A PERFORMANCE ANALYSIS OF MUTUAL FUNDS DURING COVID-19 IN INDIA

BY
REKHA NAGARAJAN
ENROLLMENT NO: A40101918104
(Master of Business Administration, Finance)
Amity University, Dubai -2020

A DISSERTATION
In partial fulfillment of the requirement of the degree of
MASTER OF BUSINESS ADMINISTRATION
Under Guidance of
Dr. Ashok Chopra
 DECLARATION
I Rekha Nagarajan, student of MBA-Finance hereby declare that the project title "A
PERFORMANCE ANALYSIS OF MUTUAL FUNDS DURING COVID-19 IN INDIA"
submitted to the Amity University, Dubai in partial fulfillment of the requirement for the award
of the degree of Master of Business Administration, is a record of an original project done by
me under the supervision of DR. Ashok Chopra, Department of Business & Commerce, Amity
University-Dubai. This result embodied in this thesis has not been submitted to any other
University or Institute for the award of any degree.

Date: 6.6 2020

Name: Rekha Nagarajan

Program: MBA (Finance)

Signature of the Student

i
 CERTIFICATE

Based on a declaration submitted by Rekha Nagarajan, student of MBA- Finance, I hereby

entitled the project titled “A PERFORMANCE ANALYSIS OF MUTUAL FUNDS DURING
COVID-19 IN INDIA" which is submitted to Department of Business & Commerce, Amity
University Dubai, in partial fulfillment of the requirement for the award of the degree of Master
of Business Administration in Finance, is an original contribution with existing knowledge &
faithful record of work carried out by him under my guidance & supervision.

To the best of my knowledge this work has not been submitted in part or full for any degree or
diploma to the University or elsewhere.

Date: 6.6.2020 Guide Name & Signature

Dr. Ashok Chopra

(Programme Leader of MBA)

Amity University, Dubai.

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 Acknowledgment

I would like to place on record our sincere thanks and gratitude to Dr. Atul Chauhan,
Chancellor of Amity University, Dubai for his endeavor in educating us in his esteemed institute
which has helped us work towards our goal.

I also express sincere thanks to Dr. Narayanan Ramachandran, Pro-Vice-Chancellor, for his
encouragement and inspiration that helped us in the progress of our project work

I would like to thank, Dr. Ashok Chopra, Programme leader of MBA as well as my faculty
guide, for his valuable guidance and kind co-operation to complete this project successfully.

I would like to take this opportunity to thank all the faculty of the Finance department who have
to lend their support during the difficult times while doing the project. We are also pleased to
express my kind thanks to all other faculties, friends, family, and some mutual fund investors for
their constant help by giving valuable responses to survey and advice for the completion of my
project.

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ABSTRACT

The outbreak situation of the COVID-19 pandemic is an Unpredictable shock to the world
economy. World Economy faces the slowdown of share market prices especially the value of
mutual fund value decreases. Companies and Businessmen mostly invested in the mutual funds
to play a safer role and modify their risk into the return and to increase the Net Assets Value
(NAV). This study attempts to describe a state of the parlous state of mutual funds in India
during this COVID-19 period. The performance of mutual funds is compared with the before and
during COVID-19 and This model specifies on testing the performance of mutual funds both in
the public and private sectors and also it attains to access the impact of COVID-19 on mutual
funds. I have used correlation for finding out the relation of COVID-19 and Mutual Funds. This
paper mainly addresses the causes of investors during economic fluctuation and the return of top
mutual companies with the comparison of the return of 1 year and during these last 3 months.
The impact of COVID-19 is not only on particular sectors, it affects almost every sector like
construction filed, manufacturing filed, Businesses, agriculture, etc. While all this sector affected
by COVID-19 pandemics it hits the society as well as the economy, once the economy comes
down, the inflation rate increase, Forex rate will increase and it affects our whole country. In this
paper, I included how much every sector affected and its performance now and how well the
different types of funds performing which will be useful for the reader to analyze the affected
areas. I conclude my report with the help of a survey and statistical tools whether the investors
can make a further payment and hold for some period or else they continue with the investment
whatever situation crisis impacts our economy.

keywords: Mutual funds in India, Different types, COVID-19 impact, investors situation,
performance, and growth of mutual funds in India.

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 TABLE OF CONTENT

TITLE PAGE NO

DECLARATION i

CERTIFICATE ii

ACKNOWLEDGEMENT iii

ABSTRACT iv

TABLE OF CONTENT v

LIST OF TABLES vi

LIST OF FIGURES vi

Introduction 1

Objectives of the Study 2

Research Methodology 2

Literature Review 3

Need for investing in Mutual Funds 5

Types of Mutual Funds 8

Importance of Mutual Funds 11

Growth of Mutual Funds in India 12

Impact of COVID-19 on Mutual Funds in India 13

Performance of Mutual Funds before COVID-19 16

and during COVID-19
Findings 28

Conclusion 30

v
 Suggestions 31

Annexure 32

Reference 42

LIST OF TABLES AND FIGURES

Table 1: Impacts of COVID-19 on different 14
sectors in India
Table 2: Top 10 Ranking Mutual Fund 19
Companies in the present time
Table 3: Interpretation and Analysis 20
Table 3.1: Age Frequency 20
Table 3.2: State 21
Table 3: Gender 21
Table 3.4: Income group 22
Table 3.5: Profession 22
Table 4: Age and Form of Investment 22
Table 5: Types of schemes do you prefer and 23
How much COVID-19 affects your return?
Table 6: Income group and Incase COVID-19 24
situation made you terminate or leave a job;
would it affect your investment
Table 7: Has COVID-19 impacts your stock 25
and Is it good to invest in mutual funds after
COVID-19 betterment?
Table 8: Investors still investing or not and 26
the platform they prefer
Table 9: Year of experience and kind of fund 27
gives higher return during this COVID-19
situation
Figure 1: Top Four Funds Performance in 17
Equity Market.
Figure 2: Top Four Funds Performance in 18
Hybrid Market
Figure 3: Top Four Funds Performance in 19
Debt Market

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INTRODUCTION

Mutual Funds is an emerging investment vehicle that is covered with a pool of funds gathered
from many investors. Mutual funds are playing the role of financial intermediaries between the
banks and investors who wants to invest in a share market. The main aim of mutual funds is to
diversify the risk of investors. Majority of industries investing their amount in mutual funds for
managing the risk of their financial assets. There is a group of securities which is called a
portfolio that helps to select security based on the performance. These huge amounts of money in
the mutual funds are operated by the investment professional called a fund manager or money
manager or portfolio manager. This fund manager's job is to invest the fund's assets in different
securities like gold, stock, and other assets to make potential capital gains or income. Mutual
funds give opportunities forever small and individual investors to access professionally
maintained portfolios of securities such as bonds, equities, and other securities. Therefore, the
gain or loss arising from such investment can be shared collectively among the investors in
proportion to their contribution to the fund. A mutual fund's range of investment is structured
and operated to fulfill the investment objectives.

According to the SEBI Regulations, mutual funds designed its schemes for the different types of
investors that suits them. In India recently there are more than 400 products and services
available in mutual funds in various categories. these systems they compressed in two forms i.e.
Open-ended schemes and close-ended schemes.

In short mutual funds are the basket by filled with full of different types of investment such as
bonds, cash, gold, stocks, etc. Money for mutual funds will be arises from the investments of
small and individual investors or some business institutions. Mutual funds offer one of the most
complete, easy, broad, and flexible ways to make a diversified range of investments. A mutual
fund is the financial tool that is made to professionally maintain and manage the funds arises
from the different investors at large. The main advantage of investing in mutual funds is that the
investors can purchase bonds or stocks in the mutual funds at comparatively lower trading costs
compared to direct investing in the stock or capital market. The huge strength of the mutual fund
is pooling the funds of different investors. Since mutual funds require only a small amount of
money to invest, it encourages the small investor to invest in mutual funds and enjoy the benefits

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that arise out of mutual funds. Every investment decision in the mutual funds is taken by the
"fund manager" according to the guidance provided in the investment objective and investment
pattern.

