Research Paper Growth And Development Of Mutual Fund Schemes In Paper ID IJIFR/ V2/ E2/ 031 Page 421-425 Subject Area Business Management Key Words Mutual Fund, Income Fund, Equity Fund, Exchange Traded Fund Associate Professor Dr. S. Poornima 1 Department of Business Management PSGR Krishnammal College for Women Coimbatore 641 004 Assistant Professor R. K. Sudhamathi 2 Department of Management Studies Dr. N.G.P. Institute of Technology Coimbatore- 641048 Abstract Mutual fund industry in has undergone four phases of its growth. Under each phase it has witnessed tremendous changes. First phase (1964-87) was solely dominated by UTI. Second phase (1987-1993) was marked by the entry of public sector mutual funds. Third Phase (1993 2003) witnessed the entry of private sector funds. Fourth phase (since February 2003) was the period during which UTI was bifurcated into two separate entities, namely UTI of, functioning under the purview of mutual fund regulation and UTI Mutual Fund, registered with SEBI and functions under the mutual fund regulations. The above phases of growth multiplied mutual fund schemes in. This article attempts to examine the growth of mutual fund schemes in. 1 Introduction Mutual fund industry in has undergone four phases of its growth. Under each phase it has witnessed tremendous changes. First phase (1964-87) was solely dominated by UTI. Second phase (1987-1993) was marked by the entry of public sector mutual funds. Third Phase (1993 2003) witnessed the entry of private sector funds. Fourth phase (since February 2003) was the period during which UTI was bifurcated into two separate entities, namely UTI of, functioning under the purview of mutual fund regulation and UTI Mutual Fund, registered with SEBI and functions under the mutual fund regulations. The above phases of growth multiplied mutual fund schemes in. At the outset, the growth in mutual fund schemes can be examined in two ways. (1) Categorywise growth in mutual fund schemes in. (2) Portfolio-wise growth in mutual fund schemes in. www.ijifr.com Copyright IJIFR 2014 421
Year (31 March) ISSN (Online): 2347-1697 14 th Edition, Page : 421-425 2 Category-wise Growth in Mutual Fund Schemes in According to category-wise mutual funds can be broadly classified in open-ended fund, close-ended fund, assured return fund and interval fund. Table 1 depicts the category-wise growth in number of mutual fund schemes in from March 2000 to March 2014. It indicates that the number of mutual fund schemes have risen to 1634 in March 2014 from 387 in March 2000. Thus, the number of mutual fund schemes has registered a Compounded Annual Growth Rate (CAGR) of 10.86 percent on the whole. The open-end mutual fund schemes have risen to 777 in March 2014 from 234 in March 2000 and it has registered CAGR of 8.95 percent. Close end mutual schemes have increased from 116 in March 2000 to 796 in March 2014. It has shown a CAGR of 14.75 percent. The assured return schemes have decreased to 21 in March 2002 from 37 in March 2000. It has ceased from market after the year 2002. Interval funds have originated from the year 2008. But the number of schemes has been reduced from 82 in March 2008 to 65 in March 2014. It has a negative CAGR of -3.80 percent. Thus the analysis on category-wise growth in number of mutual fund schemes in has led to the interpretation that mutual fund schemes in have recorded CAGR of 10.86 percent overall. Out of this, the open end funds have shown CAGR of 8.95 percent and close-end funds have shown a CAGR of 14.75 percent. Assured return fund ceased from the market from the year 2002 onwards. Interval fund which originated in the year 2008 has a negative growth rate of -3.80 