1.

1 DEFINITION
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 invested by the fund manager in different types of securities depending upon the objective of the scheme. These could range from shares to debentures to money market instruments. The income earned through these investments and the capital appreciations realized by the scheme 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 diversified, professionally managed portfolio at a relatively low cost. The small savings of all the investors are put together to increase the buying power and hire a professional manager to invest and monitor the money. Anybody with an investible surplus of as little as a few thousand rupees can invest in Mutual Funds. Each Mutual Fund scheme has a defined investment objective and strategy. You can buy mutual fund shares directly from the mutual fund company or from a stock broker or intermediary. Either way buying and redeeming is relatively easy.

FIGURE: PROCESS OF MUTUAL FUND1

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Source: www.mutualfundindia.com

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1.2 SUBJECT BACKGROUND OF THE RESEARCH TOPIC
1.2.1 ADVANTAGES OF MUTUAL FUND 1. Professional Management Mutual Funds provide the services of experienced and skilled professionals, backed by a dedicated investment research team that analyses the performance and prospects of companies and selects suitable investments to achieve the objectives of the scheme. 2.Diversification Mutual Funds invest in a number of companies across a broad cross-section of industries and sectors. This diversification reduces the risk because seldom do all stocks decline at the same time and in the same proportion. You achieve this diversification through a Mutual Fund with far less money than you can do on your own. 3. Convenient Administration Investing in a Mutual Fund reduces paperwork and helps you avoid many problems such as bad deliveries, delayed payments and follow up with brokers and companies. Mutual Funds save your time and make investing easy and convenient. 4. Return Potential Over a medium to long-term, Mutual Funds have the potential to provide a higher return as they invest in a diversified basket of selected securities. 5. Low Costs Mutual Funds are a relatively less expensive way to invest compared to directly investing in the capital markets because the benefits of scale in brokerage, custodial and other fees translate into lower costs for investors. 2

6. Liquidity In open-end schemes, the investor gets the money back promptly at net asset Value related prices from the Mutual Fund. In closed-end schemes, the units can be sold on a stock exchange at the prevailing market price or the investor can avail of the facility of direct repurchase at NAV related prices by the Mutual Fund.

7. Transparency You get regular information on the value of your investment in addition to disclosure on the specific investments made by your scheme, the proportion invested in each class of assets and the fund manager's investment strategy and outlook.

8. Flexibility Through features such as regular investment plans, regular withdrawal plans and dividend reinvestment plans, you can systematically invest or withdraw funds according to your needs and convenience.

9. Affordability Investors individually may lack sufficient funds to invest in high-grade stocks. A mutual fund because of its large corpus allows even a small investor to take the benefit of its investment strategy.

10. Choice of Schemes Mutual Funds offer a family of schemes to suit your varying needs over a lifetime.

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2 DRAWBACKS OF MUTUAL FUND: Mutual funds have their drawbacks and may not apply for everyone: 1) No Guarantees: No investment is risk free. Some funds also charge sales commissions or "loads" to compensate brokers. if you invest in Index Funds. you might not make as much money on your investment as you expected. Investors encounter fewer risks when they invest in mutual funds than when they buy and sell stocks on their own. no matter how balanced the portfolio. you forego management risk. financial consultants. Of course. If the manager does not perform as well as you had hoped. 3) Taxes: During a typical year. However. you depend on the fund's manager to make the right decisions regarding the fund's portfolio. you will pay a sales commission if you buy shares in a Load Fund.1. the value of mutual fund shares will go down as well. anyone who invests through a mutual fund runs the risk of losing money. If the entire stock market declines in value. because these funds do not employ managers 4 . If your fund makes a profit on its sales. most actively managed mutual funds sell anywhere from 20 to 70 percent of the securities in their portfolios. or financial planners.2. Even if you don't use a broker or other financial adviser. even if you reinvest the money you made. 2) Fees and commissions: All funds charge administrative fees to cover their day-to-day expenses. 4) Management risk: When you invest in a mutual fund. you will pay taxes on the income you receive.

Income schemes. Money market schemes. Other schemes     Tax saving schemes. Balanced schemes.  Interval schemes. 5 .3 TYPES OF MUTUAL FUND SCHEMES Mutual fund schemes may be classified on the basis of its structure and its investment objective.1. By investment objectives     Growth schemes. Sector specific schemes. By structure  Open ended.2. Special schemes Index schemes.  Close ended.

The key feature of open-end schemes is liquidity. SEBI Regulations stipulate that at least one of the two exit routes is provided to the investor. These do not have a fixed maturity. Investors can invest in the scheme at the time of the initial public issue and thereafter they can buy or sell the units of the scheme on the stock exchanges where they are listed. some close-ended funds give an option of selling back the units to the Mutual Fund through periodic repurchase at NAV related prices. In order to provide an exit route to the investors. 6 .By Structure 1) Open-end Funds An open-end fund is one that is available for subscription all through the year. The fund is open for subscription only during a specified period. They are open for sale or redemption during pre-determined intervals at NAV related prices. 2) Closed-end Funds A closed-end fund has a stipulated maturity period which generally ranging from 3 to 15 years. 3) Interval Funds Interval funds combine the features of open-ended and close-ended schemes. Investors can conveniently buy and sell units at Net Asset Value ("NAV") related prices.

It has been proved that returns from stocks. Growth schemes are ideal for investors having a long term outlook seeking growth over a period of time. Such schemes generally invest in fixed income securities such as bonds. corporate debentures and Government securities. commercial paper and interbank call money. In a rising stock market. 2) Income Funds The aim of income funds is to provide regular and steady income to investors. or fall equally when the market falls. have outperformed most other kind of investments held over the long term. 7 . 3) Balanced Funds The aim of balanced funds is to provide both growth and regular income. 4) Money Market Funds The aim of money market funds is to provide easy liquidity. the NAV of these schemes may not normally keep pace. These are ideal for investors looking for a combination of income and moderate growth. certificates of deposit. Such schemes periodically distribute a part of their earning and invest both in equities and fixed income securities in the proportion indicated in their offer documents. Income Funds are ideal for capital stability and regular income. Such schemes normally invest a majority of their corpus in equities. These schemes generally invest in safer short-term instruments such as treasury bills.By Investment Objective 1) Growth Funds The aim of growth funds is to provide capital appreciation over the medium to long term. preservation of capital and moderate income.

1961. Investments made in Equity Linked Savings Schemes (ELSS) and Pension Schemes are allowed as deduction u/s 88 of the Income Tax Act. These are ideal for Corporate and individual investors as a means to park their surplus funds for short periods.Returns on these schemes may fluctuate depending upon the interest rates prevailing in the market. and Pharmaceuticals etc. This could be an industry or a group of industries or various segments such as 'A' Group shares or initial public offerings. FMCG. The investment of these funds is limited to specific industries like InfoTech. c) Sectoral Schemes Sectoral Funds are those which invest exclusively in a specified sector. b) Index Schemes Index Funds attempt to replicate the performance of a particular index such as the BSE Sensex or the NSE 50. Other schemes 1) Tax Saving Schemes These schemes offer tax rebates to the investors under specific provisions of the Indian Income Tax laws as the Government offers tax incentives for investment in specified avenues. 8 . 2) Special Schemes a) Industry Specific Schemes Industry Specific Schemes invest only in the industries specified in the offer document.