A Stock market value decreases highly which the Indian economy never faced before. Nifty50
and Sensex play a safe role but still, 1,128 points have decreased as per the last survey.
Naturally, such huge investment affects an individual investor mainly including mutual funds.
Every individual consults with their friends and advisors whether they should sell their
investment or hold their investments. Almost major suggestions from the mutual fund’s manager
are that almost it becomes impossible to avoid further investment especially when you are an
investor in equity fund markets over a long period.

OBJECTIVES OF THE STUDY

To study the growth of mutual funds in India in recent years.

To scrutinize the impact of COVID 19 on mutual funds and how much investors understand the
market situation and impact level on their investment.

To determine the investor's current situation.

To evaluate the awareness of customers towards a market situation.

RESEARCH METHODOLOGY

A research work titled " A performance analysis of Mutual Fund's during COVID-19" is paving
a way to determine the causes of investment which affects investors who invested in various
schemes in mutual funds and also demand of investment and it needs for the professional
investors by introducing new schemes and fund structure which id fixed by the fund managers
and mutual funds companies. Investors invested in several sectors and due to this COVID-19
pandemic all works have to be stopped and banks are closed only the necessity od medical and
transportation is running on. During this pandemic what supposed to be an investor's mindset and
what they understood with the current market situation.

For analyzing and reporting the performance of Mutual Funds during coronavirus pandemics, I
have collected both primary and secondary data. For primary data, I have used a quantitative
method i.e. prepared a set of questionnaires and take a survey for measuring the variables. Then,

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I used the statistical tools like correlation to find out the relationship between the investor’s
funds fluctuation and how COVID-19 impacts on mutual funds with the help of SPSS.

And secondary data in the sense I used and referred many research papers, bibliographies, recent
websites for understanding the market condition, and COVID-19 crashes on mutual funds.

Pearson Correlation

Correlation Coefficient is one of the statistical tools used to measure how strong a relationship
between the two variables. There are major three types of correlation Pearson, Spearman,
Kendall's tau-b. In this report, Pearson Correlation has been used to analyze a relationship
between different variables.

LITERATURE REVIEW

According to his result, A researcher Sharad Panwar concluded that there is not much difference
in the percentage of returns in the public and private sectors. However, there is some significant
difference is showing trough coefficient of variance, the average standard deviation on
performance and interest. It gives a difference in the diversification of mutual funds and it
impacts the performance. In order to get net assets and common stocks and market capitalization,
there is no statistical difference among the foreign mutual funds and public and private mutual
funds. Portfolio risk was outperformed both in the public and private sectors.

The author "Rao Neelakanteswar Dabbeeru" comes out with an idea of establishing a
relationship between investment styles and the performance of mutual funds. It helps an investor,
policymakers, and for research to get an idea of improving investment strategies and having a
wealthy growth on mutual funds. An author particularly analysis open-ended equity with
different investment styles. Since 419 investment scheme plans were offered by India Mutual
funds, investors get confused about where to invest and when to invest. This study mention that
whole mutual funds are progressing based on growth and dividend. Through the research, this
study enforces that the growth plan gives better performance than Dividend plans. In terms of
risk and return approximately 80% of Growth plans have better adjustment plans. By analyzing
F-test and T-Test, it constructed that it is important to consider investment styles to get better
performance on an investment portfolio.

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Pandow, Bilal articles describes is that the mutual fund industry succeeds in the market and
achieve their goal? Since India is the most populated country, the challenges for facing the
competitors as well as satisfying investor's demand also so high. Moreover, challenges like lack
of awareness among investors, level of penetration ratio, insufficiency of product differentiation
also lead to a critical situation towards mutual funds. The author clearly explained in his articles
regarding the growth of mutual funds and the number of mutual funds since it is introduced in
India until 2011 and mainly focuses on the Household savings method. The whole mutual fund
industry compressed into three sectors private, public, and foreign fund houses. He concluded
that one of the major purposes of mutual funds in the case of Household savings is to attract and
mobilize the small investors to save their assets and to be a part of the economic development.

A researcher "Dr. Geeta Kesavaraj” carried out the study with the objectives towards the
customer perception on mutual funds and its types. He focuses on the possibilities of measuring
the performance, expectation, and satisfaction level. His main aim is to identify the awareness of
investor's among mutual funds schemes and the selection of schemes but the limitation in his
study is that he narrows down his topic within one district "Chennai" in India. He has used
various statistical tools like the Chi-squared test, Karl Pearson's correlation, and one-way
ANOVA for interpret finding a way for suggestions and conclusions. He concluded that the
investors have a lack of awareness on mutual funds schemes and it is responsible for the fund
manager to create awareness since India's mutual funds regulated by SEBI which provides
security and comfort to an investor but still mutual companies should focus on building an
investor awareness.

Dr.S. Narayan Rao Sapar and Ravindran Madhava evaluate the performance index and risk-
related analysis. He started to collect the data with a sample of 269 open-ended schemes (out of
total schemes of 433) for determining the relative performance index. He uses 58 schemes for
further resources but excluded the funds whose returns are less than risk-free returns. With the
help of statistical tools and ratios, they find monthly return and risk of the sample mutual fund
schemes during the period were 0.59% and 7.10%, respectively, compared to similar statistics of
0.14% and 8.57% for the market portfolio. As a result, he concluded that most of the mutual fund
schemes in the sample of 58 were able to satisfy investor's expectations by giving excess returns
over expected returns based on both premiums for systematic risk and total risk.

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A recent article by Akshatha P elaborates in his articles that the investors Primary objective of
any individual or business is to maximize the return with minimum risk and credit risk through
diversification. A mutual fund has become an attractive way for investors to invest their money.
But he assures that the people's priority is always a bank investment, the second can be a mutual
fund or any other revenue. The main objective of this article is to evaluate the performance of
Indian equity diversified mutual funds. And those performances of mutual funds are measured
based on the Sharpe's ratio, Jenson ratio, and Treynor's ratio. Also, for measurement, this paper
selected five companies' mutual schemes. The author enforces Before entering into an
investment, investors need to know about the type of investment, details about the fund and risk,
and returns involved with it otherwise there are chances that he will lose money. Investment is a
very wise decision that a person must take with careful analysis of the factors involved therein.
The study shows that most of the equity funds have outperformed under Sharpe's, Jenson's, and
Treynor's ratio.

NEED FOR INVESTING IN MUTUAL FUNDS:

There are several benefits available for the investors investing in mutual funds. Following
are some of the important benefits –

1. Professional management
2. Simplicity
3. Easy accessibility
4. Diversification
5. Tax benefits

Professional management
Take a situation where you want to start a new business. But the point in that was you
don't know how to run the business. Now you have only two options:

(i) You can learn how to run the business

(ii) You can appoint someone to take care of the business

In the first case, you have to learn to run the business and make sure that you know everything
about the business, but if you don't have the time for learning such things then it is better to

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appoint someone to take care of the business. We should apply the same process in the case of
investments also.

In order to invest in the financial markets, one should require a certain type of skill. He/she
should analyze and researches the market conditions and opt for the best option available in the
market. You must know both external and internal economic factors in the financial market. This
requires a considerable amount of time and skills from you. But if you don't have the time or
skills to analyses and research deep into the market, then investing in the mutual funds can be the
best alternative option available in the market.

