Abstract
Purpose: This study is meant to analyze investment behavior of the small investors towards mutual funds at district level of a state and to determine various factors which prompt the small investors to invest in mutual funds. Design/Methodology/Approach: This study is descriptive in nature and used factor analysis on the data collected from 108 respondents out of 120 to whom questionnaire was distributed. For research, primary data is collected and used and secondary data is used for literature review. In this study authors have taken the principal component analysis approach to determine the variables affecting the behavior of small investors towards the mutual fund investments. Findings: The study revealed that mainly males between 34-41 age group in middle class income range had been investing in mutual funds. This study concludes that the fund manager experience, fund performance, scheme risk and the low risk and high returns are the main factors appraised by the small investors while investing in mutual funds. Research Implications: This study can be used by the mutual fund companies in creating their strategies for attracting the small investors. Deploying their best fund managers, introducing diversified schemes, with high growth and liquidity, and showcasing tax benefits, past fund performance, low risk and time horizon may prove success strategies for attracting small investors towards mutual funds.
Published Version
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