Trust The Mutual Fund is constituted as a trust in accordance with the provisions of the Indian Trusts Act. Sponsor must contribute at least 40% of the net worth of the Investment Managed and meet the eligibility criteria prescribed under the Securities and Exchange Board of India (Mutual Funds) Regulations. 9 .The Sponsor is not responsible or liable for any loss or shortfall resulting from the operation of the Schemes beyond the initial contribution made by it towards setting up of the Mutual Fund.2.1. 1908. 1882 by the Sponsor.4 MUTUAL FUND STRUCTURE Sponsor Sponsor is the person who acting alone or in combination with another body corporate establishes a mutual fund. The trust deed is registered under the Indian Registration Act. 1996.

Registrar and Transfer Agent The AMC if so authorized by the Trust Deed appoints the Registrar and Transfer Agent to the Mutual Fund. The main responsibility of the Trustee is to safeguard the interest of the unit holders and inter alias ensure that the AMC functions in the interest of investors and in accordance with the Securities and Exchange Board of India (Mutual Funds) Regulations. 1996. The AMC is required to be approved by the Securities and Exchange Board of India (SEBI) to act as an asset management company of the Mutual Fund. At least 2/3rd directors of the Trustee are independent directors who are not associated with the Sponsor in any manner. the provisions of the Trust Deed and the Offer Documents of the respective Schemes. At least 50% of the directors of the AMC are independent directors who are not associated with the Sponsor in any manner. The AMC must have a net worth of at least 10 crore at all times. Asset Management Company (AMC) The Trustee as the Investment Manager of the Mutual Fund appoints the AMC. redemption requests and dispatches account statements to the unit holders. 10 . The Registrar processes the application form. The Registrar and Transfer agent also handles communications with investors and updates investor record.Trustee Trustee is usually a company (corporate body) or a Board of Trustees (body of individuals).

2. Vote in accordance with the Regulations to:a. Wind up the schemes.5 RIGHTS OF A MUTUAL FUND UNIT HOLDER A unit holder in a Mutual Fund scheme governed by the SEBI (Mutual Funds) Regulations is entitled to: 1. investment objectives. which are likely to modify the scheme or affect the interest of the unit holder. b. Approve or disapprove any change in the fundamental investment policies of the scheme. Change the Asset Management Company. Receive dividend within 42 days of their declaration and receive the redemption or repurchase proceeds within 10 days from the date of redemption or repurchase. Receive information about the investment policies. c. 3. Receive unit certificates or statements of accounts confirming the title within 6 weeks from the date of closure of the subscription or within 6 weeks from the date of request for a unit certificate is received by the Mutual Fund.1. 11 . financial position and general affairs of the scheme. 4. 2. The dissenting unit holder has a right to redeem the investment.

musician. The scheme will pay a distribution tax currently @10% plus surcharge if the portfolio holds less than 50 percent debt securities on an average during the last one year period. arising to him on account of such purchase and sale of securities or unit. artist. actor or sportsman (including an athlete). of an amount equal to 20% of the amount so subscribed. from income-tax. whose income is derived from the exercise of his profession as an author. 12 . In the case of subscription by an individual. subscription to the Units of the Scheme by Individuals and Hindu Undivided Families.6 TAX BENEFITS OF MUTUAL FUNDS Section 94(6) of the Income Tax Act 1961 Section 94(6) of the Income Tax Act 1961 now provides that any person who buys or acquires any securities or unit within a period of three months prior to the record date and such person sells or transfers such securities or unit within a period of three months after such date and the dividend or income on such securities or unit received or receivable by such person is exempt.1. 1961. 1961. Section 10(33) of the Income Tax Act 1961 The dividend received by the investors from the scheme will be exempt from income tax for all categories of investors under Section 10(33) of the Income Tax Act. Section 88 of the Income Tax Act 1961 Specified units of mutual fund schemes qualify for rebate under Section 88 of the Income Tax Act. playwright. shall be ignored for the purposes of computing his income chargeable to tax. the deduction admissible would be at the rate of 25%. if any. then. to the extent such loss does not exceed the amount of dividend or income received or receivable on such securities or unit.2. not exceeding Rupees ten thousand would be eligible to a deduction. the loss.

13 . OCBs & FIIs will be subjected to tax deduction at source at the rates in force and certificates for tax deducted will be issued. To NRI’s / OCB’s a) Tax Deduction at Source (TDS) Redemptions/Exchanges/Switches by non-residents. Wealth tax benefits Mutual Fund units are exempt from Wealth Tax. To Charitable Trusts Investment in the units of the scheme is an eligible mode of investment under Section 11(5) of the Income Tax Act read with Income Tax Rule 17 C.Tax Deduction at Source There will not be any Tax Deduction at Source on payment to resident unitholders towards redemption or dividends. To the Fund Open Ended Mutual Funds are exempt from income tax under Section 10 [23D] of the Act.

which leads to very high-risk levels. There has always been high volatility in India.2 NEED FOR STUDY The Performance evaluation of equity schemes with their respective Benchmark indexes and to find out the Beta of the fund. the different types of mutual funds schemes such as open ended schemes closed ended schemes. This concept makes all the investors aware of its advantages and makes them use these instruments according to their needs. to identify the different players in mutual fund industry. To study the concept of Mutual funds such as how mutual funds have come into existence. So there is an absolute need to develop. 2. Standard deviation of the fund and performance measures of Sharpe and Treynors. The performance of Equity schemes in Mutual Fund industry however helps the prospective investors to choose the best investment avenue that suit his objective. It helps the investors whether to invest in Equity Schemes in Mutual Fund house. to compare the performance of different mutual funds to understand the concept of NAV and mutual funds.2.1 STATEMENT OF THE PROBLEM To study about the performance of various Mutual funds and compare it with the respective Benchmark indices in the market and rank them in a systematic order over a period of time (5 year’s) and to find the risk and return of each scheme and also creating awareness about Equity Schemes among the investors. to compare equity funds with their respective Bench Mark index. 14 .

if an investment company has securities and other assets worth $100 million and has liabilities of $10 million.2. 2. $100 million the next. Treynor & Jensen measures. the investment company’s NAV will be $90 million one day. Net asset value on a particular date reflects the realizable value that the investor will get for each unit that he his holding if the scheme is liquidated on that date.4 OPERATIONAL DEFINITION OF CONCEPTS Net Asset Value or NAV NAV is the total asset value (net of expenses) per unit of the fund and is calculated by the Asset Management Company (AMC) at the end of every business day. and $80 million.  To identify different players in mutual fund industry. NAV Periodic performance in percentage NAV Closing Value – NAV Opening Value = NAV Opening Value *100 15 . Net asset Value of an investment company is the company’s total assets minus its total liabilities.  To study and compare the return of Equity mutual funds with their respective Benchmark indexes.3 OBJECTIVES OF THE STUDY  To compare the performance of different mutual funds.  To study the best performing Funds using Sharpe. For Example.