In mutual funds, you may not have knowledge and skills to manage your investment because
mutual funds are maintained and managed by the skilled, experienced and well-qualified experts
called portfolio managers. These managers are responsible for your investments, they decide
when and where to invest the money in the mutual funds and when to sell and buy the
investment.

This portfolio manager plays an important role when it comes to making a financial investment
decision based on the analyses and research and also, they are well expertise in that field. While
making an investment decision, the fund manager facing huge managerial risk and many
uncertainties. The primary motive of this fund manager is to find all possible ways to maximize
the returns for their investors.

Simplicity
Nowadays, in this globalized economy, there are many online platforms came into existence
which allows their investors to start their investing just by a few click on their mobile phone.
This investment also requires only a small amount to invest, an investor can start their mutual
funds with a minimum amount of Rs. 500 per month through a SIP (Systematic Investment
Plan).

Mutual funds are so simple to understand and to invest. Investors don't require knowledge or
experience about the economics or financial markets in order to be successful investors. In a
simple definition, mutual funds are the baskets full of investments where each basket has
hundreds or dozens of securities like gold, stock, bonds, etc. These all are combined to form one
mutual fund. Hence, if an investor buys a mutual fund. In simple, He/she is buying a whole

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basket full of investment securities. In this broad world of financial products, there is so much to
learn about financial factors but mutual funds are a little easy to understand and to use compared
to other financial products. The main advantage of mutual funds is that one could not wait for a
long time until he makes enough cash to investments. He can start an investment with some Rs.
500 in mutual funds. Mutual funds open the door for investors by offering several ways of
investment and also enable the investor to choose their investment plan which suits them
according to their amount. Hence, he will be able to make the available cash the optimize use
and maximize the returns.

Easy accessibility and less expensive

Every financial tool of investment has so much complex online process to compile with to
access its account. So, for that purpose investors should have some knowledge about systems and
online processes and also should make research and analyses about such investment. As mutual
funds offering several modes of investment, the investors can assess their account of investment
according to their fund's availability. Mutual funds are easy to access compare to other financial
tools. Mutual funds are offering and operating in many places such as mutual fund companies,
insurance companies, brokerage firms, banks, and discount brokers online. Accounts in mutual
funds can be easily opened. Even beginning investors can easily open and access an account at a
no-load mutual fund company (vanguard investments). Investors need not spend much time in
open an account, mutual funds account can be open within a minute without any difficulties.

The investments on mutual funds openly available every month, so if an investor needs to
know about their funds, they can easily access it, and also the investor can watch what portfolio
manager is doing. Direct buying of bonds and stocks results in huge costs but investing in mutual
funds will be very cheap compare to the direct buying from the BSE. This is because Fund
managers will manage huge amounts of funds on behalf of thousands and lakhs of individual
investors, therefore mutual funds take the advantage of deduction of the transaction cost.

Diversification
Unlike other investment vehicles, in mutual funds you can create a balanced and diversified
portfolio is one of the important benefits of mutual funds. We all know the proverbs called "don't
put all your eggs in one basket"; this proverb should be kept in our mind before we investing our
money. Suppose, if we invest in a single asset then our risk of loss is huge when the market gets

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crashes. To avoid this situation, one must invest in different classes of assets and diversified our
investment. So, if you want to invest in bonds and have to diversify, then you would have to
select at least twenty bonds carefully from different classes of the sector. This process takes time
and also investors need little knowledge about the securities in which he is going to invest. In
order to avoid this, investors can invest their money in mutual funds, as mutual funds take care
of diversifying your money instantly. For example, if you invest in mutual funds, it will track the
Bombay Stock Exchange SENSEX and you can get access to many stocks across sectors in a
single mutual fund. By investing in mutual funds, you can reduce your financial risk to a large
extent and increase your return. If we buy a mutual fund, then our money is combined with the
money from other investors, and it allows us to buy a part of a pool of investments. Mutual funds
contain different types of investments that make it easier for investors to diversify their
investments through the ownership of single bonds or stocks. By investing in mutual funds one
can have different investments, but not all investments will perform well at the same time. Hence
having different types of investments can help to reduce the impact of poor performances, by
taking advantage of the high return earning potential of the balanced investment. This is called
diversification.

Tax benefits
The best benefit of mutual funds is tax savings. By investing in mutual funds, you can save
income tax. Particularly, if you invest in the ELSS (Equity Linked saving Scheme), it provides
the tax exemptions under section 80c of the income tax Act, 1961. The investors can claim up to
Rs. 1.5lakhs of tax deduction under this section. Equity Linked saving scheme funds have a 3
years lock-in period. Therefore, once the investors invest their money in the Equity Linked
Saving Scheme then he must have to wait for the completion of a lock-in period of 3 years. The
investor can only withdraw his after the completion of the lock-in period. Mutual funds also
provide another tax benefit to debt funds which is called indexation of tax. It means, in Debt
Mutual Funds only returns earned over and above the inflation rate are subject to tax. This helps
the Debt Mutual fund investors to enjoy a high rate of returns.

DIFFERENT TYPES OF MUTUAL FUNDS:

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There are few most popular mutual funds which are familiar in India. Mutual funds classified
into two types of open funded and closed funded. An open-ended scheme is so flexible and an
investor can easily buy/sell units daily and initially, it needs only a certain lock-in period for
investment or disinvests for a certain amount. A closed-ended market is a market where the
initial number of funds fixed by the IPO (initial public offering).

There are few common types of mutual funds which are familiar in India

 Money Market Funds

 Fixed income funds
 Index funds
 Equity Funds
 Hybrid funds

OPEN-ENDED FUNDS:
In these types of mutual funds, units are open for purchase and redemption through the
year on a continuous basis. All units in these types of mutual funds can be purchased or
redeemed at any time at prevailing NAVs (Net Asset Value). Investors of these types of mutual
funds can keep their investment in this scheme as long as they want. As there is no limitation on
the investment in this scheme so the investor can invest their amount as much as they want. This
scheme doesn't have any fixed maturity period so the investors can withdraw their units at any
point in time.

CLOSED-ENDED FUNDS:
These types of mutual funds scheme will have a fixed maturity period example: one year,
two years, five years, etc. The units in the closed-ended fund's scheme can be purchased only
during a specified period at the initial offer period. This scheme of closed-ended funds is not like
the open-ended funds, when the stock or units are purchased in the closed fund's scheme it
couldn't be sold back to the mutual funds. The investors in this scheme have to sell their stocks
or units only through the stock market at the base price of the share. SEBI (Securities and
Exchange Board of India) demands the requirement that all the closed-ended scheme to provide
for liquidity. This closed-ended fund scheme provides two options to their investors

1. Units or stocks are required to be listed in the recognized stock exchange or

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 2. It must provide a specific periodic repurchase facility to investors.

INTERVAL FUNDS:
These are funds that have the features of both open-ended funds and closed-ended funds.
This interval funds scheme is open for both purchase and repurchase of shares at different
intervals (monthly, quarterly, annually, etc.) at the current base price of NAV (Net Assets
Value). These interval funds are similar to the close-ended funds with some different

 Close-ended funds are required to be listed in the recognized stock exchange but interval
funds need not be registered in the recognized stock exchange, as they have their in-built
redemption window.
 In Close-ended funds, stocks or units are issued only during the initial offer period. But in
interval funds stocks or units can be issued during the specified interval period at the
current prevailing base price of NAV (Net Assets Value).
 In close-ended funds, there is the fixed maturity period but in interval funds, such
maturity period is not defined.

