View of “RECENT PERFORMANCE OF MUTUAL FUND WITH SPECIAL REFERENCE TO ICICI MUTUAL FUND IN INDIA

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Vol.04,Special Issue 02, 13 Conference (ICOSD) February 2019, Available Online: www.ajeee.co.in/index.php/AJEEE

“RECENT PERFORMANCE OF MUTUAL FUND WITH SPECIAL REFERENCE TO ICICI MUTUAL FUND IN INDIA”

Umang Jain, Research Scholar

Abstract- In last one year it has been seen that most of the equity based mutual fund are not giving satisfactory returns but some of the debt and balanced fund has given expected returns. An investor before investing in the mutual fund must consider its past performance and growth in the unit valuation of the fund. The main objective of investment is earning good returns from it. Basically the mutual fund are classified as debt, equity and balance fund. All types of funds offered by ICICI Mutual Fund are studied to achieve objective of this study and which will prove very helpful in choosing the Mutual Fund for investing in it. Therefore this article aims to study the performance of mutual fund with special reference to ICICI Mutual fund and to understand the overall risk and return involved in investing in mutual funds.

Keywords: Mutual Fund, Asset Management Company, Diversification, Net Asset Value.

1 INTRODUCTION

The mutual fund industry in India began in 1963 with the formation of the Unit Trust of India (UTI) as an initiative of the Government of India and the Reserve Bank of India. Much later, in 1987, SBI Mutual Fund became the first non-UTI mutual fund in India.

Subsequently, the year 1993 heralded a new era in the mutual fund industry. This was marked by the entry of private companies in the sector. After the Securities and Exchange Board of India (SEBI) Act was passed in 1992, the SEBI Mutual Fund Regulations came into being in 1996. Since then, the Mutual fund companies have continued to grow exponentially with foreign institutions setting shop in India, through joint ventures and acquisitions.

As the industry expanded, a non-profit organization, the Association of Mutual Funds in India (AMFI), was established on 1995. Its objective is to promote healthy and ethical marketing practices in the Indian mutual fund Industry. SEBI has made AMFI certification mandatory for all those engaged in selling or marketing mutual fund products.

2. STRUCTURE OF MUTUAL FUND IN INDIA

A mutual fund is a trust made up of money collected from public or investors through the sale of units for investment in securities such as stocks, bonds, and money market instruments. Mutual Funds in India are governed by the Securities Exchange Board of India (Mutual Fund) Regulations 1996 with the exception of Unit Trust of India (UTI) as it was created by the UTI Act passed by

the Parliament of India. All mutual funds must be registered with SEBI.

Mutual Funds in India primarily have a 3-tier structure i.e. Sponsor (1^st tier), Public Trust (2^nd tier) and Asset Management Company (3^rd tier). Sponsor is any person who himself or in association with another corporate, establishes a mutual fund. The Sponsor seeks approval from the Securities &

Exchange Board of India (SEBI). Once SEBI approves it, the sponsor creates the Public Trust as per the Indian Trusts Act, 1882. Since Trusts have no legal identity in India, the Trust itself cannot enter into contracts. Thus, Trustees are appointed who are authorized to act on behalf of the Trust. The instrument of trust must be in the form of a deed between the Sponsor and the trustees of the mutual fund registered under the provisions of the Indian Registration Act. The Trust is then registered with SEBI leading to formation of mutual fund. Henceforth, the Trust is known as mutual fund. Sponsor and the Trust are two separate entities.

The Trustee’s role is only to act as internal regulators of mutual fund where they see, whether the money is being managed as per the objectives.

2.1 Benefits of Mutual Fund (MF)

1. MFs are managed by professional fund managers, responsible for making wise investments according to market movements and trend analysis.

2. MFs allow you to invest your savings across a variety of securities and diversify your

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assets according to your objectives, and risk tolerance.

3. MFs provide investors the freedom to earn on their personal savings.

Investments can be as less as Rs.

500.

4. MFs offer relatively high liquidity.

5. Certain mutual fund investments are tax efficient. For example, domestic equity mutual funds investors do not need to pay capital gains tax if they remain invested for a period of above 1 year.

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Returns of ICICI of Year 2018

https://economictimes.indiatimes.com/icici-prudential-mutual- fund/mutual_funds_search/amcid-14.cms

Some of the prominent ICICI Mutual Fund are listed below Pure Equity Schemes

ICICI Prudential Bluechip Fund ICICI Prudential Multicap Fund

These schemes are positioned aggressively to gain from recovery in the economy.

These Schemes aim to generate long term wealth creation.

