Ulips vs. Mutual Funds
EXECUTIVE SUMMARY
ULIP v/s MUTUAL FUNDS
“What is the difference between a ULIP and a Mutual Fund?”
The reason, perhaps for the wide extent of confusion, lies largely in the way ULIPs have been sold by agents. As just another mutual fund.
They are not a mutual fund, even though in some ways their structure is quite similar. In the sense, they too invest in the equity and debt markets. The risk lies on the investor. They issue units and reveal the net asset value of these units. That is where the similarity ends. ULIPs are a mixture of investment and insurance. But very long tern investment, not even medium term. Insurance companies themselves admit that if your investment horizon is anything less than 7 years, don’t even consider a ULIP.
This project aims at understanding the behavior of the investors as to what they feel about ULIP and Mutual Fund and what according to them a better investment tool is.
Basically, the project is to understand the investors, their behavior and what they feel about ULIP and Mutual Fund. This project also mentions the pros and cons of investing in ULIP and Mutual Fund. It also recommends the investors as to which investment tool is better.
INTRODUCTION
MUTUAL FUND
The growth and maturation of mutual fund industry is the greatest investment story of the twentieth century. With the introduction of innovative products, the world of mutual funds nowadays has a lot to offer to its investors. With the introduction of diverse options, investors need to choose a mutual fund that meets his risk acceptance, his risk capacity levels and has similar investment objectives as the investor. There are a large number of schemes available in the market to cater to the different needs of the investor.
The market has been bullish in the past few months and has given huge returns. Even the retail investors started investing in a big way expecting the rally to continue. But with the change in the global scenario, there has been a sudden
ULIP v/s MUTUAL FUNDS
“What is the difference between a ULIP and a Mutual Fund?”
The reason, perhaps for the wide extent of confusion, lies largely in the way ULIPs have been sold by agents. As just another mutual fund.
They are not a mutual fund, even though in some ways their structure is quite similar. In the sense, they too invest in the equity and debt markets. The risk lies on the investor. They issue units and reveal the net asset value of these units. That is where the similarity ends. ULIPs are a mixture of investment and insurance. But very long tern investment, not even medium term. Insurance companies themselves admit that if your investment horizon is anything less than 7 years, don’t even consider a ULIP.
This project aims at understanding the behavior of the investors as to what they feel about ULIP and Mutual Fund and what according to them a better investment tool is.
Basically, the project is to understand the investors, their behavior and what they feel about ULIP and Mutual Fund. This project also mentions the pros and cons of investing in ULIP and Mutual Fund. It also recommends the investors as to which investment tool is better.
INTRODUCTION
MUTUAL FUND
The growth and maturation of mutual fund industry is the greatest investment story of the twentieth century. With the introduction of innovative products, the world of mutual funds nowadays has a lot to offer to its investors. With the introduction of diverse options, investors need to choose a mutual fund that meets his risk acceptance, his risk capacity levels and has similar investment objectives as the investor. There are a large number of schemes available in the market to cater to the different needs of the investor.
The market has been bullish in the past few months and has given huge returns. Even the retail investors started investing in a big way expecting the rally to continue. But with the change in the global scenario, there has been a sudden
References: * www.mutualfundsindia.com * www.google.com * www.amfiindia.com * www.investopedia.com * www.moneycontrol.com * www.wikipedia.com * ICFAI Press, “Mutual Funds”, (2004) * “Mutual Funds Handbook”, (2004), Invest India Economic Foundation Private Limited.