Relevance of Asset Management Companies in Mutual Fund Investment Decision of Investors: An Empirical Study

Abstract

Financial markets are constantly becoming more efficient by providing more promising solutions to the investors. Being a part of financial markets, although mutual funds industry is responding very fast by understanding the dynamics of investor's perception towards rewards, still, they are continuously following this race in their endeavour to differentiate their products responding to sudden changes in the economy. The mutual fund is a type of professionally managed collective investment scheme, which pools money from many investors. The profit gained from investments is shared to 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. It is high time to understand and analyse the role of the asset management companies (AMCs) (mutual fund sponsor's) in the investment decision of the mutual fund investors. The present study attempts to identify the important mutual fund sponsor's qualities and the investor's services provided by the AMCs considered important by the investors while selecting a mutual fund for investment.