Project on mutual fund

AnOrganisational Study

atReliance Mutual Fund

Submitted in the partial fulfillment of the requirement for the Degree of

Master of Business AdministrationOf

Bangalore University

Submitted byAdalat Das MahantReg no.:11RSCMA003

Under the guidance of

Prof. Reji M.

Garden City CollegeBangalore-560049

DECLARATION

I, Adalat Das Mahant hereby declare that Industrial Training Report titled “An

Organisational Study at Reliance industry ltd. Mutual Fund, Banglore” submitted

in the partial fulfillment of the requirement for the Degree of Master of Business

Administration is my original work and is not submitted for the award of any Degree,

Diploma, Fellowship or other similar title or awards.

Place: Bangalore Adalat Das Mahant

Date: Reg no: 11RSCMA003

ACKNOWLEDGEMENT

Anytime we deny the acknowledgement of God we are undermining the entire basis for which our world

exists. Indeed, the acknowledgement of God is not synonymous with religion. I thank the Almighty

God for blessing me with this life full of opportunities to make this world a better place for each one of

us.

I express my heartfelt thanks to Dr. Joseph V.G., Chairman, Garden City Group of Institutions,

Bangalore for providing me an opportunity for carrying out this study.

My special thanks to Prof. N. Bharathi, Principal, Garden City College, Bangalore, who had been a

constant support throughout the completion of the study.

My special words of gratitude to Dr. K.V. Subramanian, Director, Department of MBA, who had been

a mentor and had supported me by his vast knowledge, experience and wisdom.

I take the opportunity to thank Mr. Shayan Pal, Head of the Department, MBA, who has motivated us

to achieve new heights and work creatively.

I would also like to thank my guide Mr. Reji M., who have immensely guided, supported and helped me

in the process of completion of my Organizational Study through his constant encouragement and

suggestions.

My sincere and humble thanks to all my faculty members, my beloved parents, my dear friends and

each and everyone who have been never ending source of knowledge, inspiration and support to me.

Signature of the StudentAdalat Das Mahant

(11RSCMA003)

Executive summary

The project deals with understanding of mutual fund and analysis, during my project, I got the

opportunity to understand the concept, various AMC (Asset mgmt company) issuing various mutual

fund according to the need of investor. During my project, I came to know important regulations of SEBI

for mutual fund operation.

Project deals with an analysis of RELIANCE MUTUAL FUND various schemes in which I tried

to came out with a result which is best, for that purpose I conducted market research. During the project

I

suggested the investors how to invest and in which fund they should invest.

During the project, I made an endeavour to understand the awareness of mutual fund among

the various classes of investors. The data collected mainly through fact sheets of funds, broachers, and

questionnaire and also from various site of Reliance mutual fund etc. the data analyzed and

recommendation is given on the basis of conclusions.

INDUSTRY PROFILE

A mutual represents a vehicle for collective investment. Till 1986, the Unit Trust of India was

the only mutual fund in India. Since then public sector banks and insurance companies have been

allowed to set up subsidiaries to undertake mutual fund business. So, State Bank of India, Canara

Bank, LIC, GIC, and few other public sector banks entered the mutual fund industry.

In 1992, the mutual fund industry was opened to the private sector, and a number of private

sector mutual fund such as Birla Mutual Fund, DSP Merrill Lynch Mutual Fund, Kotak Mahindra

Mutual Fund, Morgan Stanley Mutual Fund, Tata Mutual Fund, Prudential ICICI Mutual Fund,

Reliance Mutual Fund, Standard Chartered Mutual Fund, Templeton Mutual Fund, IDBI- Principal

Mutual Fund have been set up. The process of consolidation began in recent years.

At present, there are about 30 mutual funds managing nearly 1000 schemes. While the

mutual fund industry in India has registered a healthy growth over the last 15 years, it is still very small

in relation to other intermediaries like banks and insurance companies. Mutual funds are one of the

best investments ever created because they are very cost efficient and very easy to invest in. by

pooling money together in a mutual fund, investors can purchase stocks or bonds with much lower

trading costs than if they tried to do it on their own. But the biggest advantage to mutual funds is

diversification.

ORIGIN OF MUTUAL FUNDS

A review of the history of investment trusts, unit trusts and mutual funds indicates that the earliest

investment trust called ‘Societe General de Belgique’ was formed in Belgium in 1822. The institution

was formed by the Royal family of Holland before the separation of Belgium and Holland. The

institution acquired securities in a wide range of companies and practiced the precept of

diversification. Later, the investment trust concept attracted many countries in Europe and

considerable progress was achieved.

The concept of investment trust gained momentum in Great Britain and the first investment trust

called ‘The Foreign and Colonial Government Trust’ was founded in London in 1868. Later in 1873,

Robert Fleming at Dundee established the Scottish American Trust. During the period 1925-29, just

before the depression, substantial expansion of investment trust moment happened in US. The

banking houses promoted investment trusts to unload the un-saleable securities and to control the

companies without investing substantial amounts of their own money. Since there were very little

rules and regulations, mismanagement in these institutions was wide spread. During the great

depression on 1930s the investors had staggering losses from these trusts.

In 1933, the US Congress directed the Securities and Exchange Commission (SEC) to investigate

the operations of the American Investment Trusts. The SEC recommended the passage PF

legislation, which materialized in 1940. The Investment Companies Act of 1940 provides rules and

regulation for the establishment and management of Mutual Funds. The concept of mutual fund is

popular in the US, and they are regulated by the Investment Companies Act 1940. The act

categorizes investment companies broadly into Unit Investment Trusts and Managed Investment

Companies. Internationally, Mutual funds in the US are synonymous with unit trusts in the UK.

ORGANIZATIONAL HIERARCHY

BRANCH ORGANIZATIONAL HIERARCHY

SDM

Marketing Manager

HR Dept.

AO

AAO

HGS

Assistance

Record clerk

Sub Staffs

Finance Dept.

AO

AAO

HGS

Assistance

Record clerk

Sub Staffs

Sales Dept.

AO

AAO

HGS

Assistance

Record clerk

Sub Staffs

IT Dept.

AO

AAO

HGS

Assistance

Record clerk

Sub Staffs

Claim Dept.

AO

AAO

HGS

Assistance

Record clerk

Sub Staffs

FUNCTIONAL AREAS OF THE RELIANCE INDUSTRY LTD. MUTUAL FUND

BANGLORE

HUMAN RESOURCE MANAGEMENT

FINANCING DEPARTMENT

SALES DEPARTMENT

INFORMATION TECHNOLOGY

CLAIM DEPARTMENT

HUMAN RESOURCE DEVELOPMENT

Human Resource Development (HRD) is the frameworks for helping employees develop their personal and organizational skills, knowledge, and abilities. Human Resource Development includes such opportunities as employee training, employee career development, performance management

and development, coaching, mentoring, succession planning, key employee identification, tuition assistance, and organization development.

The focus of all aspects of Human Resource Development is on developing the most superior workforce so that the organization and individual employees can accomplish their work goals in service to customers.

Organizations have many opportunities for human resources or employee development, both within and outside of the workplace.Human Resource Development can be formal such as in classroom training, a college course, or an organizational planned change effort. Or, Human Resource Development can be informal as in employee coaching by a manager. Healthy organizations believe in Human Resource Development and cover all of these bases.The field of HRD or Human Resource Development encompasses several aspects of enabling and empowering human resources in organization. Whereas earlier HRD was denoted as managing people in organizations with emphasis on payroll, training and other functions that were designed to keep employees happy, the current line of management thought focuses on empowering and enabling them to become employees capable of fulfilling their aspirations and actualizing their potential. This shift in the way human resources are treated has come about due to the prevailing notion that human resources are sources of competitive advantage and not merely employees fulfilling their job responsibilities. The point here is that the current paradigm in HRD treats employees as value creators and assets based on the RBV or the Resource Based View of the firm that has emerged in the SHRM (Strategic Human Resource Management) field.

The field of HRD spans several functions across the organization starting with employee recruitment and training, appraisals and payroll and extending to the recreational and motivational aspects of employee development.

Indeed, one reason for the emergence of the RBV or the SHRM paradigm is that with the advent of the service sector and the greater proportion of companies in the service sector, employees are not merely a factor of production like land, labour and capital but in fact, they are sources of competitive advantage. This is characterized by many CEO’s calling employees their chief assets and valuing their contribution accordingly. As a matter of fact, many IT and Financial Services companies routinely refer to employees as the value creators and value enhancers rather than just resources doing their job.

What this has meant is that the field of HRD has become prominent and important for organizations and has morphed into a function that takes its place among other support functions in organizations and indeed, it is the main driver of competitive advantage. Further, the field of HRD now has taken on a role that goes beyond employee satisfaction and instead, the focus now is on ensuring that employees are delighted with the working conditions and perform their jobs according to their latent potential which is brought to the fore. This has resulted in the HRD manager and the employees of the HRD department becoming partners in the organization’s progress instead of just yet another line function. Further, the HR managers now routinely interact with the functional managers and the people managers to ensure high levels of job satisfaction and

fulfilment. The category of people managers is a role that has been created in many multinational companies like Fidelity and IBM to specifically look into the personality related aspects of employees and to ensure that they bring the best to the table.

Finally, HRD is no longer just about payroll or timekeeping and leave tracking. On the other hand, directors of HRD in companies like Infosys are much sought after for their inputs into the whole range of activities spanning the function and they are expected to add value rather than just consume resources. With this introduction, we will be moving into the module covering HRD with each aspect of the HRD function and the associated topics being covered here. It is hoped that the readers would gain an overall perspective about HRD after going through the HRD module.