percent. Table1: Category-Wise Growth In Number Of Mutual Fund Schemes In OPEN-END CLOSE-END ASSURED RETURN INTERVAL TOTAL 2000 234 116 37 387 2001 297 26.92 92-20.69 28-24.32 - - 417 7.75 2002 312 5.05 61-33.70 21-25.00 - - 394-5.52 2003 350 12.18 40-34.43 - - - - 390-1.02 2004 394 12.57 35-12.50 - - - - 429 10.00 2005 445 12.94 64 82.86 - - - - 509 18.65 2006 468 5.17 141 120.31 - - - - 609 19.65 2007 566 20.94 273 93.62 - - - - 839 37.77 2008 577 1.94 364 33.33 - - 82-1023 21.93 2009 622 7.80 155-57.42 - - 42-48.78 819-19.94 2010 700 12.54 239 54.19 - - 37-11.90 976 19.17 2011 732 4.57 460 92.47 - - 34-8.11 1226 25.61 2012 745 1.78 530 15.22 - - 34 0.00 1309 6.77 2013 751 0.81 501-5.47 - - 42 23.53 1294-1.15 2014 777 3.46 796 58.08 - - 65 54.76 1634 26.28 CAGR 8.95 14.7 5 3.8 10.86 422
Year (31 March) ISSN (Online): 2347-1697 14 th Edition, Page : 421-425 3 Category-Wise s In Total Number Of Mutual Funds In Table 2 shows percentage share of various mutual fund categories to total number of mutual fund schemes in for the period from March 2000 to March 2014. The open-end mutual fund schemes percentage with respect to total number of mutual fund schemes in ranges from 47.44 percent to 91.84 percent. Similarly, close-end mutual fund schemes percentage with respect to total number of mutual fund schemes in ranges from 8.16 percent to 48.60 percent. Assured return fund percentage with respect to total number of mutual funds in ranges from 5.33 percent to 9.56 percent only. Interval return fund percentage share with respect to total number of mutual funds in ranges from 5.13 percent to 2.60 percent. Thus, it could be interpreted from the Table 2 that the open-end mutual funds constitute the major percentage of share (47.44 percent to 91.84 percent) out of total mutual funds in. This was followed by close-end mutual fund schemes which range from 8.16 percent to 48.60 percent. Assured return mutual fund schemes (5.33 percent to 9.56 percent) and Interval mutual fund schemes (5.13 percent to 2.60 percent) are very marginal in their proportion when compared to total number of mutual funds in. Table: 2 Category-Wise In Total Number Of Mutual Fund Schemes In OPEN-END CLOSE-END ASSURED RETURN INTERVAL TOTAL Percentag e 2000 234 60.47 116 29.97 37 9.56 387 100 2001 297 71.22 92 22.06 28 6.71 - - 417 100 2002 312 79.19 61 15.48 21 5.33 - - 394 100 2003 350 89.74 40 10.26 - - - - 390 100 2004 394 91.84 35 8.16 - - - - 429 100 2005 445 87.43 64 12.57 - - - - 509 100 2006 468 76.85 141 23.15 - - - - 609 100 2007 566 67.46 273 32.54 - - - - 839 100 2008 577 56.40 364 35.58 - - 82 1023 100 2009 622 75.95 155 18.93 - - 42 5.13 819 100 2010 700 71.72 239 24.49 - - 37 3.79 976 100 2011 732 59.71 460 37.52 - - 34 2.77 1226 100 2012 745 56.91 530 40.49 - - 34 2.60 1309 100 2013 751 58.04 501 38.72 - - 42 3.25 1294 100 2014 777 47.44 796 48.60 - - 65 3.97 1634 100 CAGR 8.95 14.75 3.80 10.86 423
ISSN (Online): 2347-1697 14 th Edition, Page : 421-425 4 Growth Of Mutual Fund Schemes Across Type Of Portfolio In Table 3: Growth Of Mutual Fund Schemes Across Type Of Portfolio In Year Income Equity Balanced Liquid/ Money Gilt ELSS Equity Gold ETF s Other ETF s Overseas FOF Total 2000 58 25 91 39 27 12 26 11 16 7 16 7 - - - - - - 234 2001 96 32 99 33 32 11 27 9 24 8 19 6 - - - - - - 297 2002 129 33 115 29 36 9 31 8 31 8 52 13 - - - - - - 394 2003 128 33 121 31 37 9 33 8 31 8 43 11 - - - - - - 393 2004 143 33 142 33 38 9 39 9 30 7 37 9 - - - - - - 429 2005 188 37 178 35 36 7 43 8 30 6 34 7 - - - - - - 509 2006 253 42 207 34 36 6 50 8 28 5 35 6 - - - - - - 609 2007 412 49 253 30 38 5 58 7 28 3 39 5 3 0 8 1 - - 839 2008 539 53 290 28 35 3 57 6 32 3 44 4 5 0 11 1 10 1 1023 2009 