Professional Documents
Culture Documents
1) INTRODUCTION:
The SEBI regulations, 1993 defines a mutual fund as “a fund in the form of a
trust by a sponsor, to raise money by the trustees trough the sale of units to the public,
under one or more schemes, for investing in securities in accordance with these
regulations”
In the beginning:
Historians are uncertain of the origins of investment funds; some cite the closed-end
investment companies launched in the Netherlands in 1822 by King William I as the first
mutual funds, while others point to a Dutch merchant named Adriaan van Ketwich whose
investment trust created in 1774 may have given the king the idea. Van Ketwich probably
theorized that diversification would increase the appeal of investments to smaller
investors with minimal capital. The name of van Ketwich's fund, EENDRAGT MAAKT
MAGT, translates to "unity creates strength". The next wave of near-mutual funds
included an investment trust launched in Switzerland in 1849, followed by similar
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vehicles which is followed by many kind of companies created in Scotland in the 1880s.
The idea of pooling resources and spreading risk using closed-end investments soon took
root in Great Britain and France, making its way to the United States in the 1890s. The
Boston Personal Property Trust, formed in 1893, was the first closed-end fund in the U.S.
The creation of the Alexander Fund in Philadelphia, Pennsylvania, in 1907 was an
important step in the evolution toward what we know as the modern mutual fund. The
Alexander Fund featured semi-annual issues and allowed investors to make withdrawals
on demand.
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Regulation and Expansion:
By 1929, there were 19 open-end mutual funds competing with nearly 700 closed-
end funds. With the stock market crash of 1929, the dynamic began to change as highly-
leveraged closed-end funds were wiped out and small open-end funds managed to
survive.
Government regulators also began to take notice of the fledgling mutual fund industry.
The creation of the Securities and Exchange Commission (SEC), the passage of
the Securities Act of 1933 and the enactment of the Securities Exchange Act of 1934 put
in place safeguards to protect investors: mutual funds were required to register with the
SEC and to provide disclosure in the form of a prospectus. The Investment Company Act
of 1940 put in place additional regulations that required more disclosures and sought to
minimize and minimize grievience of investor of different catogeries conflicts of interest.
The mutual fund industry continued to expand. At the beginning of the 1950s, the number
of open-end funds topped 100. In 1954, the financial markets overcame their 1929 peak,
and the mutual fund industry began to grow in earnest, adding some 50 new funds over
the course of the decade. The 1960s saw the rise of aggressive growth funds, with more
than 100 new funds established and billions of dollars in new asset inflows.
Hundreds of new funds were launched throughout the 1960s until the bear market of
1969 cooled the public appetite for mutual funds. Money flowed out of mutual funds as
quickly as investors could redeem their shares, but the industry's growth later resumed.
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entire industry, which included a few closed-end funds, represented less than $10 million
in 1924.
The stock market crash of 1929 slowed the growth of mutual funds. In response to the
stock market crash, Congress passed the Securities Act of 1933 and the Securities
Exchange Act of 1934. These laws require that a fund be registered with the (SEC) .
A mutual fund is set up in the form of a trust, which has sponsor, trustees, Asset
Management Company (AMC) and custodian. The trust is established by a sponsor or
more than one sponsor who is like promoter of a company. The trustees of the mutual
fund hold its property for the benefit of the unit holders.
SEBI regulations require that at least two thirds of the directors of trustee
company or board of trustees must be independent i.e., they should not be associated with
the sponsors. Also, 50% of the directors of AMC must be independent. All mutual funds
are required to be registered with SEBI before they launch any scheme. The performance
of a particular scheme of a mutual fund is denoted by net value (NAV).
Mutual funds offer several advantages over investing in individual stocks. For example,
the transaction costs are divided among all the mutual fund shareholders, who also
benefit by having a third party (professional fund managers) apply expertise and dedicate
time to manage and research investment options. However, despite the professional
management, mutual funds are not immune to risks. They share the same risks associated
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with the investments made. If the fund invests primarily in stocks, it is usually subject to
the same ups and downs and risks as the stock market.
Many mutual funds offer more than one class of shares. For example, you may have seen
a fund that offers "Class A" and "Class B" shares. Each class will invest in the same pool
(or investment portfolio) of securities and will have the same investment objectives and
policies. But each class will have different shareholder services and/or distribution
arrangements with different fees and expenses
In India, AMCs work with five distinct distribution channels those are direct , banking,
retail, corporate and indiual financial adviser.
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opened up in india. Banks operating in india , including public sector, private and
foreign banks have established tie-up with various fund companies for providind
distribution and servicing.
The banking channel is likely to develop as the most vital distribution channel for
fund companies there are several reaons for the same. Customers remain invested
in banks for long periods of time and therefore banks maintain a relationship of
trust with their customers. Customers are rely on advice provided to them by
bankers as they are always on the look out for better investment avenues.
Managers are guiding to customers about various funds.
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The corporate channel includes a variety of institutions that invest in shares on the
company’s name. these are businesses, trust, and even state and local
governments. For institutional investors, fund managers prefer to create special
funds and share classes. Corporate can either invest directly in mutual funds, or
through an intermediary such as a distribution house or a bank.
Corporate exhibit varying degrees ‘of awareness of mutual fund products. Most of
the established corporate, such as the TVS industries in Hyderabad, are well-
versed with the performance and composition of various funds. The smaller
companies and start-up firms, however, need to be educating on several aspects of
mutual funds. In order to provide information to such clients, fund companies
usually organize presentation for these companies or set-up meetings with the
finance managers.
i. The IFA channel is the oldest channel for distribution and was widely employed
at the time when UTI monopoly in the market. In recent times with the
emergence significantly decreased.
ii. An agent who basically acts as an interface between the customer and the fund
house there is a unique systems in place in India , wherein several sub-brokers are
working under one main broker. The huge network of sub-brokers, thus ensure
larger market penetration and geographic coverage. As per AMFI, over one lakh
agents are registered to sell mutual funds and other financial products such as
insurance across the country.
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1.1.7 SEBI REGULATION ON THE INVESTMENT OF A MUTUAL FUND:
A scheme may invest in another scheme under the same asset management
company or any other mutual fund withought charging any fees, provided
• A scheme may invest in another sheme under the same asset management
company or any other mutual fund without charging any fees, provided that the
aggregate inter – scheme investment made by all the schemes under the same
management.
• Transfers of investment from one scheme to another scheme of mutual fund
permitted provided that:
a. Such transfers are done at the prevailing market price for quoted
instruments on spot basis.
b. The securities so transferred shall be in conformity with the investment
objectives of the schemes to which such transfer has been made.
c. The registration and accounting of the transactions is completed and
ratified in the next meeting of the board of trustees.
• A mutual fund may borrow to meet liquidity needs, for the purpose of repurchase,
redemption of units, or repayment of interest or dividend to the unitholders. Such
borrowings shall not exceed 20% of the net asset of the scheme and the duration
of the borrowing shall not exceed 6 months. The fund may borrow from
permissible entities at prevailing market rates and may offer the assets of the
schemes as collateral for such borrowings.
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• A scheme shaal not invest more than 15% of its NAV in debt instruments issued
by a single issuer which are rated not below investment grade by an authorized
credit rating agencu. Such investment limit may be extended to 20% of the NAV
of the scheme with the prior approval of Board of Trusttes and the Board of Asset
Management Company. This limit, however, is not applicable for investment in
governments securities and money market instruments.
• A scheme shaal not invest more than 10% of its NAV in unrated debt instruments
issued by a single issuer and the total investment in such instruments shall not
exceed 25% of the NAV of the scheme.
• A mutual fund will buy and sell securities on the basis of deliveries. It cannot
make short sales or engage in carry forward transactions.
• A scheme shall not make any investment in
a. Any unlisted security of an associates or group company of the sponsor .
b. Any security issued by way of private placement by an associate or group
company of the sponsor
c. The listed securities of group companies of the sponsor in exess of 25% of the
net assets.
• The investment manager may invest in a scheme from time to time. The percentage of
such investments to the total net assets may vary from time to time and can be upto
100% of the net assets of the schemes.
• A scheme shall not invest more than 10% of its NAV in the equity shares or equity
related instruments of any one company.
• A scheme may invest in ADRs/GDRs of Indian companies listed on overseas stock
exchanges to the extent and in a manner approved by RBI .
A scheme shall not invest more than 5% of its NAV in unlisted euity shares or equity
related instruments in case of an open ended schemes and 10% of its NAV in case a of
closed ended scheme.
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A. There are two types of tax-saving funds, equity-linked savings schemes (ELSS) and
pension funds. ELSS schemes are basically diversified equity schemes, which have a
three-year lock-in. Investments here—subject to a maximum of Rs 10,000—receive a
tax rebate of 0 to 20 per cent depending on the income slab. As these are equity
instruments they have the maximum risk-return potential among all asset classes. What
this means is that return has a propensity to vary with great intensity. Although an
average tax-saving mutual fund delivered 16.36 per cent in 2002, the range of returns was
extreme. Thus, in that year, the best tax-saving fund delivered 42.61 per cent and the
worst was down 3.16 per cent. The best way to overcome the vagaries of stock markets is
to diversify. Diversification can be across funds and, more importantly, across time
periods. By investing regularly every year in these funds one can set up a long-term
systematic investment plan.
The other route for saving taxes is pension funds, even though there are currently only
two such funds in operation, Franklin Templeton's Templeton India Pension Fund and
UTI's Retirement Benefit Plan. Introduced for the first time in 1997, pension funds are
hybrid schemes, which have a debt orientation, and carry the same tax benefit as ELSS.
