pool the savings of numerous individuals and invest the money, thus related in a diversified portfolio of securities, including equity, bonds debentures and other money market instruments, thus spreading and reducing risk. The objective of mutual fund is to maximize the return to the investor who participates in equity indirectly through mutual funds. Even though the mutual fund industry grown in asset value from Rs.7000 Crores to 2,00,000/- Crores today, this is just the tip of the iceberg. According to most Fund Managers, the real boom is yet to come. The sum of Rs.2,00,000/- Crores represents just 3% - 4% of the total market capitalization of 25,00,000 Crore. This compares poorly with the US, where the mutual funds have nearly $ 6.8 billion of market capitalization of roughly Rs.70000 Crore, barely 3% - 4% of total market capitalization. This is not expected, because mutual fund history in India, which dates back to 1964, when the first open-ended mutual fund scheme Unit-64 was launched by Unit Trust of India, is still dominated by it. The focus initially was income earning securities, with only 20 % of the Corpus going into equity. The early 80s saw other schemes like the growing income, fixed income, and monthly income being introduced by the UTI. But it was only in 1986 that the first pure Growth equity scheme Master share was launched. 1989-90 was another landmark year in the history of mutual funds. For the fist time, the monopoly of UTI over the industry was broken. The government allowed public sector banks and insurance companies to enter this sector to bring in some competition. But it was only in 1993, when the private sector was given the green signal to float mutual funds, that excitement and competition came. Not only did the Government allowed Indian companies to float mutual funds, it even allowed foreign funds to set in shop in India and float funds. Thus, in one stroke, this sector was truly privatized. Today there are about 12-14 private players in the market including foreign funds such as Morgan Stanley, besides the nine public sector players and UTI. Together, these funds have mobilized around Rs.6500 Crore from the market. The collections could have

been better, had not the public sector funds been busy complying with the SEBI guidelines pertaining to the formation of asset management companies etc. But the best is yet to come. A number of companies have plans to float mutual funds at various stages of implementation. Some of the major names which are likely to come to the market are Tata Sons in collaboration with Kleinwort Benson, ITC Classic with Thread needle UR, Oppenheimer of US, plus a host of others. And according to conservative guesstimates, mutual funds are set to collect over Rs.10000 Crore from the market this year. The reason for such confidence is that with SEBI firm about the small investor taking the mutual fund route to investments in the stock market, and the regulatory changes making it much more difficult to get allotments in primary markets, small investors will not be left with many opportunities.

Regulatory Structure of Mutual Fund in India

The structure of mutual fund in India is governed by SEBI (MUTUAL FUND) regulations 1996. These regulations make it mandatory for mutual funds to have a threetier structure of SPONSOR-TRUSTEE-ASSET MANAGEMENT COMPANY (AMC).

Concept and role of Mutual Fund

A Mutual Fund is common pool of money into which Investor place their contributions that are to be invested in accordance with a stated objective. The ownership of the Fund is thus joint or mutual; the fund belongings to all investors. A single investors ownership of the fund is in the same proportion as the amount of the contribution made by him or her bears to the total amount of the fund.

A Mutual fund uses the money collected from investors to buy those assets, which are specifically permitted by its stated investment objective. Thus, an Equity Fund would buy mainly Equity assets-ordinary shares, preference shares, warrants etc. A bond fund would mainly buy debt instruments such as debentures, bonds or government securities. It is these assets, which are owned by the investors in the same proportions as there contribution bears to the total contribution of all investors put together. When an investor subscribes to a mutual fund, he or she buys a part of these assets or the pool of funds that are outstanding at that time. Its no different from buying shares of a joint stock company, in which case the purchase makes the investor a part owner of the company and its assets. In fact, in the USA, a Mutual fund is constituted as an investment company and an investor buys into the fund, meaning he buys the shares of the fund. In India, a mutual fund is constituted as a Trust and the

investor subscribes to the units issued by the fund, which is where the term unit Trust comes from.

Types of Mutual Funds Schemes

Schemes floated by the various mutual funds are essentially of two types, namely openended and close-ended. The basic characteristics of these two types of mutual fund schemes are given below:

OPEN ENDED SCHEMES:

Open-ended schemes are available for subscription all the year round excluding the period of book-closing. They may or may not have a specified redemption period. The sale and repurchase prices are fixed by the mutual fund concerned from time to time. Repurchases are generally allowed al specified rated.

Each open-ended scheme must have a minimum corpus of Rs.50 crore. In case the fund manager is not able to raise this amount at the time of issue, or 60 % of the targeted amount whichever is higher, the entire subscription must be returned to the investor.

CLOSE-ENDED SCHEMES
These are open for subscription only during a specified period. Generally the redemption dates are also specified when the investor can redeem their units. The duration of this scheme varies: normally it is 5-7 years. Repurchase during the intervening period may or may not be allowed. Some of the schemes though have a repurchase facility after a certain period. Many of these schemes are listed in stock exchanges, except for some of the close-ended income schemes .

