AN EMPIRICAL STUDY ON MUTUAL FUND PERFORMANCE AND RETAIL INVESTOR BEHAVIOUR

Abstract

Mutual funds have become an important investment option for retail investors as they provide professional fund management, diversification, and the opportunity to participate in capital markets with relatively lower risk. This study focuses on analyzing the performance of mutual funds and examining how their performance influences the investment decisions of retail investors. The main objective of the study is to evaluate the returns, risk levels, and consistency of selected mutual fund schemes and to understand the factors that affect retail investors while choosing mutual fund investments. The research is based on both primary and secondary data. Primary data is collected through structured questionnaires distributed among retail investors to understand their preferences, awareness, and investment behavior. Secondary data is obtained from mutual fund reports, financial statements, and relevant financial publications. Various analytical tools and techniques are used to interpret the data and assess the performance of mutual funds. The findings of the study indicate that past performance, risk-return relationship, fund manager reputation, and market awareness significantly influence retail investors’ decisions. Investors tend to prefer mutual fund schemes that offer consistent returns and lower risk. The study concludes that mutual fund performance plays a crucial role in shaping retail investors’ investment choices and encourages greater participation in the financial market. It also highlights the importance of investor awareness and financial education in making informed investment decisions.