From the tax point of view, bonus units are conceptually similar to dividend stripping,
but somewhat more complex. Bonus units that a fund issue is deemed to have been
acquired at zero cost. Thus, whenever they are sold, the entire sale price is treated as
capital gains. However, at the time of issue of bonus, the NAV of the fund drops in a
proportion that is identical to the ratio at which bonus funds are issued. This fall in the
NAV is a capital loss as far as the original units are concerned and it is here that tax
benefits can be realised. The original units can be sold off with a capital loss, which can
be used to set off other capital gains. The bonus units carry a high tax liability though
since you will pay taxes on the entire sale price.
Here's an example. Suppose you hold 10,000 units of a fund whose NAV is Rs 15. You
made the purchase less than a year ago at an NAV of Rs 12. If today you decide to sell
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these units, you will fetch Rs 1.5 lakh, out of which Rs 30,000 will be short-term capital
gain. On this, you are likely to pay a tax of Rs 9,000—30 per cent of gains.
Mutual funds are an ideal vehicle for investment by retail investors in the stock market
for several reasons.
(NAV)
Net Asset Value is the market value of the assets of the scheme minus its liabilities. The
per unit NAV is the net asset value of the scheme divided by the number of units
outstanding on the Valuation Date.
Sale Price
Is the price you pay when you invest in a scheme. Also called Offer Price. It may include
a sales load.
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Repurchase Price
Is the price at which a close-ended scheme repurchases its units and it may include a
back-end load. This is also called Bid Price.
Redemption Price
Is the price at which open-ended schemes repurchase their units and close-ended schemes
redeem their units on maturity. Such prices are NAV related.
Sales Load
Is a charge collected by a scheme when it sells the units. Also called, ‘Front-end’ load.
Schemes that do not charge a load are called ‘No Load’ schemes.
Is a charge collected by a scheme when it buys back the units from the unit holders.
An investor must know that there are certain costs involved while investing in mutual
funds.
OPERATING EXPENSES:
These refer to cost incurred to operate a mutual fund. Advisory fee is paid to investment
managers, audit fees to charted accountant, custodial fees, register and transfer agent fees,
trustee fees, agent commission. Operating expenses also known as expenses ratio which
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is annual expenses expressed as a percentage of these expenses is required to be reported
in the schemes offer document or prospectus.
Operating expenses
Expenses ratio=
Average net assets
For instant, if funds Rs. 100 crores and expenses Rs. 20 lakhs. Then expenses ratio is 2%
expenses ratio is available in the offer document and fro historical per unit statistics
included in the financial results of the fund which are published by annually, un audited
for the half year ending September 30th and audited for the physically year end 1st March
30th .
Depending upon scheme and net asset, operating expenses are determined by limits
mandated by SEBI mutual funds regulation act. Any excess over specified limits as to
born by Management Company, the trustees or sponsors.
SALES CHARGES:
These are known commonly sale loads, these are charged directly to investor. Sales loads
are used by mutual fund for the payment of agent’s commission, distribution and
marketing expenses. These charges have no effect on the performance of the scheme.
Sales loads are usually expression percentage and or of two types front-end and back-end.
FRONT-END LOAD:
It is a one time fixed fee paid by an investor when buying a Mutual funds scheme. It
determines public offer price which intern decides how much of your initial investment
actually get invested the standard practice of arriving a public offer price is as follows.
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Net asset value
Public offer price= (1-front end load)
Let us assume, an investor invests Rs. 10,000 in a scheme that charges it 2% front end
load at a NAV per unit Rs. 10 using the formula public offer price = 10/(1-0.02) is Rs.
10,20. So only 980 units are allowed to the investor.
Amount invested
Number of units allotted=
Public offer price
This means units worth 9800 are allotted to him an initial investment Rs.10,000 front end
loads tend to decrease as initial investment amount increase.
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May be fixed fee redemption or a contingent differed sales charged a redemption so load
continues so long as the redeeming or selling of the units of a fund does not take place in
the event of a back end load is applied. The redemption price is arrive or using following
formula.
Contingent differed sales charges of a structured back end load. It is paid when the units
are reading during the initial years of ownership. It is for a predetermined period only
and reduced over the time you invested for a fund. The longer remains in a fund the
lower the CDSC.
The SEBI stipulate the a CDSC may be charge only for first four years after purchase of
units and also stipulate the maximum CDSC that can we charge every year. This is the
SEBI mutual funds regulations 1996 do not allow either the front end load or back end
load to any combination is higher than 7%.
TRANSACTION COST:
Some funds may also impose a switch over fee which is charge on transfer of investment
from one scheme to another within a same mutual funds family and also to switch from
one plan to another within same scheme.The real estate mutual funds sector is now being
considered as the engine of economic growth.
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1.1.12 The objectives of Association of Mutual Funds in India:
The Association of Mutual Funds of India works with 30 registered AMCs of the
country. It has certain defined objectives which juxtaposes the guidelines of its Board of
Directors. The objectives are as follows:
• This mutual fund association of India maintains a high professional and ethical
standards in all areas of operation of the industry.
• It also recommends and promotes the top class business practices and code of
conduct which is followed by members and related people engaged in the
activities of mutual fund and asset management. The agencies who are by any
means connected or involved in the field of capital markets and financial services
also involved in this code of conduct of the association.
• AMFI interacts with SEBI and works according to SEBIs guidelines in the mutual
fund industry.
• AMFI undertakes all India awarness programme for investors inorder to promote
proper understanding of the concept and working of mutual funds.
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• At last but not the least association of mutual fund of India also disseminate
informations on Mutual Fund Industry and undertakes studies and research either
directly or in association with other bodies.
Institutions:
Private Sector:
Indian:-
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Predominantly India Joint Ventures:-
Let us start the discussion of the performance of mutual funds in India from the day the
concept of mutual fund took birth in India. The year was 1963. Unit Trust of India invited
investors or rather to those who believed in savings, to park their money in UTI Mutual
Fund. For 30 years it goaled without a single second player. Though the 1988 year saw
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some new mutual fund companies, but UTI remained in a monopoly position.
The performance of mutual funds in India in the initial phase was not even closer to
satisfactory level. People rarely understood, and of course investing was out of question.
But yes, some 24 million shareholders was accustomed with guaranteed high returns by
the begining of liberalization of the industry in 1992. This good record of UTI became
marketing tool for new entrants. The expectations of investors touched the sky in
profitability factor. However, people were miles away from the praparedness of risks
The Assets Under Management of UTI was Rs. 67bn. by the end of 1987. Let me
concentrate about the performance of mutual funds in India through figures. From Rs.
67bn. the Assets Under Management rose to Rs. 470 bn. in March 1993 and the figure
had a three times higher performance by April 2004. It rose as high as Rs. 1,540bn.
.The performance of mutual funds in India suffered qualitatively. The 1992 stock market
scandal, the losses by disinvestments and of course the lack of transparent rules in the
whereabout rocked confidence among the investors. Partly owing to a relatively weak
stock market performance, mutual funds have not yet recovered, with funds trading at an
average discount of 1020 percent of their net asset value.
At last to mention, as long as mutual fund companies are performing with lower risks and
higher profitability within a short span of time, more and more people will be inclined to
invest until and unless they are fully educated with the dos and donts of mutual fund.
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SECTOR SECTOR
01- 31-
11,67
April- March- 1,732 7,966 21,377
9
98 99
01- 31-
13,53
April- March- 4,039 42,173 59,748
6
99 00
01- 31-
12,41
April- March- 6,192 74,352 92,957
3
00 01
01- 31-
01-
31-
April- 5,505 22,923 2,20,551 2,48,979
Jan-03
02
01- 31-
Feb.- March- * 7,259* 58,435 65,694
03 03
01- 31-
April- March- - 68,558 5,21,632 5,90,190
03 04
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01- 31-
April- March-
- 1,03,246 7,36,416 8,39,662
04 05
01- 31-
April- March- - 1,83,446 9,14,712 10,98,158
05 06
A lone UTI with just one scheme in 1964, now competes with as many as 400 odd
products and 34 players in the market. In spite of the stiff competition and losing market
share, UTI still remains a formidable force to reckon with.
Last six years have been the most turbulent as well as exiting ones for the industry. New
players have come in, while others have decided to close shop by either selling off or
merging with others. Product innovation is now passé with the game shifting to
performance delivery in fund management as well as service. Those directly associated
with the fund management industry like distributors, registrars and transfer agents, and
even the regulators have become more mature and responsible.
The industry is also having a profound impact on financial markets. While UTI has
always been a dominant player on the bourses as well as the debt markets, the new
generation of private funds which have gained substantial mass are now seen flexing their
muscles. Fund managers, by their selection criteria for stocks have forced corporate
governance on the industry. By rewarding honest and transparent management with
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higher valuations, a system of risk-reward has been created where the corporate sector is
more transparent then before.
Funds have shifted their focus to the recession free sectors like pharmaceuticals, FMCG
and technology sector. Funds performances are improving. Funds collection, which
averaged at less than Rs.100bn per annum over five-year period spanning 1993-98
doubled to Rs.210bn in 1998-99. In the current year mobilization till now have exceeded
Rs.300bn. Total collection for the current financial year ending March 2000 is expected
to reach Rs.450bn.
towards mutual funds has become obvious. The coming few years will show that the
traditional saving avenues are losing out in the current scenario. Many investors are
realizing that investments in savings accounts are as good as locking up their deposits in
a closet. The fund mobilization trend by mutual funds in the current year indicates that
money is going to mutual funds in a big way. The collection in the first half of the
financial year 1999-2000 matches the whole of 1998-99.