Equity Oriented Schemes : These schemes, also commonly called Growth Schemes, seek to invest a majority of their
funds in equities and a small portion in money market instruments. Such schemes have the potential to deliver superior returns over the long term. However, because they invest in equities, these schemes are exposed to fluctuations in value especially in the short term. Equity schemes are hence not suitable for investors seeking regular income or needing to use their investments in the short-term. They are ideal for investors who have a long-term investment horizon. The NAV prices of equity fund fluctuates with market value of the underlying stock which are influenced by external factors such as social, political as well as economic. HDFC Growth Fund, HDFC Tax saver and HDFC Index Fund are examples of equity schemes. Debt Based Schemes: These schemes, also commonly called Income Schemes, invest in debt securities such as corporate bonds, debentures and government securities. The prices of these schemes tend to be more stable compared with equity schemes and most of the returns to the investors are generated through dividends or steady capital appreciation. These schemes are ideal for conservative investors or those not in a position to take higher equity risks, such as retired individuals. However, as compared to the money market schemes they do have a higher price fluctuation risk and compared to a Gilt fund they have a higher credit risk. INCOME SCHEMES : These schemes provide returns in the form of dividends. The returns may be cumulative or non-cumulative on a monthly, quarterly, or yearly basis. Mutual Funds carry market risks and are prohibited by SEBI from declaring any guaranteed rate of returns. The money under such

schemes are predominantly invested in fixed income securities like debentures, bonds, Government securities etc.

Liquid Income Schemes: Similar to the Income scheme but with a shorter maturity than Income schemes. An example of this scheme is the HDFC Liquid Fund. Money Market Schemes: These schemes invest in short term instruments such as commercial paper (CP), certificates of deposit (CD), treasury bills (T-Bill) and overnight money (Call). The schemes are the least volatile of all the types of schemes because of their investments in money market instrument with short-term maturities. These schemes have become popular with institutional investors and high net worth individuals having short-term surplus funds.
Gilt Funds: This scheme primarily invests in Government Debt. Hence the investor

usually does not have to worry about credit risk since Government Debt is generally credit risk free. HDFC Gilt Fund is an example of such a scheme.

HYBRID SCHEMES : These schemes are commonly known as balanced schemes. These schemes invest
in both equities as well as debt. By investing in a mix of this nature, balanced schemes seek to attain the objective of income and moderate capital appreciation and are ideal for investors with a conservative, long-term orientation. HDFC Balanced Fund and HDFC Childrens Gift Fund are examples of hybrid schemes. Interval Schemes: These schemes combine the features of open-ended and closed-ended schemes. They may be traded on the stock exchange or may be open for sale or redemption during pre-determined intervals at NAV based prices. From the investments point of view the existing schemes can be further divided into 4 major categories :

1. GROWTH SCHEMES : These are usually close-ended schemes. The aim of such schemes is to provide capital appreciation to their investors and accordingly a substantial part of the Corpus is invested in equities an convertible debentures. Such schemes are usually listed in the major stock exchanges and the capital 2. appreciation is reflected in their market value i.e. NAV. They may or may not declare dividends even though the declaration of annual dividends represents the health of a scheme. 3. EQUITY-LINKED SCHEMES (ELSS) : These are popularly known as taxplanning schemes . They are essentially close-ended growth schemes in nature. They are floated by almost all the public sector mutual funds in the last quarter of each financial year, some of the essential characteristics are : a. Investment up to a ceiling of Rs.1,00,000/ come under Section 80C of the Income Tax Act. b. Repurchase is allowed after a specified period- usually 3 years. c. During the lock-in period of 3 years their units cannot be traded, pledged or transferred. VALUE-ADDED SCHEMES : they are in addition to the growth/income schemes. Some of the mutual funds schemes have provision for value addition. This is usually in the nature of personal insurance cover for accidents, etc. GIC Mutual Fund was the first to introduce this concept.

Major Mutual Fund Companies in India

1) ABN AMRO Mutual Fund 2) Birla Sun Life Mutual Fund 3) Bank of Baroda Mutual Fund 4) HDFC Mutual Fund 5) HSBC Mutual Fund 6) ING Vysya Mutual Fund 7) Prudential ICICI Mutual Fund
10

8) Sahara Mutual Fund 9) State Bank of India Mutual Fund 10) TATA Mutual Fund 11) Kotak Mahindra Mutual Fund 12) UTI Mutual Fund 13) Reliance Mutual Fund 14) Standard Chartered Mutual Fund 15) Franklin Templeton India Mutual Fund 16) Morgan Stanley Mutual Fund India 17) Escorts Mutual Fund 18 Alliance Capital Mutual Fund 19) Benchmark Mutual Fund 20) Canbank Mutual Fund 21) Chola Mutual Fund 22) LIC Mutual Fund 23) GIC Mutual Fund

5 Easy Steps to Invest in Mutual Funds

11

1) Search: Where to look for if we want to invest in MF

a) Contacting an Investment advisor in a bank or a brokerage house or an Independent Financial Advisor is the first step to gathering information. b) Mutual funds units can also be bought over the Internet. c) Mutual funds are much like any other product, in that there are manufacturers who provide the product and there are dealers who sell them.

