SUMMARY/ABSTRACT

Probably nothing can define the spirit of being ‘mutual’ better than this verse.
And who else to understand it better than the mutual fund industry. It seems the
mutual fund industry in India is slowly but surely beginning to recognize this aspect
for the better. Today, there is greater emphasis on the role of the industry, the
regulator. Securities and Exchange board of India (SEBI) and industry body,
Association of Mutual Funds in India (AMFI) on creating awareness among
investors and improving investor services. In fact, the efforts of both the regulator as
well as AMFI are laudable for promoting the cause of investor education religiously.
The ‘one product caters to all needs’ approach has given way to offering products
which suite the specific needs of investors ala product innovation. There is also
increased emphasis on convenience in terms of comfortable transaction services to
investors by using delivery or distribution platforms like the Internet, ATMs,
Corporate brokers, etc. Infect, distribution innovation has come to play a key role in
the growth of the industry. Industry players are using different distribution channels
to increase their market penetration. However, a significant change that is being
witnessed now is the swift response on part of the regulator to safeguard investors’
interests. Thanks to the collective efforts of SEBI and AMFI, and also the industry
players, the domestic mutual fund industry has been untouched by the depression of
late trading, inside trading etc., which affected the US Mutual Fund industry in
recent times. However, that is not to say that the Indian Mutual Fund Industry is
completely problem-free. Issues such as low penetration in both semi urban as well
rural areas (mutual funds have so far been largely and urban affair that too in big
cities), poor investor awareness and exploitation of this fact by industry players, as
demonstrated by the mutual fund IPO commotion and excessive focus on corporate
and other big pocket investors at the expense of retail investors are some of the
issues that industry needs to address With the increase in domestic saving s and
improvement in deployment of investment through markets, the need and scope for
mutual fund operation has increased tremendously. Mutual funds are not only best
suited for the purpose but also are capable of meeting this challenge effectively.
Professionals who manage mutual funds are considered to have a better knowledge
of market behavior. Another important reason is that the dividends and capital gains

1
are reinvested automatically in mutual funds and, hence, are not frittered away.
Mutual funds also create awareness among the urban and rural middle-class about
the benefits of investments in capital markets through profitable and safe avenues,
and are able to gather a large amount of the surplus funds available with this section.
Within short span of time mutual fund operation has become an integral part of
the Indian financial scene and is balanced for rapid growth in the near future. The
mutual fund industry has been remarkably flexible over the last decade in spite of
varying economic conditions, capital market scams, and increasing competition.
Today, numerous schemes, tailored to meet the diversified needs of savers, are being
offered by many institutions.

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 Introduction about Mutual Fund

Mutual Funds :Why ?

ADVANTAGES OF MUTUAL FUNDS

 Professional Management
 Diversification
 Convenient Administration
 Return Potential
 Low Costs
 Liquidity
 Transparency
 Flexibility
 Choice of schemes
 Tax benefits
 well regulated

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 Mutual Funds : What is it ?

Mutual Fund Operation Flow Chart

A Mutual Fund is a trust that pools the savings of a number of investors who
share a common financial goal. The money thus collected is then invested in capital
market instruments such as shares, debentures and other securities. The income
earned through these investments and the capital appreciation realized are shared by
its unit holders in proportion to the number of units owned by them. Thus a Mutual
Fund is the most suitable investment for the common man as it offers an opportunity
to invest in a diversified, professionally managed basket of securities at a relatively
low cost. The flow chart below describes broadly the working of a mutual fund:

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 Mutual Fund : What is it made of ?
ORGANISATION OF A MUTUAL FUND:

There are many entities involved and the diagram below illustrates the
organizational set up of a mutual fund:

Investors:

Every investor, given his financial position and personal disposition, has a
certain tendency preference to take risk (risk profile / risk appetite). The
hypothesis is that by taking an incremental risk (of losing capital, wholly or partly),
it would be possible for the investor to earn an incremental return.
But assuming risk without regularly monitoring it is foolhardy. Therefore, it
would be prudent for investors who take a risk to be able to manage this risk.
MF is a solution for investors who lack the time, or the inclination or the skills to
actively manage their investment risk in individual securities. They can delegate
this role to the MF, while retaining the right and the obligation to monitor their
investments in the scheme (which, in turn, invests in individual securities).
In the absence of a MF option, the moneys of such “passive” these investors
would lie either in bank deposits or other “safe” investment options, thus depriving
the investors of the possibility of earning a better return.
Investing through a MF would make economic sense for an investor if his
investment, over the medium to long term, fetches a return (net of all costs and
expenses) that is higher than what she would otherwise have earned by investing

5
 directly.
Because the goal of investing is to accumulate real wealth – an enhanced
ability to pay for goods and services – the ultimate focus of the long-term investor
must be on real, not nominal, returns.

Trustees:

Trustees are the people within the mutual fund organization, who are
responsible to ensure for ensuring that investors’ interests are properly taken care of
In return for their services, they are paid trustee fees, which is normally charged to
the scheme.

Asset Management Company (AMC):

AMCs manage the investment portfolios of schemes. An AMC’s Income for
an AMC comes through from the management fees that are it charges to the
schemes. The management fee is calculated as a percentage of net assets
managed. Some countries provide for performance based management fees as well.

Distributors
Distributors earn a commission for bringing investors into the schemes of a
MF. This commission is an expense for the scheme, although there are occasions
when the AMC chooses to bear the cost, wholly or partly. Depending on the
financial and physical resources at their disposal, they distributors could be:

Tier 1 distributors (having an owned or franchised network reaching out

to investors all across the country); or
Tier 2 distributors (regional players with some reach within their region); or

Tier 3 distributors (marginal players).

It is paradoxical that distributors earn a commission from the AMC, but are expected
to safeguard the financial health of investors from whom they do not earn a fee.

6
It is almost like a doctor earning a commission from the pharmaceutical company,
but expect safeguard the physical health of the patient who does not pay him anytted
hing

Registrars
The investor’s’ holding in various schemes is typically tracked by the
scheme’s Registrar and Transfer agent (R&T). Some AMCs prefer to handle this
role in-house. The registrar / AMC maintains an account of the investor’s’
investments in and dis- investment from the scheme. Requests to invest more
money into a scheme, or to recover moneys against existing investments in the
scheme are processed by the R&T

Custodian / Depository
The custodian maintains custody of the securities in which the scheme
invests (as distinct from the registrar who tracks the investment by investors in the
scheme). This ensures an ongoing independent record of the investments of the
scheme. The custodian also follows up on various corporate actions, such as
rights, bonus and dividends declared by invested companies.

In a situation where securities are increasingly being dematerialized, the

role of the depository for such independent record of investments is increasing
growing.

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 Different types of Mutual Funds :

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.

The graph indicates the growth of assets over the years.

GROWTH IN ASSETS UNDER MANAGEMENT

          

Graph 1: The graph showing Growth in assets under management

through

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 MutualFund

   Some facts for the growth of mutual funds in India                 

 Our saving rate is over 23%, highest in the world. Only channel zing these
savings in mutual fund sector is required.

 100% growth in the last 6 years

 There are approximately 29 mutual funds which are much less than US having
more than [Link] is a big scope for expansion. 'B' and 'C' class cities are
growing rapidly. 
 Today most of the mutual funds are concentrating on the 'A' class cities. Soon
they will find scope in the growing cities.
 Mutual fund can penetrate rural like the Indian insurance industry with simple
and limited products.