This module covers the HRD function in organizations from a wide variety of perspectives. At the outset, after the introduction to the module in the previous article, it is time to look at some theoretical perspectives about the HRD function. When the field of management science and organizational behaviour was in its infancy, the HRD function was envisaged as a department whose sole role was to look after payroll and wage negotiation. This was in the era of the assembly line and manufacturing where the HRD function’s purpose was to check the attendance of the employees, process their pay and benefits and act as a mediator in disputes between the management and the workers. Concomitant with the rise of the services sector and the proliferation of technology and financial services companies, the role of the HRD function changed correspondingly.

For instance, the RBV or the Resource Based View of organizations was conceptualized to place the HRD function as a department that would leverage the human resources from the perspective of them being sources of strategic advantage.

The shift in the way the human resources were viewed as yet another factor of production to being viewed as sources of competitive advantage and the chief determinant of profits was mainly due to the changing perceptions of the workforce being central to the organization’s strategy. For instance, many software and tech companies as well as other companies in the service sector routinely identify their employees as the chief assets and something that can give them competitive advantage over their rivals. Hence, the HRD function in these sectors has evolved from basic duties and is now looked upon as a critical support function.

With the advent of globalization and the opening up of the economies of several nations, there was again a shift in the way the HRD function was conceptualized. In line with the RBV and the view of the resources as being international and ethnically diverse, the HRD function was thought of to be the bridge between the different employees in multiple locations and the management. Further, the present conceptualization also means that employees have to be not only motivated but also empowered and enabled to help them actualize their potential. The point here is that no longer were employees being treated like any other asset. On the contrary, they were the centre of attraction and attention in the changed paradigm. This called for the HRD function to be envisaged as fulfilling a role that was aimed at enabling and empowering employees instead of being just mediators and negotiators.

Finally, the theory of HRD also morphed with the times and in recent years, there has been a perceptible shift in the way the HRD function has come to encompass the gamut of activities ranging from routine tasks like hiring and training and payroll to actually being the function that plays a critical and crucial role in the employee development. The theory has also transformed the function from being bystanders to the organizational processes to one where the HRD function is the layer between the management and employees to ensure that the decisions made at the top are communicated to the employees and the feedback from the employees is likewise communicated to the top

PERSONNEL MANAGEMENT

Personnel management can be defined as obtaining, using and maintaining a satisfied workforce. It is a significant part of management concerned with employees at work and with their relationship within the organization.

According to Flippo, “Personnel management is the planning, organizing, compensation, integration and maintenance of people for the purpose of contributing to organizational, individual and societal goals.”

According to Brech, “Personnel Management is that part which is primarily concerned with human resource of organization.”

NATURE OF PERSONNEL MANAGEMENT

1. Personnel management includes the function of employment, development and compensation- These functions are performed primarily by the personnel management in consultation with other departments.2. Personnel management is an extension to general management. It is concerned with promoting and stimulating competent work force to make their fullest contribution to the concern.3. Personnel management exist to advice and assist the line managers in personnel matters. Therefore, personnel department is a staff department of an organization.4. Personnel management lays emphasize on action rather than making lengthy schedules, plans, and work methods. The problems and grievances of people at work can be solved more effectively through rationale personnel policies.5. It is based on human orientation. It tries to help the workers to develop their potential fully to the concern.6. It also motivates the employees through its effective incentive plans so that the employees provide fullest co-operation.7. Personnel management deals with human resources of a concern. In context to human resources, it manages both individual as well as blue- collar workers.

ROLE OF PERSONNEL MANAGER

Personnel manager is the head of personnel department. He performs both managerial and operative functions of management. His role can be summarized as :1. Personnel manager provides assistance to top management- The top management are the people who decide and frame the primary policies of the concern. All kinds of policies related to personnel or workforce can be framed out effectively by the personnel manager.2. He advices the line manager as a staff specialist- Personnel manager acts like a staff advisor and assists the line managers in dealing with various personnel matters.3. As a counsellor,- As a counsellor, personnel manager attends problems and grievances of employees and guides them. He tries to solve them in best of his capacity.4. Personnel manager acts as a mediator- He is a linking pin between management and workers.5. He acts as a spokesman- Since he is in direct contact with the employees, he is required to act as representative of organization in committees appointed by government. He represents company in training programmes.

FUNCTIONS OF PERSONNEL MANAGEMENT

Following are the four functions of Personnel Management:1. Manpower Planning2. Recruitment3. Selection4. Training and Development

Manpower Planning which is also called as Human Resource Planning consists of putting right number of people, right kind of people at the right place, right time, doing the right things for which they are suited for the achievement of goals of the organization. Human Resource Planning has got an important place in the arena of industrialization. Human Resource Planning has to be a systems approach and is carried out in a set procedure. The procedure is as follows:1. Analyzing the current manpower inventory2. Making future manpower forecasts3. Developing employment program4. Design training program

STEPS IN MANPOWER PLANNING

1. Analyzing the current manpower inventory- Before a manager makes forecast of future manpower, the current manpower status has to be analyzed. For this the following things have to be noted-• Type of organization• Number of departments

• Number and quantity of such departments• Employees in these work units

Once these factors are registered by a manager, he goes for the future forecasting. 2. Making future manpower forecasts- Once the factors affecting the future manpower forecasts are known, planning can be done for the future manpower requirements in several work units.The Manpower forecasting techniques commonly employed by the organizations are as follows:

a. Expert Forecasts: This includes informal decisions, formal expert surveys and Delphi technique.

b. Trend Analysis: Manpower needs can be projected through extrapolation (projecting past trends), indexation (using base year as basis), and statistical analysis (central tendency measure).

c. Work Load Analysis: It is dependent upon the nature of work load in a department, in a branch or in a division.

d. Work Force Analysis: Whenever production and time period has to be analysed, due allowances have to be made for getting net manpower requirements.

e. Other methods: Several Mathematical models, with the aid of computers are used to forecast manpower needs, like budget and planning analysis, regression, new venture analysis.

3. Developing employment program- Once the current inventory is compared with future forecasts, the employment program can be framed and developed accordingly, which will include recruitment, selection procedures and placement plans.

4. Design training program - These will be based upon extent of diversification, expansion plans, development program ,etc. Training program depend upon the extent of improvement in technology and advancement to take place. It is also done to improve upon the skills, capabilities, knowledge of the workers.

IMPORTANCE OF MANPOWER PLANNING

1. Key to managerial functions- The four managerial functions, i.e., planning, organizing, directing and controlling are based upon the manpower. Human resources help in the implementation of all these managerial activities. Therefore, staffing becomes a key to all managerial functions.

2. Efficient utilization- Efficient management of personnels becomes an important function in the industrialization world of today. Setting of large scale enterprises require management of large scale manpower. It can be effectively done through staffing function.

3. Motivation- Staffing function not only includes putting right men on right job, but it also comprises of motivational programmes, i.e., incentive plans to be framed for further participation and employment of employees in a concern. Therefore, all types of incentive plans becomes an integral part of staffing function.

4. Better human relations- A concern can stabilize itself if human relations develop and are strong. Human relations become strong trough effective control, clear communication, effective supervision and leadership in a concern. Staffing function also looks after training and development of the work force which leads to co-operation and better human relations.

5. Higher productivity- Productivity level increases when resources are utilized in best possible manner. Higher productivity is a result of minimum wastage of time, money, efforts and energies. This is possible through the staffing and its related activities (Performance appraisal, training and development, remuneration)

NEED OF MANPOWER PLANNING

Manpower Planning is a two-phased process because manpower planning not only analyses the current human resources but also makes manpower forecasts and thereby draw employment programmes. Manpower Planning is advantageous to firm in following manner:1. Shortages and surpluses can be identified so that quick action can be taken wherever required.

2. All the recruitment and selection programmes are based on manpower planning.

3. It also helps to reduce the labour cost as excess staff can be identified and thereby overstaffing can be avoided.

4. It also helps to identify the available talents in a concern and accordingly training program can be chalked out to develop those talents.

5. It helps in growth and diversification of business. Through manpower planning, human resources can be readily available and they can be utilized in best manner.

6. It helps the organization to realize the importance of manpower management which ultimately helps in the stability of a concern.

TYPES OF RECRUITMENT:

1. INTERNAL RECRUITMENT - is a recruitment which takes place within the concern or organization. Internal sources of recruitment are readily available to an organization. Internal sources are primarily three - Transfers, promotions and Re-employment of ex-employees. Re-employment of ex-employees is one of the internal sources of recruitment in which employees can be invited and appointed to fill vacancies in the concern. There are situations when ex-employees provide unsolicited applications also.Internal recruitment may lead to increase in employee’s productivity as their motivation level increases. It also saves time, money and efforts. But a drawback of internal recruitment is that it refrains the organization from new blood. Also, not all the manpower requirements can be met through internal recruitment. Hiring from outside has to be done.Internal sources are primarily 3 typesa. Transfersb. Promotions (through Internal Job Postings) andc. Re-employment of ex-employees - Re-employment of ex-employees is one of the internal sources of recruitment in which employees can be invited and appointed to fill vacancies in the concern. There are situations when ex-employees provide unsolicited applications also.