2) Evaluation: Evaluation: choosing the right mutual fund for you

As an investor one may a) for the short term or long term want to invest b) want regular income or growth c) want to target lower risk or higher returns d) be convinced of a particular sector and want to invest in it

3) Purchase:
a) Systematic Investment Plan (SIP): Allows you to save a part of your income regularly. Also used to reduce risk when investing in schemes targeting aggressive growth. b) Systematic Withdrawal Plan (SWP): Allows you to withdraw a part of your investment regularly. Used when you want to withdraw your investment for a specific regular payment, like insurance premium payments of monthly/quarterly frequency. c) Automatic debit: Saves the hassle of writing a cheque when making an investment. Your account is debited automatically for the amount invested. d) Dividend Plan : A) Dividend Payout: Under this plan investor can redeem his/her dividend at specific times.

12

B) Dividend Reinvestment: Under this plan investors dividend is reinvested back to its principal amount which therefore increase the number of units investor is holding. e) Growth: Under this plan income generated from investment will put back to its invested amount which therefore increases the value of each unit customer is holding.

4) Post Purchase Monitoring:

Once you have invested in an ongoing fund, expect a period of two to three days before you receive an account statement on the address mentioned by you in your application form.

a) The Account Statement Your account statement indicates your current holding in the scheme that you have invested. b) The transaction slip: The transaction slip at the end of the account statement can be used for additional purchases, redemptions or to intimate the mutual fund on any change in bank mandates/address. c) NAV: The NAVs of all the open-ended schemes are published at the fund's website, financial newspapers and AMFI (Association of Mutual Funds) web-site www.amfiindia.com.

5) EXIT:
Every AMC advice that every investor should monitor the his/her units NAV periodically but AMC also recommend their unit holders to not get swayed by short term considerations in deciding their exit. Redemption: In case of open ended funds investor can redeem his/her invested amount. Most funds take 1-3 days to credit your account with your redemption proceeds.

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5 Pointers to Measure Mutual Fund Performance

MEASURES DESCRIPTION IDEAL RANGE

STANDARD DEVIATION

Standard Deviation allows to evaluate the volatility of the fund. The standard deviation of a fund measures this risk by measuring the degree to which the fund fluctuates in relation to its mean return. Beta is a fairly commonly used measure of risk. It basically indicates the level of volatility associated with the fund as compared to the benchmark. R- square measures the correlation of a funds movement to that of an index. R-squared describes the level of association between the fund's volatility and market risk. Alpha is the difference between the returns one would expect from a fund, given its beta, and the return it actually produces. It also measures the unsystematic risk .

Should be near to its mean return.

BETA

Beta > 1 = high risky Beta = 1 = Avg Beta <1 = Low Risky

R-SQUARE

R-squared values range between 0 and 1, where 0 represents no correlation and 1 represents full correlation.

ALPHA

Alpha is positive = returns of stock are better then market returns. Alpha is negative = returns of stock are worst then market. Alpha is zero = returns are same as market. The higher the Sharpe ratio, the better a funds returns relative to the amount of risk taken.

SHARPE RATIO

Sharpe Ratio= Fund return in excess of risk free return/ Standard deviation of Fund. Sharpe ratios are ideal for comparing funds that have a mixed asset classes.

Tax Rules For Mutual Fund Investors*

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As per the Finance Bill 2007

Equity schemes Other schemes Dividend income TDS All Schemes Dividend distribution tax

Short Term Capita l Gains

Long Term Capital Gain

Short Term Capital Gains

Long Term Capita l Gain

Equity Schem es

Liquid Schemes

Other Schemes

Resident Individual / HUF

10%

NIL

AS PER SLAB

10% (20% with indexa tion)

NIL

TAX FREE

NIL

28.32% (25% +10%surc harge+edu cation cess) 28.32% (25% +10%surc harge+edu cation cess) 28.32% (25% +10%surc harge+edu cation cess) 28.32% (25% +10%surc harge+edu cation cess) 28.32% (25% +10%surc harge+edu cation cess)

14.16% (12.5% +10%surc harge+3% education cess) 22.66% (20% +10% surcharge +3% education cess) 22.66% (20% +10% surcharge +3% education cess) 22.66% (20% +10% surcharge +3% education cess) 14.16% (12.5% +10%surc harge+3% education cess)

Partnership Firms

10%

NIL

30%

10% (20% with indexa tion)

NIL

TAX FREE

NIL

AOP/BOI

10%

NIL

AS PER SLAB

10% (20% with indexa tion)

NIL

TAX FREE

NIL

Domestic Companies

10%

NIL

30%

10% (20% with indexa tion)

NIL

TAX FREE

NIL

NRIs

10%

NIL

AS PER SLAB

10% (20% with indexa tion)

STCG30%LTC G20%After providing for indexat

TAX FREE

NIL

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ADVANTAGES OF MUTUAL FUNDS:

POINTS:
Portfolio Diversification Mutual Funds normally invest in a well-diversified

portfolio or securities where the investor can hold a diversified investment portfolio even with a small amount of investment.
Professional Management The investors does not have the skills and the

resources of their own to succeed in todays fast moving, global and sophisticated markets. Thereby they benefits from the professional management skills brought in by the fund in the management of investors portfolio. Diversification of Risk- Since the investor acquires a diversified portfolio, it reduces a risk of loss as compared to investing directly in one or two shares or debentures or other instruments. While investing in a pool of funds with other investors any loss, on one or two securities is also shared with other investors. This risk reduction is one

of the most important benefits of a collective investment vehicle like the mutual fund.
Reduction of Transaction Costs When going through a fund the investor has the

benefit of economies of scale, funds pay lesser cost because of larger volumes, and this benefit is passed onto its investors.
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 Liquidity- Investment in a mutual fund is more liquid as an investor can liquidate

the investment, by selling the unit to the fund if open-end, or selling them in a market if the fund is close-end and collect funds at the end of the period specified by the mutual fund or the stock market.
Convenience and Flexibility Mutual Fund management companies offer many

investor services where in the investor can easily transfer their holdings from one scheme to the other, get updated market information, and so on.

DISADVANTAGES OF MUTUAL FUNDS:

No Control over cost An investor in Mutual Funds has no control over the

overall cost investing as he pays investment management fees as long as he remains with the fund. He also pays fund distribution costs, which he would not incur in direct investing.
No Tailor-made Portfolios Investors who invest on their own can build their

own portfolios whereas investing through funds involves delegating this decision to the fund managers.
Managing portfolio of fund- Availability of the large number of funds can

actually mean too much choice for the investor wherein he needs an advice on selecting a fund to achieve his objectives, to suit the situation when he selects individual shares or bonds to invest in.

Who Can Invest In Mutual Funds In India?

Mutual funds in India are open to investment by: a) Residents including 1) Resident Indian Individuals 2) Indian Companies 3) Indian Trusts/Charitable Institutions 4) Banks 5) Non-Banking Finance Companies 6) Insurance Companies 7) Provident Funds b) Non Residents including 1) Non-Resident Indians, and
17

2) Overseas Corporate Bodies (OCBs) and c) Foreign entities, viz; 1) Foreign Institutional Investors (FIIs) registered with SEBI. Foreign citizens/ entities are however not allowed to invest in Mutual funds in India.

Comparison of Investment products:

Investor tends to constantly compare one form of investment with another Investors certainly look for the best returns for different option. However, to determine which option is better, the comparison should be made in terms of other benefits that the investor ought to look for in any investment.
Investment Objective Equity FI Bonds Corporate Debentures Corporate FDs Bank Deposits PPF Life Insurance Gold Real Estate Mutual Funds Capital appreciation Income Income Income Income Income Risk cover Inflation hedge Inflation hedge Capital growth & Income Returns High Moderate Moderate Moderate Low Moderate Low Moderate High High Risk Tolerance High Low High High Generally low Low Low Low Low High Investment Horizon Long term Med-long Med Med Flexible Long term Long term Long term Long term Flexible Liquidity High Moderate Low Low High Moderate Low Moderate Low High

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THE FIVE MOST COMMON MISTAKES MUTUAL FUND INVESTORS MAKE

Failing to stay invested for a longer period Worrying about portfolio turnover or dividends it pays Being affected by new in the market when youre supposed to be investing for the long term Selling out during bad markets Being impatient and losing confidence too soon.

INVESTORS THINK LONG TERM BUT ACT SHORT TERM..

Time in the market is more important than timing the market

Data Interpretation of Investors:

From the given analysis we see that 75% of the investors do not deal in Mutual funds but they still believe in the traditional mode of investment, which means there still exists a high degree of Mutual Fund un-awareness among the people. Therefore focus should be on Investors education. There is a great diversity in the pattern of investment , majority of people who are mostly the business class people invest for long term as they look for the high returns and long term capital appreciation. These people have great capacity to take risk they are called as Risk Takers , while rest invest for short term which mostly

19

comprise of service class people who go for regular/Monthly income plans i.e. short term benefits. Customers who are aware of the market situations perfectly find it futile to invest through bank and generally had brokers who refund part of the commission to them.

STANDARD CHARTERD EQUITY FUNDS LOAD STRUCTURE

FUND NAME

LUM SUM MIN. AMNT Rs.5000.00

LOADS

SIP MIN. AMNT

SIP LOAD STRUCTURE

SC CLASSIC EQUITY FUND FLEXI CAP SC IMPERIAL EQUITY FUND LARGE CAP SC PREMIER EQUITY FUND GROWTH FUND

Entry Load2.25% Exit Load-NIL Entry Load2.25% Exit Load-1% For 1 year Entry Load2.25% Exit Load-1% For 1 year

Rs. 1000.00 Entry load-NIL Min:6 mnths Exit Load- 1% For 1 year Rs. 1000.00 Entry load-NIL Min:6 mnths Exit Load- 1% For 1 year Rs. 2000.00 Entry loadMin:6 mnths 2.25% Exit Load- 1% For 1 year

Rs.5000.00

Rs.25000.00

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PRODUCTS/SCHEMS OFFERED BY STAN-C (AMC):