It reduces the price of the units to less than the NAV and is expressed as a percentage of NAV. the standard deviation tells us how much the return on the fund is deviating from the expected normal returns. In finance. SEBI has removed the entry load on mutual funds from 18th June. Standard deviation can also be calculated as the square root of the variance. 16 . It increases the price of the units to more than the NAV and is expressed as a percentage of NAV. RISK MEASUREMENT CONCEPTS STANDARD DEVIATION A measure of the dispersion of a set of data from its mean. a standard deviation is applied to the annual rate of return of an investment to measure the investment Volatility (Risk). In mutual funds. The returns can come by way of income distributions as well as appreciation in the value of the investment. 2009. A volatile stock would have a high standard deviation. Performance Performance of an investment indicates the returns from an investment.Entry Load It is the load charged by the fund manager when one invests into the fund. The more spread apart the data is higher the deviation. ExitLoad It is the load charged by the fund when one redeems the units from the fund.

(∑ R ) m 2 n2 Where Rm Index Return (Market Return) σ m Risk of the Index 17 . Standard Deviation (Risk) of the benchmark index: 1/2 σ m= n∑ Rm2 .Standard Deviation (Risk) of the Fund: σ p= n∑ Rp2 .(∑ R ) p 2 1/2 n2 Where: σ p : Risk of the Fund. Rp : Return of the fund.

18 . The higher the beta. The market is assigned a beta of 1. ARm: Average return of the benchmark index. ARp: Average return of the Mutual Fund Scheme. It tells us whether a portfolio's returns are due to smart investment decisions or a result of excess risk. Rp: Return of the fund.AR ) (R p p m – ARm ] β p= ∑ [Rm – ARm]2 Where: β p : Beta of the fund. In other words. the better the portfolio has performed.BETA It is the measure of the relative sensitivity of a stock or mutual fund to the market. Beta of the Fund: ∑ [(R . Sharpe’s Measure Sharpe measure adjusts portfolio performance for total risk rather than market risk. the more sensitive the stock or fund is considered to be relative to the market as a whole. The higher the Sharpe ratio for a portfolio. funds with beta more than 1 will react more to any fluctuations (whether upward or downward) in market than funds with beta less than 1.

Sp = Sharpe Index r* = riskless rate of interest (T-Bill 91 days) σ p = Standard deviations of the returns of portfolio p ARp= average return on portfolio p Treynor’s Measure It is a relative measure of performance for investment managers and measures the return premium per unit of systematic risk as measured by the beta or relative volatility of the portfolio. Treynor’s Measure of Performance: Tp = ARp . While a high and positive index shows a superior risk-adjusted performance of a fund. Tp = Treynor’s Index r* = Riskless rate of interest (T-Bill 91 days) β p = Beta coefficient of portfolio p ARp= Average return on portfolio p 19 .r* βp Where.r* Sp = σp Where. a low and negative index is an indication of unfavorable performance.Sharpe’s Measure of Performance: ARp .

i. technical and trade journals. Business World Magazine. ii. definitions. many books and articles related to the research have been referred. The brochures of the each company helped to gain a detailed knowledge about the product and its features. These funds are analyzed on the basis of the following: • • • • • • Average return of the fund Average return of the benchmark index Standard deviation of the fund Standard deviation of the benchmark index Beta of the fund Sharpe’s and Treynor’s Measure To ease out the research work. past 5 Years performance is taken into consideration for the 10 schemes of 10 Mutual Fund houses. kinds of mutual fund and also the factors affecting risk.These books helped to study the nature and scope of the mutual fund.5 METHODOLOGY To find out the performance of the Equity Diversified mutual funds. magazines and reports and publication of various associations connected with business and industry are referred.2.This magazine helped to grasp the facts about overall private players and their performance in the recent years in the mutual fund industry. In this project. 20 . books. Security analysis and portfolio management by Donald Fischer & Ronald Jordan and Investment analysis & portfolio management by Prasanna Chandra.

fact sheets. the entire population has been taken in to consideration for the study.7 TOOLS AND TECHNIQUES FOR DATA COLLECTION PRIMARY DATA The primary data was collected through records. 2.6 SAMPLE DESIGN EXPLORATORY RESEARCH The main purpose of exploratory studies is that of formulating a problem for precise investigation or of developing the working hypothesis from an operational point of view both primary and secondary data are used for the purpose of the study. 21 . The population consists of 10 five year old funds. fact sheets & brochures of the company. offer documents.2. internet. manuals. memorandums and other literatures. This study chose a sample of 10 Equity Schemes to evaluate their performance for a period of 5 years and compare it with their respective Benchmark index. SECONDARY DATA The Secondary data for this study was collected from newspapers. Variables yearly calculated risk and returns were used for comparing equity schemes. books. magazines. mutual fund prospectus.

Interaction with the company professional was limited. tables) and other research tools are used to analyze the data.10 CHAPTER SCHEME • • The first chapter deals with the introduction about the topic and the industry profile.2. The NAV values and the Benchmark Index values obtained may not be entirely accurate. 22 . classified & tabulated for easy interpretation & analysis. The research design is covered in the second chapter which consists of the various sampling techniques and methodology used and contextual definition. (as taken directly from mutual fund & market indices websites) 2. standard deviation etc). Only funds. Statistical tools like Measures of central tendency (averages).9 LIMITATIONS OF THE STUDY • • • • • • Not all the information required was freely available. Only open-ended growth funds have been considered. charts. which are more than five years old. Measures of Dispersion (Correlation.8 PLAN OF ANALYSIS The data collected are edited. Only 10 Equity funds of different AMCs were compared and analyzed. presentation tools (graphs. 2. have been considered.

Punjab National Bank Mutual Fund (Aug 89). • The summary of findings. Bank of Baroda Mutual Fund (Oct 92). public sector mutual funds set up by public sector banks and Life Insurance Corporation of India (LIC) and General Insurance Corporation of India (GIC).1 INDUSTRY PROFILE The mutual fund industry in India started in 1963 with the formation of Unit Trust of India. conclusion and suggestion is the fifth chapter. The history of mutual funds in India can be broadly divided into four distinct phases: First Phase – 1964-87 Unit Trust of India (UTI) was established on 1963 by an Act of Parliament. 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 fourth chapter that is the computation of Return. Risk. at the initiative of the Government of India and the Reserve Bank. The first scheme launched by UTI was Unit Scheme 1964. 3. Second Phase – 1987-1993 (Entry of Public Sector Funds) 1987 marked the entry of non. Third Phase – 1993-2003 (Entry of Private Sector Funds) 23 .• • The third chapter consists of the industry profile. Indian Bank Mutual Fund (Nov 89). LIC established its mutual fund in June 1989 while GIC had set up its mutual fund in December 1990. and Beta deals with the analysis and interpretation of data.UTI. Bank of India (Jun 90).UTI Mutual Fund established in June 1987 followed by Canbank Mutual Fund (Dec 87). SBI Mutual Fund was the first non. It was set up by the Reserve Bank of India and functioned under the Regulatory and administrative control of the Reserve Bank of India.

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 (Mutual Fund) Regulations 1996. Fourth Phase – since February 2003 In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI was bifurcated into two separate entities. One is the Specified Undertaking of the Unit Trust of India with assets under management of `29,835 crores as at the end of January 2003. It does not come under the purview of the Mutual Fund Regulations. The second is the UTI Mutual Fund, sponsored by SBI, PNB, BOB and LIC. It is registered with SEBI and functions under the Mutual Fund Regulations. As on 31st July 2010, there are a total of 40 Asset Management Companies (AMCs) with a total of 3661 schemes. The total assets under management (AUM) of all these AMCs is to the tune of `6,65,567 crores. The top fund house as per AUM is Reliance Mutual Fund with the total assets of `1,02,179 crores.