2. EXTERNAL RECRUITMENT - External sources of recruitment have to be solicited from outside the organization. External sources are external to a concern. But it involves lot of time and money. The external sources of recruitment include - Employment at factory gate, advertisements, employment exchanges, employment agencies, educational institutes, labor contractors, recommendations etc.

a. Employment at Factory Level - This a source of external recruitment in which the applications for vacancies are presented on bulletin boards outside the Factory or at the Gate. This kind of recruitment is applicable generally where factory workers are to be appointed. There are people who keep on soliciting jobs from one place to another. These applicants are called as unsolicited applicants. These types of workers apply on their own for their job. For this kind of recruitment workers have a tendency to shift from one factory to another and therefore they are called as “badli” workers.

b. Advertisement - It is an external source which has got an important place in recruitment procedure. The biggest advantage of advertisement is that it covers a wide area of market and scattered applicants can get information from advertisements. Medium used is Newspapers and Television.

c. Employment Exchanges - There are certain Employment exchanges which are run by government. Most of the government undertakings and concerns employ people through such exchanges. Now-a-days recruitment in government agencies has become compulsory through employment exchange.d. Employment Agencies - There are certain professional organizations which look towards recruitment and employment of people, i.e. these private agencies run by private individuals supply required manpower to needy concerns.

e. Educational Institutions - There are certain professional Institutions which serves as an external source for recruiting fresh graduates from these institutes. This kind of recruitment done through such educational institutions is called as Campus Recruitment. They have special recruitment cells which help in providing jobs to fresh candidates.

f. Recommendations - There are certain people who have experience in a particular area. They enjoy goodwill and a stand in the company. There are certain vacancies which are filled by recommendations of such people. The biggest drawback of this source is that the company has to rely totally on such people which can later on prove to be inefficient.

g. Labour Contractors - These are the specialist people who supply manpower to the Factory or Manufacturing plants. Through these contractors, workers are appointed on contract basis, i.e. for a particular time period. Under conditions when these contractors leave the organization, such people who are appointed have to also leave the concern.

Employee Selection is the process of putting right men on right job. It is a procedure of matching organizational requirements with the skills and qualifications of people. Effective selection can be done only when there is effective matching. By selecting best candidate for the required job, the organization will get quality performance of employees. Moreover, organization will face less of absenteeism and employee turnover problems. By selecting right candidate for the required job, organization will also save time and money. Proper screening of candidates takes place during selection procedure. All the potential candidates who apply for the given job are tested.But selection must be differentiated from recruitment, though these are two phases of employment process. Recruitment is considered to be a positive process as it motivates more of candidates to apply for the job. It creates a pool of applicants. It is just sourcing of data. While selection is a negative process as the inappropriate candidates are rejected here. Recruitment precedes selection in staffing process. Selection involves choosing the best candidate with best abilities, skills and knowledge for the required job.

The Employee selection Process takes place in following order-

1. Preliminary Interviews- It is used to eliminate those candidates who do not meet the minimum eligibility criteria laid down by the organization. The skills, academic and family background, competencies and interests of the candidate are examined during preliminary interview. Preliminary interviews are less formalized and planned than the final interviews. The candidates are given a brief up about the company and the job profile; and it is also examined how much the candidate knows about the company. Preliminary interviews are also called screening interviews.

2. Application blanks- The candidates who clear the preliminary interview are required to fill application blank. It contains data record of the candidates such as details about age, qualifications, reason for leaving previous job, experience, etc.

3. Written Tests- Various written tests conducted during selection procedure are aptitude test, intelligence test, reasoning test, personality test, etc. These tests are used to objectively assess the potential candidate. They should not be biased.

4. Employment Interviews- It is a one to one interaction between the interviewer and the potential candidate. It is used to find whether the candidate is best suited for the required job or not. But such interviews consume time and money both. Moreover the competencies of the candidate cannot be judged. Such interviews may be biased at times. Such interviews should be conducted properly. No distractions should be there in room. There should be an honest communication between candidate and interviewer.5. Medical examination- Medical tests are conducted to ensure physical fitness of the potential employee. It will decrease chances of employee absenteeism.6. Appointment Letter- A reference check is made about the candidate selected and then finally he is appointed by giving a formal appointment letter.

Training of employees takes place after orientation takes place. Training is the process of enhancing the skills, capabilities and knowledge of employees for doing a particular job. Training process moulds the thinking of employees and leads to quality performance of employees. It is continuous and never ending in nature.

IMPORTANCE OF TRAINING

Training is crucial for organizational development and success. It is fruitful to both employers and employees of an organization. An employee will become more efficient and productive if he is trained well.Training is given on four basic grounds:1. New candidates who join an organization are given training. This training familiarizes them with the organizational mission, vision, rules and regulations and the working conditions.2. The existing employees are trained to refresh and enhance their knowledge.3. If any updations and amendments take place in technology, training is given to cope up with those changes. For instance, purchasing a new equipment, changes in technique of production, computer implantment. The employees are trained about use of new equipments and work methods.4. When promotion and career growth becomes important. Training is given so that employees are prepared to share the responsibilities of the higher level job.The benefits of training can be summed up as:1. Improves morale of employees- Training helps the employee to get job security and job satisfaction. The more satisfied the employee is and the greater is his morale, the more he will contribute to organizational success and the lesser will be employee absenteeism and turnover.2. Less supervision- A well trained employee will be well acquainted with the job and will need less of supervision. Thus, there will be less wastage of time and efforts.3. Fewer accidents- Errors are likely to occur if the employees lack knowledge and skills required for doing a particular job. The more trained an employee is, the less are the chances of committing accidents in job and the more proficient the employee becomes.4. Chances of promotion- Employees acquire skills and efficiency during training. They become more eligible for promotion. They become an asset for the organization.5. Increased productivity- Training improves efficiency and productivity of employees. Well trained employees show both quantity and quality performance. There is less wastage of time, money and resources if employees are properly trained.

WAYS/METHODS OF TRAINING

Training is generally imparted in two ways:

On the job training- On the job training methods are those which are given to the employees within the everyday working of a concern. It is a simple and cost-effective training method. The in-proficient as well as semi- proficient employees can be well trained by using such training method. The employees are trained in actual working scenario. The motto of such training is “learning by doing.” Instances of such on-job training methods are job-rotation, coaching, temporary promotions, etc.

Off the job training- Off the job training methods are those in which training is provided away from the actual working condition. It is generally used in case of new employees. Instances of off the job training methods are workshops, seminars, conferences, etc. Such method is costly and is effective if and only if large number of employees have to be trained within a short time period. Off the job training is also called as vestibule training, i.e., the employees are trained in a separate area( may be a hall, entrance, reception area, etc. known as a vestibule) where the actual working conditions are duplicated

Training methods pertain to the types of training that can be provided to employees to sharpen their existing skills and learn new skills. The skills that they learn can be technical or soft skills and for all categories of skills, some training methods are suggested here. The training methods can range from onsite classroom based ones, training at the office during which employees might or not might check their work, experiential training methods which are conducted in resorts and other places where there is room for experiential learning. Training methods include many types of training tools and techniques and we shall discuss some of the commonly employed tools and techniques. For instance, it is common for trainers to use a variety of tools like visual and audio aids, study material, props and other enactment of scene based material and finally, the experiential tools that include sports and exercise equipment.

If we take the first aspect of the different training methods that are location based, we would infer from the explanation that these training methods include the specific location based ones and would range from classroom training done at the trainers’ location to the ones done on the office premises.

Further, the experiential training methods can include use of resorts and other nature based locations so that employees can get the experience of learning through practice or the act itself rather than through study material. It needs to be remembered that the trainings conducted in the office premises often involve employees taking breaks to check their work and hence might not be ideal from the point of view of the organizations. However, provision can be done to locate the training rooms away from

the main buildings so that employees can be trained in a relaxed manner. For instance, Infosys has training centres that are exclusively built for training and these centres give the employees enough scope and time for learning new skills.

The next aspect of the training methods includes the use of visual and audio aids, study material, props and equipment. Depending on the kind of training that is being imparted, there can be a mechanism to use the appropriate tools and techniques based on the needs of the trainers and the trainees. The use of the training material often indicates the thoroughness of the training program and the amount of work that the trainers have put in to make the training successful. Of course, if the training material is good, it also means that the employees would benefit from the scope and depth of the material though they need to invest time and energy as well.

Finally, the bottom line for any training to be successful is the synergy between the trainers and the trainees and this is where the HRD function can act as a facilitator for effective trainings and ensure that the trainers and trainees bond together and benefit in a mutual process of understanding and learning. In conclusion, there are various ways to approach trainings and some of the methods discussed above would be good starting points for follow up action and partnership between the training agencies and the organizations.

AREAS OF PROGRAMMES AT HRD CENTRE :

o NON EXECUTIVE

ENHANCNG AGENT SKILLSMUTISKILLELECTRONCS COMPUTERUNIT TRAINING

o EXECUTIVE

COMPUTER MANAGERIAL GENERAL MANAGEMENT MANAGERIAL FUNCTION

FINANCE DEPARTMENT

Finance is the life blood of business. Finance is the base of all corporate activities

in the day to day world. Management of finance is broadly concerned with the acquisition

and use of funds by a business firm.

Reliance mutual fund has a very efficient Finance Department headed by Manager

Finance. All the Finance Department staffs are professionals. Finance Department consist of

a team of professionals headed by Manager Finance, having sufficient industry experience in

the field of accounting, costing, taxation, company law and financial management

OBJECTIVES OF FINANCE DEPARTMENT

1. To manage & account for the financial resource of the organization, to forecast its

requirement in the future and plan accordingly and to check for deviation.

2. Report the financial performance of the organization, to comply with the government

rules and regulation.

FUNCTIONS OF FINANCE DEPARTMENT

The main functions of finance department are defined as follows.

1. Recording of day-to-day business transaction.

2. Receiving payments from customers and accounting these funds.

3. Preparations of sales budgets and revenue budgets and expenditure budgets on a

quarterly basis.

4. Preparations and, maintenance of costing records.

5. Preparations of fund flow and cash flow statement for every month.

6. Preparing and filling of quarterly and final income tax returns.

7. Preparations and implementation of cost reduction and cost control methods

8. Conduct and co-ordinate internal and stationary audits.

9. Perpetual stock verification and asset evaluation.

JOB DESCRIPTION OF PEOPLE IN FINANCE DEPARTMET

Responsibility of people in finance department

Establishing and controlling the financial systems and administrative services of

the organization, and providing financial information to Board of Directors.