EQUITY FUNDS:
Equity funds schemes are one of the most popular mutual funds schemes. Equity funds are
those schemes in which the funds are invested in the company's equity stocks or shares and allow
the investors to participate in the stock markets. The main objectives of this equity fund scheme
are to provide high returns potential over the long-term. This equity fund scheme is categorized
as a high-risk scheme but it also has superior returns compared to other schemes in the mutual
funds. So, these types of schemes are commonly meant for investors with a long-term
perspective and also with a higher risk-bearing. These equity mutual funds can be further divided
into four categories

1. Diversified funds.
2. Tax saving funds.
3. Index funds.
4. Sectoral funds.

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DEBT FUNDS:
Debt mutual funds are also called fixed income mutual funds. The main objective of debt
funds is to provide fixed and regular income to investors. These funds are mainly invested in the
instruments which are considered safe investments and provide fixed returns. Examples of such
debt instruments are Money Market Instruments, Government securities, Bonds, corporate
debentures, and other Fixed Income Assets. These types of debt funds schemes are relevant only
for investors whose aim is to keep their capital safe and also satisfied with small or modest
growth in their capital. These types of debt funds are not usually affected when markets deal
with the fluctuations. the Net Assets Value of debt-oriented funds is getting affected if there is a
change in the interest rate in the country.

HYBRID FUNDS:
Hybrid funds are also called as balanced funds. In a hybrid mutual fund scheme, their
investments are divided between equity and debt. Sometimes the proportion of debt funds is
higher than the equity funds but in some other cases, the proportion of equity funds will be
higher than the debt funds. Therefore, they are also known as marginal equity funds. This
allotment between equity and debt will keep changing based on the risk in the market. The
important objective of the balanced funds is to satisfy both higher returns and maintain the
stability of income in the long-term process. These schemes are suitable for investors who are
retired and want a constant income with very low risk. Net Assets Values of balanced funds are
normally less tensed compared to pure equity funds. The offer document of this scheme shows
the mentioning of the proportion of investment which is made into equity and fixed income
securities. These hybrid funds are a good replacement for pure equity funds.

MONEY MARKET FUNDS:

Money Market Funds are also called Liquid funds. These are purely related to the risk-free
debt-oriented schemes, the main objective of this scheme is to preserve the capital, average
potential returns, and easy liquidity of the fund. In order to reach this objective, investors in the
liquid funds invest their capital primarily in short-term instruments such as T-Bills, Government
securities, CPs, Certificates of deposits, etc. They are normally risk-free instruments, but with the
lower possible income compare to the other types of mutual funds. Money Market Funds are
contemplated as safer instruments for the investors who are looking to park their surplus money

11
for a short period but with moderate returns. These are an alternative for the investor to put
money in a savings bank account. These Money Market Funds have nearly wrapped the changes
in the interest rate in the market economy of the country.

IMPORTANCE OF MUTUAL FUNDS

Mutual Funds are creating a different type of securities and investment under one umbrella. With
the one pool of money banks, you can enjoy by investing in hundreds of various securities like
equities, bonds, securities, commodities, etc. The price of every unit of mutual funds will be
adjustable according to the market fluctuation. Every people want to save an income and tries to
double up the amount. Mutual funds and their schemes fulfill an investor's demand. It is more
convenient for investors.

Every individual thinks to save their money and double their money. Mutual funds company will
guide an investor to attain their objectives. It provides various financial sectors, strategies,
instruments for investors as well as organizations to invest in a stock, bonds, or any other assets
to reduce the risk or increase the return. Imagine with one simple purchase you can gain by
investing in different securities which will reduce the risk as well as save your investment. The
price of mutual funds will reflect market prices and adjust with the expenses and management
fees. There are several investors with different mentality some people need the highest return and
ready to bear any risk and contradictory some investors prefer to be safe and steady and want to
save their money for future needs. Funds like equity funds and growth funds are appropriate to
aggressive investors while a conservative investor can move for balanced funds seeking both
income and capital gain. According to investors' income, a mutual fund manager will help to find
out a great plan with a maturity period schemes date of deposit for a better outcome.

Another importance of mutual funds it is easy to buy and sell the securities. When an investor
knows that the investment sector is falling, he can immediately execute his strategy. There is no
restriction or obligation for buying and selling an instrument.

GROWTH OF MUTUAL FUNDS IN INDIA

The growth of mutual funds has been increasing tremendously. The first and foremost Mutual
fund in India was UTI (Unit Trust of India) since 1963 which was set up by the Reserve Bank of
India and the Government of India. Initially, it starts to attract small investors and describe them

12
about schemes and investment. Later on, in the 1970s -1980, UTI becomes quite familiar and
starts to implement many schemes and different portfolios which helps investors to protect from
high risk. In the 1980s, another mutual fund introduced called ULIP (Unit Linked Insurance
Plans). From 1987, the number of public sector banks was allowed to establish a mutual fund as
a part of an institution. SBI started its mutual fund in 1987 December and followed by Canara
Bank, Indian Bank, and so on introduced a mutual fund scheme. Mutual Funds diversify the
investor's securities in a different portfolio and also suggest the schemes according to their
willingness of taking risk. It allocates their income pat as a saving in the investment of the funds.
Assets Under Management has increased from Rs 6.7 crores to 47.4 crores from 1980 to 1993.
1993-1996 was the era where drastic changes happen in the mutual fund company. Private
sectors like industries also granted permission to begin a mutual fund business. It raises
competition among the public and private sectors. Apparently, Foreign Fund management also
entered into Indian market through Joint Ventures and with some Indian promoters. Private
sectors have brought with many different new schemes and technologies to attract an investor.
The number of Mutua Funds stands up with foreign traders and investors. A recent survey
mentioned that India has 44 Asset Under Management (AUM) which is fully authorized and
licensed by the government. Investors can invest in any securities like real estate, golds, mutual
funds, cryptocurrency, etc. The funds like ICICI prudential fund, HDFC blue-chip fund, Reliance
mutual funds, SBI Mutual funds, Reliance, and Bajaj Finance play a leading role in the stock
market.

A mutual fund has seen immense growth and development since the day it is incorporated. Many
mutual funds companies were merged and integrated and companies like Allianz Mutual Funds
and PNB mutual funds were taken over by Birla Sun Life and Principal, etc. Over the decades,
mutual funds in India have seen a lot of changes and development. It has become more flexible,
transparent, and well organized in terms of schemes, functions proposed by mutual fund
companies have been offering top-notch mutual funds. With the emergence of mutual funds
development, there are several schemes were launched in India. There are around 2500 schemes
are available till now. The average asset management fund of India Mutual fund industry for
April 2020 stays at 23.53 lakh crores. The total number of portfolios under debt, equity, hybrid
schemes, and orientation schemes and wherein schemes those all give higher return was stand for
around 80 million.

13
IMPACT OF COVID 19 ON MUTUAL FUNDS IN INDIA

Globally, the stock market is bearing a crisis of COVID 19 pandemics. An impact of coronavirus
pandemics has affected a stock market vastly. It becomes a more volatile state. It causes many
investors to have met dramatic changes in the value of the investment portfolio. It's been critical
for an investor to maintain and track their investment goals and especially it affects long term
investment plans. Every country's stock market value comes down which affects the banks and
private sector. The rapid spread of this virus, an investor from all over the world affected. People
those who all invested in mutual funds investment facing financial asset crisis. India’s mutual
funds’ performance is quite better than in other countries. However, the performance of the
equity market is falling worst. Sensex hits around 23% on the equity market. Mainly people who
have invested in construction companies are facing losses every day. According to the money
control report, interest rates on fixed deposits fall which was announced by Reserve Bank of
India (RBI) and it particularly impacts the savings bank rates. Investors try to save their
investment by using some strategies for taking a fresh breath like Sensex as well as the Nifty
market. During this lockdown period, investors can take ease pressure from the equity market,
some markets are highly rated which are pharma, emerging giants, prudence, etc.