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 MUTUAL FUND COMPANIES IN INDIA

List of Some of the AMCs Operating in India

Name of the AMC Nature of

ownership

Alliance Capital Asset Management (I) Private Private

Limited Foreign

Birla Sun Life Asset Management Company Limited Private Indian

Bank of Baroda Asset Management Company Banks

Limited

Bank of India Asset Management Company Limited Banks

Canbank Investment Management Services Limited Banks

Cholamandalam Cazenove Asset Management Private

Company Limited Foreign

Dundee Asset Management Company Limited Private

Foreign
DSP Merrill Lynch Asset Management Company Private
Limited Foreign

Escorts Asset Management Limited Private Indian

First India Asset Management Limited Private Indian

GIC Asset Management Company Limited Institutions

IDBI Investment Management Company Limited Institutions

Indfund Management Limited Banks

ING Investment Asset Management Company Private

Private Limited Foreign

J M Capital Management Limited Private Indian

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 Jardine Fleming (I) Asset Management Limited Private
Kotak Mahindra Asset Management Company Foreign
Limited Private Indian
Kothari Pioneer Asset Management Company
Limited Private Indian
Jeevan Bima Sahayog Asset Management Company
Limited Institutions
Morgan Stanley Asset Management Company
Private Limited Private Foreign
Punjab National Bank Asset Management Company
Limited Banks
Reliance Capital Asset Management Company
Limited Private Indian
State Bank of India Funds Management Limited Banks

Shriram Asset Management Company Limited Private Indian

Sun F and C Asset Management (I) Private Limited Private Foreign

Sundaram Newton Asset Management Company Private Foreign
Limited
Tata Asset Management Company Limited Private Indian
Credit Capital Asset Management Company Limited Private Indian
Templeton Asset Management (India) Private Private Foreign
Limited
Unit Trust of India Institutions
Zurich Asset Management Company (I) Limited Private Foreign

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 Industry Profile

HISTORY AND ORGANIZATION OF MUTUAL FUNDS IN INDIA

The mutual fund industry in India started in 1963 with the formation of Unit
Trust of India, at the initiative of the Government of India and Reserve Bank the. The
history of mutual funds in India can be broadly divided into four distinct phases
First Phase – 1964-87:
Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It
was set up by the Reserve Bank of India and functioned under the Regulatory and
administrative control of the Reserve Bank of India. In 1978 UTI was de-linked from
the RBI and the Industrial Development Bank of India (IDBI) took over the
regulatory and administrative control in place of RBI. The first scheme launched by
UTI was Unit Scheme 1964. At the end of 1988 UTI had Rs.6,700 crores of assets
under management.
Second Phase – 1987-1993 (Entry of Public Sector Funds):
1987 marked the entry of non- UTI, public sector mutual funds set up by
public sector banks and Life Insurance Corporation of India (LIC) and General
Insurance Corporation of India (GIC). SBI Mutual Fund was the first non- UTI
Mutual Fund established in June 1987 followed by Canbank Mutual Fund (Dec 87),
Punjab National Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund (Nov 89),
Bank of India (Jun 90), Bank of Baroda Mutual Fund (Oct 92). LIC established its
mutual fund in June 1989 while GIC had set up its mutual fund in December 1990. At
the end of 1993, the mutual fund industry had assets under management of Rs.47,004
crores.
Third Phase – 1993-2003 (Entry of Private Sector Funds):
With the entry of private sector funds in 1993, a new era started in the Indian
mutual fund industry, giving the Indian investors a wider choice of fund families.
Also, 1993 was the year in which the first Mutual Fund Regulations came into being,
under which all mutual funds, except UTI were to be registered and governed. The
erstwhile Kothari Pioneer (now merged with Franklin Templeton) was the first
private sector mutual fund registered in July 1993.
The 1993 SEBI (Mutual Fund) Regulations were substituted by a more

12
comprehensive and revised Mutual Fund Regulations in 1996. The industry now
functions under the SEBI (Mutual Fund) Regulations 1996.
The number of mutual fund houses went on increasing, with many foreign
mutual funds setting up funds in India and also the industry has witnessed several
mergers and acquisitions. As at the end of January 2003, there were 33 mutual funds
with total assets of Rs. 1,21,805 crores. The Unit Trust of India with Rs.44,541 crores
of assets under management was way ahead of other mutual funds.
Fourth Phase – since February 2003:
In February 2003, following the repeal of the Unit Trust of India Act 1963
UTI was bifurcated into two separate entities. One is the Specified Undertaking of the
Unit Trust of India with assets under management of Rs.29,835 crores as at the end of
January 2003, representing broadly, the assets of US 64 scheme, assured return and
certain other schemes. The Specified Undertaking of Unit Trust of India, functioning
under an administrator and under the rules framed by Government of India and does
not come under the purview of the Mutual Fund Regulations.
The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and
LIC. It is registered with SEBI and functions under the Mutual Fund Regulations.
With the bifurcation of the erstwhile UTI which had in March 2000 more than
Rs.76,000 crores of assets under management and with the setting up of a UTI
Mutual Fund, conforming to the SEBI Mutual Fund Regulations, and with recent
mergers taking place among different private sector funds, the mutual fund industry
has entered its current phase of consolidation and growth

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 COMPANY PROFILE

Reliance Mutual Fund (RMF) has been established as a trust under the Indian Trusts
Act, 1882 with Reliance Capital Limited (RCL), as the Settlor/Sponsor.

OUR FOUNDER

Dhirubhai H. Ambani
Founder Chairman,
Reliance Industries Limited, India
December 28, 1932 - July 6, 2002
Major Group Companies:
Reliance Industries Limited,
India's largest private sector company
Birthplace: Chorwad, village in Saurashtra (Gujarat), India Father's
Name: Hirachand Govardhandas Ambani Mother's Name: Jamunaben
Hirachand Ambani

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INTRODUCTION OF RELIANCE MUTUAL FUND

About Reliance Mutual Fund :

Reliance Mutual Fund (RMF) has been established as a trust under the Indian
Trusts Act, 1882 with Reliance Capital Limited (RCL), as the Settlor/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.

About Reliance Capital Asset Management Ltd:

Reliance Capital Asset Management Limited (RCAM), a company registered under

the Companies Act, 1956 was appointed to act as the Investment Manager of
Reliance Mutual Fund.

Reliance Capital Asset Management Limited is a wholly owned subsidiary of

Reliance Capital Limited, the sponsor. The entire paid-up capital (100%) of Reliance
Capital Asset Management Limited is held by Reliance Capital Limited.

Reliance Capital Asset Management Limited was approved as the Asset

Management Company for the Mutual Fund by SEBI vide their letter no
IIMARP/1264/95 dated June 30, 1995. The Mutual Fund has entered into an
Investment Management Agreement (IMA) with RCAM dated May 12, 1995 and
was amended on August 12, 1997 in line with SEBI (Mutual Funds) Regulations,
1996. Pursuant to this IMA, RCAM is authorized to act as Investment Manager of
Reliance Mutual Fund. RCAM has been registered as a portfolio manager vide SEBI
Registration No. INP000000423 and renewed effective 1st August, 2003

15
 RCAM has commenced these activities. It has been ensured that key personnel of
the AMC, the systems, back office, bank and securities accounts are segregated
activity wise and there exists systems to prohibit access to inside information of
various activities. As per SEBI Regulations, it will further ensure that AMC meets
the capital adequacy requirements, if any, separately for each such activity.

RCAM has been appointed as the Investment Manager of "Reliance India

Power Fund", a Venture Capital Fund registered with SEBI vide Registration
[Link]/VCF/05-06/062 dated June 16, 2005 but this activity is yet to commence.

Reliance Mutual Fund (RMF) is one of India’s leading Mutual Funds, with
Average Assets Under Management (AAUM) of Rs. 1,22,252 Crores and an investor
base of over 72.40 Lacs. (AAUM and investor count as of November 2009) AAUM

Reliance Mutual Fund, a part of the Reliance - Anil Dhirubhai Ambani Group,
is one of the fastest growing mutual funds in the country. RMF offers investors a
well-rounded portfolio of products to meet varying investor requirements and has
presence in 118 cities across the country. Reliance Mutual Fund 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 Limited., a subsidiary of Reliance Capital Limited, which holds 93.37%
of the paid-up capital of RCAM, the balance paid up capital being held by minority
shareholders."

