A study on the perception of investment and the selection behavior of investors towards the mutual funds.

A Mutual Fund is a trust that pools the savings of a number of investors who share a common financial goal. The investment is the process of investing of money on an investment assets like shares, debentures, fixed deposits, gold, real assets, life policies, mutual funds and money market instruments. Investors invest on this with the expectation of future return in terms of interest and the capital gain. Individual investor considers different factors before making any decision to invest the funds on various securities which involves various degrees of risk and return. In the present economic scenario, the investors have different options available for investment and they have varied factors which motivates the investors for investing which is also governed by socio- economic profile which includes the good rate of return and risk tolerance. An attempt has been made to identify the perceptual factors which influence the investors to invest their fund in mutual funds. The proverb says “never put all the eggs in the same basket” which guides the investor for diversifying the risk. Diversification refers to the process where investor invests his funds in more than one investment opportunity which is available for investors. An investor must learn to analyze and measure the risk and return of the portfolio. All the investors may not be in a position to undertake the fundamental and technical analysis before they decide on investment options. In most of the capital markets throughout the world, mutual funds have gained a significant position. The mutual fund industry is playing a significant role in the development of the economy as well. The growth of mutual fund leads to lower intermediation costs, more efficient financial markets, and increased the activity of the capital markets and higher local ownership of the financial assets.