MANAGER (FINANCE)

Main duties

Directing the establishment of financial/accounting principles, procedures and practices in

line with legal and corporate requirements.

Ensuring accurate and timely financial reports and forecasts for the whole organisation

so as to provide a clear insight into its financial condition.

Ensuring that the profits of the organisation are protected through the establishment of

effective financial controls; implementing and maintaining appropriate management

accounting and reporting systems, budgetary controls and expenditure procedures.

ADMINISTRATIVE OFFICER (FINANCE)

Main duties

Providing accurate and timely financial reports and forecasts and general accounting and

administrative services.

Ensuring effective costing and contribution analysis.

Implementing policies to ensure the security of funds and assets.

CASHIER

Main duties

Maintain an awareness of all promotions and advertisements.

Accurately and efficiently ring on registers and accurately maintain all cash and media

at the registers.

Communicate customer requests to top management.

INTERNAL AUDIT

The audit of all branch office departments of the corporation is completing every year

financial year. In keeping with practice of improving our systems and procedures through the

use of IT as a tool, audit packages are being used so that our auditors are able to carry out the

audit in a Front End Applications package environment.

INSPECTION

The inspection of all the branches of the corporation in India is completing within time

schedule. Implementation of inspection package in all our offices led to transparency by on-

line report writing, acceptance of compliance and closure process.

VIGILANCE

Special efforts were made to focus on disposal of vigilance cases pending for more than

one year. Besides expediting disposal of vigilance cases, emphasis is also laid on preventive

vigilance through the dissemination of information on areas susceptible to vigilance.

NOMINEE DIRECTORS

The corporation appoints nominee directors on the board of the companies where it has

substantial stake by way of debt or equity. Nominees are officials of the corporation who

are in service or retired. Adequate systems are in place to review and guide the nominee

directors from time to time. Nominee directors provide feedback with regard to operations

problems, prospects and corporate governance standards etc.

RISK MANAGEMENT

Corporation is the largest institutional investor in the financial market and its staggering

fund size which is placed in varying asset classes is exposed to various financial risks. To

mitigate the investment risks arising out of market risk, credit risk, interest rate risk and

other risks inherent in the financial market, a distinct full-fledged Risk management

structure has been created in the corporation.

BOARD MEETINGS

Board meetings as per regulations are generally held once in three months. In addition to

policy matters, the board provides strategic direction for execution ensures financial

discipline and accountability to the policy holders and also ensures the interest of the policy

holders and stakeholders.

SALES DEPARTMENT

Manager (Sales)

Assistance

Higher Grade Staffs

Asst. Administrative

Officers (AAO)

Administrative Officers (AO)

Record clerk

Sub Staff

SALES DEPARTMENT

Sales management is a business discipline which is focused on the practical

application of sales techniques and the management of a organizational sales operations. It is

an important business function as net sales through the sale of products and services and

resulting profit drive most commercial business. These are also typically the goals and

performance indicators of sales management.

The art of meeting the sales targets effectively through meticulous planning and

budgeting refers to sales management. Sales Management helps to extract the best out of

employees and achieve the sales goals of the organization in the most effective ways.

Process of Sales Management

1. Sales Planning

Marketers must plan things well in advance for the best results. It is essential to have

concrete plans. Mere guess works do not help in business.

Know product well. Sales professionals must know the benefits of the product for the

consumers to believe them.

Identify the target market.

Sales Planning makes the products available to the end users at the right time and at

the right place.

Sales Planning helps the marketers to analyse the customer demands and respond

efficiently to fluctuations in the market.

Devise appropriate strategies to increase the sales of the products.

2. Sales Reporting

Sales strategies are implemented in this stage.

Check the effectiveness of the various strategies. Find out whether they are bringing

the desired results or not.

Ask the sales team to submit reports of what all they have done throughout the week.

The management must sit with the sales team frequently to assess their performance

and chalk out future course of actions.

3. Sales Process

Sales process refers to various activities which help in the timely achievement of sales

targets for the successful functioning of an organization.

Sales Process includes various strategies and techniques employed by an individual to

achieve sales goals within the stipulated time frame.

MANAGER (SALES)

Sales manager is the typical title of someone whose role is sales management. The

role typically involves sales planning, human resources, talent development, leadership and

control of resources such as organizational assets.

Main duties

Manage and coordinate all marketing, advertising and promotional staff and activities

Conduct market research to determine market requirements for existing and future

products

Analysis of customer research, current market conditions and competitor information

Develop and implement marketing plans and projects for new and existing products

MARKETING ACTIVITIES IN RELIANCE MUTUAL FUND

PRODUCT DEVELOPMENT

In a competitive market, there is a greater need to provide insurance products that meet

the needs of customers RMF therefore a wide variety of products which fulfils the needs of

different segments of the society. As at the end of the financial year 2009-10, the corporation

had 54 plans available for sale.

FIELD PERSONNEL TRAINING (FPT)

The theme of FPT is professionalism. For the purpose, training in a big way is

conducting across all zones using reputed International / National Training Institutions.

BANCASSURANCE & ALTERNATE CHANNELS

Banc assurance is the term used to describe the partnership or relationship between a

bank and an insurance company whereby the insurance company uses the bank sales channel

in order to sell insurance products.

DIRECT MARKETING

This vertical is started with an objective of “creating new systems for business

generation, sales process monitoring and business processing with a view to reach out to

untapped markets and provide improved buying experience to customers.”

In a short period, the channel has expanded and professionally trained Direct Sales

Executives (DSEs) to provide financial advice to prospective customers.

The main focus of the channel was setting up systems and processes. A state of art lead

management system has been established to provide easy access to prospective customers to

reach out to LIC to buy a policy. Such leads captured through our website.

www.reliancemutualfund.com is passed on to well trained DSEs on real time basis who can

contact the customer instantly.

AGENTS

Most people have their first contact with an insurance company through an insurance

sales agent. These workers help individuals, families, and businesses select insurance policies

that provide the best protection for their lives, health, and property. Insurance sales agents

commonly referred to as “producers” in the insurance industry.

a) Agency Strength

The total number of agents on our role is 140280 as at 31.03.2011 as against 134485

as on 31.03.2012.

b) Agents’ Club Membership

In order to motivate and recognize high performers amongst agents a premium club

called the Corporate Club. The other 5 clubs which were formed to recognize agents, who

perform consistently year after year.

MEMBERS OF VARIOUS AGENTS CLUBS

Name of the Club

Corporate

Chairman

Zonal Manager

Divisional Manager

Branch Manager

Distinguished Agents

c) Career Agents Scheme

The corporation has a scheme of Urban Career Agents and Rural Career Agents

to promote the cause of professionalizing the agency force. They are given Stipends at the

start of their career to enable them to settle down in the profession.

d) Chief mutual fund Advisor Scheme

The corporation introduced the above scheme with an objective of increasing its

market presence through more agents by utilizing capabilities of existing high performing

agents for organizational growth.

e) Authorised Agents

In tune with the increasing customer expectation for more conveniences in premium

payments and servicing, the corporation has empowered select agents to collect the renewal

premium through “Premium Points”.

CLAIMS DEPARTMENT

The Claims department is headed by the claims manager

FUNCTIONS OF CLAIMS DEPARTMENT

The claims department is responsible for the claim settlements arising from the

customers. In case of a life insurance claim the department gets information directly from the

customer, the department authenticates the policy details and issues a claim number, and then

assigns the surveyor for valuation. After proper enquiry, fund is collected and delivered to the

customer.

In case of reimbursement process, the customer will have to submit documents and

they will make the payment within 3 days of completion of documentation.

Survival Benefit/Maturity Claims:

RMF settles survival benefit/maturity claims on or before the due date.

Policyholders are intimated well in advance by the Branch Office which services the

policy regarding the payment, and the necessary Discharge Voucher is also sent for

execution by the assured. In case the policyholder does not get any intimation from

the Branch Office concerned, he/she should contact them, quoting the Policy Number.

Survival Benefit payment up to Rs.60,000/- are settled without insisting for Policy

Bond and Discharge Voucher.

Death Claims:

If the life assured dies during the term of the policy, death claim arises. The death of

the policyholder should be immediately intimated in writing to the Branch Office

where the policy is serviced along with the following particulars:

1. The No./s of the policy/ies

2. The name of the policyholder

3. Death Certificate issued by concerned Authority

4. The date of death

5. The cause of death and

6. Claimant’s relationship with the deceased

On receipt of the intimation of death, necessary claim forms are sent by the Branch

Office for completion along with instructions regarding the procedure to be followed

by the claimant.

The claims which have arisen after a period of three years are treated as non-early

claims and settled within 30 days from the date of receipt of all requirements.

The claims that have arisen within a period of two years from the date of

commencement of the policy, are treated as early claims and investigation is

compulsory in such cases.

The Corporation grants claims concessions under certain Plans whereby payment of

full sum assured is made, subject to the deduction of unpaid premiums with interest

till the date of death and unpaid premiums falling due before the next anniversary of

the policy, in the event of the death of the life assured within a period of six months or

one year from the date of the first unpaid premium, provided premiums have been

paid for at least three years and five years respectively.

Claim Review Committee:

The Corporation settles a large number of Death Claims every year. Only in case of

fraudulent suppression of material information is the liability repudiated. This is to ensure

that claims are not paid to fraudulent persons at the cost of honest policyholders. The number

of Death Claims repudiated is, however, very small. Even in these cases, an opportunity is

given to the claimant to make a representation for consideration by the Review Committees

of the Zonal office and the Central Office. As a result of such review, depending on the

merits of each case, appropriate decisions are taken. The Claims Review Committees of the

Central and Zonal Offices have among their Members, a retired High Court/District Court

Judge. This has helped providing transparency and confidence in our operations and has

resulted in greater satisfaction among claimants, policyholders and public.