Reliance Capital Ltd. is one of 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
Ltd. has interests in asset management, life and general insurance, private equity and
proprietary investments, stock broking and other financial services.

Reliance Mutual Fund Is Now India's Largest MF

Reliance mutual funds has now gone ahead of Unit Trust of India (UTI) to become
India's largest mutual fund by AUM (assets under management).
According to AFMI (Association of Mutual Funds of India) Reliance's AUM were Rs
39000 crore in January compared to Rs 37500 crore of UTI.
Prudential ICICI MF is now in the third position with AUM of 34750 crore and HDFC
MF is at fourth position with AUM of 31500 crore.

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Total AUM of all mutual funds in India (except Taurus and Escorts) is now at Rs
323500 crore.

17
 AWARDS & ACHIVEMENT

 Lipper Fund Award India 2007 :

o Reliance Gilt Securities Fund-Long Term Plan-Growth was declared
the best fund over 3 years in the Bond INR Government category, out
of 52 eligible schemes.
o Reliance Growth Fund-Growth Plan was declared the best fund over 5
years in the Equity India category, out of 81 eligible schemes.
o
 Lipper Fund Award Gulf 2007 :
o Reliance Banking Fund-Growth Plan-Growth Option was declared the
best fund over 3 years in Equity Sector Banks and Other Financials
o Reliance Growth Fund-Growth Plan was declared the best fund over 3
years in the Equity India category
o Reliance Growth Fund-Growth Plan was declared the best fund over 5
years in the Equity India category
o Reliance Income Fund-Growth Plan-Growth Option was declared the
best fund over 5 years in Bond Indian Rupee – General category
o Reliance Gilt Securities Fund-Long Term Plan-Growth was declared
the best fund over 3 years in the Bond INR Government category
o Reliance Short Term Fund-Growth Plan was declared the best fund
over 3 years in Bond Indian Rupee
o
 CNBC TV18 - CRISIL Mutual Fund of the Year Awards 2006 :
o Reliance Gilt Securities Fund - Long Term Plan was awarded CNBC
TV18 - CRISIL Mutual Fund of the Year Awards 2006, in the Open
End Long Term Gilt Category
o Reliance Short Term Fund was awarded CNBC TV18 - CRISIL Mutual
Fund of the Year Awards 2006, in the Open End Debt Short Term
Category

 ICRA Mutual Funds Awards 2007 :

o Reliance Short Term Fund has been ranked ICRA MFR 1 by ICRA
Mutual Funds Awards 2007 in the category Open Ended Debt – Short
Term for its 1 year performance till December 31, 2006. The rank
indicates performance within the top 10% of the stated category.

o Reliance Gilt Securities Fund - Long Term Retail Plan has been ranked
ICRA MFR 1 by ICRA Mutual Funds Awards 2007 in the category
Open Ended Gilt - Long Term for its 3 year performance till December
31, 2006. The rank indicates performance within the top 10% of the
stated category.
o Reliance Liquidity Fund has been ranked ICRA MFR 1 by ICRA
Mutual Funds Awards 2007 in the category Open Ended Liquid

18
 Scheme for its 1 year performance till December 31, 2006. The rank
indicates performance within the top 10% of the stated category.

 The first mutual fund in India to offer instant cash withdrawal facility on
investments. Reliance Mutual Fund offers the Reliance Any Time Money
(ATM) Card with select schemes. The card is a boon for retail investors as it
enables them to withdraw their investment any time, anywhere at over 1
million VISA-enabled ATMs across the world.

 Reliance Mutual Fund is amongst the few mutual funds with a 24X7 Call
Centre facility

Lipper Fund Awards India & Gulf 2007 Disclaimer :

Reliance Short Term Fund-Growth Plan was declared the best fund over 3
years in Bond Indian Rupee – General category out of 27 eligible schemes. Reliance
Gilt Securities Fund-Long Term Plan-Growth was declared the best fund over 3 years
in the Bond INR Government category, out of 13 eligible schemes. Reliance Growth
Fund-Growth Plan was declared the best fund over 3 years in the Equity India
category, out of 50 eligible schemes. Reliance Banking Fund-Growth Plan-Growth
Option was declared the best fund over 3 years in Equity Sector Banks and Other
Financials, out of 6 eligible schemes. Reliance Income Fund-Growth Plan-Growth
Option was declared the best fund over 5 years in Bond Indian Rupee – General
category, out of 5 eligible schemes. Reliance Growth Fund-Growth Plan was declared
the best fund over 5 years in the Equity India category, out of 40 eligible schemes. All
awards are as of 31st December 2006. Sales Charge is not considered for fund awards
ranking. Methodology: The currency for the calculation corresponds to the currency of
the country for which the awards are calculated and relies on monthly data.
Classification averages are calculated with all eligible share classes for each eligible
classification. The calculation periods extend over 36, 60, and 120 months. The
highest Lipper Leader for Consistent Return (Effective Return) value within each
eligible classification determines the fund classification winner over three, five, or ten
years. For a detailed explanation & source please review the Lipper Leaders
methodology document on [Link] Criteria: Funds registered for

19
sale in the respective country as of the end of the evaluation year. Lipper Global
classifications with at least ten distinct portfolios based on the primary share class
definition, excluding residual classifications, institutional, private, closed-end and
insurance funds. Asset classes: equity, bond, and mixed-asset. The information
contained herein has been obtained from sources published by third parties. While
such publications are believed to be reliable, however, neither the AMC, the Trustees,
the Fund nor any of their affiliates or representatives assume any responsibility for the
accuracy of such information. Investment Objective: Reliance Short Term Fund-The
primary objective of the Scheme is to generate stable returns for investors with a short
term investment horizon by investing in fixed income securities of a short term
maturity. Reliance Gilt Securities Fund-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 Growth
Fund-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 Banking Fund-The primary investment objective
of the Scheme is to seek to generate continuous returns by actively investing in
equity / equity related or fixed income securities of banks. Reliance Income Fund-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 Market Instruments.

CNBC TV18 - CRISIL Mutual Fund of the Year Awards 2006 Disclaimer :
Reliance Gilt Securities Fund was among the 2 schemes that won the CNBC TV18 -
CRISIL Mutual Fund of the Year Awards 2006 in the Open End Long Term Gilt
Category. In total 4 schemes qualified for the award universe. Reliance Short Term
Fund was the only scheme that won the CNBC TV18 - CRISIL Mutual Fund of the
Year Awards 2006 in the Open End Debt Short Term Category. In total 3 schemes
qualified for the award universe. The award is based on consistency of schemes
performance in the last four quarterly CRISIL CPR rankings released during the
calendar year 2006. The individual CRISIL CPR parameter scores averaged for the
four quarters and further multiplied by the parameter weight as per the CRISIL CPR
methodology to arrive at the final scores. A detailed methodology of the CRISIL CPR

20
is available at [Link]. Rankings and Award Source: CRISIL FundServices,
CRISIL Limited

ICRA Ranking Disclaimer :

The rank is an outcome of an objective and comparative analysis against various

parameters, including: risk adjusted return, fund size, sector concentration, portfolio
turnover, liquidity, company concentration and average maturity. The ranking
methodology did not take into account entry and exit loads imposed by the Fund. The
rank is neither a certificate of statutory compliance nor any guarantee on the future
performance of Reliance Short Term Fund, Reliance Gilt Securities Fund - Long Term
Retail Plan and Reliance Liquidity Fund. Ranking Source & Publisher: ICRA Online

WHY RELIANCE MUTUAL FUND ?

