Fundamental Factors Influencing Investments in Mutual Funds - the EIC Approach- a Case Study of RCAML

Abstract

With the growing risk appetite, rising income, and increasing awareness, mutual funds in India are becoming a preferred investment option as compared to other investment avenues like Fixed Deposits (FDs) and postal savings that are considered safe, but give comparatively low returns. However, before investing in mutual funds, investors have to analyze the factors of the economy, industry and company within the investment environment in which they operate. There are several macro-economic factors havirtg an influence upon the irtvestment choices. The researchers intend to study, more particularly, the impact of qmmtitativ~ economic variables on the investment of mutual funds. The trends within the industry also have to be examined from time to time. In response to the changing circumstances, the fund houses have introduced a host of interesting technological innovations to gtab the attention of the investors. Investors need to correctly appraise the risks and rewards of investing in schemes, which seek to offer attractive returns. Against this backdrop, the current research has been undertaken following the Economy, Industry and Company (EiC) Approach of mutual funds. The Mutual Fund under consideration is the Reliance Capital Asset Management Limited (RCAML), the rnarket leader, as a case study.