FIGURE : THE GROWTH OF ASSETS

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3.2 COMPANY PROFILE

Almondz Global Securities Ltd.
3.2.1 Introduction
• Almondz Global Securities Limited (AGSL) is a well established Independent Investment Bank. • The company was incorporated in 1994 and is listed on the Bombay Stock Exchange. • It is part of the Almondz group which also comprises of the following companies: o Almondz insurance brokers pvt. ltd

o Almondz reinsurance brokers pvt ltd o Almondz capital and Management services ltd. o Almondz commodities pvt. ltd.

• Experienced & professional Board supported by a team of over 1000 professionals & Support Staff. 25

• An Associate/sub-broker network of 4000+ spread across India. • Head offices in Delhi & Mumbai along with 17 branch offices all across the country. • The company has a well diversified client base of Public Sector Units, Private Corporate, Insurance Companies, Fund Houses, Banks & Financial Institutions, Employee Benefit Funds, High Net worth Individuals & Retail Investors. The company has also tied up with NOBLE Investment Group of UK to increase their reach in the Global Financial Markets.

3.2.2 Business Segments
 Corporate Finance 1. Investment Banking * IPOs, FPOs & Rights Issues * Private Placement of Equity * Delisting, Takeover, Substantial Acquisitions & ESOPs * Private Placement of Debt * Project Finance 2. Infrastructure Advisory * Road * Power  Debt Portfolio Management 1. Secondary Debt Trading 2. Debt Portfolio Advisory

 Retail & Distribution 26

Insurance Products  Equity Broking 1. 27 . DP Services 3. Institutional Equity Broking 3. Retail Equity Broking 2. Public Issue of Debt 3. Equity IPOs 2. Tax Saving Instruments 5. Highly Networked & Fully Integrated Financial Products and Services House’ in the country. Mutual Funds 4. Mission Creating Wealth and Value for Our Clients & Associates. Fixed Deposits & Other Fixed Income Products 6.2.1.3 Guiding Principles Objectives Endeavor to be amongst the ‘Top Ranked. Portfolio Management Services 7. Vision To Position Ourselves Amongst Top 3 Integrated & Professionally Managed Financial Services Firms in India.

• Professional Management. • High Corporate Governance Standards.2. Commitment. •Integrity.Values • Responsibility towards Clients. • System and Process Driven Business Practices &. Accountability.4 Activity Focus: Publication & Research • Value added in-Depth research • Specialized Industry & Company coverage • Daily morning updates • Investment Opportunity suggestions • Daily suggestions / trading idea • Monthly Magazine Research Reports 28 . 3.

Debt and Forex with focus on Mutual Funds. Debt Market Commentary The Daily Market Reports Kya Lagta hai Stock Ideas Wealth Park Activity Focus: Service Deliverables • Daily • Mutual Fund Performance score card • Weekly • Market review of Equity and Debt • Monthly • Market review of Equity. • Wealth Park Magazine • Mutual Fund Performance score card 29 . • Portfolio update through email.

2. PSU.000 High Net worth individuals Advise and manage over 1000 clients through a dedicated wealth management team. • Any good investment ideas.5 Current Investor Profile Investor base of more than 1. • Dedicated Wealth Managers.com 3.00.00. Have more than 2000 partners across the country Service a client base of over 1. Corporate. The ticket size varies from ` 5 lakhs to ` 10 crores. • Note on special event like credit policy etc. • Customer Service email id: atyourservice@almondz. FI & Banks 30 .000 with AUM in excess of `1300 crores Retail Manage the retail investors through our channel partners.• Event based • Research note on New Fund Offerings by Mutual funds and Initial Public offerings of Primary market.

The funds chosen belong to the top 10 AMCs in India as on 31st December 2009. 4. Reliance mutual growth fund 31 . J M Mutual fund equity growth 6. Empanelled with most of the banks and FI.1 Introduction to Performance study of Mutual Funds The performance of Mutual Funds has been measured for a period of five years starting from January 2005 to December 2009. Kotak 30 growth fund 7. DSP Blackrock opportunities growth 3. The funds’ performance is analyzed and a comparison is made between the performances of various funds with their respective benchmark index with the help of above discussed methods (methodology section) on yearly basis. Birla Sunlife Frontiline Equity 2. The funds are selected based on their corpus and objective of the portfolio investment (Growth Schemes). ICICI Prudential growth fund 4. The ticket size vary from `50 lakhs to `200 crores. Manage over 100 investors in this category. More than 80% of the total corpus of each fund is invested in the equity. The following 10 Equity funds are included in the study – 1. HDFC Equity fund 5.

income generation and distribution of dividend.2 Description of the Birla sun life frontline Equity Mutual fund family Fund class Launch Date Fund Manager Birla Sun life Mutual Fund Equity Diversified August 2002 Mahesh Patil 32 .8. TATA pure equity growth 10. TABLE 3. It would target the same sectoral weights as BSE 200. subject to flexibility of selecting stocks within a particular sector. HSBC equity fund 4.2 Brief Description of Funds An introduction to various mutual funds used for comparison is as follows-  BIRLA SUNLIFE MUTUAL FUNDS Scheme: Birla Sun life Frontline Equity Objective The scheme aims to generate long-term capital growth. Sundaram BNP Paribas growth 9..

1000 Rs.3 Description about the fund: Mutual fund family Fund class Launch Date Fund Manager Minimum Investment Subsequent Investment Minimum Withdrawal Minimum Balance Pricing Method Type DSP Merillynch Mutual Fund Equity Diversified August 2000 Anup Maheshwari Rs.1000 Rs. TABLE 3. cyclical and technology.500 Forward Open End 33 .5000 Rs.Minimum Investment Subsequent Investment Minimum Withdrawal Minimum Balance Pricing Method Type Bench Mark Source secondary data Rs. pharma.1000 --Forward Open End BSE 200  DSP Blackrock Mutual Fund Scheme: Opportunities Growth Objective The scheme seeks to achieve long-term capital appreciation by responding to the dynamically changing Indian economy by moving across sectors such as the lifestyle.5000 Rs.

5000 Forward Open End S & P CNX Nifty 34 .4 Description of the ICICI Prudential Growth Mutual fund family Fund class Launch Date Fund Manager Minimum Investment Subsequent Investment Minimum Withdrawal Minimum Balance Pricing Method Type Bench Mark Source secondary data ICICI Mutual Fund Equity Diversified June 1998 Kaushik Roychaudhary Rs.500 Rs.500 Rs.Bench Mark Source secondary data S & P CNX Nifty  ICICI Mutual Fund Scheme: Prudential Growth Objective The scheme seeks to generate long-term capital appreciation by investing predominantly in equities that is 95% in equities while the rest would be invested in debt and money market instruments. TABLE 3.5000 Rs.

5 Description of the HDFC Equity Growth fund Mutual fund family Fund class Launch Date Fund Manager Minimum Investment Subsequent Investment Minimum Withdrawal Minimum Balance Pricing Method Type Bench Mark Source secondary data .1000 Rs.500 Rs.1000 Forward Open End S & P CNX 500  J M Mutual Fund 35 . HDFC Mutual Fund Equity Diversified December 1994 Prashanth Jain Rs. TABLE 3. HDFC Mutual Fund Scheme: Equity Objective The scheme seeks to provide long-term capital appreciation by predominantly investing in high growth companies.5000 Rs.