Reliance Mutual Fund ,a part of the –Anil Dhirubhai Ambani Group(R-
ADAG) is one of the fastest growing mutual fund company in the country.
Reliance mutual fund offer investors a well –rounded portfolio of products to
meet varying investor requirements.
Reliance mutual fund has a presence over 80 cities across the country.
Reliance mutual fund investor base of over 2 million and manages assets over
Rs.88388 crore as on 30 April
2009,(source:[Link])
A fund from Reliance mutual fund ,an AMC with a established track record of
consistent return.
Investor –friendly personal and technological support.
Strong and consistent fund management team.

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 SWOT ANALYSIS
STRENGTHS
 Reliance Mutual Fund ,a part of the –Anil Dhirubhai Ambani Group(R-ADAG)
is one of the fastest growing mutual fund company in the country.
 Reliance mutual fund offer investors a well –rounded portfolio of products to
meet varying investor requirements.
 Reliance mutual fund has a presence over 118 cities across the country, with
investor base over 71.53 lacs.
 Reliance mutual fund investor base of over 2 million and manages assets over
Rs.88388 crore as on April 30,2009(source:[Link])
WEAKNESS
 Less existence in rural areas less expenditure on advertising and promotional
schemes
OPPORTUNITIES

 Reliance mutual fund has a very good quality products &schemes comparison to
other competitor.
 A fund from Reliance mutual fund ,an AMC with a established track record of
consistent [Link] and consistent fund management team.
 Investor –friendly personal and technological support.
 Ensures better costumer services, conveniences ,communication by efficient
network.
 Quality product & services – High quality standard maintained.
 Brand Name – Reliance Mutual Fund ’ is popular brand name among
customers.
 Good image between customers.
 Reliance is first company which launched Equity fund with hedging
feature which aim to minimize risk.. Good perception among the customer.
THREATS
 Less schemes provided by Reliance mutual fund comparison to competitor.

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 Lot of competitor in market.
 Lot of schemes are provided by competitors. Share market may be go
down in future.
 The Mutual Fund is not guaranteeing or assuring any dividend/ bonus
OBJECTIVES

1. To project Mutual Fund as the ‘productive avenue’ for investing activities.

2. To show the wide range of investment options available in Mutual Funds by

explaining its various schemes.
3. To compare the schemes based on Sharpe’s ratio, ,Co- efficient, Returns
and show which scheme is best for the investor based on his risk profile.
4. To help an investor make a right choice of investment, while considering the
inherent risk factors.
5. To Manage investors portfolio that provides regular income, growth,
Safety, liquidity, tax advantage, professional management and diversification.

To understand the recent trends in Mutual Funds world.

The comparison between these schemes is made based on the following factors
A) Sharpe’s Ratio
B) (Beta) co-efficient. C) Returns

A) The Sharpe’s Measure:-

In this model, performance of a fund is evaluated on the basis of Sharpe
Ratio, which is a ratio of returns generated by the fund over and above risk free
rate of return and the total risk associated with it.
According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk. Symbolically, it can be written as:

Sharpe Index (Si) = (Ri - Rf)/Si

Where,
Si is Standard Deviation of the fund.

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While a high and positive Sharpe Ratio shows a superior risk-adjusted performance
of a fund, a low and negative Sharpe Ratio is an indication of unfavorable
performance.

B) (Beta) Co-efficient:-

Systematic risk is measured in terms of Beta, which represents fluctuations

in the NAV of the fund vis-à-vis market. The more responsive the NAV of a
Mutual Fund is to the changes in the market; higher will be its beta. Beta is
calculated by relating the returns on a Mutual Fund with the returns in the
market. While unsystematic risk can be diversified through investments in a
number of instruments, systematic risk cannot. By using the risk return
relationship, we try to assess the competitive strength of the Mutual Funds vis-
à-vis one another in a better way.
(Beta) is calculated as N ( XY) – X Y N

( X2) – ( X)

C) Returns:- Returns for the last one-year of different schemes are taken for the
comparison and analysis part.

D) Standers Deviation

A statistical measurement of the dispersion of a fund's return over a specified time

period. Investors may examine historical standard deviation in conjunction with
historical returns to decide whether a fund's volatility would have been acceptable
given the returns it would have produced. A higher standard deviation indicates a
wider dispersion of past returns and thus greater historical volatility. Standard
deviation does not indicate the absolute performance, but merely indicates the
volatility of its returns over time.

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RESEARCH METHODOLOGY

Secondary data:
The information that is received with the help of Journals, Magazines,
Financial reports or which is already present with the company.

References used from management books

Gathered information through World Wide Web (www).

Support and knowledge provided by Faculty.

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EQUITY

Reliance Growth - Growth : 414.08 (NAV as on Jan 29, 2010)

INVESTMENT OBJECTIVE
Asset Allocation
The primary objective of the scheme is to
derivaties,dep equity achieve long term growth of capital by
10% t,cash,and
other investing in equity and equity related
recivable securities through a research based
90% investment.

Scheme Particulars
Type Open Ended
Equity (Equity: 89.68%, Debt:
Nature
0%, Cash: 10.32%)
Option Growth
Inception Date Oct 7, 1995
Face Value 10
Fund Size ([Link]) 6851.07 as on Dec 31, 2009
Fund Manager Sunil Singhania .
SIP NA
STP NA
SWP NA
Expense ratio(%) 1.8
Portfolio Ratio(%) 36
Last Divdend Declared 4882.05
Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
If redeemed bet. 0 Year to 1
Exit Load
Year; Exit load is 1%.

Since Total
1 3 6
Period 1 year 3 year 5 year Inceptio
month month month
n

26
 Return 202.33
-2.94 7.72 17.9 106.07 14.01 29.93 29.64
s (%)

Risk Analysis

Risk ratios Percent

Mean (?) 25.20
Standard Deviation (?) 21.60
Sharpe (?) 0.46
Beta (?) 0.06

FUND PERFORMANCE:-
(Rm- (Rp- Rf) (X
YEAR Rp Rm Rf X2 XY -Xbar) D2

X Y D

36 202.3325.9 176.43 10.1 31127.54 1871.94 151.23 22870.51

TOTAL

Rp - Portfolio Return
Rm - Market Return
Rf - Risk free rate of return.

CALCULATION OF ARTHMETIC MEAN:-

= X/N
= 176.43/7
= 25.20

CALCULATION OF STANDARD
DEVIATION (σ ):-

= √ (X-Xbar) 2 / N
= √22870.51/ 7
=151.23/ 7

= 21.60

27
 CALCULATION OF BETA CO-EFFICIENT:-
= N ( XY) – X Y

N ( X2) – ( X) 2

= 7(1871.94) – (176.43)(10.1)
7(31127.54) – (176.43) 2

11321.637
=
186765.23

= 0.061

CALCULATION OF SHARP RATIO:-

= Rp-Rf / σ

= 10.1 /21.60

= 0.46

ITERPRETATION:-.

Beta of Reliance Growth Fund is 0.061 it indicate that the securities will less volatile
than the market.

According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk.

0.46 it is the total risk of the fund that the investors are concerned about.

28
EQUITY

Reliance NRI Equity Fund - Growth : 33.23 (NAV as on Jan 29, 2010)

Asset Allocation
INVESTMENT OBJECTIVE
8% cash & other
receivables The primary objective of the scheme is
equity to generate optimal returns by investing
in equity and equity related securities
primarily drawn from the companies in
the BSE 200 Index.
92%

Scheme Particulars
Type Open Ended
Equity (Equity: 95.69%, Debt:
Nature
0%, Cash: 4.31%)
Option Growth
Inception Date Nov.15,2004
Face Value 10
Fund Size ([Link]) 140.85 as on Dec 31, 2009
Fund Manager Omprakash Kuckien.
SIP NA
STP NA
SWP NA
Expense ratio(%) 2.45
Portfolio Ratio(%) 96
Last Divdend Declared 4882.05
Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
If redeemed bet. 0 Year to 1
Exit Load
Year; Exit load is 1%.