IT DEPARTMENT

Manager (IT)

Assistance

Higher Grade Staffs

Asst. Administrative

Officers (AAO)

Administrative Officers (AO)

Record clerk

Sub Staff

IT DEPARTMENT

RMF has been one of the pioneering organizations in India who

introduced the leverage of Information Technology in servicing and in their business.

Data pertaining to almost 10 crore policies is being held on computers in RMF. RMF

have gone in for relevant and appropriate technology over the years.

1964 saw the introduction of computers in RMF. Unit Record Machines

introduced in late 1950’s were phased out in 1980’s and replaced by Microprocessors

based computers in Branch and Divisional Offices for Back Office Computerization.

Standardization of Hardware and Software commenced in 1990’s. Standard Computer

Packages were developed and implemented for Ordinary and Salary Savings Scheme

(SSS) Policies.

FUNCTIONS OF IT DEPARTMENT

FRONT END OPERATIONS

With a view to enhancing customer responsiveness and services, LIC started

a drive of On Line Service to Policyholders and Agents through Computer. This on

line service enabled policyholders to receive immediate policy status report, prompt

acceptance of their premium and get Revival Quotation, Loan Quotation on demand.

Incorporating change of address can be done on line. Quicker completion of proposals

and dispatch of policy documents have become a reality. All our 2048 branches across

the country have been covered under front-end operations. Thus all our 100 divisional

offices have achieved the distinction of 100% branch computerization. New payment

related Modules pertaining to both ordinary & SSS policies have been added to the

Front End Package catering to Loan, Claims and Development Officers’ Appraisal.

All these modules help to reduce time-lag and ensure accuracy.

METRO AREA NETWORK

A Metropolitan Area Network, connecting 74 branches in Mumbai was

commissioned in November, 1997, enabling policyholders in Mumbai to pay their

Premium or get their Status Report, Surrender Value Quotation, Loan Quotation etc.

from ANY Branch in the city. The System has been working successfully. More than

10,000 transactions are carried out over this Network on any given working day. Such

Networks have been implemented in other cities also.

WIDE AREA NETWORK

All 7 Zonal Offices and all the MAN centres are connected through a Wide

Area Network (WAN). This will enable a customer to view his policy data and pay

premium from any branch of any MAN city. As at November 2005, we have 91

centers in India with more than 2035 branches networked under WAN.

INTERACTIVE VOICE RESPONSE SYSTEMS (IVRS)

IVRS has already been made functional in 59 centers all over the country.

This would enable customers to ring up RMF and receive information (e.g. next

premium due, Status, Loan Amount, Maturity payment due, Accumulated Bonus etc.)

about their policies on the telephone. This information could also be faxed on demand

to the customer.

RMF ON THE INTERNET

Our Internet site is an information bank. We have displayed information

about RMF & its offices. Efforts are on to upgrade our web site to make it dynamic

and interactive. The addresses/e-mail Ids of RMF Zonal Offices, Zonal Training

Centers, Management Development Center, Overseas Branches, Divisional Offices

and also all Branch Offices with a view to speed up the communication process.

PAYMENT OF PREMIUM AND POLICY STATUS ON INTERNET

RMF has given its policyholders a unique facility to pay premiums through Internet

absolutely free and also view their policy details on Internet premium payments.

There are 11 service providers with whom RMF has signed the agreement to provide

this service.

INFO CENTRES

RMF have also set up call centers, manned by skilled employees to provide

you with information about our Products, Policy Services, Branch addresses and other

organizational information.

COMPANY PROFILE

Reliance mutual fund, a part of the Reliance- Anil Dhirubhai group (RADAG) is one of the

fastest growing mutual funds in the country. Reliance mutual fund offers investors a well rounded

portfolio of products to meet varying investor requirements. Reliance mutual fund has a presence in

95 cities across the country, an investor base of over 2.8 million and manages assets of

Rs36927crore as on December 31, 2006. Reliance mutual constantly endeavors to launch innovative

products and customer service initiatives to increase value to investors.

Reliance mutual fund schemes are managed by reliance capital asset management Ltd., a

wholly owned subsidiary of reliance capital ltd. Reliance capital is one of the India’s leading and

fastest growing private sector financial services companies, and ranks among the top 3 private sector

financial services and banking companies in terms of net worth.

Reliance capital has interests in asset management and mutual funds, life and general

insurance, private equity and investments, stock broking and other financial services. Reliance Mutual

Fund (RMF) has been established as a trust under the Indian Trusts Act, 1982 with Reliance Capital

Limited (RCL), as the Settler/Sponsor and Reliance Capital Trustee Co. Limited (RCTCL), as the

Trustee.

RMF has been registered with the Securities & Exchange Board of India (SEBI) vide

registration number MF/022/95/1 dated June 30, 1995. The name of Reliance Capital Mutual Fund

has been changed to Reliance Mutual Fund effective 11th. March 2004 vide SEBI's letter no.

IMD/PSP/4958/2004 date 11th. March 2004. Reliance Mutual Fund was formed to launch various

schemes under which units are issued to the Public with a view to contribute to the capital market and

to provide investors the opportunities to make investments in diversified securities.

The main objectives of the Trust are:

To carry on the activity of a Mutual Fund as may be permitted at law and formulate and devise various

collective Schemes of savings and investments for people in India and abroad and also ensure

liquidity of investments for the Unit holders;

To deploy Funds thus raised so as to help the Unit holders earn reasonable returns on their savings

and

To take such steps as may be necessary from time to time to realize the effects without any limitation.

Statutory Details:

Sponsor: Reliance Capital Limited.

Trustee: Reliance Capital Trustee Co. Limited.

Investment Manager: Reliance Capital Asset Management Limited. The Sponsor, the Trustee and the

Investment Manager are incorporated under the Companies Act 1956.

Business overview

RCL is registered as a depository participant with national securities depository Ltd (NSDL)

and central depository services Ltd (CSDL) under the securities and exchange board of India

(Depositories and participants) regulations, 1996. RCL has sponsored the reliance mutual fund within

the frame work of the securities and exchange board of India

(Mutual fund) regulations, 1996

RCL primarily focuses on funding projects in the infrastructure sector and supports the

growth of its subsidiary companies, reliance capital trustee co. Limited, reliance capital asset

management limited, reliance general insurance company limited and reliance life insurance

Company limited. As of march 31, 2005, the company’s investment in infrastructure projects stood at

Rs.1071 crores. The investment portfolio of RCL is structured in a way that realizes the highest post-

tax return on its investments.

EQUITY SCHEMES:

Reliance Equity Fund:

(An open-ended diversified Equity Scheme.) The primary investment objective of the scheme

is to seek to generate capital appreciation & provide long-term growth opportunities by investing in a

portfolio constituted of equity & equity related securities of top 100 companies by market capitalization

& of companies which are available in the derivatives segment from time to time and the secondary

objective is to generate consistent returns by investing in debt and money market securities.

Reliance Tax Saver (ELSS) Fund:

(An Open-ended Equity Linked Savings Scheme.) The primary objective of the scheme is to

generate long-term capital appreciation from a portfolio that is invested predominantly in equity and

equity related instruments.

Reliance Equity Opportunities Fund:

(An Open-Ended Diversified Equity Scheme.) The primary investment objective of the

scheme is to seek to generate capital appreciation & provide long-term growth opportunities by

investing in a portfolio constituted of equity securities & equity related securities and the secondary

objective is to generate consistent returns by investing in debt and money market securities.

Reliance Vision Fund:

(An Open-ended Equity Growth Scheme.) The primary investment objective of the Scheme is

to achieve long term growth of capital by investment in equity and equity related securities through a

research based investment approach.

Reliance Growth Fund:

(An Open-ended Equity Growth Scheme.) The primary investment objective of the Scheme is

to achieve long term growth of capital by investment in equity and equity related securities through a

research based investment approach.

Reliance Index Fund:

(An Open Ended Index Linked Scheme.) The Investment Objective under the Nifty Plan is to

replicate the composition of the Nifty, with a view to endeavour to generate returns, which could

approximately be the same as that of Nifty. The Investment Objective under the Sensex plan is to

replicate the composition of the Sensex, with a view to endeavour to generate returns, which could

approximately be the same as that of Sensex.

Reliance NRI Equity Fund:

(An open-ended Diversified Equity Scheme.) The Primary investment objective of the scheme

is to generate optimal returns by investing in equity or equity related instruments primarily drawn from

the Companies in the BSE 200 Index.

DEBT SCHEMES:

Reliance Monthly Income Plan:

(An Open Ended Fund. Monthly Income is not assured & is subject to the availability of

distributable surplus ) The Primary investment objective of the Scheme is to generate regular income

in order to make regular dividend payments to unit holders and the secondary objective is growth of

capital. Primarily the investment shall be made in debt and money market securities (i.e. 80%) with a

small exposure (i.e. up to 20%) in equity.

Reliance Gilt Securities Fund - Short Term Gilt Plan & Long Term Gilt Plan:

Open-ended Government Securities Scheme) the primary objective of the Scheme is to

generate optimal credit risk-free returns by investing in a portfolio of securities issued and guaranteed

by the central Government and State Government

Reliance Income Fund:

(An Open-ended Income Scheme) The primary objective of the scheme is to generate optimal

returns consistent with moderate levels of risk. This income may be complemented by capital

appreciation of the portfolio. Accordingly, investments shall predominantly be made in Debt & Money

Instruments.

Reliance Medium Term Fund:

(An Open End Income Scheme with no assured returns.) The primary investment objective of

the Scheme is to generate regular income in order to make regular dividend payments to unit holders

and the secondary objective is growth of capital

Reliance Short Term Fund:

(An Open End Income Scheme) The primary investment objective of the scheme is to

generate stable returns for investors with a short investment horizon by investing in Fixed Income

Securities of short term maturity.