In the business point of view, meetings like Annual General Meeting, Board meetings, corporate
meetings, meetings for product launches, conferences, seminars meetings, etc. has canceled and
postponed due to COVID-19. GDP growth of the Indian economy reduced to 4.7% in the 3 rd
Quarter of 2019-2020. The outbreak of COVID-19 changes the whole world economy into a
recession including India. It changes the lives of people, businesses, and how the economies will
function. This impact would continue at least for the next 24 months, currently, many businesses
are struggling to survive and some may even result in wound up. But things will eventually get
back to normal only if emerges of new industries take place with famed hope of recovery. We
can expect the liquidity of many industries and companies in near future as the cost of borrowing
went upwards in the real term, due to this RBI (Reserve Bank of India) forced to reduce its
interest rates. Currently, demand for the essential goods was increased rapidly. Therefore, the
Indian government's focus is only on the essential goods which will affect the non-essential
goods is huge. So, Non-essential goods business would look forward to recovering they're
outstanding from outsiders and receivable from debtors in order to survive in the market.

14
Financial institutions and banks have already had the problems of recovering the Non-
Performable Assets, bankrupt and insolvency now this impact will add additional pressure to
them.

Table 1: IMPACTS OF COVID-19 ON DIFFERENT SECTORS IN INDIA

IMPACTS ON DIFFERENT SECTOR RETURNS (April to June)

Construction -13.3%
Professional services, Real estate, and -17.3%
Finance
Agricultural, Fishing, and Forestry -1.3%
Manufacturing -6.3%
Water supply, electricity, gas and other -13.9%
Trade, Transport, Hotels, Communication -9.7%
Public administration, defense, and others -0.4%

Building and construction:

It's really hard to find the sector which is not affected by the COVID-19; almost every
commercial activity has been affected severely by the COVID-19. Building and construction
sector have already faced multiple challenges like irrecoverable create, insufficiency of capital,
different kind of frauds, etc. Now, this COVID-19 makes Building and construction sectors
further worst. Due to the lockdown imposed by the government, the building and construction
activities and many more businesses across the world have stopped. The Building and
Construction companies in India appointing nearly 5cr people as employs it is almost 12% of the
working people population of India. Impact of COVID-19 affected the economy in wide-spread
but it is an unprecedented good chance for us to respond and restart the majority of our baselines
in the building and construction sector in India.

Travel and Tourism sectors

As everyone knows that Travel and Tourism sector was the first most affected sector due to
lockdown outbreak, and also it sweeps this industry to a dead level, ISTO (Indian Association of
Tour Operators) evaluates the Travel and Hotel industry to incur the huge losses of Rs.8500 crs
because of lockdown imposed by the government due to lockdown.

15
Automobile sectors
This sector was already undergone into deep considerable lowdown for the past 12 to 15
months because of total structural changes like GST, Axle-load reforms, Liquidity crunch, shift
to shared mobility, and so on. COVID-19 makes Automobile sectors further worst and it
completely affected the manufacturer's revenues and cash flows. Bharat Stage-IV sales from past
10 days after lockdown ends, dealers of automobile industries facing the burden to liquidate the
Bharat-Stage-IV which is unsold and it is worth Rs,6300 crores.

PERFORMANCE OF MUTUAL FUNDS BEFORE COVID-19 AND DURING COVID-19

Many investors invest two or three mutual funds in different categories in the name of
diversification. It helps to avoid risk as well as maximum return. There is a simple logic that
these mutual funds divide into three major categories large-cap, mid-cap, and small-cap. No one
knows when this pandemic comes to the end. When it comes to equity investment, an investor
expects to dace the high market volatility due to the disclose of banks, AMC. it is better to
concentrate on asset allocation funds which can be dynamically managed by a fund manager and
helps to continue with SIP (Systematic Investment Planning). In another way, the debt investor
needs to perceive that the developments are largely isolated from the single fund house. Due to
unexpected pandemics, the debt market falls and shows negative development for certain house
funds and that's why the debt market offers to invest in single fund houses with small capital for
the small and mid-term enterprises. A outperform of 33 Portfolio Management Schemes, Kotak’s
Association Management Company encounters a huge profit by investing in pharmaceutical and
gaining return nearby 26%. The hybrid funds are suggested by mutual fund managers during this
current situation because the outperformance of the mixed composed portfolio plays well in the
aggressive market than the equity market

According to the "IIT Hyderabad" elaborates that investors need not worry about the net asset
value (NAV) of their investment since it wouldn't change or fall drastically during the present
quarter. The outbreak of COVID-19, market volatility will continue to hold the mutual funds'

16
industry because it considers as part of the ongoing turmoil of the Indian economy as well as for
investor's concern. Though the Reserve Bank of India (RBI) and Ministry of Finance announced
to continue the mutual fund investments through a systematic investment plan (SIP),
simultaneously it poses unreliability about the future cash flows to equity assets. Instead of
pulling out the money from mutual funds without the knowledge of volatility in the equity and
debt funds in the short-term, investors can continue with the flow of income who are aiming at
long-term investment. This is to be immune to the economic backfire of COVID-19 and around
44 mutual funds industry are under pressure to continue with the small-midterm following the
volatility of the market. The Pharma industry and telecom industry outpaced in its peers and
achieving continues advantages from the ongoing disruption. Due to the lockdown condition,
business is running via the Internet which is beneficial to the telecom industry. 1.47 lakhs
customers may face an issue related to their business in the way od demand, survival, debt, and
affordability. Healthcare sectors will sure get more benefits from the government in the future as
well.

PERFORMANCE OF TOP MUTUAL FUNDS IN DIFFERENT SCHEMES

I have taken the three major funds equity, hybrid, and debt funds with top companies 4 funds
running in a good manner and made a comparison of performance between a 1year return and
this three-month return.

Figure 1: Top Four Funds Performance in Equity Market.

17
 EQUITY FUNDS

1.00%

-1.00% Axis Mid Cap Fund- Axis Mid Cap BOI AXA Tax Ad- CR Bluechip Equity
D(G) Fund(G) vantage-D (G) Fund-D(G)
RETURNS

-3.00%
Before 0.003 -0.011 -0.022 -0.028
-5.00%
COVID-19
DURING
-7.00% -0.084 -0.087 -0.102 -0.075
COVID-19
-9.00%

-11.00%

As you can see the difference from one-year return and 3 months return. Even though the 1-year
return was negative in some companies but still these three months of COVID-19 pandemics go
more negative. The first Axis Midcap fund- Direct plan and have growth charges its 1year return
was 0.30% but the three months return is -8.40% you could see the losses. The top companies
holding this fund are City Union Bank, Info Edge, Bajaj Finance, Bata India, etc. Secondly, also
an Axis Midcap fund but it doesn't have a direct plan but charging only growth rate. BOI AXA
Tax Advantage it comes under the ELSS fund category. Its 1-year return is already in negative -
2.20% but this three-month negative return (-10.20%) crossed the 1-year negative return and the
companies holding this fund are Bajaj Finance, HDFC Bank, ICICI Bank, Kotak Mahindra,
Reliance, etc. CR Bluechip Equity Fund is under Large Cap fund and growth charges 1.0% of
sell value and companies holding this fund are HDFC Bank, Infosys, Axis Bank, TCS, Reliance,
etc.

Figure 2: Top Four Funds Performance in Hybrid Market.