29
 Fund Features

1 3 6 Since Total
Period 1 year 3 year 5 year
month month month Inception
Returns 168.69
-5.16 3.14 12.37 98.3 9.27 25.04 25.73
(%)

Risk Analysis

Risk ratios Percent

Mean (?) 20.39
Standard Deviation (?) 2.49
Sharpe (?) 17.48
Beta (?) 0.49

FUND PERFORMANCE:-

(Rm- (Rp- (X
YEAR Rp Rm Rf Rf) Rf) X2 XY -Xbar) D2

X Y D
Since 96 168.6925.9 142.79 70.1 20388.98 10009. 14981.7
Inception 5 122.4 6

Rp - Portfolio Return
Rm - Market Return
Rf - Risk free rate of return.

CALCULATION OF ARTHMETIC MEAN:-

= X/N
= 142.797
= 20.39

CALCULATION OF STANDARD
DEVIATION (σ ):-

= √(X-Xbar) 2 / N
= √14981.76/ 7
=122.4/ 7

30
 = 17.48

CALCULATION OF BETA CO-EFFICIENT:-

= N ( XY) – X Y

N ( X2) – ( X) 2

= 7(10009.5) – (142.79)(70.1)
7(20388.98) – (142.79) 2

= 0.49

CALCULATION OF SHARP RATIO:-

= Rp-Rf / σ

=70.1 /17.48

= 4.01

ITERPRETATION:-.

Beta of Reliance Growth Fund is 0.49. It indicate that the securities will less volatile
than the market.

According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk.

4.01 percent it is the total risk of the fund that the investors are concerned about.

31
EQUITY

Reliance Vision - Growth : 239.06 (NAV as on Jan 29, 2010)

INVESTMENT OBJECTIVE
Asset Allocation
The primary objective of the scheme is
9% to achieve long term growth of capital
cash & other by investing in equity and equity
receivables
related securities through research
equity
based investment approach.

91% Fund Features

Scheme Particulars
Type Open Ended
Equity (Equity: 90.54%, Debt:
Nature
0%, Cash: 9.46%)
Option Growth
Inception Date Oct 7, 1995
Face Value 10
Fund Size ([Link]) 3950 as on Dec 31, 2009
Fund Manager Ashwani Kumar .
SIP NA
STP NA
SWP NA
Expense ratio(%) 1.83
Portfolio Ratio(%) 133
Last Divdend Declared 4882.05
Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
If redeemed bet. 0 Year to 1
Exit Load
Year; Exit load is 1%.

32
 1 3 6 Since Total
Period 1 year 3 year 5 year
month month month Inception
Return 155.27
-5.5 4.53 14.16 85.21 8.46 23.66 24.75
s (%)
Risk ratios Percent
Mean (?) 18.48
Standard Deviation (?) 15.84
Sharpe (?) 6.76
Beta (?) 0.82

FUND PERFORMANCE:-

(Rm- (Rp- (X
YEAR Rp Rm Rf Rf) Rf) X2 XY -Xbar) D2

X Y D
Since 133 155.2725.9 129.37 107.1 16736.59 13855. 110.8 12296.5
Inception 527 9 9

Rp - Portfolio Return
Rm - Market Return
Rf - Risk free rate of return.

CALCULATION OF ARTHMETIC MEAN:-

= X/N
= 129.37/7
= 18.48

CALCULATION OF STANDARD
DEVIATION (σ ):-

= √ (X-Xbar) 2 / N
= √12296.59/ 7
=110.89/ 7

= 15.84

CALCULATION OF BETA CO-EFFICIENT:-

33
 = N ( XY) – X Y

N ( X2) – ( X) 2

= 7(13855.52) – (129.37)(107.1)
7(16736.59 ) – (129.37) 2

= 0.82

CALCULATION OF SHARP RATIO:-

= Rp-Rf / σ

=107.1 /15.84

= 6.76

ITERPRETATION:-.

Beta of Reliance Growth Fund is [Link] indicate that the securities will less volatile
than the market.

According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk.

6.76 it is the total risk of the fund that the investors are concerned about.

34
EQUITY

Reliance Equity Opportunities Fund - Growth : 27.90 (NAV as on Jan 28, 2010)

INVESTMENT OBJECTIVE

The primary objective of the

Asset Allocation scheme is to seek to generate long
5% term growth opportunity by
warrants, equity
derivatives, investing in portfolio constituted of
debt,cash & other equity related securities &
receivable
secondary objective is to generate
consistent returns by investing in
debt & money market instrument.
95%
.

Fund Features

Scheme Particulars
Type Open Ended
Equity (Equity: 95.13%, Debt:
Nature
0%, Cash: 4.87%)
Option Growth
Inception Date Mar 30, 2005
Face Value 10
Fund Size ([Link]) 1902.34 as on Dec 31, 2009
Sailesh Raj Bhan , Sunil
Fund Manager
Singhania
SIP NA
STP NA
SWP NA
Expense ratio(%) 1.94
Portfolio Ratio(%) 63
Last Divdend Declared 4882.05
Minimum Investment (Rs) 5000

35
 Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
If redeemed bet. 0 Year to 1
Exit Load
Year; Exit load is 1%.
Risk Analysis

Since Total
1 3 6
Period 1 year 3 year 5 year Inceptio
month month month
n
Return 144.36
NA 10.61 28.77 120.87 7.75 NA 23.64
s (%)

Risk ratios Percent

Mean (?) 16.92
Standard Deviation (?) 14.50
Sharpe (?) 2.55
Beta (?) 0.31
E:-

FUND PERFORMANCE;-

(Rm- (Rp- (X
YEAR Rp Rm Rf Rf) Rf) X2 XY -Xbar) D2

X Y D
Since 63 144.3625.9 118.46 37.1 14032.77 4394.8 101.5 10310.3
Inception 66 4 7

Rp - Portfolio Return
Rm - Market Return
Rf - Risk free rate of return.

CALCULATION OF ARTHMETIC MEAN:-

= X/N
= 118.46/7
= 16.92

CALCULATION OF STANDARD
DEVIATION (σ ):-

36
 = √ (X-Xbar) 2 / N
= √10310.37/ 7
=101.54/ 7

= 14.50

CALCULATION OF BETA CO-EFFICIENT:-

= N ( XY) – X Y

N ( X2) – ( X) 2

= 7(4394.86) – (118.46)(37.1)
7(14032.77) – (118.46) 2

= 0.31

CALCULATION OF SHARP RATIO:-

= Rp-Rf / σ

=37.1 /14.50

= 2.55

ITERPRETATION:-.

Beta of Reliance Growth Fund is [Link] indicate that the securities will less volatile
than the market.

According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk.

2.55 it is the total risk of the fund that the investors are concerned about.

37
EQUITY

Reliance Equity Fund - Growth : 14.44 (NAV as on Jan 28, 2010)

INVESTMENT OBJECTIVE
Asset Allocation
The primary objective of the
12% cash & other scheme is to seek to generate
receivables capital appreciation & provide long
equities
term growth opportunity by
investing in portfolio constituted of
equity related securities of top 100
companies by market capitalization
88%
& of companies which are available
in the derivatives segment from
time to time & the secondary
objective is to generate consistent returns by investing in debt & money market
instrument.