Reliance Liquid Fund:

(Open-ended Liquid Scheme). The primary investment objective of the Scheme is to generate

optimal returns consistent with moderate levels of risk and high liquidity. Accordingly, investments

shall predominantly be made in Debt and Money Market Instruments.

Reliance Fixed Term Scheme:

(Close-ended Income Scheme) The primary objective of the Scheme is to seek to achieve

regular returns / growth of capital by investing in a portfolio of fixed income securities normally

maturing in line with the time profile of the plan with the objective of limiting interest rate volatility.

Reliance Floating Rate Fund:

(An Open End Income Scheme) The primary objective of the scheme is to generate regular

income through investment in a portfolio comprising substantially of Floating Rate Debt Securities

(including floating rate securitized debt and Money Market Instruments and Fixed Rate Debt

Instruments swapped for floating rate returns). The scheme shall also invest in fixed rate debt

Securities (including fixed rate securitized debt, Money Market Instruments and Floating Rate Debt

Instruments swapped for fixed returns.

Reliance NRI Income Fund:

(An Open-ended Income scheme) The primary investment objective of the Scheme is to

generate optimal returns consistent with moderate levels of risks. This income may be complimented

by capital appreciation of the portfolio. Accordingly, investments shall predominantly be made in debt

Instruments.

Fixed Maturity Fund - Series I: Reliance

(A Close Ended Income Scheme)The primary investment objective of the Scheme is to seek

to achieve regular returns / growth of capital by investing in a portfolio of fixed income securities

normally maturing in line with the time profile of the Plan with the objective of limiting interest rate

volatility.

Reliance Fixed Maturity Fund - Series II:

(A closed ended Income Scheme) The primary investment objective of the Scheme is to seek

to achieve growth of capital by investing in a portfolio of fixed income securities normally maturing in

line with the time profile of the respective plans.

RELIANCE REGULAR SAVINGS FUND: (An Open - ended scheme)

The Investment Objectives:

Debt Option: The primary investment objective of this plan is to generate optimal returns consistent

with moderate level of risk. This income may be complemented by capital appreciation of the portfolio.

Accordingly investments shall predominantly be made in Debt & Money Market Instruments.

Equity Option: The primary investment objective is to seek capital appreciation and or consistent

returns by actively investing in equity / equity related securities.

Hybrid Option: The primary investment objective is to generate consistent return by investing a major

portion in debt & money market securities and a small portion in equity & equity related instruments.

Sector Specific Schemes

Sector Funds are specialty funds that invest in stocks falling into a certain sector of the

economy. Here the portfolio is dispersed or spread across the stocks in that particular sector. This

type of scheme is ideal for investors who have already made up their mind to confine risk and return

to a particular sector.

Reliance Banking Fund

Reliance Mutual Fund has an Open-Ended Banking Sector Scheme which has the primary

investment objective to generate continuous returns by actively investing in equity / equity related or

fixed income securities of banks.

Reliance Diversified Power Sector Fund

Reliance Diversified Power Sector Scheme is an Open-ended Power Sector Scheme. The

primary investment objective of the Scheme is to seek to generate consistent returns by actively

investing in equity / equity related or fixed income securities of Power and other associated

companies.

Reliance Pharma Fund

Reliance Pharma Fund is an Open-ended Pharma Sector Scheme. The primary investment

objective of the Scheme is to generate consistent returns by investing in equity / equity related or

fixed income securities of Pharma and other associated companies.

Reliance Media & Entertainment Fund

Reliance Media & Entertainment Fund is an Open-ended Media & Entertainment sector scheme. The

primary investment objective of the Scheme is to generate consistent returns by investing in equity /

equity related or fixed income securities of media & entertainment and other associated companies.

SELECTION OF A PARTICULAR SCHEME

1. Choice of any scheme would depend to a large extent on the investor preferences. For an investor

willing to undertake risks, equity funds would be the most suitable as they offer the maximum returns.

Debt funds are suited for those investors who prefer regular income and safety. Gilt funds are best

suited for the medium to long-term investors who are averse to risk. Balanced funds are ideal for

medium- to long-term investors willing to take moderate risks.

2. Liquid funds are ideal for Corporate, institutional investors and business houses who invest their

funds for very short periods. Tax Saving Funds are ideal for those investors who want to avail tax-

benefit.

3. An important aspect while selecting a particular scheme is the duration of the investment. Depending

on your time horizon you can select a particular scheme. Besides all this, factors like promoter’s

image, objective of the fund and returns given by the funds on different schemes should also be taken

into account while selecting a particular scheme.

RISKS INVOLVED IN INVESTING IN MUTUAL FUNDS

Mutual Funds do not provide assured returns. Their returns are linked to their performance. They

invest in shares, debentures and deposits. All these investments involve an element of risk. The unit

value may vary depending upon the performance of the company and companies may default in

payment of interest/principal on their debentures/bonds/deposits. Besides this, the government may

come up with new regulation which may affect a particular industry or class of industries. All these

factors influence the performance of Mutual Funds.

Risk factors in mutual funds

The Risk-Return Trade-off: The most important relationship to understand is the risk-return

trade-off. Higher the risk greater the returns/loss and lower the risk lesser the returns/loss. Hence it is

up to you, the investor to decide how much risk you are willing to take. In order to do this you must

first be aware of the different types of risks involved with your investment decision.

Market Risk: Sometimes prices and yields of all securities rise and fall. Broad outside influences

affecting the market in general lead to this. This is true, may it be big corporations or smaller mid-

sized companies. This is known as Market Risk. A Systematic Investment Plan (“SIP”) that works on

the concept of Rupee Cost Averaging (“RCA”) might help mitigate this risk.

Credit Risk: The debt servicing ability (may it be interest payments or repayment of principal) of a

company through its cash flows determines the Credit Risk faced by you. This credit risk is measured

by independent rating agencies like CRISIL who rate companies and their paper. An ‘AAA’ rating is

considered the safest whereas a ‘D’ rating is considered poor credit quality. A well-diversified portfolio

might help mitigate this risk.

Inf lat ion Risk: Things you hear people talk about:

“Rs. 100 today is worth more than Rs. 100 tomorrow.”

“Remember the time when a bus ride costed 50 paise?”

“Mehangai Ka Jamana Hai.”

The root cause, Inflation. Inflation is the loss of purchasing power over time. A lot of times people

make conservative investment decisions to protect their capital but end up with a sum of money that

can buy less than what the principal could at the time of the investment. This happens when inflation

grows faster than the return on your investment. A well-diversified portfolio with some investment in

equities might help mitigate this risk.

Interest Rate Risk: In a free market economy interest rates are difficult if not impossible to

predict. Changes in interest rates affect the prices of bonds as well as equities. If interest rates rise

the prices of bonds fall and vice versa. Equity might be negatively affected as well in a rising interest

rate environment. A well-diversified portfolio might help mitigate this risk.

Polit ical /Government Policy Risk: Changes in government policy and political decision can

change the investment environment. They can create a favorable environment for investment or vice

versa.

Liquidity Risk: Liquidity risk arises when it becomes difficult to sell the securities that one has

purchased. Liquidity Risk can be partly mitigated by diversification, staggering of maturities as well as

internal risk controls that lean towards purchase of liquid securities.

ADVANTAGES OF MUTUAL FUNDS

There are numerous benefits of investing in mutual funds and one of the key reasons for its

phenomenal success in the developed markets like US and UK is the range of benefits they offer,

which are unmatched by most other investment avenues. We have explained the key benefits in this

section. The benefits have been broadly split into universal benefits, applicable to all schemes and

benefits applicable specifically to open-ended schemes.

Diversification: The nuclear weapon in your arsenal for your fight against Risk. It simply means that

you must spread your investment across different securities (stocks, bonds, money market

instruments, real estate, fixed deposits etc.) and different sectors (auto, textile, information technology

etc.). This kind of a diversification may add to the stability of your returns, for example during one

period of time equities might underperform but bonds and money market instruments might do well

enough to offset the effect of a slump in the equity markets.

Affordability: A mutual fund invests in a portfolio of assets, i.e. bonds, shares, etc. depending upon

the investment objective of the scheme. An investor can buy in to a portfolio of equities, which would

otherwise be extremely expensive. Each unit holder thus gets an exposure to such portfolios with an

investment as modest as Rs.500/-. This amount today would get you less than quarter of an Infosys

share! Thus it would be affordable for an investor to build a portfolio of investments through a mutual

fund rather than investing directly in the stock market.

Variety: Mutual funds offer a tremendous variety of schemes. This variety is beneficial in two ways:

first, it offers different types of schemes to investors with different needs and risk appetites; secondly,

it offers an opportunity to an investor to invest sums across a variety of schemes, both debt and

equity. For example, an investor can invest his money in a Growth Fund (equity scheme) and Income

Fund (debt scheme) depending on his risk appetite and thus create a balanced portfolio easily or

simply just buy a Balanced Scheme.

Professional Management: Qualified investment professionals who seek to maximize returns and

minimize risk monitor investor's money. When you buy in to a mutual fund, you are handing your

money to an investment professional who has experience in making investment decisions. It is the

Fund Manager's job to (a) find the best securities for the fund, given the fund's stated investment

objectives; and (b) keep track of investments and changes in market conditions and adjust the mix of

the portfolio, as and when required.

Regulations: Securities Exchange Board of India (“SEBI”), the mutual funds regulator has clearly

defined rules, which govern mutual funds. These rules relate to the formation, administration and

management of mutual funds and also prescribe disclosure and accounting requirements. Such a

high level of regulation seeks to protect the interest of investors.

Liquidity: It's easy to get your money out of a mutual fund. Write a check, make a call, and you've got

the cash.