Before COVID-19 indicates the 1-year return and during COVID-19 calculates the three months
return.CR Income Saver Fund-D it deals with a direct plan and Growth. The top companies
holding CR Income saver funds are Apollo hospital, City Union Bank, Axis Bank, Sanofi India,

18
 HYBRID FUND

7.50%
6.50%
5.50%
4.50%
3.50%
2.50%
Returns

1.50%
0.50%
-0.50% CR Income Saver LIC MF Debt Hybrid CR Income Saver LIC MF Debt Hybrid
Fund-D(G) Fund-D(G) Fund(G) Fund

BEFORE 0.075 0.067 0.064 0.058

COVID-19
DURING -0.007 -0.001 -0.009 -0.004
COVID-19

Whirlpool, etc. LIC MF Debt Hybrid funds set a benchmark of CRISIL MIP Blended Fund and
the companies holding this fund are ICICI Bank Ltd, Infosys Ltd, State Bank of India,
Government of Indian Sovereign, etc. CR Income saver funds-G is a growth plan only and it
comes under the Canara Robeco Mutual funds and it dealing with LIC Housing Finance Ltd,
Indian Railway Finance, Reliance Industries Ltd, Housing Development, etc.

Figure 3: Top Four Funds Performance in Debt Market.

DEBT FUNDS

22.50%

17.50%

12.50%

7.50%
RETURNS

2.50%
DSP Strategic DSP Strategic DSP Government DSP Government
Bond Fund -D(G) Bond Fund -IP(G) Securities -DP(G) Securities -RP(G)

BEFORE 0.21 0.202 0.167 0.16

COVID-19
DURING 0.041 0.039 0.046 0.045
COVID-19

19
By comparing the equity and hybrid fund, debt fund still earning a positive return but when you
compare 1-year returns and these three months it's far less. DSP Strategic Bond Fund -D(G) is
under the Dynamic Bond Fund, it is for the purpose of bond investment where it expects to
maximize more returns. DSP Strategic Bond Fund- IP(G) it is for an institutional plan; the
primary goal of this scheme is to generate optimal returns with high liquidity through the
portfolio. DSP Government Securities DP(G), this scheme's objective is to generate income
through investment in Government Securities of various maturities. The last fund is DSP
Government Securities -RP (Regular Plan)- Growth mainly invested in bonds which issues by
the government of India. These types of bonds do not carry any default risk since the repayment
money is backed by the government.

Table 2: TOP 10 RANKING MUTUAL FUNDS COMPANY IN PRESENT TIME

AMC CATEGORY STRATEGY NAME RECENT

RETURN(APRIL) %
KOTAK Sector Fund Pharma 26%
EQUIRIES Mid & Small Cap Long Horizon Fund 24%
SECURITIES
GREEN PORTFOLIO Multi-Cap Special 20%
AMBIT CAPITAL Small-Cap Emerging Giants 19%
ICICI PRUDENTIAL Large Cap Large-cap Portfolio 19%
SOLIDARITY Multi-Cap Prudence 18%
ADVISORS
MARCELLUS Small-Cap Little Champs 17%
CREST WEALTH Small-Cap Emerging Bluechip 17%
MANAGEMENT
ANAND RATHI Multi-Cap Impress PMS 17%
ADVISORS
RIGHT HORIZONS Small-Cap Minerva India Under- 17%
Served

To better understand, I have analyzed data to support the best solution and the data collected
through questionnaires to aligning the investor's interest. Data has been collected with a sample
of 50 from all over India.

Table 3: INTERPRETATION AND ANALYSIS IN DEMOGRAPHICS VARAINACE

VARIABLE FACTORS FREQUENCY PERCENTAGE %

Age Below 30 28 56

20
 30-40 13 26
40-50 7 14
50-60 2 4
Gender Male 29 58
Female 21 42
Income Statement Below Rs.50,000 14 28
50,000 -1,00,000 12 24
1,00,000-2,00,000 13 26
2,00,000-3,00,000 11 22
PROFESSION Entrepreneur 9 18.0
Businessman 8 16.0
Employee 31 62.0
Others 2 4.0

Table 3.1: Age

Frequency Percent Valid Percent Cumulative

Percent

Below 30 28 56.0 56.0 56.0

Between 30-40 13 26.0 26.0 82.0

Valid Between 40-50 7 14.0 14.0 96.0

Above 50 2 4.0 4.0 100.0

Total 50 100.0 100.0

Table 3.2: State

Frequency Percent Valid Percent Cumulative

Percent

Valid 30 60.0 60.0 60.0

Andra Pradesh 2 4.0 4.0 64.0

Bihar 1 2.0 2.0 66.0

Delhi 1 2.0 2.0 68.0

Gujarat 1 2.0 2.0 70.0

Karnataka 1 2.0 2.0 72.0

Kerala 1 2.0 2.0 74.0

21
 Maharashtra 1 2.0 2.0 76.0

Mumbai 3 6.0 6.0 82.0

Pondicherry 1 2.0 2.0 84.0

Rajasthan 2 4.0 4.0 88.0

Tami Nadu 1 2.0 2.0 90.0

Tamil Nadu 4 8.0 8.0 98.0

Uttar Pradesh 1 2.0 2.0 100.0

Total 50 100.0 100.0

Table 3.3: Gender

Frequency Percent Valid Percent Cumulative

Percent

Male 29 58.0 58.0 58.0

Valid Female 21 42.0 42.0 100.0

Total 50 100.0 100.0

Table 3.4: income group

Frequency Percent Valid Percent Cumulative

Percent

Below Rs50,000 14 28.0 28.0 28.0

Between Rs. 50,000-Rs.

12 24.0 24.0 52.0
1,00,000

Valid Between Rs.1,00,000 -

13 26.0 26.0 78.0
Rs.2,00,000

Above Rs.2,00,000 11 22.0 22.0 100.0

Total 50 100.0 100.0

22
Table 3.5: Profession

Frequency Percent Valid Percent Cumulative

Percent

Entrepreneur 9 18.0 18.0 18.0

Businessman 8 16.0 16.0 34.0

Valid Employee 31 62.0 62.0 96.0

other 2 4.0 4.0 100.0

Total 50 100.0 100.0

SOURCE: PRIMARY DATA

CORRELATION

Table 4: Age and Form of Investment

Level of significance: 0.05

Null hypothesis (H0): There is no relationship between age and the most preferred basis that
investors considered as important while investing in mutual funds
The alternative hypothesis (H1): There is a relationship between age and the most preferred basis
that investors considered as important while investing in mutual funds

Descriptive Statistics

Mean Std. Deviation N

age 1.6600 .87155 50

indicate the most preferred
basis that you considered as
2.9400 1.16776 50
important while you investing
in mutual funds

Correlations

23
 age indicate the
most preferred
basis that you
considered as
important while
you investing in
mutual funds

Pearson Correlation 1 -.181

age Sig. (2-tailed) .209

N 50 50
indicate the most preferred Pearson Correlation -.181 1
basis that you considered as Sig. (2-tailed) .209
important while you investing
N 50 50
in mutual funds

Interpretation: The Pearson correlation coefficient i.e. r=-181 with the N of 50 which is less than
0.05 and it clearly shows that the null hypothesis is rejected. The value lies .209 which indicates
a weak correlation between these two variables.

Table 5: Types of schemes do you prefer and How much COVID-19 affects your return?
Level of Significance=0.05
Null Hypothesis (H0) = There is no relationship between this type of schemes were investors
prefer most and the amount of impact on return due to COVID-19

Alternative Hypothesis (H1) = There is a relationship between this type of schemes were
investors prefer most and the amount of impact on return due to COVID-19

Descriptive Statistics

Mean Std. Deviation N

what type of schemes do

2.1200 1.11831 50
you prefer most?
how much COVID-19 affects
3.6600 1.11776 50
your return in mutual funds?

Correlations

24
 what type of how much
schemes do you COVID-19
prefer most? affects your
return in mutual
funds?

Pearson Correlation 1 .197

what type of schemes do
Sig. (2-tailed) .171
you prefer most?
N 50 50
Pearson Correlation .197 1
how much COVID-19 affects
Sig. (2-tailed) .171
your return in mutual funds?
N 50 50
Interpretation: From the above output could see that the Pearson correlation 0.197> 0.05
indicates the null hypothesis is accepted. The type of schemes that investors prefer does not
relate to the impact on the return of COVID-19. There are a very low degree of .171 (17%)
chances to prove that this statement is not true.