India is at the first stage of a revolution that has already peaked in the U.S. The U.S.
boasts of an Asset base that is much higher than its bank deposits. In India, mutual fund
assets are not even 10% of the bank deposits, but this trend is beginning to change.
Recent figures indicate that in the first quarter of the current fiscal year mutual fund
assets went up by 115% whereas bank deposits rose by only 17%. (Source: Thinktank,
The Financial Express September, 99) This is forcing a large number of banks to adopt
the concept of narrow banking wherein the deposits are kept in Gilts and some other
assets which improves liquidity and reduces risk. The basic fact lies that banks cannot be
ignored and they will not close down completely. Their role as intermediaries cannot be
ignored. It is just that Mutual Funds are going to change the way banks do business in the
future.
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RISK HIGH LOW
INVESTMENT OPTION LESS MORE
NETWORK HIGH PENETRATION LOW BUT IMPROVING
LIQUIDITY AT A COST BETTER
QUALITY OF ASSETS NOT TRANSPARENT TRANSPARENT
INTEREST CALCULATION MINIMUM BALANCE BETWEEN EVERY DAY
10TH AND 30TH OF EVERY
MONTH.
ADMINISTRATION EXPENSES HIGH LOW
Table 1.1
Indian mutual fund industry reached Rs 1,50,537 crore by March 2004. It is estimated
that by 2010 March-end, the total assets of all scheduled commercial banks should be Rs
40,90,000 crore. The annual composite rate of growth is expected 13.4% during the rest
of the decade. In the last 5 years there is an annual growth rate of 9%. According to the
current growth rate, by year 2010,
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• 'B' and 'C' class cities are growing rapidly. Today most of the mutual funds are
concentrating on the 'A' class cities. Soon they will find scope in the growing
cities.
• Mutual fund can penetrate rurals like the Indian insurance industry with simple
and limited products.
• SEBI allowing the MF's to launch commodity mutual funds.
• Emphasis on better corporate governance.
• Trying to curb the late trading practices
The asset base will continue to grow at an annual rate of about 30 to 35 % over the next
few years as investor’s shift their assets from banks and other traditional avenues. Some
of the older public and private sector players will either close shop or be taken over.
Is the professional management of various securities (shares, bonds etc) assets (e.g. real
estate), to meet specified investment goals for the benefit of the investors. Investors may
be institutions (insurance companies, pension funds, corporations etc.) or private
investors (both directly via investment contracts and more commonly via collective
investment schemes e.g. mutual funds) .
The term asset management is often used to refer to the investment management of
collective investments, whilst the more generic fund management may refer to all forms
of institutional investment as well as investment management for private investors.
Investment managers who specialize in advisory or discretionary management on behalf
of (normally wealthy) private investors may often refer to their services as wealth
management or portfolio management often within the context of so-called "private
banking".
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The provision of 'investment management services' includes elements of financial
analysis, asset selection, stock selection, plan implementation and ongoing monitoring of
investments. Investment management is a large and important global industry in its own
right responsible for caretaking of trillions of dollars, euro, pounds and yen. Coming
under the remit of financial services many of the world's largest companies are at least in
part investment managers and employ millions of staff and create billions in revenue.
At the heart of the investment management industry are the managers who invest and
divest client investments.
• ASSET ALLOCATION:
The different asset classes and the exercise of allocating funds among these assets (and
among individual securities within each asset class) is what investment management
firms are paid for. Asset classes exhibit different market dynamics, and different
interaction effects; thus, the allocation of monies among asset classes will have a
significant effect on the performance of the fund. Some research suggests that allocation
among asset classes has more predictive power than the choice of individual holdings in
determining portfolio return. Arguably, the skill of a successful investment manager
resides in constructing the asset allocation, and separately the individual holdings, so as
to outperform certain benchmarks (e.g., the peer group of competing funds, bond and
stock indices).
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investment). For example, over very long holding periods (eg. 10+ years) in most
countries, equities have generated higher returns than bonds, and bonds have generated
higher returns than cash. According to financial theory, this is because equities are riskier
(more volatile) than bonds which are themselves more risky than cash.
• DIVERSIFICATION:
Against the background of the asset allocation, fund managers consider the degree of
diversification that makes sense for a given client (given its risk preferences) and
construct a list of planned holdings accordingly. The list will indicate what percentage of
the fund should be invested in each particular stock or bond. The theory of portfolio
diversification was originated by Markowitz and effective diversification requires
management of the correlation between the asset returns and the liability returns, issues
internal to the portfolio (individual holdings volatility), and cross-correlations between
the returns.
Fund performance is the acid test of fund management, and in the institutional
context accurate measurement is a necessity. For that purpose, institutions measure the
performance of each fund (and usually for internal purposes components of each fund)
under their management, and performance is also measured by external firms that
specialize in performance measurement. The leading performance measurement firms
(e.g. Frank Russell in the USA) compile aggregate industry data, e.g., showing how funds
in general performed against given indices and peer groups over various time periods.
In a typical case (let us say an equity fund), then the calculation would be made (as far as
the client is concerned) every quarter and would show a percentage change compared
with the prior quarter (e.g., +4.3% total return in US dollars)..
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Generally speaking, it is probably appropriate for an investment firm to persuade its
clients to assess performance over longer periods (e.g., 3 to 5 years) to smooth out very
short term fluctuations in performance and the influence of the business cycle.
Performance measurement should not be reduced to the evaluation of fund returns alone,
but must also integrate other fund elements that would be of interest to investors, such as
the measure of risk taken. Several other aspects are also part of performance
measurement: The need to answer all these questions has led to the development of more
sophisticated performance measures, many of which originate in modern portfolio theory.
Modern portfolio theory established the quantitative link that exists between portfolio
risk and return. The Capital Asset Pricing Model (CAPM) developed by Sharpe (1964)
highlighted the notion of rewarding risk and produced the first performance indicators, be
they risk-adjusted ratios (Sharpe ratio, information ratio) or differential returns compared
to benchmarks (alphas). The Sharpe ratio is the simplest and best known performance
measure. It measures the return of a portfolio in excess of the risk-free rate, compared to
the total risk of the portfolio. This measure is said to be absolute, as it does not refer to
any benchmark, avoiding drawbacks related to a poor choice of benchmark.
.Portfolio normal return may be evaluated using factor models. The first model, proposed
by Jensen (1968), relies on the CAPM and explains portfolio normal returns with the
market index as the only factor. It quickly becomes clear, however, that one factor is not
enough to explain the returns and that other factors have to be considered.
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1.3) ABOUT THE TOPIC:
1.3.1 MEANING:
1.3.2 DEFINITION:
The SEBI regulations, 1993 defines a mutual fund as “a fund in the form of a trust by a
sponsor, to raise money by the trustees trough the sale of units to the public, under one or
more schemes, for investing in securities in accordance with these regulations”
A Mutual Fund is a trust that pools the savings of a number of investors who share a
common financial goal. The money thus collected is then invested in capital market
instruments such as shares, debentures and other securities. The income earned through
these investments and the capital appreciation realised are shared by its unit holders in
proportion to the number of units owned by them. Thus a Mutual Fund is the most
suitable investment for the common man as it offers an opportunity to invest in a
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diversified, professionally managed basket of securities at a relatively low cost. The flow
chart below describes broadly the working of a mutual fund.
Figure1.1
In India, the following are involved in a mutual fund operations: the sponsor, the mutual
fund, the trustees, the asset management company, the custodian, and the registrars and
transfer agents.
• Sponsor:
The sponsor of a mutual fund is like the promoter of a company. The sponsor may be a
bank, a financial institution, or a financial service company. It may be indian or foreign.
The sponsor is responsible for setting up and establishing the mutual fund. The sponsor is
the settler of the mutual fund trust. The sponsor delegates the trustee fuction to the
trustees.
• Mutual fund :
The mutual funds constitued as a trust under the Indian trust act, 1881, and registered
with SEBI.
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• Trustees:
A trust is a notional entity that cannot contract in its own name. so, the trust enters into
contracts in the name of the trustees. Appointment by the sponsor, the trustees can be
either individuals or a corporate body. Typically it is the latter. The trusees appoint the
asset management company(AMC), secure necessary approval, periodically monitor how
the AMC fuctions, and hold the properties of the various schemes in trust for the benefits
of investors.
• Custodian:
The custodian handles the investment back office operations of a mutual fund. It looks
after the receipt and delivery of securities, collection of income, distribution of dividends,
andsegregation of assets between schemes. The sponsor of a mutual fund cannot act as its
custodian.
The registrars and transfer agents handle investor related services such as issuing units,
redeeming units, sending fact sheets and annual reports, and so on. Some funds handle
such fuctions in house, while others outsource it tobSEBI approved registrars and transfer
agents like karvy and CAMS.The legal structure and organization of mutual funds as laid
down by SEBI guidelines is as follows.
2
ORGANISATION OF MUTUAL FUND:
BORD OF
TRUSEE
CUSTODIAN
ACTING AS REGISTRAR, TRANSFER AGENT AND
RELATED SERVICE FOR MUTUAL FUND.
INVESTOR
Figure 1.2
2
Operational classification portfolio classification
Investment based
Sector based
Leverage based
Others
2
A mutual fund scheme can be classified into open-ended scheme or close-ended
scheme depending on its maturity period.
