MUTUAL FUND INVESTMENTS THROUGH FACTOR ANALYSIS IN IDFC

STUDY THE BUYER BEHAVIOUR AND DETERMINE THE “KEY BUYING CRITERIA” OF INDIAN INVESTORS WITH RESPECT TO MUTUAL FUND INVESTMENTS THROUGH FACTOR ANALYSIS.
EXECUTIVE SUMMARY

 IDFC Mutual Funds wanted a thorough analysis of investor‟s needs and preferences with respect to mutual fund investments. Nowadays, to survive in such intensely competitive environment, knowledge of customer‟s needs and requirements has become a prerequisite for success. Most of the companies realising this are doing their best to find out how a customer perceives their product. In the Indian Mutual Fund Industry, this area has been overlooked to a great extent with over 38 AMC‟s bombarding the Indian investors with 832 schemes. As soon as an investor plan to make a mutual fund investment, that is when his nightmare starts. He is soon caught in the frenzy of complicated jargon of the mutual fund industry and he finds himself dealing with complicated schemes, SIP‟s, STP‟s, SWP‟s and what not. For a normal investor, it becomes a really arduous task to make a mutual fund investment and so most of the time he approaches a broker or an agent to get a recommendation. However, even with a recommendation he ends up investing in a non-suitable mutual fund scheme. Hence, it is very important for companies to know their customers and develop products that are suited to their requirements rather than selling random schemes to them. On conducting the analysis, 5 major factors were extracted that were primarily the investor‟s expectation levels in a mutual fund product. The factors were basic product, augmented product, persuasive promotion, investor confidence and investor loyalty. All the 20 variables were grouped under these factors depending upon the respondent data collected. Then the Voice of Investor Survey was done which made us familiar with the practical aspects of the mutual funds industry and the problems associated with. This survey was not done under the purview of any statistical package and neither were we focussing on statistics. Our primary aim was to understand, leave alone factors, but what goes on in the minds of the investors in plain words. The survey provided us with quite unique knowledge inputs with respect to mutual fund industry. In a nutshell, at the end of the study we are providing IDFC Mutual Funds with an insight into customer‟s needs and requirements through a statistically proven model and some general excerpts that might come in handy while servicing the customers and dealing with them.


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