Table 6: Income group and Incase COVID-19 situation made you terminate or leave a job;
would it affect your investment?

Level of significance= 0.05

Null hypothesis (H0) = There is no correlation between the income group and the impact of
investment if you leave or terminate from the job during this COVID-19 situation.

Alternative Hypothesis (H1) = There is a correlation between the income group and the impact of
investment if you leave or terminate from the job during this COVID-19 situation.

Descriptive Statistics

Mean Std. Deviation N

what type of schemes do

2.1200 1.11831 50
you prefer most?
incase COVID-19 situation
made you terminate or leave
1.8333 .78591 18
your job, would it affect your
investment

Correlations

25
 what type of incase the
schemes do you COVID-19
prefer most? situation made
you terminate or
leave your job,
would it affect
your investment

Pearson Correlation 1 -.087

what type of schemes do
Sig. (2-tailed) .732
you prefer most?
N 50 18
incase COVID-19 situation Pearson Correlation -.087 1
made you terminate or leave Sig. (2-tailed) .732
your job, would it affect your
N 18 18
investment
Interpretation: This output shows -.087<0.05which means the null hypothesis is rejected. there is
a correlation between these two variables. The level of significance (2 tailed) shows 0.732 which
means 72% chances are there to sentence this as a true.
Table 7: Has COVID-19 impacts your stock and Is it good to invest in mutual funds after
COVID-19 betterment?
Level of significance= 0.05

Null Hypothesis (H0): There is no relationship between has COVID-19 impact on a stock and is
it good to invest in mutual funds after the COVID-19 betterment

Alternative Hypothesis (H1): There is a relationship between has COVID-19 impact on a stock
and is it good to invest in mutual funds after the COVID-19 betterment

Descriptive Statistics

Mean Std. Deviation N

has COVID-19 impact on

1.5800 .85928 50
your stocks?
is it good to invest in mutual
funds after the covid19 1.6600 .84781 50
betterment?

26
 Correlations

has COVID- 19 is it good to

impact on your invest in mutual
stocks? funds after the
covid19
betterment?

Pearson Correlation 1 .192

Has COVID-19 impact on
Sig. (2-tailed) .181
your stocks?
N 50 50

is it good to invest in mutual Pearson Correlation .192 1

funds after the covid19 Sig. (2-tailed) .181

betterment? N 50 50
Interpretation: Pearson correlation shows 0.192>0.05 level of significance that results in H 0 is
accepted that there is no relationship between the impact on their stocks and idea about investing
in mutual funds once this COVID-19 ends.
Table 8: Investors still investing or not and the platform they prefer
Level of significance =0.05

Null Hypothesis (H0): There is no relationship between are you still investing and which
platform do you invest most
Alternative Hypothesis (H1): There is a relationship between are you still investing and which
platform do you invest most.

Descriptive Statistics

Mean Std. Deviation N

do you still invest? 2.0000 .90749 18

which platform do you invest
2.5200 1.35887 50
most?

Correlations

do you still which platform

invest? do you invest
most?

do you still invest? Pearson Correlation 1 .314

Sig. (2-tailed) .205

27
 N 18 18
Pearson Correlation .314 1
which platform do you invest
Sig. (2-tailed) .205
most?
N 18 50
Interpretation: In the above output shows Pearson Correlation is 0.314 is greater than 0.05 which
means the null hypothesis is accepted. There is no relationship between which platform you are
investing and still you are investing in mutual funds. There are very low chances of around 0.205
chances only available for the relationship between these two variables.

Table 9: Year of experience and kind of fund gives higher return during this COVID-19
situation
Level of significance = 0.05
Null hypothesis (H0): There is no correlation between the years of experience investing in mutual funds
and which kind of funds gives higher return during COVID-19 situation.
Alternative Hypothesis (H1): There is a correlation between the years of experience investing in mutual
funds and which kind of funds gives higher return during COVID-19 situation.

Descriptive Statistics

Mean Std. Deviation N

year of experience 1.9722 1.02779 36

which kind of funds gives
higher returns during the 1.8200 .87342 50
COVID-19 situation?

Correlations

year of which kind of

experience funds gives
higher returns
during the
COVID-19
situation?

Pearson Correlation 1 -.005

year of experience Sig. (2-tailed) .976

N 36 36
which kind of funds gives Pearson Correlation -.005 1
higher returns during the Sig. (2-tailed) .976

28
 N 36 50
COVID-19 situation?

Interpretation: Pearson correlation shows negative r= -.005 which is less than 0.05. It disproves
that the null hypothesis can be accepted. The significance of two-tailed gives .976 which is 97%
results that there is a strong relationship between the experience in mutual and the expected
funds which give high return even though it is COVID-19 situation.

FINDINGS:
 I have received 50 responses around India. I got a response from many states like Tamil
Nadu, Maharashtra, Rajasthan, Gujarat, Andra Pradesh, Karnataka, Mumbai, Bihar, etc.
 Most of the responded age is around 30. 56% responded comes under the age of 30 and
followed by 26% responded are at the age of between 30-40 and 14% goes under the age
of 40-50 and the remaining 4% was above 50.
 58% responded are the male and the remaining 42%are the female. Male prefers more to
invest in mutual funds than female.
 28% investor's income is below Rs. 50,000 and 26% investors are between Rs1,00,000-
Rs 2,00,000 and 24% investors are earning between Rs 50,0000-Rs. 1,00,000 and rest
22% comes under who all are earning above Rs 2,00,000. There is not much difference in
income categories since the percentage is close to each other.
 The above-average of 58% respondent falls into employee profession and 20% are
businessmen and 14% are an entrepreneur and out of 50 respondents, some of the
investors are students, assistant professor, managing directors.
 28% of respondents' experience in mutual funds is less than 1 year those who newly
entered into the market. 24% respondent comes between 1-2 years of experience and 22%
comes between 2-3 years of experience and 8% are above 4 and 5 years. As per my
survey, most of the investors are newly started to do their investment in mutual funds.
 40% of investors fall into mutual funds and secondly 20% they prefer shares/debentures
and followed by 14% chose real estates and 12 % of investors preferred gold and fixed
deposits.

29
 Investors use some platforms to invest, 36% investors use Clearfunds, and 28% investors
use Zerodha, 16% uses Groww and 8% uses ABW websites and remaining investors
investing through banks, direct investment, or IG trading or company intranet sites.
 According to 42% of investors investing in mutual funds to get high returns, 28% of
respondents investing in mutual funds for the safety purpose and remaining 18% and
10% is for Tax benefits and liquidity and only 2% chose lock-in period because investors
never expect those kinds of situation.
 The type of schemes investors mostly preferred is equity(dividend) is 38% those who are
all ready to take the risk for high return and then followed by balanced funds is 24%
those who want to play safe and 20% goes for debt market and 16% chose hybrid funds
those who want to diversify their risk and assets can fall into this category.
 The majority of 64% of investors say that the COVID-19 situation impacts their stocks
and 26% of respondents doubt it whether their stocks are affected or not and the
remaining 10% of respondents say no.
 27.8% of investors have changed their strategy and strategies they followed is currently
stopped their investment or investing in pharmaceutical companies or using buy and hold
strategy 33.3% investors not aware of the strategies and 38.9% investors not following
any strategies.
 38.9% of investors are still investing as same as 38.9% investors are currently stopped
due to the panic against COVID-19 and 22.2% are stopped investment.
 38.9% investors say yes that their investment will affect if this COVID-19 situation made
them terminate or leave the job and as same as 38.9% respondent says that their
investment will not affection even they left the job or company terminates them and
22.2% are not sure whether the job losses will affect their investment or not.
 32% and 24% respondent say COVID-19 situation impact their investment very highly
and highly and 26% respondent says that this situation affects their investment in
moderate condition.
 36% of investors agree that this is not a good decision to invest during the COVID-19
situation and 34% of respondents chose yes for investing during the COVID-19 period
and the rest 30% have no idea about it.