Convenience: An investor can purchase or sell fund units directly from a fund, through a broker or a

financial planner. The investor may opt for a Systematic Investment Plan (“SIP”) or a Systematic

Withdrawal Advantage Plan (“SWAP”). In addition to this an investor receives account statements and

portfolios of the schemes.

Flexibility: Mutual Funds offering multiple schemes allow investors to switch easily between various

schemes. This flexibility gives the investor a convenient way to change the mix of his portfolio over

time.

Low cost: Mutual fund expenses are often no more than 1.5 percent of your investment. Expenses

for Index Funds are less than that, because index funds are not actively managed. Instead, they

automatically buy stock in companies that are listed on a specific index

Transparency: Mutual fund provide information on each scheme about the specific investment made

there-under and so on

Tax benefits: Any income distributed after March 31, 2002 will be subject to tax in the assessment of

all Unit holders. However, as a measure of concession to Unit holders of open-ended equity-oriented

funds, income distributions for the year ending March 31, 2003, will be taxed at a concessional rate of

10.5%. In case of Individuals and Hindu Undivided Families a deduction up to Rs. 9,000 from the

Total Income will be admissible in respect of income from investments specified in Section 80L,

including income from Units of the Mutual Fund. Units of the schemes are not subject to Wealth-Tax

and Gift-Tax. Well regulated: The funds are registered with the Securities and Exchange Board of

India and their operations are continuously monitored.

Mutual funds drawbacks and may not be for everyone:

No Guarantees: No investment is risk free. If the entire stock market declines in value, the value of

mutual fund shares will go down as well, no matter how balanced the portfolio. Investors encounter

fewer risks when they invest in mutual funds than when they buy and sell stocks on their own.

However, anyone who invests through a mutual fund runs the risk of losing money.

Fees and commissions: All funds charge administrative fees to cover their day-to-day expenses.

Some funds also charge sales commissions or "loads" to compensate brokers, financial consultants,

or financial planners. Even if you don't use a broker or other financial adviser, you will pay a sales

commission if you buy shares in a Load Fund.

Taxes: During a typical year, most actively managed mutual funds sell anywhere from 20 to 70

percent of the securities in their portfolios. If your fund makes a profit on its sales, you will pay taxes

on the income you receive, even if you reinvest the money you made.

Management risk: When you invest in a mutual fund, you depend on the fund's manager to make the

right decisions regarding the fund's portfolio. If the manager does not perform as well as you had

hoped, you might not make as much money on your investment as you expected. Of course, if you

invest in Index Funds, you forego management risk, because these funds do not employ managers.

TYPE OF MUTUAL FUND SCHEMES

Wide variety of mutual fund schemes exists to cater to the needs such as financial position, risk

tolerance and return expectations etc. the table below gives an overview into the existing types of

schemes in the industry.

By structure

Open- Ended schemes

Close- Ended schemes

Interval schemes

By investment objectives

Growth/Equity schemes

Income/Debt scheme

Money market

Guilt funds

Balanced schemes

Other schemes

Tax saving schemes

Special schemes:

Sector specific schemes

Index schemes

BY STRUCTURE

Open - Ended Schemes: An open-ended fund or scheme is one that is available for subscription and

repurchase on a continuous basis. These schemes do not have a fixed maturity period. Investors can

conveniently buy and sell units at Net Asset Value (NAV) related prices, which are declared on a daily

basis. The key feature of open-end schemes is liquidity

Close - Ended Schemes: A close-ended fund or scheme has a stipulated maturity period e.g. 5-7

years. The fund is open for subscription only during a specified period at the time of launch of the

scheme. Investors can invest in the scheme at the time of the initial public issue and thereafter they

can buy or sell the units of the scheme on the stock exchanges where the units are listed. In order to

provide an exit route to the investors, some close-ended funds give an option of selling back the units

to the mutual fund through periodic repurchase at NAV related prices. SEBI Regulations stipulate that

at least one of the two exit routes is provided to the investor i.e. either repurchase facility or through

listing on stock exchanges. These mutual funds schemes disclose NAV generally on weekly basis.

Interval Scheme: these combine the feature of open-ended and close ended schemes. They may be

traded on the stock exchange or may be open for sale or redemption during predetermined intervals

at NAV related prices.

BY INVESTMENT OBJECTIVE

Growth Schemes: The aim of growth funds is to provide capital appreciation over the medium to

long- term. Such schemes normally invest a major part of their corpus in equities. Such funds have

comparatively high risks. These schemes provide different options to the investors like dividend

option, capital appreciation, etc. and the investors may choose an option depending on their

preferences. The investors must indicate the option in the application form. The mutual funds also

allow the investors to change the options at a later date. Growth schemes are good for investors

having a long-term outlook seeking appreciation over a period of time.

Income Schemes: The aim of income funds is to provide regular and steady income to investors.

Such schemes generally invest in

fixed income securities such as bonds,

corporate debentures, Government

securities and money market instruments.

Such funds are less risky compared to

equity schemes. These funds are not affected

because of fluctuations in equity markets.

However, opportunities of capital appreciation are also limited in such funds. The NAVs of such funds

are affected because of change in interest rates in the country. If the interest rates fall, NAVs of such

funds are likely to increase in the short run and vice versa. However, long term investors may not

bother about these fluctuations.

Different types of debt schemes

Balanced Schemes: The aim of balanced funds is to provide both growth and regular income as

such schemes invest both in equities and fixed income securities in the proportion indicated in their

offer documents. These are appropriate for investors looking for moderate growth. They generally

invest 40-60% in equity and debt instruments. These funds are also affected because of fluctuations

in share prices in the stock markets. However, NAVs of such funds are likely to be less volatile

compared to pure equity funds.

Money Market Schemes: These funds are also income funds and their aim is to provide easy

liquidity, preservation of capital and moderate income. These schemes invest exclusively in safer

short-term instruments such as treasury bills, certificates of deposit, commercial paper and inter-bank

call money, government securities, etc. Returns on these schemes fluctuate much less compared to

other funds. These funds are appropriate for corporate and individual investors as a means to park

their surplus funds for short periods

Gilt Fund: These primarily invest in government debts. Hence, the investor usually does not have to

worry about credit risk since government debt is generally credit risk free. Reliance Gilt Securities

Fund - Short Term Gilt Plan & Long Term Gilt Plan are best example of such scheme.

OTHER SCHEMES

Tax Saving Schemes: These schemes offer tax rebates to the investors under specific provisions of

the Income Tax Act, 1961 as the Government offers tax incentives for investment in specified

avenues. E.g. Equity Linked Savings Schemes (ELSS). Pension schemes launched by the mutual

funds also offer tax benefits. These schemes are growth oriented and invest pre-dominantly in

equities. Their growth opportunities and risks associated are like any equity-oriented scheme.

SPECIAL SCHEMES

Index Schemes: Index Funds replicate the portfolio of a particular index such as the BSE Sensitive

index, S&P NSE 50 index (Nifty), etc. These schemes invest in the securities in the same weightage

comprising of an index. NAVs of such schemes would rise or fall in accordance with the rise or fall in

the index, though not exactly by the same percentage due to some factors known as "tracking error"

in technical terms. Necessary disclosures in this regard are made in the offer document of the mutual

fund scheme. There are also exchange traded index funds launched by the mutual funds which are

traded on the stock exchanges.

Sector Specific Schemes: These are the funds/schemes which invest in the securities of only those

sectors or industries as specified in the offer documents. E.g. Pharmaceuticals, Software, Fast

Moving Consumer Goods (FMCG), Petroleum stocks, etc. The returns in these funds are dependent

on the performance of the respective sectors/industries. While these funds may give higher returns,

they are more risky compared to diversified funds. Investors need to keep a watch on the

performance of those sectors/industries and must exit at an appropriate time. They may also seek

advice of an expert.

NAV

NAV or Net Asset Value of the fund is the cumulative market value of the assets of the fund net of

its liabilities. NAV per unit is simply the net value of assets divided by the number of units outstanding.

Buying and selling into funds is done on the basis of NAV-related prices. NAV is calculated as follows:

NAV= Market value of the fund’s investments + Receivables +

Accrued Income– Liabilities-Accrued Expenses

Number of Outstanding units

Entry/Exit Load

A Load is a charge, which the AMC may collect on entry and/or exit from a fund. A load is

levied to cover the up-front cost incurred by the AMC for selling the fund. It also covers one time

processing costs. Some funds do not charge any entry or exit load. These funds are referred to as ‘No

Load Fund’. Funds usually charge an entry load ranging between 1.00% and 2.00%. Exit loads vary

between 0.25% and 2.00%.

E.g. Let us assume an investor invests Rs. 10,000/- and the current NAV is Rs.13/-. If the entry load

levied is 1.00%, the price at which the investor invests is Rs.13.13 per unit. The investor receives

10000/13.13 = 761.6146 units. (Note that units are allotted to an investor based on the amount

invested and not on the basis of no. of units purchased).

Let us now assume that the same investor decides to redeem his 761.6146 units. Let us also assume

that the NAV is Rs 15/- and the exit load is 0.50%. Therefore the redemption price per unit works out

to Rs. 14.925.

The investor therefore receives 761.6146 x 14.925 = Rs.11367.10

Sales/Purchase price

Sales/Purchase price is the price paid to purchase a unit of the fund. If the fund has no entry load,

then the sales price is the same as the NAV. If the fund levies an entry load, then the sales price

would be higher than the NAV to the extent of the entry load levied.

Switch

Some Mutual Funds provide the investor with an option to shift his investment from one scheme to

another within that fund. For this option the fund may levy a switching fee. Switching allows the

Investor to alter the allocation of their investment among the schemes in order to meet their changed

investment needs, risk profiles or changing circumstances during their lifetime.

