A Study on Investors Perception and Satisfaction towards Mutual Funds Return

22 Stochastic Analytical Frameworks for Indian Knowledge Systems and Innovation: Future Pathways 175 A Study on Investors Perception and Satisfaction towards Mutual Funds Return Jaismeen Kaur Assistant Professor, Baba Farid College of Engineering & Technology, Bathinda. Abstract The present study analyses investors' risk perception and satisfaction with mutual fund returns in the Indian market. Based on a survey of 100 investors, the study finds that the majority view mutual funds as moderately risky, with debt funds being perceived as the riskiest. Market volatility, past performance, and opinions of financial advisors are the major determinants of risk perception. Although most investors anticipate returns of 5-15% per annum, some are dissatisfied with actual returns. The research highlights the necessity of better financial literacy, enhanced transparency on the part of fund managers, and the adoption of online platforms for real-time performance monitoring in order to build investor confidence and satisfaction. Keywords: Investors' risk perception, Satisfaction, Market volatility, Past performance. 1. Introduction A Mutual fund is a vehicle in which money of different investors is pooled and invested in equities, bonds, government securities, money market instruments etc. There are the professional fund managers who invest in the bonds and stock. They invest the money, which are gathered in the mutual funds scheme. Mutual funds in India are formed in the nature of a trust under Indian Trust Act, 1882, as per SEBI (Mutual Funds) Regulations, 1996. 176 Stochastic Analytical Frameworks for Indian Knowledge Systems and Innovation: Future Pathways Mutual Funds has a very vital role in mobilizing the saving into productive investment of different investors. In recent years, mutual fund industry is growing day by day continuously. Mutual fund is an investment tool in which the investors can pool their funds in different forms of securities. Mutual funds offer a professional fund management facility to the investors through which investors are able to invest their funds in a safe and sound mode. Mutual funds help the investors to earn good returns. Mostly, the investors prefer to invest their funds in mutual funds because the mutual fund is very convenient. It is an investment vehicle for the investors to invest funds and also it gives the high return to the investors. Mutual Funds is handled by the professional fund managers which assists to protect the investment of the investors also funds managers gives their expertise service to the investors which assists them to make the decision for the investment. 2. Perception of the investors Perception refers to that how the individual perceived something or ability to Understand something. The perception of the investors refers to that how investors perceived about the investment. There are the different factors which the investors taken into the consideration while investing in mutual funds such as age, gender, risk, return, liquidity, convenience, inflation rate, interest rate etc. But the most important factors which affect the perception of the investors are risk and return. Because while investing in the mutual fund a investor always attempts to reduce the risk and increase the return on his investment. 3. Objective of the Study This Study aims to analyse investors’ perception of mutual funds return and evaluate their satisfaction with the return received. 4. Review of Literature Malhotra et al., (2024) examined Indian mutual funds and noted that, historically, they had lower volatility and monthly returns than benchmark indexes. This suggested that although the returns might not have been as high, some investors looking for lower risk might find these products’ steadiness appealing. Stochastic Analytical Frameworks for Indian Knowledge Systems and Innovation: Future Pathways 177 Sharma, (2024) investigated the knowledge and views of Indian investors in order to gauge their level of satisfaction with mutual fund results. The study sought to offer suggestions for improving investors’ mutual fund investing experiences while highlighting the difficulties they had encountered. It underlined how crucial strategic decision-making and investor awareness are to raising satisfaction levels. Upadhyay, (2024) investigated how investors’ expectations for returns were impacted by market conditions. According to the study, investors’ opinions of mutual fund performance were influenced by market volatility since shifting circumstances had an effect on both short-term returns and long-term trust in these investments. 5. Research Gap Although numerous studies have analysed investor satisfaction in mutual funds, gaps exist in certain areas. The influence of demographic variables, changes in the market, and behavioural factors such as risk tolerance on investor attitudes has not been adequately researched. There is also little research on post-investment experience, variation in satisfaction between different types of funds, and the influence of digital platforms. Bridging these gaps will provide insights into investor behaviour and satisfaction in greater depth. 6. Research Methodology The study adopts a descriptive research design to analyses investor perception and satisfaction towards mutual funds return. Primary data were gathered using a structured questionnaire, while secondary data were obtained from journals, research articles, and financial reports. Purposive sampling is used by the study, focusing on mutual fund investors with varying demographics, and the sample size is 100. Data is analysed through tables and charts. 7. Data Analysis and Interpretation A survey was conducted where in the investor were asked a set of questions. The responses were received which has analyzed using tables and charts. 