6 Description of the JM Equity Growth Mutual fund family Fund class Launch Date Fund Manager Minimum Investment Subsequent Investment Minimum Withdrawal Minimum Balance Pricing Method Type Bench Mark Source: Secondary data J M Mutual Fund Equity Diversified December 1994 Amandeep Chopra Rs.5000 -Rs.0 -Forward Open End Sensex  Kotak Mutual Funds Scheme: Kotak 30 Growth Objective 36 .Scheme: Equity Growth Objective The scheme seeks long-term capital growth and appreciation through investment primarily in equities. TABLE 3.

1000 Rs. and there will be an exposure to debt and money market instruments also. The fund would invest in not more than 30 stocks. The funds will be invested in Equity and equity related instruments.The scheme seeks capital appreciation.8 37 . TABLE 3. TABLE 3.1000 Rs. through investments in equities.5000 Rs.7 Description of the Kotak 30 Growth Mutual fund family Fund class Launch Date Fund Manager Minimum Investment Subsequent Investment Minimum Withdrawal Minimum Balance Pricing Method Type Bench Mark Source: Secondary data Kotak Mutual Funds Equity Diversified December 1998 Krishna Sanghvi Rs. A part of the corpus will be invested in debt also.5000 Forward Open End S&P CNX Nifty  Reliance Mutual Funds Scheme: Reliance Growth Objective The scheme aims at long-term growth of capital through research based investment approach.

5000 Forward Open End BSE 100  Sundaram Mutual Funds Scheme: BNP Paribas Growth Objective: The scheme aims to provide to investors a reasonably diversified portfolio of stocks essentially meant to give higher returns in the medium to long term.9 Description of the Sundaram BNP Paribas Growth 38 . However on a selective basis.0 Rs.5000 Rs.1000 Rs. short-term opportunities that may yield above average returns will not be ignored. TABLE 3.Description of the Reliance Growth Mutual fund family Fund class Launch Date Fund Manager Minimum Investment Subsequent Investment Minimum Withdrawal Minimum Balance Pricing Method Type Bench Mark Source: Secondary data Reliance Mutual Funds Equity Diversified October 1995 V Ramanan Rs.

the scheme aims at medium to long term capital growth.1000 Rs. TABLE 3.Mutual fund family Fund class Launch Date Fund Manager Minimum Investment Subsequent Investment Minimum Withdrawal Minimum Balance Pricing Method Type Bench Mark Source: Secondary data Sundaram Mutual Funds Equity Diversified March 1997 Rajesh Singh Rs.2000 Rs.5000 Rs. liquid bluechip companies. with 100 per cent investments in the equity of large-cap.500 Rs.1000 39 .500 Forward Open End BSE 200  TATA Mutual Funds Scheme: Pure Equity Growth Objective: Earlier known as Tata Twin Option (Equity).10 Description of the Tata Pure Equity Growth Mutual fund family Fund class Launch Date Fund Manager Minimum Investment Subsequent Investment TATA Mutual Fuds Equity Diversified March 1998 M Venugopal Rs.

1000 Forward BSE 200 Sensex 40 .1000 Rs. TABLE 3.1000 Rs.11 Description of the HSBC Equity Mutual fund family Fund class Launch Date Fund Manager Minimum Investment Subsequent Investment Minimum Withdrawal Minimum Balance Pricing Method Type Bench Mark HSBC Mutual Fund Equity Diversified December 2002 Mihr Vora Rs.1 Rs.Minimum Withdrawal Minimum Balance Pricing Method Type Bench Mark Source: Secondary data Rs.5000 Forward Open End Sensex  HSBC Mutual Fund Scheme: Equity Objective: The scheme seeks to generate long-term capital growth from a diversified portfolio of equity and equity related securities of companies across a range of market capitalization’s. with a preference for medium and large companies.10000 Rs.

5 3 2 2 5 8 . eV a l u R p R p ^2O p .7 9 4 2 .1 2 5 4 . 5 3 3 9 . 7 8 8 6 . 7 4 4 . 7186 5 5 . 3 6 7 6 3 1 . 5-95 6 .Source: Secondary data 4.1 Comparison of Birla Frontline equity fund with market indicators (BSE200. 0-46 6 . 1829 0 . 6171 5 6 . 4 8 1 8 6 . 2 8 1 5 4 2 . V aCl lu.11541 6.04 Sp Tp 1. 8 5 6 6 4 . eV a l u Re m R m ^2( R p .13 8 1 63. 4 6 . 9 6 7 6 9 . 7 4 5 1 2 .8 6 8 1 . 2 1 1 2 0 0 6 3 3 . 9 7 .A R m ) ^2 e Pr R 2 0 0 5 2 4 . 3 4 5 20 7. 6 5. 6 1 2 4 4 3 .75 Source: Secondary data Where Rp Rm ARp Arm SDRp Fund Return (Portfolio Return) Index Return (Market Return) Average fund return Average Index return Standard deviation of Fund Return 41 S D rp 36. 4 2 2 7 2 0 0 9 4 2 . 5 6 0 .56 5 8 9 5 0 .A (RRpm) .3 BIRLA SUNLIFE FRONTLINE EQUITY This part of the chapter provides the comparison of Birla Frontline Equity with Market Indicators (BSE200) TABLE 4. 2 8 7 .) NAV B SE 200 Y e a rO p . V aCl lu.4 6 3 3 . 0 9 6 . 4 9 2 7 . 5116 5 5 .4 7 . 0 72 . 9 4 3 8 . 3 45 9 5 5 .8 5 7 9 . 2 1 1 7 7 7 . 7 5 5 4 . 2 1 1 1 0 3 . 7 6 1 5 0 2 .1 3 6 1 . 2 26 3 5 . 7141 6 3 . 2 3 3 . 0 4 9 8 2 . 4 3 2 6 2 0 0 8 8 2 . 4 2 . 6 8 0 . 6 6 4 6 2 0 0 7 5 0 .76 0 .5 3 β r* 0 . 2286 5 6 . 3 4 5 9 .8 9 . 1 8 7 4 2 7 . 9111 8 8 . 7 3 9 .44 A rm 3 2. 7 1 8 .A R mo )d u( c tm . 1 3 4 7 . 7 2 9 8 2 . 9 3 3 5 9 1 . 6271 8 0 . 4 9 3 6 5 8 .9 8 5 0 .9 6 S D rm 48.2 5 .1 .7171 39.0 7 6 A rp 4 1. 6 03 2 0 3 .2 4 0 .

rbi.SDRm r* Standard deviation of Index return Riskless rate of return (T-bill 91 days)2 2 www.org: official Reserve Bank of India website 42 .

1 Comparison of Birla Frontline equity fund with market indicators (BSE200.) • The fund has performed excellently and the return of the fund has always been greater than the respective market index for the period 2005-2009. • The standard deviation of fund return compared to index return is satisfactory. 43 .FIGURE 4. • The average return of the fund is also satisfactory barring the year 2008 when all funds did not perform well. • The Beta shows that it is less volatile than the market which is good for the investors.