1) Grindlays Super Saver Income Fund- Short Term Plan(GSSIF-ST) 2) Grindlays Super Saver Income Fund- Medium Term Plan(GSSIF-MT) 3) Grindlays Cash Fund (GCF) 4) Grindlays Government Securities Fund- Investment Plan(GGSF-IP) 5) Grindlays Government Securities Fund- Short Term Plan(GGSF-ST) 6) Grindlays Government Securities Fund- PF Plan(GGSF-PF) 7) Grindlays Dynamic Bond Fund(GDBF) 8) Grindlays Floating Rate Fund-Short Term Plan (GFRF-ST) 9) Grindlays Floating Rate Fund- Long Term Plan(GFRF-LT) 10) Standard Chartered All Seasons Bond Fund(SCASBF) 11) Standard Chartered Classic Equity Fund(SCCEF) 12) Standard Chartered Premier Equity Fund(SCPEF) 13) Standard Chartered Imperial Equity Fund(SCIEF) 14) Standard Chartered Enterprise Euity Fund(SCEEF) 15) Standard Chartered Arbitrage Fund(SCAF) 16) Standard Chartered Liquidity Manager(SCLM) 17) Standard Chartered Liquidity Manager Plus(SCLMP)

21

SWOT ANALYSIS OF STANDARD CHARTERED VIZ-A-VIZ OTHER FUND HOUSES Strengths:

Brand image. Image of an Ethical player. Brand Reach Prompt service provider. Good relationship with distributors Efficient Sales Staff Fair understanding of market and competition.

Weakness:
Inability to fully cover the outstation market Lack of manpower. Overshadowing of Home Loans.

Opportunity:
Unexplored/ outstation market. Target export segment aggressively

Threats: Substitute products like

bank FDs, RDs etc. New entrants

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RISK FACTORS
Mutual Funds and Securities investment are subject to market risks and there can be assurance or guarantee that the scheme objectives will be achieved. As with any investment in securities, the Net Asset Value of Unit issued under the Scheme may go up or down depending on the various factors and farces affecting the capital markets. Past performance of the Sponsors and their affiliates / AMC / Mutual Fund and its scheme do not indicate the future performance of the schemes of the Mutual Fund. The Sponsors are not responsible or liable for any loss or shortfall resulting from the operations of the scheme beyond the contribution of Rs 1 lakh each made by them towards the corpus of the Mutual Fund. As per SEBI circular ref. SEBI/IMD/CIR No. 10/22701/03 dated December 12, 2003 read with circular ref SEBI/IMD/CIR NO. 1/42529/05 dared June 14, 2005, it is specified inter alias that each portfolio under a scheme should have a minimum of 20 investors and no single investor should account for more than 25% of the corpus of such portfolio.

23

INVESTMENT COMPARISON SHEET

FUND NAME EXP. RATIO % 2. 24 FRONT END LOAD% 2. 25 BCK END LOAD% 0 MIN INITIAL INVESTMENT (Rs) 5000 PORTFOLIO MANAGER PRATEEK MANAGER K N SIVA SUBRAMANIAM PRASHANT JAIN PRASHANT JAIN DEVEN SANGOI TENURE(YRS)

ABN AMRO OPPORTUNITIES FRANKLIN INDIA PRIMA HDFC PRUDENCE

1. 91

2. 25

5000

14

1. 89

2. 25

5000

13

HDFC TOP 200

1. 93

2. 25

5000

ICICI PRU SERVICE INDUSTRY RELIANCE GROWTH S C CLASSIC EQUITY S C PREMIER EQUITY SUNDARAM BNP PARIBAS SELECT MIDCAP TATA EQUITY OPPORTUNITIES

2. 26

2. 25

5000

1. 84

2. 25

5000

SUNIL SINGHANIA AJAY BODKE

2. 24

2. 25

5000

2. 38

2. 25

25000

KENNETH ANDRADE N PRASAD

1. 98

2. 25

5000

NA

2. 26

2. 25

5000

M VENUGOPAL

24

INVESTMENT GRAPH

INVESTMENT COMPARISON
EXPENSE RATIO & LOAD 3 2.5 2 1.5 1 0.5 0 HDFC Top 200 ICICI Pru Service Franklin India Prima HDFC Prudence Reliance Growth ABN AMRO opportunities S C Premier Equity S C Classic Equity Sundaram BNP Paribas TATA Equity Opportunities

Expense Ratio % Front End Load %

TOP 10 FUNDS

DESCRIPTON:
1) High expense ratio means it will affect the returns negatively. 2) Long Tenure means Fund is more trusted.

STATEMENT:
On the basis of above description we can state that STANDARD CHARTERED PREMIER EQUITY FUND has high expense ratio (2.38) and small tenure.While FRANKLIN INDIA PRIMA and HDFC PRUDENCE has low expense ratio and long tenure.