A scheme can also be classified as growth scheme, income scheme, or balanced scheme
considering its investment objective. Such schemes may be open-ended or close-ended
schemes as described earlier. Such schemes may be classified mainly as follows:
2
The aim of growth funds is to provide capital appreciation over the medium to long-
term. Such schemes normally invest a major part of their corpus in equities. Such funds
have comparatively high risks. These schemes provide different options to the investors
like dividend option, capital appreciation, etc. and the investors may choose an option
depending on their preferences.
The aim of income funds is to provide regular and steady income to investors. Such
schemes generally invest in fixed income securities such as bonds, corporate debentures,
Government securities and money market instruments. Such funds are less risky
compared to equity schemes. These funds are not affected because of fluctuations in
equity markets.
Balanced Scheme:
The aim of balanced funds is to provide both growth and regular income as such schemes
invest both in equities and fixed income securities in the proportion indicated in their
offer documents. These are appropriate for investors looking for moderate growth. They
generally invest 40-60% in equity and debt instruments. These funds are also affected
because of fluctuations in share prices in the stock markets. However, NAVs of such
funds are likely to be less volatile compared to pure equity funds.
These funds are also income funds and their aim is to provide easy liquidity, preservation
of capital and moderate income. These schemes invest exclusively in safer short-term
instruments such as treasury bills, certificates of deposit, commercial paper and inter-
bank call money, government securities, etc. Returns on these schemes fluctuate much
less compared to other funds. These funds are appropriate for corporate and individual
investors as a means to park their surplus funds for short periods.
2
Gilt Fund:
Index Funds:
Index Funds replicate the portfolio of a particular index such as the BSE Sensitive index,
S&P NSE 50 index (Nifty), etc, these schemes invest in the securities in the same
weightage comprising of an index. NAV’s of such schemes would rise or fall in
accordance with the rise or fall in the index, though not exactly by the same percentage
due to some factors known as "tracking error" in technical terms. Necessary disclosures
in this regard are made in the offer document of the mutual fund scheme.
Load Funds
A Load Fund is one that charges a commission for entry or exit. That is, each time you
buy or sell units in the fund, a commission will be payable. Typically entry and exit loads
range from 1% to 2%. It could be worth paying the load, if the fund has a good
performance history.
No-Load Funds
A No-Load Fund is one that does not charge a commission for entry or exit. That is, no
commission is payable on purchase or sale of units in the fund. The advantage of a no
load fund is that the entire corpus is put to work.
2
1.3.7 Sector Specific Schemes:
These are the funds/schemes which invest in the securities of only those sectors or industries
as specified in the offer documents. e.g. Pharmaceuticals, Software, Fast Moving Consumer
Goods (FMCG), Petroleum stocks, etc. The returns in these funds are dependent on the
performance of the respective sectors/industries.
Special Schemes
Industry Specific Schemes invest only in the industries specified in the offer document. The
investment of these funds is limited to specific industries like InfoTech, FMCG,
Pharmaceuticals etc.
• Index Schemes
Index Funds attempt to replicate the performance of a particular index such as the BSE
Sensex or the NSE 50
• Sectoral Schemes
Sectoral Funds are those, which invest exclusively in a specified industry or a group of
industries or various segments such as 'A' Group shares or initial public offerings
These schemes offer tax rebates to the investors under specific provisions of the Income Tax
Act, 1961 as the Government offers tax incentives for investment in specified avenues. e.g.
Equity Linked Savings Schemes (ELSS). Pension schemes launched by the mutual funds also
offer tax benefits. These schemes are growth oriented and invest pre-dominantly in equities.
Their growth opportunities and risks associated are like any equity-oriented scheme.
The mutual fund industry has grown at a phenomenal rate in the recent past. The following
are some of the important advantages of mutual funds.
36
• Channelizing savings for investment:
A number of schemes are being offered by MFs so as to meet the varied requirements
of the peoples and savings are directed towards capital investments directly. In the
absence of MFs these savings would have remained idle.
37
• Offering tax benefits:
Certain funds offer tax benefits to its customers. Thus, apart from dividend, interest
and capital appreciation, investors also stand to get the benefit of tax concession.
Under the wealth tax act, investments in MFs are exempted up to Rs. 5 lakhs.
38
• Diversification: The best mutual funds design their portfolios so individual
investments will react differently to the same economic conditions. For example,
economic conditions like a rise in interest rates may cause certain securities in a
diversified portfolio to decrease in value. Other securities in the portfolio will respond
to the same economic conditions by increasing in value. When a portfolio is balanced
in this way, the value of the overall portfolio should gradually increase over time,
even if some securities lose value.
Mutual funds have their drawbacks and may not be for everyone:
• Fees and commissions: All funds charge administrative fees to cover their day-to-
day expenses. Some funds also charge sales commissions or "loads" to compensate
brokers, financial consultants, or financial planners. Even if you don't use a broker or
other financial adviser, you will pay a sales commission if you buy shares in a Load
Fund.
• Taxes: During a typical year, most actively managed mutual funds sell anywhere
from 20 to 70 percent of the securities in their portfolios. If your fund makes a profit
on its sales, you will pay taxes on the income you receive, even if you reinvest the
money you made.
• Management risk: When you invest in a mutual fund, you depend on the fund's
manager to make the right decisions regarding the fund's portfolio. If the manager
does not perform as well as you had hoped, you might not make as much money on
your investment as you expected. Of course, if you invest in Index Funds, you forego
management risk, because these funds do not employ managers.
39
1.3.9 OPTIONS AND VALUE-ADDED SERVICES:
Thanks to the heightened competition in the mutual fund industry, mutual funds now offer
various options and value-added services to attract and retain customers.
• Options:
With respect to a number of schemes, mutual funds offer the following: dividend and growth
options, systematic investment plan, and systematic withdrawal plan.
i. Dividend and growth options When you join a scheme, you can shoose the dividend
option or the growth option. Under the dividend option, the gains of the scheme are paid
out at regular intervals in the form of dividends. Funds may offer daily, weekly,
monthly, quarterly, half-yearly, and annual dividend options.
ii. Under the growth option, investment gains are ploughed back into the scheme and no
dividends are declared. Though the returns from both the dividend and growth options
will be the same, the tax implications may be different.
iii. Systematic investment plan Under the systematic investment plan (SIP), the investor can
invest regular sums of money every month to buy units of a mutual fund scheme. As the
investment is made regularly, the investor buys more units when the price is low and
fewer units when the price is high.
iv. Systematic withdrawal plan A systematic withdrawal plan (SWP) works like a
systematic investment plan in the opposite direction. The SWP allows the investor to
withdraw a fixed amount every month.
Mutual funds offer value-added services like redemption over phone, triggers and alerts,
cheque book facility, and new points of purchase.
i. Redemption over phone Prudential ICICI for example offers investors the facility of
making a redemption request or switch between schemes over the phone.
ii. Cheque book facility Fund houses take few days to process a redemption request and
then further time is lost when the redemption cheque is in transit. To cut down this
40
delay, some fund houses give investors in certain schemes (typically debt scemes), the
some limit, at the time of investment itself. Encashment of the cheque is deemed as
withdrawal, at the scheme’s NAV on the day the cheque is deposited.
There are few tips which helps the investors to choose right fund.
• Portfolio management:
The fund’s portfolio can reveal a lot about the fund. Ideally a fund should display a high
degree of consistency in its holdings; similarly the portfolio should be a well-spread one.
41
• Expense ratio and load:
Expenses incuured by the fund have a significant impact on its performance. The
expenses are incurred for a variety of reasons ranging from management fees to
marketing and selling expenses. Similarly entry/exit load are vital too. An entry load
reduces the amount invested proportionately and only the balance is utilized for
generating returns.
• Seek advice:
Utilize the services of a financial planner before making investments in mutual funds.
A financial planner will help you create a portfolio comprising of schemes that are
“right” for you.
42
CHAPTER TWO:
RESEARCH DESIGN:
2.1. Introduction:
Research refers to a search for knowledge. The advanced learner’s dictionary of current
english lays down the meaning of research as “ a careful investigation or enquiry specially
through search for new facts in any branch of knowledge.”
43
indicate and why. Researchers also by which they can decide that certain techniques and
procedures will be applicable to certain problems and other will not. All this means that it is
necessary for the researcher to design his methodology.
The research methodology has wider dimension and wider scope than that of research
methods. Thus, when we talk of research methodology we not only talk of research methods
but also consider the logic behind the methods we use in the context of our research methods
but also consider the logic behind the methods we use in the context of our research study
and explain why we are using a particular method or technique and why we are not using
other so that research results are capable of being evaluated either by the researcher himself
or by others.
A research should be preliminary orientation and background knowledge about the topic and
he should collect the basic concept and information regarding the final in which the topic
includes due to this reasons review of the literature has an important role in research study.
Considering the importance of mutual funds, several academicians have tried to study the
performance of various funds. Initially, their studies have focused on timing and investment
abilities of fund managers. Later, several researchers have tried to study the various factors
and their impact on fund performance. These factors include potential measurement errors
from survivorship bias and misspecification of the benchmark, the impact of fund expenses
and economies of scale, to the personal characteristics of fund managers. Various studies that
focused on factors such as the ability of fund managers to consistently outperform the market
and the fund specific organizational and managerial aspects, came out with contradictory
conclusions.