V Cal l. 71 49 8 7 . 8 5 . 9 2 9 2 9 .4 DSP BLACKROCK OPPORTUNITIES GROWTH This part of the chapter provides the comparison of DSP Merrilynch Opportunities Growth with Market Indicators (S & P CNX Nifty) TABLE 4.5 5 . V Cal l. 8 35 4 2 . 0 0 6 0 5 47 2 1 7 7 .20873 6 .1 5 14 1 0 3 2 5 99570 5 .36946 6 . 4 2 2 9 . uVe a l Ru pe R p ^ O p . 0 7 7 8 . 5 3 2 0 0 9 4 1 . A rp 3 5 . 7 62 3 .AP Rr omd )(uR cm . 9 -08 2 .9 4 S D rp 4 7 .4 7 A rm 3 0 . 3 7 3 2 2 .2 Comparison of DSP Opportunities growth equity fund with market indicators (S & P CNX Nifty) NAV S & P C N X N IF T Y Y e a O p .69143 6 .38906 6 . 7 5 . 0 45 . 2 3 3 9 0 .62153 8 . 0 64 7 . 8 5 1 49 1 2 0 0 7 5 6 . 58 9. 5 2 7 0 2 .6 1 Source: secondary data 44 . 0 75 6 .7 0 2 9 2 . 9 7 . 5 9 . 3 0 . 26 8 4 2 . 7 7 9 9 9 . 8 8 7 5 . 4 55 6 7 . 8 95 8 . 1 1 9 0 7 . 2 34 3 . 9 2 64 2 22 2 0 0 8 9 0 . 8 2 . 6 44 4 . 4 3 6 5 . -1551 .0 4 S p 0 .53200 1 .7 5 T p 3 2 . 772 5 1 9 . -1950 . 5 2 2 56 1 12 2 0 0 6 3 9 .27955 9 . 8 2 5 8 5 . 0 97 5 . uVe a lRu m R m ^(2R p .0 9 0 .A RR m ). 5 1 2 5 6 . 4 5 8 .20803 6 . 7286 8 1 .• The Sharpe & Treynor Measure suggests that the fund is performing better compared to other mutual funds in the same family.4 7 S D rm4 3 . 4330 7 2 . 3 5. 5 44 0 . 4. 3 37 5 5 6 . 5 0 . 4 83 9 . 5 8 1 2 3 .A R m ) ^ 2 r 2 e ( p t 2 0 0 5 2 6 .29078 0 . 3 5 .23916 3 . 9 2 1 1 5 4 . 8 18 9 . 2 48 3 .6 0 β r* 1 .

• Sharp’s & Treynor’ Measure suggests that the fund has not performed good if compared to similar funds in the family.2 Comparison of DSP Opportunities growth equity fund with market indicators (S & P CNX Nifty) • The fund has performed better in terms of average returns if compared to market index. • The standard deviation of the fund shows that the returns are quite fluctuating which is not good from the investor’s point of view.FIGURE 4. 45 . • The beta of the fund suggests that it is quite volatile and it has greater risks if compared to the benchmark index.

8 5 1 1 2 0 0 7 9 4 . 0 71 0 . 3 7 3 2 2 .21038 0 .20803 6 .27955 9 .9 3 Source: secondary data 46 . 5 2 7 0 2 .5 3 13 1 5 4 . uV ea lRu pe R p ^O p . 34 90 .9 2 0 5 . 0 0 5 5 1 79 1 5 6 .7 7 T p 3 3 . uV e a lRume R m ^( 2R p . 5 2 2 1 2 0 0 6 6 5 .29976 3 . 0 68 .-17 59 . 70 5 .0 4 S p 0 .9 2 0 .62153 8 . 7 72 0 . 9 2 1 2 5 2 0 0 81 3 4 . VC al l. 5 9 2 9 .A RRmp ). 4 3 9 2 .3 0 A rm 3 0 . 19 7 .69103 6 . 7286 8 1 .5 ICICI PRUDENTIAL GROWTH FUND This part of the chapter provides the comparison of ICICI Prudential Growth with Market Indicators (S & P CNX Nifty) TABLE 4. 6 0 4 2 . 0 86 5 . 8 2 5 8 5 . 1 2 8 7 .38906 6 . 35 9 . 5 3 58 2 0 0 9 7 2 .AP R omd ()uR cmt . 15 19 .31926 6 . 56 40 . 18 15 .-1551 . 3 4 3 3 7 . 3 6 7 9 4 .8 6 S D r m4 3 .8 2 35 A rp 3 1 . 5 24 4 . 4 81 3 4 . 7 7 9 9 9 . 5 89 3 .4.53200 1 . 0 45 . 3 82 3 .7 4 2 9 2 .9 4 S D rp 4 0 . 35 65 . 8 8 9 8 . 4 5.24813 6 . 3 64 2 . 3 94 8 . 2 0 7 8 . 0 1 2 3 . 6 0 β r* 0 . 6 9 8 2 2 . 7625 3 5 . 5 8 7 6 1 .1 5 10 8 7 5 9 .3 Comparison of ICICI Prudential growth fund with market indicators (S & P CNX Nifty) NAV S & P C N X N IF T Y Y e a O p .A R m ) ^ 2 r 2 ( r 2 0 0 5 4 4 . 7212 7 5 . 0 -18 2 . 8 32 7 1 .5 1 2 4 5 . 3 1 6 7 .4 7 . VC al l. 8 41 2 . 8 2 0 1 5 .

The beta of the fund suggests that it is not so volatile when compared to the benchmark index. • • The average return of the fund is satisfactory The standard deviation of fund return is less than that of Bench mark return. 47 . • Sp and Tp measures suggests that the fund has performed satisfactory in relation to other funds and the market.FIGURE 4.3 Comparison of ICICI Prudential growth fund with market indicators (S & P CNX Nifty) • • The fund returns have always been at the similar level of the market returns.

7 1 1 .86 00 2 5 . 2 61 . 7 2 9 . 23 52 7 7 . 24 07 4 3 3 .32 50.30 35. VC al . 4 36 6 5 5 1. 1 94 5 .75 57 . 93 05 4 . VC al . 28 71 8 2.3 3 S D r p4 9 . 17 02 3 4 7 . 93 52 9 .9 9 0 .l uV ea R up e R p ^O2 p .20 06 . 58 80 4 9 . 5 9 8 . 9 9 β r* 0 .. 6 7 1 1 8 7 91 . 1 8 A rp 3 9 . 3. 6 14 2 7 0 2.66 12 .13 17 . 04 46 5 3. 7 74 6 9 7 .67 20.-94 0. 23 27 0 2.81 70. 32 59 5 .l uV ea Rl ume R m ^( 2 p . 0 80 9 6 .68 9 . 2 13 2 4 1 .6 HDFC EQUITY FUND This part of the chapter provides the comparison of HDFC Equity with Market Indicators (S & P CNX 500) TABLE 4. 6 17 1 3 3 .34 04 6 9 . 2 5 4 2 0 0 82 2 4 .4 Comparison of HDFC equity fund with market indicators (S & P CNX500) NAV S& P CN X 500 Y e a Or p . 8 0 2 0 0 71 4 7 .8 9 A rm 3 2 . 2 92 3 . 01 10 1 . 8 35 5 . 29 02 0 1 .(AR Rmp -) P rRo md( u cmt . 02 09 5 . 6 2 6 6 4 3. 0610 . 3395 .4. 2 37 8 7 7 . 92 64 9 6 5. 0 1 8 2 0 0 91 1 4 .8 0 T p 4 0 .A R m ) ^ 2 l R A R ) 2 0 0 56 6 .30005 4. 4 31 4 2 5 .4 9 .2 6 Source: secondary data 48 . 3521 . 8. 3 4 . 5 62 . 54 55 9 .5 .. 9 3 5 1 . 0 8 1 6 1 . 4 0 9 2 0 0 61 0 7 .78 29 . 9 0 5 9 . 7 2 2 1 9 9 . 16 76 2 2 7 . 52 59 9 5. 52 23 1 . 9 5 S D r m4 8 . 51 91 2 . 6 1 0 7 .0 4 S p 0 .