25

PORTFOLIO COMPARISON SHEET

FUND NAME

P/E RATIO 41.48

MARKET CAP(Rs. Cr) 8522. 42

TURNOVER

ASSETS(Rs.Cr)

TOP 5 HOLDINGS (%) 24. 81

ABN AMRO OPPORTUNITIES FRANKLIN INDIA PRIMA HDFC PRUDENCE

NA

352. 5

28. 29

2612. 97

155. 02

1596. 14

27. 62

31. 94

4779. 55

158. 68

2522. 49

22. 98

HDFC TOP 200

31. 22

26766. 24

80. 86

1971. 01

25. 72

ICICI PRU SERVICE INDUSTRY RELIANCE GROWTH S C CLASSIC EQUITY S C PREMIER EQUITY SUNDARAM BNP PARIBAS SELECT MIDCAP TATA EQUITY OPPORTUNITIES

35.09

4742. 92

NA

615. 51

18. 99

29.78

5360. 18

61.75

3923. 9

18. 95

31. 24

20811. 72

NA

365. 1

27. 63

43. 53

1821. 59

NA

254. 27

23. 08

36. 99

2363. 59

5.11

2151. 51

13. 54

34. 34

6207. 35

2.24

465. 04

21. 89

26

MARKET CAP & ASSETS

P/E RATIO 50 40 30 20 10 0 ABN AMRO opportunities Franklin India Prima HDFC Prudence HDFC Top 200 ICICI Pru Service Reliance Growth S C Classic Equity S C Premier Equity Sundaram BNP Paribas TATA Equity Opportunities P/E Ratio

30000 25000 20000 15000 10000 5000 0

ABN AMRO

Franklin India

HDFC

HDFC Top

ICICI Pru

PORTFLIOCOMPARISON

P OR TFOLIO C OMPAR ISON

PORTFOLIO (P/E RATIO) COMPARISON GRAPH

PORTFOLIO (MARKET CAP/ASSETS) COMPARISON GRAPH

TOP 10 FUNDS
TOP 10 FUNDS

Reliance

S C Classic

S C Premier

Sundaram

TATA Equity Assets (Rs. Cr) M arket Cap(Rs. Cr)

27

DESCRIPTON:
1) High P/E ratio means Fund is very actively manage. 2) Large Market Capitalization reveals Organizations strong position in the market as well as Organizations long term growth. 3) Large Assets reveals Organizations strong financial position and Shareholders Security.

STATEMENT:
On the basis of above mentioned description we can state that STATNDARD CHARTERED PREMIER EQUITY FUND has highest P/E ratio but small Market Cap and Assets.While HDFC PRUDENCE has high P/E ratio, moderate Market Cap and largest Assets whereas ABN AMRO OPPORTUNITIES has high P/E ratio, largest Market Cap and low Assets.

28

PERFORMANCE COMPARISON SHEET

FUND NAME

1-MNTH RETURN(%) 16. 56

1-MNTH RANK 10/176

6-MNTH RETURN(%) 23. 47

6-MNTH RANK 4/164

1-YEAR RETURN(%) 70. 58

1-YEAR RANK 4/161

ABN AMRO OPPORTUNITIES FRANKLIN INDIA PRIMA HDFC PRUDENCE

12. 19

52/176

8. 31

132/162

46. 68

76/161

7. 23

18/176

10. 53

14/32

42. 78

3/161

HDFC TOP 200

8. 46

150/176

11. 24

103/164

43. 16

95/161

ICICI PRU SERVICE INDUSTRY RELIANCE GROWTH S C CLASSIC EQUITY S C PREMIER EQUITY SUNDARAM BNP PARIBAS SELECT MIDCAP TATA EQUITY OPPORTUNITIES

9. 29

130/176

14. 91

51/164

81. 64

3/161

12. 63

43/176

18. 19

24/164

60. 82

21/161

12. 1

59/176

14. 21

58/164

44. 87

84/161

15. 1

18/176

31. 55

2/164

83. 87

2/161

11. 79

64/176

9.17

124/164

38. 84

117/161

11. 57

68/176

16. 56

35/164

51. 59

52/161

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PERFORMANCE (RETURNS) COMPARISON GRAPH

P E R F O R M AN C E C O M P AR IS O N
90 80 70 60 50 40 30 20 10 0 1-M onth R eturn(% ) 6-M onth Return(% ) 1-Y ear Return(% )

A B N A M R O opportunities F rank lin India P rim a H D F C P rudenc e H D F C Top 200 ICIC I P ru S ervic e Indus try R elianc e G row th S C Clas s ic E quity S C P rem ier E quity

RETURNS

T IM E P ER IO D(IN M O N T H S /YEA R )

DESCRIPTION:

1) High returns shows Organizations high competitiveness & performance 2) High rank shows its strong position among its competitors

S undaram B N P P aribas S elec t M idc ap

30

STATEMENT:
On the basis of returns : RETURNS
1-MONTH HIGH

ORGANIZATION
ABN AMRO OPPORTUNITIES

6-MONTH HIGH

STANDARD CHARTERED PREMIER EQUITY STANDARD CHARTERED PREMIER EQUITY

1- YEAR HIGH

STANDARD CHARTERED PREMIER EQUITY has both 6 months and 1-year high returns. While ABN AMRO OPPORTUNITIES has a 1-month high returns.