Fund Features

Scheme Particulars
Type Open Ended
Equity (Equity: 88.51%, Debt:
Nature
0%, Cash: 11.49%)
Option Growth
Inception Date Mar 27, 2006
Face Value 10
Fund Size ([Link]) 2264.77 as on Dec 31, 2009
Fund Manager Omprakash Kuckien .
SIP NA
STP NA
SWP NA
Expense ratio(%) 1.86
Portfolio Ratio(%) 97

38
 Last Divdend Declared 4882.05
Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
If redeemed bet. 0 Year to 1
Exit Load
Year; Exit load is 1%.

Since Total
1 3 6
Period 1 year 3 year 5 year Inceptio
month month month
n
Return 85.42
NA 0.41 4.45 64.11 6.58 NA 9.87
s (%)
Risk Analysis

Risk ratios Percent

Mean (?) 8.5
Standard Deviation (?) 7.28
Sharpe (?) 9.76
Beta (?) 0.83

FUND PERFORMANCE:-
(Rm- (Rp- (X
YEAR Rp Rm Rf Rf) Rf) X2 XY -Xbar) D2

X Y D
Since 97 85.42 25.9 59.52 71.1 5055.21 4231.8 51.02 2603.04
Inception 7

Rp - Portfolio Return
Rm - Market Return
Rf - Risk free rate of return.

CALCULATION OF ARTHMETIC MEAN:-

= X/N
= 59.52 /7
= 8.5

CALCULATION OF STANDARD DEVIATION (σ ):-

= √ (X-Xbar) 2 / N
= √2603.04/ 7

39
 =51.02/ 7

= 7.28

CALCULATION OF BETA CO-EFFICIENT:-

= N ( XY) – X Y

N ( X2) – ( X) 2

= 7(4231.87) – (59.52)(71.1)
7(5055.21 ) – (59.52) 2

= 0.83
CALCULATION OF SHARP RATIO:-

= Rp-Rf / σ

=71.1 /7.28

= 9.76

TERPRETATION:-.

Beta of Reliance Growth Fund is [Link] indicate that the securities will less volatile
than the market.

According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk.

9.76 it is the total risk of the fund that the investors are concerned about.

40
EQUITY

Reliance Long Term Equity Fund - Growth : 13.10 (NAV as on Jan 28, 2010)

INVESTMENT OBJECTIVE
Asset Allocation
The primary objective of the scheme is to
4%
seek to generate long term capital
appreciation & provide long term growth
opportunity by investing in portfolio
constituted of equity related securities &
derivatives & secondary objective is to
96% generate consistent returns by investing in
debt & money market instrument.

Fund Features

Scheme Particulars
Type Open Ended
Equity (Equity: 96.18%, Debt:
Nature
0%, Cash: 3.82%)
Option Growth
Inception Date Dec 25, 2006
Face Value 10
Fund Size ([Link]) 2195.61 as on Dec 31, 2009
Fund Manager Sunil Singhania
SIP NA
STP NA
SWP NA
Expense ratio(%) 1.9
Portfolio Ratio(%) 39
Last Divdend Declared 4882.05

41
 Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
If redeemed bet. 0 Year to 1
Exit Load
Year; Exit load is 1%.

Since Total
1 3 6
Period 1 year 3 year 5 year Inceptio
month month month
n
Return 129.14
NA 6.34 18.07 87.4 8.23 NA 9.1
s (%)

Risk Analysis

Risk ratios Percent

Mean (?) 14.74
Standard Deviation (?) 12.64
Sharpe (?) 0.12
Beta (?) 1.04

FUND PERFORMANCE:-

(Rm- (Rp- (X
YEAR Rp Rm Rf Rf) Rf) X2 XY -Xbar) D2

X Y D
Since 39 129.1425.9 103.24 13.1 10658.49 1352.4 88.5 7832.25
Inception 4

Rp - Portfolio Return
Rm - Market Return
Rf - Risk free rate of return.

CALCULATION OF ARTHMETIC MEAN:-

= X/N
= 103.24/7

= 14.74

42
 CALCULATION OF STANDARD DEVIATION (σ ):-

= √ (X-Xbar) 2 / N
= √7832.25/ 7
=88.5/ 7

= 12.64

CALCULATION OF BETA CO-EFFICIENT:-

= N ( XY) – X Y

N ( X2) – ( X) 2

= 7(1352.44) – (103.2)(13.1)
7(10658.49 ) – (103.2) 2
= 0.12
CALCULATION OF SHARP RATIO:-

= Rp-Rf / σ

=13.1 /12.64

= 1.04

ITERPRETATION:-.

Beta of Reliance Growth Fund is 0.12 [Link] indicate that the securities will less
volatile than the market.

According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk.

1.04 percent it is the total risk of the fund that the investors are concerned about.

43
DEBT

Reliance Floating Rate Fund - Growth : 14.39 (NAV as on Jan 28, 2010)

INVESTMENT OBJECTIVE
Asset Allocation
The primary objective of the scheme is
to generate regular income through
21%
investment in a portfolio comprising
Debt Cash substantially of floating rate debt
securities. The scheme shall also invest
in fixed rate debt securities.
80%

Fund Features

Scheme Particulars
Type Open Ended
(Equity: 0%, Debt: 20.5%,
Nature
Cash: 79.5%)
Option Growth
Inception Date Sep 1, 2004
Face Value 10
Fund Size ([Link]) 920.06 as on Dec 31, 2009
Fund Manager Amit Tripathy
SIP NA
STP NA

44
 SWP NA
Expense ratio(%) 0.7
Portfolio Ratio(%) 66.6
Last Divdend Declared 4882.05
Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
If redeemed bet. 0 Year to 1
Exit Load
Year; Exit load is 1%.

Since Total
1 3 6
Period 1 year 3 year 5 year Inceptio
month month month
n
Return 31.08
0.35 1.11 2.31 5.54 7.71 7.11 6.95
s (%)
Risk Analysis

Risk ratios Percent

Mean (?) 14.74
Standard Deviation (?) 12.64
Sharpe (?) 3.22
Beta (?) -NA

FUND PERFORMANCE:-

Rp (Rm- Rp-Rf XY (X
YEAR Rm Rf
Rf) X2 -Xbar) D2
Y
X D
Since 66.6 129.1425.9 103.24 40.7 10658.4 4201. 88.5 7832.25
Inception 9 86

-
Rp - Portfolio Return
Rm - Market Return
Rf - Risk free rate of return.

CALCULATION OF ARTHMETIC MEAN:-

= X/N
= 103.24/7

45
 = 14.74

CALCULATION OF STANDARD DEVIATION (σ ):-

= √ (X-Xbar) 2 / N
= √7832.25/ 7
=88.5/ 7

= 12.64

CALCULATION OF SHARP RATIO:-

= Rp-Rf / σ

=40.7 /12.64

=3.22

ITERPRETATION:-.

According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk.

3.22 percent it is the total risk of the fund that the investors are concerned about.

46
DEBT

Reliance NRI Income Fund - Growth : 11.91 (NAV as on Jan 28, 2010)
INVESTMENT OBJECTIVE
Asset Allocation
The primary objective of the scheme is
Cash
to generate optimal returns consistent
Debt with moderate level of risk. This
income may be complemented by
capital appreciation of portfolio.
Accordingly, investment shall
predominantly be made in debt
100%
instrument.