Long-Term SIP Schemes

ICICI Prudential Value Discovery Fund ICICI Prudential Smallcap Fund ICICI Prudential Midcap Fund

ICICI Prudential Large & Mid Cap Fund

These schemes aim to generate long term wealth creation over a full market cycle.

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Asset Allocation Schemes

ICICI Prudential Balanced Advantage Fund

ICICI Prudential Equity & Debt Fund ICICI Prudential Multi-Asset Fund ICICI Prudential Equity Savings Fund ICICI Prudential Regular Savings Fund

These schemes aim to benefit from volatility and can be suitable for investors aiming to participate in equities with low volatility.

Thematic / Sectoral Schemes ICICI Prudential Infrastructure Fund ICICI Prudential Banking & Financial Services Fund

ICICI Prudential India Opportunities Fund

Investors could invest in these thematic schemes for tactical allocation. It would be a high risk investment option.

Source: https://www.icicipruamc.com/docs/default-source/default-document- library/fund-factsheet-for-january270002ff41026ea9a3af27f6b75ecbbf.pdf?sfvrsn=0

https://www.icicipruamc.com/docs/default-source/default-document-library/fund- factsheet-for-january270002ff41026ea9a3af27f6b75ecbbf.pdf?sfvrsn=0

Therefore, in last year some of the funds earned profits and some are showing negative returns. It can be said that the last year funds have not given the expected returns.

3. INSURANCE VS MUTUAL FUNDS

Life Insurance Mutual Fund

Meaning Life insurance is a protection scheme that lets you secure the financial future of your family in your absence.

A mutual fund is an investment tool that helps you enhance your wealth through market linked investments.

Goal A life insurance policy is a vital component of a person’s financial portfolio, as it safeguards the financial future of your dependents, your parents or children.

Mutual funds are a rewarding investment to meet your long-term financial goals, be it for education, purchasing a property, starting a business, etc.

Benefits A life insurance policy involves a lesser amount of risk as compared to mutual funds. There is a guaranteed death benefit.

A mutual fund does not guarantee does not provide any death benefit.

However, it provides a fund manager.

Returns Low Returns

If a life insurance plan is used for the purpose of investment, it is not only

Maximized Returns

Since a mutual fund offers the option of diversification of funds,

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expensive but also does not promise

returns similar to mutual funds. you can maximise your returns without being dependent on a single fund for growth.

4. CONCLUSION AND SUGGESTION Every investor has its own objective of investment. Therefore the purpose of the investing making does matters. ICIC is a prominent Asset Management Company in India and most of the funds did not performed as expected in year 2018. But if we see overall growth in the investment in long term horizon then the Mutual funds are giving good returns to the Investors. The Mutual fund is purely an investment avenue and gives 15-25% of return in long term. Today large number of Mutual fund are there in India. Market is very competitive and the investors have wide variety of funds to choose one according to their investment objectives.

Still most of the investors are not aware of the benefits of the Mutual funds so more aware need to be made.

REFERENCES

1. Agrawal, Anuj, “Insurance Distribution Channels in India: A Study of Pre and Post Period of IRDA Period,” International Journal of Economics and Management Thoughts (IJEMT), Varanasi, Vol. 2, 2 Oct.

- March 2011- 12. ISSN - 2229-3736.

2. Albert, Schweitzer, “Modern Management:

Concepts and Skills Management,” 11th ed., Upper Saddle River, NJ: Prentice Hall, 2009.

Chaudhary, Sonika,Priti Kiran, “Life Insurance Industry in India - Current Scenario” , International Journal of Management

3. & Business Studies IJMBS Vol. 1, Issue 3, September 2011 pp146-151

4. Singh, M.P., Chakraborty, Arpita, G, Raju,

“Contemporary Issues in Marketing of Life Insurance Service in India,” International Journal of Multidisciplinary Research, Vol.1 Issue 7, November 2011, ISSN 2231

5780. Retrieved from,

www.zenithresearch.org.in

5. Media Reports, Press Releases, Press Information Bureau, Union Budget 2017- 18, Insurance Regulatory and Development Authority of India (IRDA), Crisil

Websites

http://www.mospi.gov.in/104-insurance-statistics https://www.amfiindia.com/indian-mutual https://www.toppr.com/guides/general-

awareness/capital-markets/insurance-industry-in- india/

https://www.financialexpress.com/money/health- insurance-a-growing-segment-in-india-

report/1212734/

https://www.icicipruamc.com/docs/default- source/default-document-library/fund-factsheet-for- january270002ff41026ea9a3af27f6b75ecbbf.pdf?sfvr sn=0