The overall performance is pretty good when compared to other mutual funds in the same class and family in the industry. 49 . The return on the fund has picked up after the instant fall in the year 2008. The fund volatility and risk factors are similar to benchmark index.4 Comparison of HDFC equity fund with market indicators (S & P CNX500) • • • • The fund returns are highly inconsistent during the last 5 years.FIGURE 4.

69 . 16 67 3 4 7 2 18 4. 6 2 2 31 7 8 2 0 0 92 2 .5 Comparison of JM equity fund with market indicators (Sensex) NAV SEN SEX Y e a Or p .A R m ) ^ 2 l V l V ( d c 2 0 0 51 8 .7 J M Mutual Fund Equity Growth This part of the chapter provides the comparison of JM Equity Growth with Market Indicators (Sensex) TABLE 4. 6. 8 1 4 42 .19 59 1 8 3 . 8 6 01 .26293 4 . 0 29 0 4 . 4 1 3 2 . 5 3 5 .0 4 S p 0 . 2 17 3 6 8 . l u eaRl um e R m ^ R2 p . 6 19 . 89 8 .69 . 9 88 8 . 01 37 2 95 6.(AR Rm p -)PA r Ro m( Ru) m t . 3 21 5 6 . 3 2 6 9.3 0 Source: secondary data 50 . 5 2 S D r m4 4 . 3 16 9 6 71 . VC a . 0 3 7 . 2 0 0 62 7 . 8 9 4 . 7 7 64 . 1 2 0 0 85 8 . 52 47 5 9 -. 13 38 6 02 . 1 4 3 . 5 7 3 5 72 . 8 12 7 4 9 2 24 2. 9 0 7 . 2 4 1 .98 . 6 12 9 0 2 9. 9 5 7 . 9 2 3 8 .95973 5 . 3 3 9 . 0 28 6 0 9 6. 97 21 1 8 2 1 07 1. 4 32 0 7 1 9. 24 77 -. 4 32 3 1 . 8 0 9 6 2 0 .9 7 r* 0 .13 35 4 1 1 .5 9 T p 2 7 . 3 9 7 4 91 3. . 6 18 9 3 . 7 5 A rp 2 6 . 9 0 5 4 28 . 5 1 1 6 1 .4 0 S D r p4 4 .4 7 A rm 3 2 .71221 3 . 1 -56 2 . 13 22 1 4 5 1 47 7. 38 89 2 27 0. 4 9 2 . 1 2 0 0 73 9 . 8 6 5 . 5 8 β 0 . l u ea Rl up e R p ^O2 p . 8 5 2 5 6 4 . 75 45 6 47 . VC a . 2 5 3 . 34 79 8 64 .0 4 .4. 2 7 21 . 97 35 2 5 . 6 0 4 . 5 2 .

The fund has performed badly in relation to the benchmark return. Overall the fund has not been up to mark when compared to other funds in the industry.5 Comparison of JM equity fund with market indicators (Sensex) • The average return of the fund is quite low as compared to the respective benchmark index.97 indicates that it is less volatile as compared to the benchmark index The standard deviation of fund return is very much similar to that of benchmark return.FIGURE 4. 51 . • • • The beta of 0.

89 06 6 .19 27 . 6 35 .l uV ea Rl ume R m ^( 2 p . 5 5 6 7 . 1 5 9 1 9 9 .9 7 0 .. 11 63 6 2. 2506 . 2 21 1 3 4 2. 79 55 9 . 0 0 1 6 7 . 68 03 6 3.5 8 A rm 3 0 . 0.6 Comparison of Kotak 30 Growth fund with market indicators (S&P CNX Nifty) NAV S & P C N X N IF T Y Y e a Or p . 5 54 7 . 52 05 5 0 6.34 90 .25 99 . 99 26 6 6. 76 29 5 4 . 15 95 8 7 . 4 18 8 9 0 2.99 1 8 . 1 45 2 4 4 3. 9 6 7 8 .4. 32 00 1 .9 4 Source: secondary data S D rp4 2 . VC al . 5 52 7 0 2 .38 15 . 5 94 6 . 99 56 3 5. 90 88 0 2. 21 53 8 .(AR Rmp -) A rRomd( u cmt . 4 3 6 8 . 17 40 2 9 2 . 3 44 3 . 5 18 3 3 5 . 7 27 9 9 9 . 8 12 5 8 5 . 8 5 2 0 0 76 8 .6 5 52 . 5 82 3 . 9 64 4 . 5 3 5 0 . 08 03 6 . 5 3 2 0 0 95 7 . 72 86 8 1 .8 KOTAK 30 GROWTH FUND This part of the chapter provides the comparison of Kotak 30 Growth with Market Indicators (S & P CNX Nifty) TABLE: 4. 6 82 4 2 .56 40 . 95 .0 4 S p 0 . 9 3 1 3 . 5 2 2 0 0 64 7 . 92 58 0 5 .l uV ea Rup e R p ^O2 p . VC al . 9 2 1 7 3 2 0 0 81 1 4 .7 8 T p 3 4 . 6 0 β r* 0 .35 65 . 18 48 8 5 7 . 2 36 3 . 8 8 8 7 .A R m ) ^ 2 l R P )R 2 0 0 53 2 . 3 17 3 2 2 . 6 2 2 9 . 6 0 1 5 4 . 8 3 5 2 . 8 2 A rp 3 3 . 6 36 8 .70 55 . 6 29 4 .78 2 .9 4 S D r m4 3 ..15 51 .18 54 . 5 4 0 3 6 2. 8645 .

53 . • The standard deviation of Fund return is similar to that of Benchmark return which means that the fund’s return has been similar to benchmark return.FIGURE 4.6 Comparison of Kotak 30 Growth fund with market indicators (S&P CNX Nifty) • The fund has performed better than the benchmark index from 2005 to 2008 however after the correction in the market. the fund has deteriorated. • The Beta of the scheme is 0. • The overall performance has been satisfactory for the fund during the last 5 years which is clear from its positive sharp’s & treynor’s measure.97 which shows that its volatility is similar to benchmark index.