Jenson’s (1968) study on mutual fund performance of 115 funds over a period spanning from
1945 60 1964, confirmed the efficient market hypothesis. His analysis has shown that the
performance of expense-adjusted fund returns was markedly lower than those randomly
chosen portfolios of a similar risk category. These results were in sync with the findings of
Treynor 91965) and Sharpe (1966). Performance of professionally managed funds also was
not any better than the performance of risk-adjusted index portfolio, which also indicated that
managers of these funds did not appear to possess private information. Thus, the results of
the early studies prevailed as general conclusions in the erstwhile literature.
44
However, a number of later studies on the topic, nonetheless, go against the early findings.
For instance, a study by Ippolity (1993) found mutual fund returns after expenses (before
loads) to be superior than the returns offered by risk-adjusted market indices, which indicated
that mutual fund managers may have access to the useful private information. Thus, the
mutual fund managers may produce such excess returns that can offset the expenses of the
fund.
Further studies by Grinblatt and Titman (1992), Hendricks, Patel and Zeckhauser (1993),
Goetzmann and Ibbotson (1994), and Volkman and Wohar (1995) were in support of market
efficiency as they discovered instances of repeated winners amongst fund managers.
Recently, Wermers (2000) decomposed mutual fund returns into a stock picking talent;
features of stockholding and trading costs and expenses. The decomposition helped him
show that stock picking of funds, in fact, enabled the managers to cover their costs. Other
studies by Elton, Gruber, Das and Hlavka (1993), Malkiel (1995) and Carhart (1997)
reinforce the early conclusion of Jensen (1968). While doing away with survivorship bias,
carhart (1997) has shown that the common factors that drive stock returns are responsible for
consistency in mutual fund performance.
On the other hand the Malkiel (1995) study considers both benchmark errors and
survivorship bias and concludes that the previous results indicating market inefficiency were
affected by these factors.
“ A study on Analysis of the performance of mutual fund with reference to mutual fund
industry.”
The study of mutual fund has the wider scope. Mutual fund is a professionally managed form
of collective investment that pools money from many investors and invest it in stocks, bonds,
short-term money market instruments and other securities. Mutual fund distributors of tax
free municipal bonds income are also tax free to the share holders. Taxable distribution can
be either ordinary income or capital schems which are equity schemes , debt and hybrid
schems.
45
The present study includes five-year return of the mutual fund companies and funds in
India. Out of all mutual fund companies we have selected only two companies those are ING
mutual fund and HDFC mutual fund, and only those schemes and funds are included in this
study, which are performed well during from last few years. The schemes covered under the
study are:
To evaluate the performance of schemes and funds, the researcher applied Sharpe Index,
Treynor Index and Jensen’s Alpha measure.
46
To analyze the performance of various schemes of mutual funds.
To identify the sector where the mutual fund and how invested.
2.6. Methodology:
• Descriptive study:
The type of the study or research used in this project is a descriptive research design. It
mainly involves surveys and facts findings enquiries of different kinds. The main objective of
descriptive research is to describe the state of affairs as it exists at present. The major purpose
of descriptive research is a description of the state of the affairs, as it exists at present. Thus a
descriptive study is a fact finding investigation with adequate interpretation. It is the simplest
type of research. It focuses on particular aspects or dimensions of the problem studied. It is
designed that it gathers descriptive information and provides information for formulating
more sophisticated studies. There is a cause effective relationship.
The criteria for selecting this particular design are that, the problem of the project must be
described and not arguable. The data collected is amenable to statistical analysis and has
accuracy and significance. It is possible to develop to valid standards of comparison. It tends
itself to the verifiable procedure of collection and analysis of data.
47
2.6.2 Type of data:
Secondary data:
The data which is used for the research is secondary data. The secondary data is the
data which is duplicate of primary data. “The data (published or unpublished) which
have already been collected and processed by some agency or person and taken over
from there and used by any other agency for their statistical work are termed as
person and taken over from there and used by any other agency for their statistical
work are termed as secondary data” as far as second agency is concerned. The second
agency if and when it publishes and files such data becomes the secondary source to
anyone who later uses these data.
In other words secondary source is the agency who publishes for use by others the
data which was not originally collected and processed by it.
Unpublished sources:
i. The data can be governments or private offices can be collected from these are
unpublished data.
Published sources:
i. Central and state government publication publishes the various statistics like crop
production, population, statistic, wages expenses.
48
ii. The commerce association, commerce and trade association, Indian chamber of
commerce federation are publishes several data.
iii. News paper, journals, periodicals etc. publishes the several data.
iv. Some private organization, research berceuse, universities publishes several data’s.
Internet: google.com
Nytimes.com
AMFI.com
It is used to measure the variation in individual returns from the average expected return over
a certain period. Standard deviation is used in the concept of risk of a portfolio of
investments; higher standard deviation means a greater fluctuation in expected return.
2.7.2 Beta:
Beta measures the systematic risk and shows how prices of securities respond to the market
forces. It is calculated by relating the return on a security with return for the market. By
convention, market will have beta 1.0 Mutual fund is said to be volatile, more volatile or less
volatile. If beta is greater than 1 the stock is said to be riskier than market. If beta is less than
1, the indication is that stock is less risky in comparison to market. If beta is zero then the
risk is the same as that of the market. Negative beta is rare.
49
Sharpe index measures risk premium of a portfolio, relative to the total amount for risk in the
portfolio. Sharpe index summarizes the risk and return of a portfolio in a single measure that
categorizes the performance of funds on the risk-adjusted basis. The larger the Sharpe Index,
the portfolio over performance the market and vice versa.
Treynor’s model is on the concept of the characteristics straight line. The characteristics line
has drawn a relationship between the market return and a specific portfolio without taking
into consideration any direct adjustment for risk. It is also known as reward to volatility ratio
and is defined as:
It measures the difference between market risk and actuel performance of the fund.
50
2.8 Limitations of the study:
The study also has the some limitations which are as follows:
The time is the main constraint so limited period of time is spent on this study.
The support from the management side may be limited due to their pre occupied meetings
and work.
Not possible to get whole information because of their business secret and lack of
awareness among people.
1 Introduction
2 Research Design
51
6 Bibliography
(Annexure)
CHAPTER THREE:
The Indian mutual fund industry has evolved over distinct stages. The growth of the mutual
fund industry in India can be divided into four phases: Phase I (1964-87), Phase II (1987-
1992), Phase III (1992-1997) and Phase IV (beyond 1997).
Mutual fund industry started in India with the establishment of Unit Trust of India (1964),
which was the only player in the mutual fund industry up to 1987. In 1987, the government
permitted public sector banks and financial institutions to join the fray. From 1993 onwards
the industry was opened up for private participation. Thus, private and foreign players have
started setting up mutual funds in India. Today, mutual funds are one of the fast-growing
sectors in India.
The Indian Mutual Fund industry has grown tremendously in the last decade. There are 29
mutual funds as on March 31st, 2005 with Assets under Management (AUM) of rs. 1,49,600
cr (Table1). AUM crossed Rs. 1,00,000 cr during the year 1999-2000 recording a growth
rate fo 65%. Besides, a vast majority of equity schemes outperformed the market.
The origin of mutual fund industry in India is with the introduction of the concept of mutual
fund by UTI in the year 1963. The main reason of its poor growth is that the mutual fund
industry in India is new in the country. Large sections of Indian investors are yet to be
intellectuated with the concept. Hence, it is the prime responsibility of all mutual fund
52
companies, the up with condition to market the product correctly abreast of selling.
The mutual fund industry can be broadly put into four phases according to the development
of the sector. Each phase is briefly described as under.
Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. It was set up by
the Reserve Bank of India and functioned under the Regulatory and administrative control of
the Reserve Bank of India. In 1978 UTI was de-linked from the RBI and the Industrial
Development Bank of India (IDBI) took over the regulatory and administrative control in
place of RBI. The first scheme launched by UTI was Unit Scheme 1964. At the end of 1988
UTI totally had Rs.6,700 crores of assets under management.
Entry of non-UTI mutual funds. SBI Mutual Fund was the first followed by Canbank Mutual
Fund (Dec 87), Punjab National Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund of
(Nov 89), Bank of India (Jun 90), Bank of Baroda Mutual Fund (Oct 92). LIC in 1989 and
GIC in 1990. The end of 1993 marked Rs.47,004 as assets under management.
With the entry of private sector funds in 1993, a new era started in the Indian mutual fund
industry, giving the Indian investors a wider choice of fund families. Also, 1993 was the year
in which the first Mutual Fund Regulations came into being, under which all mutual funds,
except UTI were to be registered and governed. The erstwhile Kothari Pioneer (now merged
with Franklin Templeton) was the first private sector mutual fund registered in July 1993.
The 1993 SEBI (Mutual Fund) Regulations were substituted by a more comprehensive and
revised Mutual Fund Regulations in 1996. The industry now functions under the SEBI and
(MutualFund)Regulations1996.
The number of mutual fund houses went on increasing, with many foreign mutual funds
53
setting up funds in India and also industry has witnessed several mergers and acquisitions.
As at the end of January 2003, there were 33 mutual funds with total assets of Rs. 1,21,805
crores. The Unit Trust of India with Rs.44,541 crores of assets under management was way
ahead of other mutual funds.
This phase had bitter experience for UTI. It was bifurcated into two separate entities. One is
the Specified Undertaking of the Unit Trust of India with AUM of Rs.29,835 crores (as on
January 2003). The Specified Undertaking of Unit Trust of India, functioning under an and
administrator and under the rules framed by Government of India and does not come under
the purview of the Mutual Fund Regulations.