30
  46% of respondents support equity will give more returns even in the current market
fluctuation. 28% of respondents vote debt funds and 24% vote hybrid funds give more
return and 2% say that constant government funds will give a good return.
 58% of respondents say is it well decide to invest after this COVID-19 comes to the end,
24% of respondents say probably and 18% say no.

CONCLUSION

The COVID 19 pandemics is a first and foremost tragedy that affects millions of people around
the world. The contagious COVID 19, that outbreaks in 2019 has led to a medical emergency
throughout the world. The fears among people hit the global economy when it comes to the
Indian economy the stock market losing around 20%-40% of their value every day. More than
Rs. 30,800 crores of investor's money were lockdown and stuck in mutual funds. Even though
the maturity date finished but the investor's money will remain locked. In India, the stock market
lost highly in the opening traded which leads to nervousness among investors. The Sensex fell
around 2.84% for an hour. But the main advice from my side is to don't rush to save your
capitalization and rush to flee. Once the pandemic is over, there is a major chance to recover and
raise the funds' value. Last few months we saw the China market falls and hits the economy
vastly and when you see how the current market of China rises and they come back with the
normal life and starts to reinvest in the market and diversify their assets in various sector. The
fact that COVID-19 is a temporary hit to the market and during this period the pharmaceutical
field and gold especially the pharma sector yielding lots of benefits from the COVIS-19
pandemics we contact them for claiming face masks, hand sanitizers, face shields, etc. those
seem necessary during this situation. Financial planners and mutual fund managers believe that
the schemes on vaccines and drugs would go high at the moment. In the last one month itself, the
return for the pharma field is 3.07% and 8.05% in three months. After the pharma industry,
Internet-based business makes the world disrupted for good due to COVID-19 pandemics.

We expect this market volatility going to continue for a few months but the investors always
remain the ongoing impact in the market. They should keep assets allocation discipline to avoid
further losses on their stock. It must be a good time to buy stocks at reasonable prices for long-
term investment players. Don't panic, sell those stocks are not giving any good returns as soon as

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possible and buy a stock at a low price and allocate in SIP. Invest in a swaying manner and add
some liquidity which helps during this volatility period and always keeps contact and gets advice
from your mutual fund managers and experts before doing any changes in the portfolio.

SUGGESTIONS

Due to the lack of clarity in the economic impact of COVID-19, it is better to adopt many
precaution strategies and to create awareness among the investors, especially for the equity
investors. Portfolio Managers and Financial experts believe that the market will bounce back, so
investors no need to panic about their investment. But having some strategy will save the
investors from any kind of hurdle. Long- term investors who are having more than 5-years of
investment plans are in a safer place because once this lockdown gets over, all the funds market
starts to run as usual and within their maturity date, the economy will bounce back. But the
hurdle is for short-term investors, most of the investors invest in equity mutual funds which are
high riskier and those can hold their investment or they can start to sell the funds if the prices of
the company go down. Attains to diversify your funds and allocate the assets in some other funds
with the help of SIP. There would be at least some pent-up demand in particular goods once this
pandemic comes to an end. At the same time, customers need to take care of their investment and
always get advice from the finance experts not to lose the money further. The investors must
create a contingency fund that will be helpful in case of an emergency such as job loss, health
crisis, etc. It will be taking care of an investor at least for 3 months. Always have some
individual cover like health cover, etc. can't expect only banks and companies will cover our
loss. In case of a situation to leave a job or lose a job, those types of individual cover will help
you and balance your life.

ANNEXURE

Questionnaires

1) Age
a. Below 30
b. Between 30-40
c. Between 40-50
d. Above 50

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2) Which state are you from in India?
3) Gender
a. Male
b. Female
4) Income group
a. Below Rs.50,000
b. Between Rs.50,000- RS. 1,00,000
c. Between Rs. 1,00,000- Rs. 2,00,000
d. Above Rs. 2,00,000
5) Profession
a. Employee
b. Businessman
c. Entrepreneur
d. Any other
6) Have you ever invested in mutual funds?
a. Yes
b. No
7) Year of experience
a. Less than 1 year
b. 1-2 years
c. 2-3 years
d. 3-4 years
e. Above 4 years
8) What form of investment do you prefer?
a. Real Estates
b. Gold
c. Fixed deposits
d. Mutual funds
e. Shares/debentures
f. Cryptocurrency
g. Any others

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9) Which platform do you invest most?
a. Zerodha
b. Clearfunds
c. Groww
d. ABW website
e. Any other
10) Please indicate the most preferred basis that you considered as important while you
investing in mutual funds?
a. Tax Benefits
b. Liquidity
c. Safety
d. Higher return
e. Lock-in period
f. Any other
11) What type of schemes do you prefer most?
a. Equity (Dividend)
b. Debt (Income)
c. Balanced Fund
d. Hybrid funds
e. Any other
12) Has COVID 19 impact on your stock?
a. Yes
b. No
c. Probably
13) Have you changed the strategy?
a. Yes
b. No
c. Probably
14) If yes, then what it would be your strategy?
15) Have you still investing?
a. Yes

34
 b. No
c. Temporarily stopped
16) Incase COVID-19 situation made you terminate or leave your job, would it affect your
investment?
a. Yes
b. No
c. Probably
17) How much COVID-19 affects your return in mutual funds?
a. Very low
b. low
c. Moderate
d. High
e. Very High
18) Is it a good decision in investing in mutual funds during COVID-19?
a. Yes
b. No
c. Probably
19) Which kind of Funds gives a higher return during the COVID-19 situation?
a. Equity fund
b. Debt fund
c. Balanced Fund
d. Hybrid Fund
e. Any other
20) Is it good to invest in the mutual fund after the COVID-19 betterment?
a. Yes
b. No
c. Probably

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REFERENCE:

Sharad Panwar and Dr. R. Madhumathi Indian Institute of Technology, Madras “Characteristics
and Performance Evaluation of selected Mutual Funds in India.”

Rao Neelakanteswar Dabbeeru “Investment Styles and Performance of Equity Mutual Funds in
India”.

Bilal Pandow Middle East College “Performance of Mutual Funds in India”

B Phaniswara Raju and K Malilkarjuna Rao, “Market Timing Ability of Selected Mutual Funds
in India”

Dr. Geeta Kesavaraj, “A customer perception towards various types of mutual funds in Chennai”

Narayan Rao Sapar and Ravindran Madhava “Performance Evaluation of Indian Mutual Funds”

Akshatha P “Performance of Mutual Funds: A comparative study on the selected equity mutual
funds in India”

Read more at:

https://economictimes.indiatimes.com/mf/analysis/consider-sip/stp-into-value-focused-dividend-
yield-or-small-cap-funds-s-naren/articleshow/75883151.cms?
utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

Read more about COVID-19 crisis

https://www.google.com/url?
sa=t&rct=j&q=&esrc=s&source=web&cd=&cad=rja&uact=8&ved=2ahUKEwigzu3SuOvpAhU
FxYUKHchgC48QFjAFegQIBxAC&url=https%3A%2F%2Fround-lake.dustinice.workers.dev%3A443%2Fhttps%2Fwww.business-standard.com
%2Farticle%2Fmarkets%2Fcovid-19-impact-equity-mf-schemes-give-25-negative-returns-to-
investors-120032200247_1.html&usg=AOvVaw1uWpZvcNPdPmuYJtiyZNTj

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