As a result, the popularity of the mutual funds is limited to big towns and cities i.e. the places outside the metropolitan area are yet to be fully tapped by the industry. A significant portion of the country’s population lives in these areas. It is important that the mutual funds target this section of investors if it has to raise the profitability margins. This can help the industry to penetrate into the unexploited markets in the country. If the industry can reach out to the wider audience then this give a significant boost to the growth and development of the mutual funds in the country.
On the other hand Indian mutual fund segment has largely been product led-and not sufficiently customer focused with limited focus being accorded by players to innovation and new product development. Further there is limited flexibility in fees and pricing structures as reported by interviewees in our study in 2009. It is important that if the funds desire to achieve a robust growth they should design their policies as per the needs of the customer. The diversified population of the country comprising of the retired individuals, high income groups, middle income groups, etc make it necessary to have the funds as per the requirements of the related group. For example the investment objective of a retired individual is not the same as that of the high income group. The former requires a regular flow of cash and is happy with stable returns while the latter is risk averse and desires high returns by taking high risks. By designing the funds as per the investment needs of the investors the industry can cater to the various sections of the society. This will make it popular across all the income classes.
Mutual funds are investment schemes that are managed by professional experts. These financial instruments have become extremely popular on account of some inbuilt advantages. Initially investment in high value stocks