178 Stochastic Analytical Frameworks for Indian Knowledge Systems and Innovation: Future Pathways Ques 1: Age Group 0 5 10 15 20 25 30 35 40 Number of Respondents 18-25 years 26-35 years 36-45 years 45-55 years Above 55 years Interpretation The data shows that the majority of the respondents are in the age group of 18-25 years, making up 35% of the total. This shows that more young people are actively involved in mutual fund investment. The next age group of 36-45 years represents 19% and shows moderate interest in investing. On the other hand, the participation rate of people above 45 years is lower and only 6% of the respondents. This trend indicates younger investors are relatively more open to exploring mutual funds compared to older age groups. Ques 2: Gender Stochastic Analytical Frameworks for Indian Knowledge Systems and Innovation: Future Pathways 179 Interpretation According to the data, 58% of the respondents are females and 41% are males, with 1% not wishing to declare their gender. It would seem, therefore, that women are perhaps more interested or involved in this type of investment. Ques 3: Occupation 0 10 20 30 40 50 Number of Respondents Student Salaried employee Selfemployee Retired Other Interpretation The data reveals that the majority of respondents (48%) are salaried employees, indicating that fixed-income professionals are more inclined towards mutual fund investments. Students (29%) also form a significant portion, suggesting that young individuals are exploring investment options early. Self-employed individuals (20%) show a moderate level of participation, while retired individuals (1%) and others (2%) represent a small fraction of investors. Ques 4: Income level (Per annum) 0 5 10 15 20 25 30 35 Number of Respondents Below Rs 3 lakhs Rs 3-5 lakhs Rs 5-10 lakhs Above Rs 10 lakhs 180 Stochastic Analytical Frameworks for Indian Knowledge Systems and Innovation: Future Pathways Interpretation The majority of the respondents, 31%, fall into the ₹3-5 lakhs income category, followed by 27% who earn less than ₹3 lakhs. This means a large number of investors are in the middle-income groups. Another 25% of the respondents fall into the ₹5-10 lakhs income bracket and 17% earn more than ₹10 lakhs, showing that high-income individuals also invest in mutual funds, though to a lesser extent. Ques 5: Education level Interpretation This data indicates that 46 percent of the investors are post graduate and 43 percent of the investors are graduate and there are only 3 percent of investor whose education level is high school. which show that the most of the investors are well educated. Ques 6: What is your expected annual return from mutual funds? 0 10 20 30 40 50 60 Number of Respondents Less than 5% 5-10% 10-15% Above 15% Stochastic Analytical Frameworks for Indian Knowledge Systems and Innovation: Future Pathways 181 Interpretation Most investors anticipate returns of 5-10% (51%), while 36% are expecting 10-15%. This is indicating a preference for moderate growth. Only 7% expect returns above 15%, and the small high-risk group is comprised of 6% who anticipate less than 5%. Therefore, investors generally have realistic expectations about returns. Ques 7: How satisfied are you with the historical returns of mutual funds? 0 10 20 30 40 50 60 Number of Respondents Very satisfied Satisfied Neutral Very dissatisfied Dissatisfied Interpretation This data shows that the 57 percent of the investors are satisfied with the historical return of the mutual funds and no one is dissatisfied with the historical return of mutual funds. Which shows that the mutual funds provides the best return to their investors. Ques 8: Which type of mutual funds do you believe provides the best returns? 0 10 20 30 40 50 60 Number of Respondents Equity Debt Funds Hybrid Funds Sectoral/Thematic Funds Other 182 Stochastic Analytical Frameworks for Indian Knowledge Systems and Innovation: Future Pathways Interpretation The majority (51%) believe debt funds provide the best returns, indicating a preference for stable, low-risk investments. 28% favour equity funds, suggesting a moderate risk appetite. 17% choose hybrid funds, balancing risk and return, while only 4% prefer sectoral/ thematic funds, likely due to their higher volatility. Ques 9: Do you consider mutual funds a better investment option compared to other investment options such as fixed deposits or real estate in terms of returns? 0 10 20 30 40 50 Number of Respondents Yes No Not Sure Interpretation Investors are split, with 48% saying mutual funds are better than fixed deposits or real estate in terms of returns. 43% disagree, which may be due to a bias toward traditional investment options. 9% are unsure, indicating a lack of clarity or experience in comparing returns across investment types. Ques 10: How often do you review the performance of mutual fund investments? 0 10 20 30 40 50 Number of Respondents Monthly Quaterly Annually Rarely Stochastic Analytical Frameworks for Indian Knowledge Systems and Innovation: Future Pathways 183 Interpretation The data shows that 45% of investors review their mutual fund performance monthly, which indicates active monitoring. 12% review quarterly and 13% annually, which is a moderate approach. However, 30% rarely review their investments, highlighting a significant portion of passive investors who may not track their portfolio regularly. Ques 11: Are you satisfied with the ease of tracking mutual funds performances? 0 10 20 30 40 50 Number of Respondents Very satisfied Satisfied Neutral Very dissatisfied Dissatisfied Interpretation Majority of the investors (48%) are satisfied with the ease of tracking mutual fund performance, while 7% are very satisfied, which indicates a generally positive experience. However, 34% remain neutral, suggesting that some investors find tracking neither easy nor difficult. 11% are very dissatisfied, which indicates the need for improved tracking tools or better accessibility. Ques 12: Have your mutual funds returns met your expectations? 0 10 20 30 40 50 60 Number of Respondents Yes, exceeded expectations Yes, met expectations No, underperformed Not sure