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RISK & VOLATILITY COMPARISON SHEET

FUND NAME

FUND RISK GRADE NOT RATED

STANDARD DEVIATION NA

SHARPE RATIO NA

BETA

ALPHA

R-SQUARE

ABN AMRO OPPORTUNITIES FRANKLIN INDIA PRIMA HDFC PRUDENCE

NA

NA

NA

ABOVE AVG LOW

6. 22

0. 5

O. 76

1. 03

0. 48

3. 68

O. 76

0. 86

1. 47

0. 63

HDFC TOP 200

LOW

5. 39

0. 59

0. 91

0. 67

0. 92

ICICI PRU SERVICE INDUSTRY RELIANCE GROWTH S C CLASSIC EQUITY S C PREMIER EQUITY SUNDARAM BNP PARIBAS SELECT MIDCAP TATA EQUITY OPPORTUNITIES

NOT RATED

NA

NA

NA

NA

NA

AVG

6. 28

0.64

0. 83

1.73

0. 57

NOT RATED

NA

NA

0.92

3.40

NA

NOT RATED

NA

NA

0.82

5.63

NA

LOW

5.7

0. 72

0. 69

2.18

0. 48

ABOVE AVG

6.27

0. 54

0. 97

0. 73

0. 78

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STATEMENT:
Because of Non-Availability of figures for some Funds we cannot give any comment under this parameter. However on the basis of available data we can conclude that FRANKLIN INDIA PRIMA & TATA EQUITY OPPORTUNITIES are little risky funds.

NAV COMPARISON SHEET

FUND NAME NAV AS ON 52 WEEKS HIGH 26. 51 AS ON 52 WEEKS LOW AS ON

ABN AMRO OPPORTUNITIES FRANKLIN INDIA PRIMA HDFC PRUDENCE

26. 51

JULY 13, 07

JULY 13, 07

14. 06

19-jul-06

236. 04

JULY 13, 07

236. 04

JULY 13, 07

149. 47

24-jul-06

128. 14

JULY 13, 07

128. 14

JULY 13, 07

85. 88

19-jul-06

HDFC TOP 200

124. 89

JULY 13, 07

124. 89

JULY 13, 07

81. 59

19-jul-06

ICICI PRU SERVICE INDUSTRY RELIANCE GROWTH S C CLASSIC EQUITY S C PREMIER EQUITY SUNDARAM BNP PARIBAS SELECT MIDCAP TATA EQUITY OPPORTUNITIES

18. 11

JULY 13, 07

18. 11

JULY 13, 07

9. 38

19-jul-06

324. 04

JULY 13, 07

324. 04

JULY 13, 07

183. 75

24-jul-06

18. 17

JULY 13, 07

18. 17

JULY 13, 07

11. 51

21-jul-06

17. 72

JULY 13, 07

17. 72

JULY 13, 07

9. 06

24-jul-06

103. 32

JULY 13, 07

103. 32

JULY 13, 07

68. 98

24-jul-06

69. 55

JULY 13, 07

69. 55

JULY 13, 07

41. 86

24-jul-06

NAV ( 52 WEEKS H/L) COMPARISON GRAPH

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NAV COMPARISON
NAV(52 WEEKS H/L) 350 300 250 200 150 100 50 0 Franklin India Prima HDFC Top 200 ICICI Pru Service ABN AMRO opportunities S C Premier Equity HDFC Prudence Reliance Growth S C Classic Equity Sundaram BNP Paribas TATA Equity Opportunities

52 Weeks High 52 Weeks Low

TOP 10 FUNDS

DESCRIPTION:
NAV: Net Asset Value shows the per unit value of a mutual fund unit that an investor is holding. High/Low NAV shows that by how much amount the invested amount is appreciated or depreciated.

STATEMENT:
On the basis of above description we can state that RELIANCE GROWTH has the highest all time high (52 weeks high) NAV 324.04 While STANDARDCHARTERED PREMIER EQUITY has the all time low (52 weeks low) NAV 9.06

A) CO-VARIANCE = 1) (Ra-Ra (bar))*(Rj-Rj(bar))/n-1 = 3.863 2) (Rm-Rm (bar)*(Rj-Rj(bar))/n-1 = 4.347

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B) VARIANCE (2 ) = (Rj-Rj (bar)2 ) = n-1 C) BETA () = COVARIANCE VARIANCE 1) STANDARD CHARTERED PREMIER EQUITY FUND () = 0.821 2) STANDARD CHARTERED CLASSIC EQUITY FUND () = 0.924 D) ALPHA () = 1) STANDARD CHARTERED PREMIER EQUITY FUND Ra (bar) * Rj (bar) = 5.639 2) STANDARD CHARTERED CLASSIC EQUITY FUND Rm (bar) * Rj (bar) = 3.400 E) STANDARD DEVIATION () = () = SQUARE ROOT OF VARIANCE = 2.168 = 4.703

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STATEMENT:
On the basis of above table we can state that S C Premier Equity & S C Classic Equity
FUND NAME S C PREMIER EQUITY FUND S C CLASSIC EQUITY FUND BENCHMARK BSE-200 4.703 VARIANCE CO-VARIANCE 3.863 4.347 2.168 STANDARD DEVIATION BETA 0.821 0.924 ALPHA 5.639 3.400

fund are less risky in comparison to their benchmark index BSE-200 as their Beta values are less then 1 as well as they also have better returns then benchmark index as their Alpha values are positive.