309 38 304 37 33 4 57 7 35 4 49 6 6 1 12 1 14 2 819 2010 443 45 324 33 32 3 51 5 36 4 48 5 10 1 16 2 16 2 976 2011 696 57 306 25 30 2 55 4 39 3 48 4 12 1 21 2 19 2 1226 2012 2013 2014 775 59 303 23 30 2 55 4 42 3 49 4 14 1 21 2 20 2 1309 760 58 298 23 32 2 55 4 42 3 49 4 14 1 23 2 21 2 1294 1077 65 311 19 30 2 53 3 44 3 52 3 14 1 26 2 27 2 1634 CAGR 23.20 9.17 0.76 5.22 7.49 8.78 24.62 18.34 15.25 14.89 indicates percentage share of various types of portfolio According to type of portfolio, mutual fund schemes in can be classified into Income, Equity, Balanced, Liquid/Money market, Gilt, Equity-Linked Tax Saving Scheme (ELSS) Equity, Gold Exchange Traded Funds ( Gold ETF), Other Exchange Traded Funds ( Other ETF) and Overseas Fund of Funds ( Overseas FOF). Table 3 depicts the growth of mutual fund schemes across type of portfolio in. Income funds have recorded a Compounded Annual Growth Rate (CAGR) of 23.20 percent. Its percentage with respect of total number of mutual fund schemes ranges from 25 percent to 65 percent for the study period of March 2000 to March 2014. Equity mutual fund schemes have a CAGR of 9.17 percent. And its percentage to total number of mutual funds ranges from 19 percent to 39 percent. Balanced mutual funds have a CAGR of 0.96 percent, its percentage to total number of mutual funds ranges from 2 percent to 12 percent. 424
ISSN (Online): 2347-1697 14 th Edition, Page : 421-425 Liquid/ money market mutual funds have a CAGR of 5.22 percent. Its percentage to total number of mutual funds ranges from 11 percent to 3 percent. Gilt schemes have a CAGR of 7.49 percent. Its percentage to total number of mutual funds ranges from 7 percent to 3 percent. ELSS Equity has recorded a CAGR of 8.78 percent. Its percentage share to total number of mutual funds ranges from13 percent to 3 percent. Gold ETF s originated in the year 2007 have recorded CAGR of 24.62 percent. Its percentage to total number of mutual fund schemes constitutes only 1 percent. Other ETF s also originated only from the year 2007 and have recorded CAGR of 18.34 percent. Its percentage to total number of mutual fund schemes ranges from 1 percent to 2 percent. Overseas FOF s originated from the year 2008 have recorded CAGR of 15.25 percent. Its percentage to total number of mutual fund schemes ranges from 1 percent to 2 percent. Thus, it could be interpreted from the Table 3 that among the various types of portfolios Income portfolio constitutes a major (25 percent to 65 percent) proportion followed by Equity portfolio (19 percent to 39 percent). The other types of portfolio funds such as Balanced, Liquid/Money market, Gilt, ELSS Equity constitute only less proportion. Gold ETF s, Other ETF s and Overseas FOF s are new entrants and are attracting large investors. 5 Conclusion Entry of private sector companies in to mutual fund industry has brought tremendous growth in the industry. The open-end mutual funds constitute the major percentage of share out of total mutual funds in. Among the various types of portfolios Income portfolio constitutes a proportion followed by Equity portfolio. The other types of portfolio funds such as Balanced, Liquid/Money market, Gilt, ELSS Equity constitute only less proportion. Gold ETF s, Other ETF s and Overseas FOF s are new entrants and are attracting large investors. References [1] Amitab Gupta ( 2001) Mutual funds in : A study of investment management. Finance, XV(2),631-637. [2] A.G. (2001) Mutual funds in. New Delhi: Anmol Publications Pvt. Ltd. [3] Agarwal A.M. (2000). Mutual Funds Emerging Trends and Prospects. Finance XIV (4), 1271-1275. [4] Prasad G, P.K. (2008). Growth of Mutual Fund Industry in. Sourthern Economist, 15-18. 425