Association of Mutual Fund in India (AMFI):

AMFI, the apex body of all the registered Asset Management companies was incorporated on

august 22, 1995 as a non-profit organization. As of now, all the 31Asset Management Companies

that has launched Mutual Fund schemes are its members. AMFI functions under the supervision and

guidance of a Board of Directors.

Over the years, AMFI has worked closely with SEBI in establishing standards that match the best

in the world. It has played a significant role in introducing best practices to reinforce the growth of the

industry on healthy lines and protect the interests of the investors.

One of the major initiatives of AMFI has been the introduction of certification program for agent

distributors. SEBE has mandated that all those engaged in sales a marketing of mutual fund

schemes will be AMFI certified and registered. AMFI has brought out a detailed workbook on mutual

funds based on which it conducts computerized testing through National Stock Exchange test centers.

It also organizes written examinations in different languages. Till date over 31,000 agent distributors

have passed the test.

AMFI complies and publishes data on a monthly and quarterly basis. It has a quarterly

publication “AMFI update” which summarizes major developments in the mutual fund industry and

changes in the regulatory framework.

SEBI REGULATIONS ON MUTUAL FUNDS

SEBI REGULATIONS 1996: Mutual funds in India are comprehensively regulated under the SEBI

(Mutual Funds) Regulation, 1996. Some of the important provisions of this regulation are as follows:

A mutual fund shall be constituted in the form of a thrust executed by the sponsor in favor of the

trustees.

The sponsor or, if so authorized by the trust deed, the trustees, shall appoint an asset management

company.

The mutual fund shall appoint a custodian.

No scheme shall be launched by the AMC unless it is approved by the trustees an a copy of the offer

document has been filed with SEBI.

The offer document and advertisement materials shall not be misleading.

No guaranteed return shall be provided in a scheme unless such returns are fully guaranteed by the

sponsor or the AMC.

The moneys collected under any scheme of a mutual fund shall be invested only in transferable

securities.

The moneys collected under any money market scheme of a mutual fund shall be invested only in

money market instruments in accordance with directions issued by the reserve bank of India.

The mutual funds shall not borrow except to meet temporary liquidity needs.

The net asset value (NAV) and the sale and repurchase price of mutual fund schemes must be

regularly published in daily newspapers.

Every AMC shall keep and maintain proper books of accounts records, and documents for each

scheme.

The investments of a mutual fund are subject to several restrictions relating to exposure to stocks of

individual companies, debt instruments of individual issuers so on and so forth.

Costs associated with mutual fund investing such as initial expenses, loads (entry and exit), and

annual recurring expenses are subject to certain ceilings.

The rights which are available to a Mutual Fund holder: As per SEBI Regulations on Mutual Funds, an

investor is entitled to-

Receive unit certificates or statement of accounts confirming your title within 6 weeks from the date

your request for a unit certificate is received by the Mutual Fund.

Receive information about the investment policies, investment objectives, financial position and

general affairs of the scheme.

Receive dividend within 42 days of their declaration and receive the redemption of repurchase

proceeds within 10 days from the date of redemption or repurchase.

The trustees shall be bound to make such disclosures to the unit holders as they essential in order to

deep them informed about any information which may have an adverse bearing on their investments.

75% of the unit holders with the prior approval of SEBI can terminate the AMC of the fund.

75% of the unit holders can pass a resolution to wind-up the scheme.

SWOT ANALYSIS:-

SWOT analysis is a strategic planning method used to evaluate the Strengths, Weaknesses,

Opportunities, and Threats involved in a business venture. It involves specifying the objective of the

business venture or project and identifying the internal and external factors that are favourable and

unfavourable to achieve that objective.

A SWOT analysis must first start with defining a desired end state or objective. A SWOT

analysis may be incorporated into the strategic planning model. Strengths: attributes of the person or

company that is helpful to achieving the objectives.

1. Weaknesses: attributes of the person or company that is harmful to achieving the objectives.

2. Opportunities: external conditions that is helpful to achieving the objectives.

3. Threats: external conditions which could do damage to the objectives.

Identification of SWOTs is essential because subsequent steps in the process of planning for

achievement of the selected objective may be derived from the SWOTs.

Identification the threats and opportunities in the environment and strength weakness of the

firm is the basis of business policy formulation; these factors determine the course of action to ensure

the survival or growth of the firm.

The environment might present many opportunities but a company might not have the

strengths to exploit all opportunities. Similarly, sometimes a firm will not have the strengths to meet

the environmental threats. If a company thus finds that it will not have the competence to survive in a

particular line of business, it will prudent to give up and concentrate on such business for which the

firm is most competent.

STRENGTH

RMF offers high claim settlement.

Outstanding claim is very less.

RMF offers maximum variety of policies according to the needs of people in India

The only guaranteed return regular mode pension plan in the country.

No other insurer could launch till IRDA dispensed with guarantee.

Introducing satellite branches in every branch.

There are well trained and experienced development officers for guiding agents

Agents are business minded and experienced in this profession.

WEAKNESS

It is subject to constant changes of the Indian economy

It should follow the updating Indian economic norms.

It is not an independent decision making on, it always dependent to national economic

conditions

Lack of competitive differential with other offshore centres.

Rigid legislation that inhibits business development.

The middle class population that we are eyeing at are today overburdened, first by inflationary

pressures on their pockets and then by the tax net

OPPORTUNITY

Mutual fund market is very big, where company can expand its horizon in insurance industry.

Though good investment and insurance it is easy to top Indian customers.

Globalization of the economy has helped the organization to overcome operational

restrictions.

There is an opportunity for merger or acquisition or setting up a joint venture or creating a

subsidiary by either party.

THREATS

It’s still difficult task to win the confidence of public towards mutual company.

The company is facing some threats from other private companies.

Plans for all income groups are not available which can create adverse effect later on the

market share of the company.

Outsourcing to cheaper jurisdictions

Subsequent impact on rest of finance sector ecosystem.

The investors in the capital may turn their face off in case the rate of return on capital falls

short of the existing rate of return on capital.

MISSION, VISION & VALUES

Vision

“To be a globally admired organization that enhances the quality of life of all stakeholders through

sustainable industrial and business development”

Mission

We aspire to achieve business excellence through-

• The spirit of entrepreneurship and innovation

• Optimum utilization of resources

• The highest ethics and standards

• Maximizing returns to stakeholders

Value s

• Passion for people

• Business excellence

• Integrity, ownership and and source of belonging

• Sustainable development

FINDINGS:-

The Reliance Banking Fund has given higher return 0f 40.25% in the year 2008 compared to the

index return (bank nifty) of 30.32%. In 2007 this fund is the highest return given compared to the other

fund in the past 3 years.

The second best is Reliance Growth Fund which has given return of 71.97% in the year 2007

compared to the BSE 100 59.35%.

The Reliance Growth Fund was performed well with the average return of 59.79% compared to the

BSE 100 which is has average return of 45.95%.

The Reliance NRI Equity Fund also performed well with the average return of 52.05% compared to

BSE 200 44.33%.

Reliance Equity Fund was favorable fund with less standard deviation of 4.4749 than the other fund.

The rate of risk of Reliance Pharma Fund was less compared to the other funds with 0.4104.

As per the Sharpe index performance measure the well performed fund with less Standard Deviation

was Reliance Equity Fund.

According to the Treynor index performance measure the well performed fund with less rate of risk

was Reliance Pharma Fund.

According to the Jensen Index, performance measure the well performed fund was Reliance Pharma

Fund which has given excess return over the actual return.

SUGESSIONS AND RECOMMENDATION:-

The investor should read the offer document before investing.

The investor should consult the financial experts or the investment advisors before taking any

decisions.

Both- the economy and the corporate sector are doing well but the valuations are fair and priced for

perfection.

Asset allocation and Systematic Investment Plans are the best way to safeguard against volatility.

They insure optimal returns and not the maximum return in volatile markets.

Investors who able to wait for long time could look at value stocks, which consistently perform over a

period of time.

Investors should look at a mix of large and mid cap funds for 3-5 years horizon on systematic

investment basis.

With the long-term India growth story intact, remain invested in equity with a longer time horizon.

In a fair value plus market, maintain a little less than neutral allocation towards equities.

AMFI passed that agents are not so active to promote the product, so conduct programmes or

meetings to educate and giving additional information about company’s performance of existing

schemes.

CONCLUSION

The research shows that Equity Funds are performing well, but the investments from

investors are less in equity funds, because of unawareness about mutual funds.

The low level of awareness among investors is the biggest problem to the expansion of the

industry. Despite the best efforts by mutual funds, SEBI and AMFI and their distributor, the investor’s

base is below one percent of the population. Generally, investors react only when activity in equity

markets reaches a crescendo. Some are caught up by catchy advertisements and invest in belief that

the party is going to lost forever. Only when the market tanks and they burn their fingers do investors

suddenly realize their ignorance and even then not all. Many do not know how to track their portfolio.

Therefore company has to take some steps to make aware people of Mutual Funds, through

advertisements in Newspaper, Magazine, Commercial advertisement, distributing leaflets, Television,

Radios. As per budget , the dividends from MF units’ continue to be tax-free for its investors. Debt-

oriented Mutual Funds schemes continue to pay distribution tax amounting to 12.5 percent on the

dividends declared, while equity-oriented mutual funds schemes will not be required to pay

distribution tax. Long-term capital gains tax on equity 5[unds remains nil while for debt funds it would

be taxed at the prevailing rates- 10% ithout indexation or 20% with indexation.

BIBLIOGRAPHY:-

1)Reliance mutual fund Brochures and Manuals.

2)Website- www.relianceimutualfund.com.

3)Newspapers.

4)Search Magazines.

5)Electrical media.

http://www.relianceimutualfund.com/

Project on mutual fund

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