The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and LIC. It is with
registered with SEBI and functions under the Mutual Fund Regulations. With the bifurcation
of the erstwhile UTI which had in March 2000 more than Rs.76,000 crores of AUM and with
the setting up of a UTI Mutual Fund, conforming to the SEBI Mutual Fund Regulations, and
with recent mergers taking place among different private sector funds, the mutual fund can
industry has entered its current phase of consolidation and growth. As at the end of
September, 2004, there were 29 funds, which manage assets of Rs.153108 crores under 421
schemes.
3.2 The major players in the Indian Mutual Fund Industry are:
Figure 1.4
54
STRUCTURE OF MUTUAL FUND INDUSTRY IN INDIA:
MUTUAL FUNDS
UTI BANKS FI
SPONSORE
D SPONSORED
Figure 1.5
55
3.3 Rating of Mutual fund schemes in mutual fund industry:
Mutual fund schemes are periodically evaluated by independent institutions. CRISIL, Value
Research India, and Economic Times are three such institiutions whose rankings or
evaluations are currently very popular.
CRISIL Credit Rating nd Information Services of India Limited (CRISIL) carries out
Composite Performance Rankings that cover all open-ended schemes that disclose their entire
portfolio composition and have NAV information for at least two years. It currently ranks
schemes in five categories, viz., Equity Schemes, Debt Schemes, Gllit Schemes, Balanced
Schemes, and Liquid Schemes. Its ranking is based on four criteria, viz., risk-adjusted return
of the scheme’s NAV, diversification of the portfolio, liquidity, and asset size. The weights
assigned to these criteria vary from category to category.within each category, the top 10
percent are considered vbery good, thenext 20 percent good, the next 40 percent average, the
next 20 percent below average, and the last 10 percent poor.
Value research India like CRISIL, value research India rates schemes in different categories.
Each scheme is assigned a risk grade and a return grade and a composite measure of
performance is calculated by subtracting the risk grade from the return grade. Within each
category, the top 10 percent are consideree five star, the next 22.5 percent four star, the next
35 percent three star, the next 22,5 percent two star, and the last 10 percent one star.
3.4 Some facts for the growth of mutual fund industry in India:
• Number of foreign AMC's are in the que to enter the Indian markets like Fidelity
Investments, US based, with over US$1trillion assets under management worldwide.
• Our saving rate is over 23%, highest in the world. Only channelizing these savings in
mutual funds sector is required.
• We have approximately 29 mutual funds which is much less than US having more
than 800. There is a big scope for expansion.
56
• 'B' and 'C' class cities are growing rapidly. Today most of the mutual funds are
concentrating on the 'A' class cities. Soon they will find scope in the growing cities.
• Mutual fund can penetrate rurals like the Indian insurance industry with simple and
limited products.
Here in this project we considered two companies for analysis part ING Investment pvt.ltd.
ING Vysya Mutual Fund was setup on February 11, 1999 with the same named Trustee
Company. It is a joint venture of Vysya and ING. The AMC, ING Investment Management
(India) Pvt. Ltd. was incorporated on April 6, 1998.
ING Group is known for its philosophy of 'keeping it simple' covering some 60 million
private, corporate and institutional clients in 50 countries. It is the world's fourth largest
financial services group.
ING Vysya Mutual Fund aims to provide investors with the most practical and secure
investment opportunities to invest their valuable savings. This is combined with a range of
innovative options to deliver healthy returns combined with a high degree of security.
Currently, the fund offers four equity, five debt and two hybrid schemes to its investors.
57
3.5.2 ING Investment Management:
In India ING Investment Management (I) Pvt Ltd has an investor base of over 1,52,677 with
Rs. 5080.97 crores as of June 30th, ’07 (SOURCE: WWW.AMFIINDIA.COM ). With a
presence in 34 locations, we currently manage 21 schemes.
ING Investment Management (I) Pvt Ltd has been associated with innovation and responsive
adaptability with sharp minds at work. ING Investment Management has sealed a position of
strength and is considered as one of the top contenders to challenge the market leaders. ING
Investment Management has enjoyed many firsts and has always maintained a pioneering
outlook.
* The assigned rating of AAAf is valid only for ‘ING Floating Rate Fund’ and ‘ING Liquid
Fund’. The rating of the fund is not an opinion of the asset management company’s
willingness or ability to make timely payments to the investor. The rating is also not an
opinion on the stability if the NAV of the fund, which could vary with market developments.
58
Financial markets:
ING Vysya Bank Financial Markets is a leading player in the Indian Financial Markets
providing one of the widest ranges of products for large corporate, small and medium
enterprises as well as individual needs. Supported by state-of-the-art systems and the
capabilities of the ING Group, we offer competitive pricing and efficient execution across
markets and a comprehensive suite of products.
Wholesale banking:
Wholesale Banking is a reflection of ING Vysya Bank's ability to provide its corporate
clients in India a full range of commercial, transactional and electronic banking products. The
bank offers a wide array of client-focused corporate banking services, including working
capital finance, trade and transactional services, foreign exchange and cash management, to
name a few.
The bank is uniquely positioned to be able to advise, lead manage and place, thus giving the
customer the advantage of being a full fledged Commercial Bank along with investment
banking. As a Category I merchant banker registered with SEBI, the bank has an advanced
product portfolio that includes the following.
Financial advisory service: for mergers and acquisitions, capital and debt structuring and
restructuring, private capital raising and structured financing. This includes onshore as well
as offshore.
Local debt distributin: both in loan and bond forms, including plain vanilla debt and
structured dedt.
Securitization: We advise our clients on securitising their assets with a view to sell them.
Our services include advisory, structuring portfolios, assist in obtaining ratings for the
portfolios & sell-down of the portfolio.
investment banking services are provided to a range of Indian as well as offshore clients. For
cross border transactions involving global clients, the investment-banking group works
closely with ING Bank's global corporate finance and investment banking office.
59
Trade finance and commodities:
As an innovative solution provider of international and domestic trade flows of our clients,
we offer an entire range of trade finance products. The product suite, offered in close co-
ordination with the ING global network of structured trade finance units includes
documentary credit, guarantees, bills/ invoices discounting, supply chain financing, pre/post-
export finance and structured commodity finance.
Letter of credit: letter of credit facilities (inland/ foreign) are provided to the customers for
meeting working capital requirement needs as well as for capital requirements purchases.
Bill Discounting: Bill discounting involves financing of short-term trade receivables through
negotiable instruments/ invoices discounting. This has gained considerable importance in
recent past in view of self-liquidating in nature.
Supply chain financing: SCF refers to trade credit extended by the Bank to partners
involved in comprehensive supply chain process (commodities to cash) commencing from
conversion of raw material into parts/ components, consumed by big manufacturers and
thereafter sold to ultimate consumers through dealers. Core objective is to provide integrated
financial solution to the supply and distribution channels of our corporate clients.
Export credit: ING Vysya provides extensive export credit for pre-shipment and post-
shipment requirements of exporter borrowers in rupees and foreign currencies. We also
arrange discounting of bills under export LCs by overseas banks at competitive pricing with/
without recourse to the exporters.
Private banking:
believe that trust can be built over time by continuously providing quality advice to our
customers."-Michel Tilmant, Chairman, ING Group Welcome to ING Vysya Bank, Private
Banking Division. Our integrated global business in insurance, asset management and
banking enables us to offer clients innovative financial solutions few others can match. ING
Asia Private Banking has been ranked as # 1 for Best quality advice in the Asia Money
2007 survey amongust clients with AUM exceeding 25 million.
60
• NRE and NRO savings accounts
Earn Indian Interest Rates on your Foreign Currency deposits with our Foreign Currency
Non-Resident deposit.
The housing development finance corporation (HDFC) was amongst the first to receive an 'in
principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private
sector, as part of the RBI's liberalisation of the Indian Banking Industry in 1994. The bank
was incorporated in August 1994 in the name of 'HDFC Bank Limited', with its registered
office in Mumbai, India. HDFC Bank commenced operations as a Scheduled Commercial
Bank in january 1995.
HDFC Mutual Fund was setup on June 30, 2000 with two sponsorers nemely Housing
Development Finance Corporation Limited and Standard Life Investments Limited.
The Standard Life Assurance Company was established in 1825 and has considerable
experience in global financial markets. In 1998, Standard Life Investments Limited became
the dedicated investment management company of the Standard Life Group and is owned
100% by The Standard Life Assurance Company. With global assets under management of
approximately US$126 billion as at May 15, 2003, Standard Life Investments Limited is one
of the world's major investment companies and is responsible for investing money on behalf
of five million retail and institutional clients worldwide.
The Trustee Company of HDFC Mutual Fund is HDFC Trustee Company Limited and AMC
is HDFC Asset Management Company Limited, incorporated with the SEBI on December
10,1999.
• Equity Funds
61
• Balance Funds
• Debt Funds
Apart from this it also provides the following value added services:
HDFC Bank :
(NYSE: HDB), one amongst the firsts of the new generation, tech-savvy commercial banks
of India, was incorporated in August 1994, after the Reserve Bank of India allowed setting up
of Banks in the private sector. The Bank was promoted by the Housing Development Finance
Corporation Limited, a premier housing finance company (set up in 1977) of India. Net Profit
for the year ended March 31, 2006 was Rs. 1,141 crores. Results of the latest quarter ended
June 2007, indicate that the bank continues to grow in a steady manner.
• Personal banking
• Wholesale banking
• NRI banking
Branch network:
Currently HDFC Bank has 753 branches, 1,716 ATMs, in 320 cities in India, and all branches
of the bank are linked on an online real-time basis. The bank offers many innovative products
& services to individuals, corporates, trusts, governnments, partnerships, financial
institutions, mutual funds, insurance companies. It is the pathbreaker in the indian banking
sector.