Fund Features

Scheme Particulars
Type Open Ended
Debt (Equity: 0%, Debt: 0%,
Nature
Cash: 100%)
Option Growth
Inception Date Nov 15, 2004
Face Value 10
920.06 as on Dec 31,
Fund Size ([Link])
20090.37 as on Dec 31, 2009
Fund Manager Prashant [Link] .
SIP NA

47
 STP NA
SWP NA
Expense ratio(%) 0.88
Portfolio Ratio(%) 22
Last Divdend Declared 4882.05
Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
If redeemed bet. 0 Months to
Exit Load
6 Months; Exit load is 1%

Since Total
1 3 6
Period 1 year 3 year 5 year Inceptio
month month month
n
Return 9.76
NA 0.39 0.19 0.45 2 3.36 3.37
s (%)

Risk Analysis

Risk ratios Percent

Mean (?) -2.3
Standard Deviation (?) 1.97
Sharpe (?) -1.93
Beta (?) -NA

FUND PERFORMANCE:-
Rp (Rm- Rp-Rf (X
YEAR Rm Rf
Rf) X2 -Xbar) D2
Y
X D
Since 22.1 9.76 25.9 -16.14 -3.8 260.49 - 191.27
Inception 13.83

-
Rp - Portfolio Return
Rm - Market Return
Rf - Risk free rate of return.

CALCULATION OF ARTHMETIC MEAN:-

= X/N

48
 = -16.14/7

= -2.31

CALCULATION OF STANDARD DEVIATION (σ ):-

= √ (X-Xbar) 2 / N
= √191.27/ 7
=13.83/ 7

= 1.97

CALCULATION OF SHARP RATIO:-

= Rp-Rf / σ

=-3.8/1.97

= -1.93

ITERPRETATION:-.

According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk.

1.93 percent it is the total risk of the fund that the investors are concerned about.

49
DEBT

Reliance Regular Savings Fund - Debt - Institutional - Growth : 12.56 (NAV as on Jan
28,

INVESTMENT OBJECTIVE

The primary objective of the

Asset Allocation scheme is to seek capital
appreciation & or to generate
continuous returns by investing in
30% equity and equity related
Debt Cash
securities.

Fund Features
70%
Scheme Particulars
Type Open Ended
Debt (Equity: 0%, Debt:
Nature
70.23%, Cash: 29.77%)
Option Growth
Inception Date Jul 12, 2009
Face Value 10
Fund Size ([Link]) 1399.12 as on Dec 31, 2009
Fund Manager Prashant [Link] .
SIP NA
STP NA

50
 SWP NA
Expense ratio(%) 1
Portfolio Ratio(%) NA
Last Divdend Declared 4882.05
Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
Exit Load Exit Load is 0%.

Since Total
1 3 6
Period 1 year 3 year 5 year Inceptio
month month month
n
Return 15.7
NA 2.36 4.45 NA NA NA 8.89
s (%)

Risk Analysis

Risk ratios Percent

Mean (?) NA
Standard Deviation (?) NA
Sharpe (?) NA
Beta (?) NA

51
DEBT

Reliance Income Fund - Retail - Growth Plan - Growth : 30.72 (NAV as on Jan 29,
2010)

INVESTMENT OBJECTIVE
Asset Allocation
The primary objective of the scheme is to
Debt Cash generate optimal return consistent with
moderate level of risk. This income may be
43% complemented by capital appreciation of the
57% portfolio. Accordingly, investment shall
predominantly be made In debt and money
market instrument

Fund Features

Scheme Particulars
Type Open Ended
Debt (Equity: 0%, Debt:
Nature
57.14%, Cash: 42.86%)
Option Growth
Inception Date Dec 31, 1997
Face Value 10
Fund Size ([Link]) 657.9 as on Dec 31, 2009
Fund Manager Amit Tripathy ..
SIP NA
STP NA
SWP NA
Expense ratio(%) 1.47

52
 Portfolio Ratio(%) NA
Last Divdend Declared 4882.05
Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
If redeemed bet. 0 Days to 30
Exit Load
Days; Exit load is 1%

6 Total
1 3 1 3 5 Since
Period mont
month month year year year Inception
h
Return 34.88
0.65 1.7 1.11 3.72 9.84 8.09 9.77
s (%)

Risk Analysis

Risk ratios Percent

Mean (?) 1.28
Standard Deviation (?) 1.1
Sharpe (?) 0.22
Beta (?) 0.13

FUND PERFORMANCE:-

Rp (Rm- Rp-Rf XY (X
YEAR Rm Rf Rf) X2 -Xbar) D2
Y
X D
Since 25.9 7.7
Inception 26.14 34.88 8.98 0.242 80.64 9.22 59.29

Rp - Portfolio Return

53
Rm - Market Return
Rf - Risk free rate of return.

CALCULATION OF ARTHMETIC MEAN:-

= X/N
= 8.98/7

= 1.28

CALCULATION OF STANDARD
DEVIATION (σ ):-

= √ (X-Xbar) 2 / N
= √59.29/ 7
=7.7/ 7

= 1.1

CALCULATION OF SHARP RATIO:-

= Rp-Rf / σ

=0.242/1.1

=-0.22
CALCULATION OF BETA CO-EFFICIENT:-
= N ( XY) – X Y

N ( X2) – ( X) 2

= 7(9.22) – (8.98)(.242)
7(80.64 ) – (8.98) 2

= 0.13

54
ITERPRETATION:-.

Beta of Reliance Growth Fund is 0.13 [Link] indicate that the securities will less
volatile than the market.

According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk.

0.22 percent it is the total risk of the fund that the investors are concerned about.

DEBT

Reliance Monthly Income Plan - Growth : 19.92 (NAV as on Jan 29, 2010)

INVESTMENT OBJECTIVE
Asset Allocation
The primary objective of the scheme is to
Debt
13% Cash generate regular income un order to make
equities regular dividend payment to unit holder and
the secondary objective is growth of capital.
51%
36%

Fund Features

Scheme Particulars
Type Open Ended
Debt (Equity: 15.67%, Debt:
Nature
59.79%, Cash: 24.53%)
Option Growth
Inception Date Jan 12, 2004
Face Value 10
Fund Size ([Link]) 2467.89 as on Dec 31, 2009
Fund Manager Amit Tripathy.
SIP NA
STP NA

55
 SWP NA
Expense ratio(%) 1.75
Portfolio Ratio(%) 57
Last Divdend Declared 4882.05
Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
If redeemed bet. 0 Year to 1
Exit Load
Year; Exit load is 1%.

Since Total
1 3 6
Period 1 year 3 year 5 year Inceptio
month month month
n
Return
-0.18 3.17 8.24 26.17 12.59 13.68 12.03
s (%) 75.7

Risk Analysis

Risk ratios Percent

Mean (?) 7.11
Standard Deviation (?) 6.09
Sharpe (?) 0.21
Beta (?) 0.025

FUND PERFORMANCE:-

Rp (Rm- Rp-Rf XY (X
YEAR Rm Rf Rf) X2 -Xbar) D2

X Y D
Since 25.9
Inception 26.17 75.7 49.8 1.278 2480.0 63.68 42.69 1822.43
4

Rp - Portfolio Return
Rm - Market Return
Rf - Risk free rate of return.

CALCULATION OF ARTHMETIC MEAN:-

56
 = X/N
= 49.8/7

= 7.11

CALCULATION OF STANDARD
DEVIATION (σ ):-

= √ (X-Xbar) 2 / N
= √1822.43/ 7

= 6.09

CALCULATION OF SHARP RATIO:-

= Rp-Rf / σ

=1.278/6.6

=-0.21

CALCULATION OF BETA CO-EFFICIENT:-

= N ( XY) – X Y

N ( X2) – ( X) 2

= 7(63.68) – (49.8)(1.278)
7(2480.04 ) – (49.8) 2

= 0.025

ITERPRETATION

57
Beta of Reliance Growth Fund is 0.025 [Link] indicate that the securities will less
volatile than the market.

According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk.

0.21 percent it is the total risk of the fund that the investors are concerned about.

DEBT

Reliance Short Term Fund - Growth : 17.27 (NAV as on Jan 29, 2010)

INVESTMENT OBJECTIVE
Asset Allocation
The primary objective of the scheme is to
Debt
Cash generate stable return for investor with a
equities short term investment horizon by investing in
37%
fixed income securities of a short-term
maturity.
63%
.