SNAP-SHOT(ALL 5 PARAMETERS) COMPARISON SHEET

1) HT-highest on parameter, 2) H-high on parameter, 3) A-avg on parameter 4) L-low on parameter , 5) LT- lowest on parameter, 6) NR-not rated 7)*-better then others, 8) #-worst then others, 9) $-best on the parameter

36

PARAMETERS ABN FR.IND HDFC HDFC ICICI REL. S C AMRO PRIMA PRU. TOP SERV. GRW. CLASS. OPP. 200 EQU.

SC SND. TATA. REMARKS PRE. MID EQU. EQU. CAP. OPP.

INVESTMENT (EXP.RATIO)

LT

HT

*(FR,HDFC, REL) #(S C PRE)

PORTFOLIO (P/E RATIO)

LT

HT

$(S C PRE) *(ABN,ICICI SND,TATA) #(FR.IND)

PRFMNCE (1-yr. RETURNS)

HT

LT

$(S C PRE) *(ABN,ICICI) #(SND BNP)

RISK & VOLATILITY (RISK GRADE)

NR

NR

*(ALL LOW RISK GRADE FUNDS)

NET ASSET VALUE (52-WEEKS HG)

HT

$(RELGRW) *(FR.IND)

37

GENERAL CATEGORY COMPARISON SHEET

FUND NAME ABN AMRO OPP. FRANKIN INDIA HDFC PRUDENCE HDFC TOP 100 ICICI PRU.SERV RELIANCE GROWTH S C CLASSIC S C PREMIER SND BNP SELECT MID CAP TATA EQUI. OPP.

LAUNCH DATE MAR-05 NOV-93 JAN-94 SEP-96 NOV-05 OCT-95 JUL-05 SEP-05 JUL-02 MAR-03

CATEGORY Equity: Diversified Equity: Diversified Hybrid:Equity: Oriented Equity: Diversified Equity: Diversified Equity: Diversified Equity: Diversified Equity: Diversified Equity: Diversified Equity: Diversified

RATING NOT RATED

NOT RATED

NOT RATED NOT RATED

SUGGESTION ON THE BASIS OF LIFE STAGES.

In a general perspective there are 3 basic motives behind holding the cash : 1) Speculative 2) Precautionary 3) Transactional

38

After the intense market survey on mutual fund investment is done we have bifurcated people in 2 segments. We have done bifurcation mainly on the basis of life stages. After survey we found that people at the age range of 25 years to 40 years who come under the income bracket of Rs. 15000 to Rs. 30000 per month have more risk appetite and they can easily take huge risk because of their speculative behavior then to the people who are at the age range of 55 years and above and come under the same income bracket (however people on this edge of their life cycle are mostly depend either on their family members or on pension or on their lifetime savings or investments for e.g Life Insurance, Post Office savings, Bank savings account, house rent, FDs etc.) have less risk appetite . They dont want to take high risk on their hard earned money and are happy with investments if it is giving conservative returns but secure their principal amount. Also people at the age of 55 and above are in great need of cash in hand because at this age most of them are done with their investments. Therefore they are more interested in investments which can get them sufficient cash at regular intervals. In general people at the age range of 25 years to 35 years are very speculative, and because they are earning regular income so they dont need to hold much cash in need, they can also afford their daily expenses very easily. Therefore they are more interested in investments which are little more risky but can get them handsome returns. As people at this age have huge future needs for e.g having their own home and so they also more interested in long term investments. Hence on the basis of this survey and analysis we have done above we recommend following funds to these 2 segments of investors.

SUGGESTED FUNDS FOR BOTH SEGMENTS OF INVESTORS

INVESTORS ABN FR.INDIA HDFC HDFC AMRO PRIMA PRU. TOP OPP. 200 ICICI REL PRU. GRW. SERV. SC SC CLAS. PRE. EQU EQU. SND. BNP. SELECT MID CAP TATA EQU. OPP.

BETWEEN 25y. TO 35y

39

55y & ABOVE

RISK FACTORS

Mutual Funds and Securities investment are subject to market risks and there can be assurance or guarantee that the scheme objectives will be achieved. As with any investment in securities, the Net Asset Value of Unit issued under the Scheme may go up or down depending on the various factors and farces affecting the capital markets. Past performance of the Sponsors and their affiliates / AMC / Mutual Fund and its scheme do not indicate the future performance of the schemes of the Mutual Fund. The Sponsors are not responsible or liable for any loss or shortfall resulting from the operations of the scheme beyond the contribution of Rs 1 lakh each made by them towards the corpus of the Mutual Fund.

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BIBLIOGRAPHY 1. Fact and Figures collected by STANDARD CHARTERED (AMC). 2. Pamphlets collected from STANDARD CHARTERED (AMC).
3. WWW.VALUERESEARCHONLINE.COM

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