62
HDFC Bank India provides the
• Savings Account
• HDFC Bank Preferred
• Sweep-In Account
• Super Saver Account
• HDFC Bank Plus
• Demat Account
• HDFC Mutual Fund
• HDFC Standard Life Insurance
63
3.3 SPECIFIC DEPARTMENT WHICH YOU STUDIED:
The Department provides investor needs and aftercare to both new and existing foreign and
citizen enterprises through its One Stop Service Centre (link to How can we help you). This
facility operates with liaison officers from various government and parastatal institutions that
have a direct bearing in providing services to investors.
The main focus of activity is to enable investors in the manufacturing and services sectors to
secure all clearances and approvals necessary to set up and operate business in the country
from under one roof. The assistance provided includes company registration, operating
licenses, visitors visa, residence and work permits as well as infrastructural facilities such as
land, factory buildings, utilities, social prerequisites, power and telephone connections.
The Department literally takes the investor by the hand and helps them walk through all
formalities until the business is established. Thereafter, investors are paid periodic visits
which enable interactions necessary to preempt any difficulties that they may encounter in
their day to day operations.
All share transfers and related operations have so far been conducted in-house by Hindustan
Lever's Investor Service Department, which is registered with the SEBI as a Category 2
Registrar. It is a well equipped department which endeavours to provide efficient and timely
services to its shareholders in share transfers and related operations.
The Company has evaluated the option of outsourcing the investor service function in order
to add further value and to overcome certain limitations like not being able to service
shareholders directly across the counter at various places across the Country where the
shareholders are based. After a careful evaluation, the Company has come to the conclusion
that it will benefit the shareholders if the investor service function is outsourced to an outside
agency which has in addition to specialised expertise, better infrastructure to serve the
64
investors across the Country. Accordingly, it has been decided that the share registration and
allied operations relating to the equity shares of the Company will be outsourced to Karvy
Computershare Private Limited (Karvy) who are Category I Registrars & Transfer Agents
registered with SEBI and possess almost 20 years experience in handling share registry
operations. Karvy serves over 250 corporate clients and renders service to an investor base of
over 16 million. It is the largest Registrar & Share Transfer Agents in the Country and serves
the investors through its 193 branches across 135 cities.
65
Objective: to provide long term capital appreciation from a portfolio that is
invested predominately in equity and equity related securities.
ING tax saving fund :( an open ended indexed equity savings scheme)
66
ING C.U.B (competitive upcoming businesses): (open-ended balanced
scheme)
67
Objective: The aim is to optimize returns and take advantage of phases of high
overnight rates and inverted curves while providing liquidity
68
varying maturities and at the same provide continuous liquidy along with
adequate safety.
Under plan B the scheme will also seek to generate capital appreciation by
investing a smaller portion of corpus in equity and equity related securities.
69
HDFC Premier Multi-Cap fund:
Objective:
Nifty plan: to generate returns those are commensurate with the performance of
nifty, subject to tracking errors.
Sensex plan: to generate returns those are commensurate with the performance
of nifty, subject to tracking errors.
Sensex Plus Plan: to invest 80 to 90% of the assets of the plan in companies
whose securities are included in sensex and between 10 to 20% of the net assets
in companies whose securities are not included in the sensex.
70
Objective: To provide periodic returns and capital appreciation over a long
period of time from a judicious mix of equity and debt to minimize capital
erosion.
Objective: To generate positive returns over medium time frame with low risk
of capital loss over medium time frame.
71
HDFC Short Term Plan (STP):
72
CHAPTR FOUR:-
“Analyses the performance of mutual fund with reference to mutual fund industry.”
2. Objectives:
3. Methodology:
o Descriptive study:
The type of the study or research used in this project is a descriptive research design. It
mainly involves surveys and facts findings enquiries of different kinds. The main
objective of descriptive research is to describe the state of affairs as it exists at present.
73
• Type of data:
o Secondary data:
“The data (published or unpublished) which have already been collected and processed by
some agency or person and taken over from there and used by any other agency for their
statistical work are termed as person and taken over from there and used by any other
agency for their statistical work are termed as secondary data”.
Scheme objective : To provide long term capital appreciation from a portfolio that is
Benchmark : BSE-100
Load structure
Entry load : 2.25% for investment of less than Rs,1 cr. No entry load on
74
Exit load/CDSC : 1% on the investment below 1 cr. And redeemed within 180 days,
0.5% if Redeemed after 180 but before 365 days and no exit load on
Table 1.1
75
Fabrics and garments 1.79
Fertilizers-nitrogenous 1.64
Power 1.59
Industrial equipment and others 17.5
Table 1.2
Table 1.3
Interpretation:
By comparing these three ratios the fund giving fair return that is 0.918 by taking into
consideration of total risk of 23.19 because it measures the reward to the total risk. By
76
evaluating treynor ratio this fund performing well it gives 23.69 returns by talking into
consideration of total market risk this fund gave the good return but it can’t perform up to the
benchmark return for last two years so it gave negative result in the Jensen ratio.
Scheme objective : To provide long term capital appreciation from a portfolio that is
Benchmark : BSE-100
Load structure
Entry load : 2.25% for investment of less than Rs,1 cr. No entry load on
Exit load/CDSC : 1% on the investment below 1 cr. And redeemed within 180 days,
0.5% if Redeemed after 180 but before 365 days and no exit load on
77
4.2.1 Portfolio construction as on 31th January 2008:
Table 1.4
78
4.2.2 Fund performance as on 31th January 2008:
Table 1.5
Table 1.6
Interpretation:
By comparing these ratios the sharp ratio shows that the fund performing better and giving
fair return that is 0.9466. by evaluating treynor ratio this fund able to give good returns that is
23.88 by considering market risk of 1.01. This fund consistently performing well. Because it
gave less negative value -1.94, it shows that fund generating good returns.
79
4.3 ING Dividend Yield Fund:
Benchmark : BSE-100
Load structure
Entry load : 2.25% for investment of less than Rs,1 cr. No entry load on
Exit load/CDSC : 1% on the investment below 1 cr. And redeemed within 180 days,
0.5% if Redeemed after 180 but before 365 days and no exit load on
80
4.3.1 Portfolio construction as on 31th January 2008:
Table 1.7
81
4.3.2 Performance of fund as on 31 th 2008:
Table 1.8
Table 1.9
Interpretation:
By comparing these ratios the sharp ratios shows that the fund performing well and gives
return like 0.874 by taking total risk 26.07 by evaluating treynor ratio this fund able to give
good return 33.48 by considering market risk of 0.83. This fund gave Jensen of -6.19 more –
ve value because first and last year it perform poor.
82
4.4 ING L.I.O.N: (Large cap, Intermediate cap, Opportunities, New Offering)
Fund:
Benchmark : BSE-100
Load structure
Entry load : 2.25% for investment of less than Rs,1 cr. No entry load on
Exit load/CDSC : 1% on the investment below 1 cr. And redeemed within 180 days,
0.5% if Redeemed after 180 but before 365 days and no exit load on
83
4.4.1 Portfolio construction as on 31th January 2008:
Table 1.10
Table 1.11
84
Last three year 35.82 38.92
Last four years 40.12 42.58
Last five years 25.44 37.09
Table 1.12
Interpretation:
This fund gave the return of 0.982 with total risk of 24.08, shows that this fund is performing
well. By compairing treynor ratio it shows that the fund gave the more return of -3.92 which
shows that the fund can’t out perform even for one time.
85
Date of launch : 23-02-2002
Load structure
Entry load : 2.25% for investment of less than Rs,1 cr. No entry load on
Exit load/CDSC : 1% on the investment below 1 cr. And redeemed within 180 days,
0.5% if Redeemed after 180 but before 365 days and no exit load on
Table 1.13
86
Telecom-services 11.20
Refineries/marketing 10.70
Computers-software 9.07
Oli exploration/production 8.47
Power 7.60
Power equipments 6.39
Steel 4.57
Diversified-construction 3.43
Cigarettes 2.86
Housing finance 2.60
Pharmaceuticals 2.09
Cement 1.89
Residential/commercial/sez project 1.69
Aluminium 1.53
Diversified-consumer goods 1.46
Copper & copper products 1.38
Passenger/utility vehicles 1.30
Motor cycles/scooters 1.18
Gas transmission/marketing 1.10
Commercial vehicles 0.53
T V broadcosting and software production 0.39
CBLO/Repo/FD/Cash/Other assets 7.21
Table 1.14
87
Last three year 33.44 35.66
Table 1.15
Interpretation:
This fund gave the more sharp ratio that is 0.939 showed that, fund performing well during
five years history with total risk of 26.07. by evaluating treynor ratio, the fund gave return of
23.16 with little more market risk of 0.91 and fund performing well during five years of
history because it gaves very less difference between actual and benchmark return -0.356.