Fund Features

Scheme Particulars
Type Open Ended
Debt (Equity: 0%, Debt:
Nature
36.78%, Cash: 63.22%)
Option Growth
Inception Date Dec 22, 2002
Face Value 10
Fund Size ([Link]) 2865.71 as on Dec 31, 2009
Fund Manager Amitabh Mohanty .
SIP NA

58
 STP NA
SWP NA
Expense ratio(%) 0.64
Portfolio Ratio(%) NA
Last Divdend Declared 4882.05
Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
Exit Load Exit Load is 0%.

1 3 6 Since Total
Period 1 year 3 year 5 year
month month month Inception
Return 40.54
0.53 1.66 2.69 8.78 10.18 8.72 7.98
s (%)
Risk Analysis

Risk ratios Percent

Mean (?) 2.09
Standard Deviation (?) 1.79
Sharpe (?) 2.73
Beta (?) 0.33

FUND PERFORMANCE:-

Rp (Rm- Rp-Rf XY (X
YEAR Rm Rf Rf) X2 -Xbar) D2

X Y D
Total
Returns 30.78 40.54 25.9 14.64 4.88 214. 71. 12.55 157.
33 54 50

Rp - Portfolio Return
Rm - Market Return
Rf - Risk free rate of return.

CALCULATION OF ARTHMETIC MEAN:-

= X/N
= 14.64/7

59
 = 2.09

CALCULATION OF STANDARD
DEVIATION (σ ):-

= √ (X-Xbar) 2 / N
= √157.50/ 7

= 1.79

CALCULATION OF SHARP RATIO:-

= Rp-Rf / σ

=1.278/6.6

=-2.73

CALCULATION OF BETA CO-EFFICIENT:-

= N ( XY) – X Y

N ( X2) – ( X) 2

= 7(71.54) – (14.64)(4.88)
7(214.33 ) – (14.64) 2

= 0.33

ITERPRETATION:-.

Beta of Reliance Growth Fund is 0.33 percent. It indicate that the securities will less
volatile than the market.

60
According to Sharpe, it is the total risk of the fund that the investors are
concerned about. So, the model evaluates funds on the basis of reward per unit
of total risk.

2.73 percent it is the total risk of the fund that the investors are concerned about.

CONCLUSION

RATIOS

RELIANCE EQUITY FUND

Standard Beta Sharp

deviation
Reliance Growth 21.60 0.06 0.46
Reliance NRI 2.49 0.49 17.48
Equity
Reliance Vision 15.84 0.82 6.76
Reliance Equity 14.50 0.31 2.55
Opportunities
Reliance Equity 7.28 0.83 9.76
Fund
Reliance Long 12.64 0.12 1.04
Term Equity

RELIANCE DEBT FUND

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 Standard Beta (%) Sharp (%)
deviation (%)
Reliance Floating 12.64 NA 3.32
Rate fund
Reliance NRI 1.97 NA -1.93
Income fund
Reliance Regular NA NA NA
Saving fund
Reliance Income 1.1 0.13 0.22
Fund
Reliance Monthly 6.09 0.025 0.21
Income fund
Reliance Short 1.79 2.73 0.33
Term fund

The following suggestions are the outcome of the research and applications
of these suggestions are not necessary:-

Reliance Mutual Fund is better option for investment in mutual fund, because
it is Indias leading Mutual Fund and fasted growing private sector financial
services and india’s largest mutual fund.
The Equity option of Reliance Mutual Fund as the more‘productive avenue’ than Debt
optionfor investing activities.

 Reliance Mutual Fund provide high liquidity, minimum interest rate risk
but there are certain type of risk
 Market Risk
 Scheme Risk
 Investment Risk
 Business Risk
[Link] schemes have more market risk than Debt scheme.
[Link] schemes have more investment risk than Debt scheme.
[Link] schemes have business risk risk than Debt scheme

Since theSharp ratio of Reliance equity fund is high it implies the risk is

62
 high.

Reliance income fund (Debt option)is the best option to the investor
because it is less risky than other fund.

RECOMONDATION

 The company should come up with innovative ways of service at their door
steps this may be a costly affair but will surely give positive results in the
long run.

 The company should take the initiative of training the advisors about the
new funds from time to time which also makes the advisors connected to the
company.

 The company should also emphasis on the monitoring of funds which

directly relates to the returns of a specific fund.

 The company should come up with proper Hedge funds at this point of
time where the market is highly volatile and the investors become very
cautious at this level.

 The company should emphasis on creating an awareness about the SIP
options which is always preferable when the market is volatile.

63
 LIMITATIONS

1. The study is limited only to the analysis of two schemes of Reliance

Mutual Fund. (Debt fund & Equity fund)
2. The study is based on secondary data available from monthly
fact sheets, websites and other books, as primary data was not
accessible.

64
 BIBLIOGRAPHY

BOOKS

MUTUAL FUNDS IN I NDIA - PERSPECTIVES AND STRATEGIES

BROUCHERS:-

RELIANCE MUTUAL FUND MAGAZINE, BUSINESS WORLD

REFERENCES Websites:

[Link] [Link] [Link]

[Link]

[Link] [Link]
[Link]/mutual funds/nav/about funds/open ended [Link]
[Link]/aboutus/html

65
 ANNEXURE-I

ABBREVIATIONS

ASL : Allianz Securities Limited

SE : Securities
Mf : Mutual Fund
MF’S : Mutual Funds
NASDAQ : National Association of Securities Dealers Automated
Quotation
BSE : Bombay Stock Exchange
AMC : Asset Management Company
AMFI : Association of Mutual Funds India
AUM : Assets under Management
CBFI : Crisil Balanced Fund Index
CCBI : Crisil Composite Bond Index
CRISIL : Credit Rating & Information Services of India Ltd.

66
FDI : Foreign Direct Investment
NAV : Net Asset Value
NFO : New Fund Offer
SEBI : Securities Exchange Board of India
SIP : Systematic Investment Plan
STP : Systematic Transfer Plan
SWP : Systematic Withdrawal Plans

ANNEXURE-I

Equity Fund is the one in which much of the portfolio is invested in

corporate securities and Debt Fund is the one in which much of the portfolio is
invested in Gilt and money market securities.
In an Open-ended Mutual Fund, there are no limits on the total size of the
corpus. Investors are permitted to enter and exit the open-ended Mutual Fund at
any point of time at a price that is linked to the net asset value (NAV).
In case of Closed-ended funds, the total size of the corpus is limited by the size
of the initial offer.

A Dividend plan entails a regular payment of dividend to the investors.

A Re-investment plan is a plan where these dividends are reinvested in the
scheme itself.
A Growth plan is one where no dividends are declared and investor only
gains through capital appreciation in the NAV of the fund.

NAV is the net asset value of the fund. Simply put it reflects what the unit
held by an investor is worth at current market prices.

The broad guidelines issued for a Mutual Fund:

SEBI is the regulatory authority of Mutual Funds. SEBI has the following
broad guidelines pertaining to Mutual Funds:
Mutual Funds should be formed as a trust under Indian Trust Act and
should be operated by Asset Management Companies.

67
Mutual Funds need to set up a Board of Trustee Companies. They
should also have their Board of Directories.

The net worth of the Asset Management Company should be at least

Rs.10 crore.

Asset Management Companies and Trustees of a MF should be two

separate and distinct legal entities.

The Asset Management Companies or any of its companies cannot act

AS managers for any other fund.

Asset Management Company has to get the approval of SEBI for its
articles and Memorandum of Association.
All Mutual Fund Schemes should be registered with SEBI.

Mutual Funds should distribute minimum of 90% of their profits among

the investors.

68