Scheme objective : The objectives of the fund is to generate medium to long term
88
Date of launch : 28-03-2002
Load structure
Entry load : 2.25% for investment of less than Rs,1 cr. No entry load on
Exit load/CDSC : 1% on the investment below 1 cr. And redeemed within 180 days,
0.5% if Redeemed after 180 but before 365 days and no exit load on
Table 1.16
89
Banks 6.28
LPG/CNG/LNG SUPPLIER 5.69
Refineries/marketing 4.77
Power equipments 4.64
Trading 4.54
Personal care 3.45
Paints 3.45
Fertilizers-phosphate 3.41
Residential/commercial/sez projects 3.36
Financial institution 3.03
Ship building 3.02
Industrial minerals 2.95
Plastic products 2.89
Fabrics and garments 2.63
Hotels 2.55
Stockbroking and allieds 2.38
Steel 2.17
Fertilizers and nitrogeneous 2.06
Steel products 1.94
Retailing 1.93
Industrial equipment 1.90
Printing and publishing 1.89
Sugar 1.52
Electrodes 1.50
Computer software 1.50
Oil exploration 1.49
Air conditioner 1.33
NBFC 0.09
Aluminium 0.03
CBLO/Repo/FD/Cash/Other assets 3.60
Table 1.17
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4.6.3 Quantitative data:
Table 1.18
Interpretation:Sharp ratio shows the reward to total risk associated with fund. That is this
fund gave the return of 0.714 with risk of 26.01. the treynor ratio shows that the fund
performance by considering market risk it gave less return 20.64 because they have to create
awqrness of the fund to the people. Because of new category og fund the Jensen ratio also
very less that is -9.518 shows that fund performance not able to beat the benchmark return.
Scheme objective : The objectives of the fund is to generate long term capital
Investment pattern: for new investor Rs.5000 and in multiples of Rs.100 thereafter.
91
Growth Option : Rs. 68.432
Benchmark : Sensex
Load structure
Entry load : 2.25% for investment of less than Rs,5 cr. No entry load on
Exit load/CDSC : 1% on the investment below 5 cr. And redeemed within 365 days,
Table 1.19
Pharmaceuticals 5.02
Finance 4.68
92
Industrial capital goods 3.58
Table 1.20
Table 1.21
93
Jensen ratio 8.39
Interpretation:
This fund gave the more sharp ratio, 4.006 shows that the fund performing better during five
year history with the tatal risk of 7.75. by evaluating Treynor ratio the fund gave the return of
30.89 by considering the beta value of 1.003 it shows that even though in volatile condition
the fund perform well, the Jensen gave the positive return of 8.30 it shows that actual return
is more than benchmark return during 5 year history because it is difference between actual
and benchmark return.
Scheme objective : The objectives of the fund is to generate long term capital
appreciation
Investment pattern : For new investor Rs.5000 and in multiples of Rs.100 thereafter.
Load structure:
94
Entry load : 2.25% for investment of less than Rs,5 cr. No entry load on
Table 1.22
banks 9.73
Banks 3.92
Pharmaceuticals 3.50
Pesticides 3.29
Pharmaceuticals 3.20
95
Industrial capital goods 3.09
Table 1.23
Table 1.24
96
Treynor ratio 32.98
Interpretation:
This fund gave the sharp ratio of 3.74 that is reward of 3.47 with risk of 7-77% and giving
good return to the investor. Treynor ratio gave the value of 32.98 means it gave the good
return with overcoming market risk of 0.883 and succeed in the performance. The Jensen
ratio measure that fund beat the benchmark return and gave the return of 8.44.
Scheme objective : The objectives of the fund is to generate long term capital
200 index
Investment pattern: For new investor Rs.5000 and in multiples of Rs.100 thereafter.
97
Dividend Option : Rs. 48.858
Load structure
Entry load : 2.25% for investment of less than Rs,5 cr. No entry load on
Exit load/CDSC : 1% on the investment below 5 cr. And redeemed within 365 days,
Table 1.25
Software 4.66
Banks(SBI) 3.15
Pharmaceuticals 2.70
98
total equity and equity related holdings 96.48
Table 1.26
Table 1.27
99
Jensen ratio 8.22
Interpretation:
This fund perform well and gave the sharp value of 4.11 by considering total risk 7.25 and
treynor ratio shows that the fund succeed in overcoming market risk and gave return of
43.43% and Jensen gave positive return 8.22 means that fund beat the benchmark return in
it’s five year history.
Scheme objective : The objectives of the fund is to generate long term capital
Investment pattern: for new investor Rs.5000 and in multiples of Rs.100 thereafter.
100
Benchmark : S & P CNX 500
Load structure
Entry load : 2.25% for investment of less than Rs,5 cr. No entry load on
Table 1.28
Banks 6.11
Banks 5.54
Pharmaceuticals 4.02
101
Ferrous metals 3.94
Chemicals 3.43
Table 1.29
Table 1.30
102
Treynor ratio 33.17
Jensen ratio -9.20
Interpretation:
This fund able to compensate the risk and possible of giving return of 4.29, treynor gave the
return of 33.17% with considering market risk of 0.8708 and able to beat the market risk .
Jensen gave the value of 9.20 shows that the fund beat the benchmark return and gave the
good return to the investors.
Scheme objective : The objectives of the fund is to generate returns that are commensurate
Investment pattern: for new investor Rs.5000 and in multiples of Rs.100 thereafter.
103
Growth Option : Rs. 154.2977
Benchmark : Sensex
Load structure
Exit load/CDSC : 1% on the investment below 5 cr. And redeemed within 365 days,
Table 1.31
Banks(ICICI) 10.39
Software 6.02
Finance 5.58
104
Telecom services 4.73
Banks(SBI) 4.29
Bank(HDFC) 3.68
Table 1.32
105
4.11.3 Quantitative data:
Table 1.33
Interpretation:
This fund able to compensate the risk and possible to give the return of 2.6. treynor gave the
normal return of 22.45 with beta of 0.949 by considering Jensen ratio we come to know that
the fund has not performed well during five year of history which gave the –ve value of
-10.69.
Scheme objective : The objectives of the fund is to generate returns that are commensurate
Investment pattern: for new investor Rs.5000 and in multiples of Rs.100 thereafter.
106
NAV per unit as on 31th January 2008
Load structure
Exit load/CDSC : 1% on the investment below 5 cr. And redeemed within 365 days,
Table 1.34
Oil 6.94
Power 5.31
107
Banks(ICICI Bank) 4.14
Banks(SBI) 3.87
Table 1.35
108
Table 1.36
Interpretation:
This fund gave the return of 2.45% with risk of 7.98, the fund not able to provide better
return to the investor, by compairing the treynor ratio this fund gave the normal return of
23.06 with beta of 0.894. Jensen ratio provide that the fund performing well and not so good
and it gave the negative value of -2.49.
CHAPTER FIVE:
• Sharp ratio indicates that fund performance by considering overall total risk. Some
funds are not able to perform well because of total risk involved in the funds.
• ING investing funds in the some selected sectors. So it is not possible to diversify the
risk associated with funds, so they having more standard deviation.
109
• Because of volatility in the market conditions. The funds are not able to cross the
benchmark return so fund houses should concentrate on the market conditions.
• By considering Jensen ratio it shows that no fund has not crossed more time
benchmark return so that’s why Jensen ratio can’t give the +ve return for many funds.
• By considering treynor ratio it shows that the fund performs well during 5 years of
history and able to overcome the market risk.
• From portfolio construction shows that, the fund diversifies it’s risk for some extent
so the fund able to give +ve return based on Jensen ratio.
• In HDFC all funds are having very less standard deviation and it helps the fund to
generate good returns on the fund.
• Out of six funds last two funds that is sensex and index got –ve value based on Jensen
ratio because they gave more preference for bank deposits.
• Out of six equity schemes many funds are crossed the benchmark return because of
the well management of funds and well diversifying of risk.
5.2 CONCLUSION:
110
“Mutual fund is booming sector now a days and it has lot of scope to generate income and
providing return to the investor, the mutual fund is one of the way to development of country
and helps to mobilizing dead money in the economy which helps to develop the economic
conditions of the country and people.
Mutual fund helps the people for studying the market conditions, it providing lot of
opportunities to the people for research work and helps the people to know the new things
going on around the world. It gave the more knowledge to the person, because it diversifies
the risk by investing in different securities.”
5.3 SUGGESSTIONS:
111
• The fund house has to reduce the total risk involved in the fund in order to increase
the return with good portfolio construction.
• The fund house should select the innovative way of portfolio construction and should
see the attracting areas of investing funds.
• The fund houses should concentrate on the market conditions according to that they
have to set the benchmark and invest in different sectors.
• The fund houses should invest in good and attracting sectors to reduce standard
deviation.
• The fund house should try to reduce little more beta in order to generate more returns
to investors.
• In ING Jensen never gave the +ve value so fund house try to cross the benchmark
return and achieve the objectives of the fund.
• HDFC fund house gave the good return it showed by sharp ratio even though they
have to reduce the total risk by diversifying their portfolio and achieving objectives.
• The HDFC investing in diversifies areas but not in upcoming areas like real estate and
infrastructure better to invest in those areas to increase return.
112
• HDFC still it has to reduce the standard deviation to generate more return by reducing
total risk factors associating with mutual funds, and analyses all the factors.
• HDFC has to concentrate on those funds which are performing less than thir
benchmark return and take actions and analyse the market conditions and take correct
steps
5.4 BIBLIOGRAPHY:
BOOK REFERENCES:
FISHER AND JORDEN (2000): Security analysis and portfolio management, Prentice hall.
WEBSITES:
www.valueresearchonline.com
www.amfindia.com
www.google.com
www.ingim.co.in
www.hdfcfund.com
www.investorsideas.com
113
Sanjay j bhayani ss(2008): “An empirical analysis of performance evaluation of mutual fund
schemes in india”, capital market(Icfai journals):
P.Prasad Rao(2007): “distribution channels in the mutual fund industry”, Money market(Icfai
journals).
Siddhartha Srivastava(2008): “real estate fund , present conditions and future of the fund”
114