2 9 5 0 .A PRrm d) u Rc m .84 . 8 4 2 7 . 7 2 6 6 .52 98 . 6 51 6 5 2 . V C l u V a l u em R m ^2R p . 2136 6 9 9 .2 7 β r* 1 . 0. 6 7 9 9 .8 4 4 0 . 4 0 . 5 6 2 1 . 7 37 4 .0 8 0 .e R ( m o ( t 2 0 0 5 1 1 2 . 4 98 7 4 1 . 8 41 4 3 1 . 9 2 2 9 . 2387 . 1 17 9 5 . 8 21 5 8 5 . 4 9 5 4 . 2. 9215 5 5 . 5460 .4.A( R p ) .9 8 . 6 6 7 5 9 . 0223 4 5 7 . 8 5 6 00 58 2 2 1 . 4 9 5 3 . V C l u V a l uR ep R p ^2O p . 0 4 7 1 . 5 3 2 1 . 1 3 A rp 4 4 . 4 4 1 2 1 2 2 . 7 9 5 2 . 6 4 5 49 2 0 0 8 4 7 6 . 8 0.3 2 . 3 59 3 . 7 66 8 1 .11 16 1 7 3 . 1 86 7 . 8 2 1 6 . 4738 5 9 . 6233 .7 1 54 . 0 8 6 9 58 2 0 0 6 1 9 0 . 4 7 5 4 .11 16 1 8 6 4 49 58 8 . 7813 .8 8 . 0. 4 8 2 6 . 6 0 9 8 1 . 7 43 9 .7 Comparison of Reliance Growth fund with market indicators (BSE 100) NAV B SE 100 Y e a rO p . 8 1 8 9 . 8360 . 8 07 0 2 2 .e a .2 5 Source secondary data S D rp 5 2 . 9 1 1 6 6 . 5 62 4 9 1 .7 RELIANCE MUTUAL GROWTH FUND This part of the chapter provides the comparison of Reliance Growth with Market Indicators (BSE 100) TABLE 4.2 0 A rm 3 3 .A R m ) ^2 a . 6 85 5 7 7 . 3 53 5 2 2 .5 5 . 4 1 7 8 2 0 0 9 2 2 0 .3 2 S D rm 4 7 . 3 9 7 . 4 7 6 4 . 6 24 5 7 2 . 4 3 0 7 0 . 3 5 9 3 . 5 9 1 0 7 . 5499 .1710 1 5 4 . 4 2 4 . 7 7 8 29 4 2 0 0 7 2 7 0 . 6 9 8 2 .0 4 Sp Tp 0 .

• The fund has performed better in providing better returns to the investors.FIGURE 4. the fund has always performed better than its benchmark index BSE 100. 55 .7 Comparison of Reliance Growth fund with market indicators (BSE 100)  Since the last 5 years. • The beta of the fund suggests that it is quite volatile and possess greater risks than the benchmark index • The standard deviation of fund return is quite erratic when compared to other funds in the industry.

6 6 39 2 0 0 7 6 9 . 6 5 0 . 0 7 .A R m ) ^ 2 ue 2 ue ( p m t 2 0 0 5 3 4 . 0 85 4 . 3 2 8 9 . 2 94 8 . V Ca ll. V Ca ll. 47 59 8 2 .4. 3 92 7 . 8 33 3 4 3 .4 9 A rm 3 2 .16 17 5 6 . 8 48 6 . 2 1 06 3 2 0 0 6 4 8 .5 3 β r* 0 . 7 6 . 6 11 9 1 5 . 2 0 4 2 . 7 4 . 5 2 . 72 79 8 2 . 3 67 6 3 1 . 07 7. 8 9 0 .22 68 5 6 . 1 34 0 . 2 81 5 4 2 .7 9 S D rm 4 8 . 3 91 1 7 . 0786 9 . 3 61 6 2 9 . 8 84 8 8 3 . 4 71 8 0 4 . 1 2.AP Rr o d )(uRcm . A rp 3 2 .8 SUNDARAM BNP PARIBAS GROWTH This part of the chapter provides the comparison of Sundaram BNP Paribas Growth with Market Indicators (BSE 200) TABLE 4. 5 6 1 1 0 9 1 11157 7 7 . 3 84 0 6 9 . 8 6 9 . 3 7 1 6 3 .12 67 5 5 . -094 0 . 3 4 87 35 1 6 2 . -5 596 . 7 4 . 2 3 .10 19 8 8 . 4 93 6 5 8 . 41 66 2 2 6 .11 15 6 3 . 9 8 6 .u Ve a l R m R m ^2R p . 5 3 6 5 .4 6 56 .26 17 8 0 . 8 5 0 .0 4 Sp Tp 0 . 4 2 4 2 0 0 9 5 1 . 4 3 8 60 37 2 0 0 8 1 1 8 .A( RR m ).8 Comparison of Sundaram BNP Paribas Growth fund with market indicators (BSE 200) NAV BSE 200 Y e a rO p . 99 7. 71 57 1 3 9 . 2 5 .28 61 6 4 .6 9 3 4 . 4 6 3 .5 7 .7 5 Source: secondary data S D rp 4 6 . 6 30 2 0 3 . 4181 8 6 . 8 7 0 . 5 74 5 6 6 . 7 41 0 3 7 .9 4 0 . 1 76 8 . 8 76 7 .17 68 5 5 .u Ve a l R p R p ^ O p . 6 34 2 . 2 11 1 0 3 .

57 . • The fund has performed fairly during the five years taken together but it seems that it has lost some sense after the corrections in the market in 2009.8 Comparison of Sundaram BNP Paribas Growth fund with market indicators (BSE 200) • The return of the fund was similar to benchmark index from 2005 to 2008 however it has lagged behind in the year 2009 in terms of return on investment.FIGURE 4. • The beta of the fund and its standard deviation indicates that its volatility and deviation in returns were similar to the benchmark index.

VC a .7 8 T p 3 5 . 4 6 1 6 1 . 89 3 . 24 7 -.(AR Rm p . 9 12 1 8 . 3 1 S D r m4 4 . 5 -14 9 . 3. 9 6 21 . 7 1 6 9 . 9 0 5 77 .1 6 58 . 1 1 4 . 8 12 7 4 9 . 8 1 0 5 42 2 0 0 76 2 . 4 10 9 3 . 5 9 9 . 2 17 9 1 3 .76231 3 . 75 45 6 47 .9 Comparison of Tata Pure equity growth fund with market indicators (Sensex. 07 36 2 95 6.69 . 34 79 8 64 .69 . l u ea Rl up e R p ^O2 p . 4 7 4 . 3 9 7 4 91 3. 97 30 8 1 .8 7 A rm 3 2 . 5 7 3 9 72 .) NAV SEN SEX Y e a Or p .9 6 r* 0 .20213 4 .91933 5 . 4 3 8 7 . 6 4 2 .9 TATA PURE EQUITY GROWTH This part of the chapter provides the comparison of TATA Pure Equity Growth with Market Indicators (Sensex) TABLE: 4. l u eaRl um e R m ^ R2 p . 8 0 9 5 6 0 . 7 8 69.98 .4 0 Source: secondary data S D r p4 3 . 52 4 5 9 -. VC la . 5 21 . 13 22 1 4 5 . 5 8 β 0 . 3 8 9 .8 4 . 2 9 9 . 52 14 5 02 . 4 4 7 .)PA r Ro m( Ru) m t . 9 39 4 8 01 . 3 18 7 9 5 9. 31 85 2270. 1 16 8 6 2 6.4. 5 26 0 4 .A R m ) ^ 2 l V V ( d c 2 0 0 53 0 . 2 4 3 . 7 5 A rp 3 3 .92. 4 5 8 . 1 4 3 . 8 1 01 .0 4 S p 0 . 3 6 1 . 05 30 . 2 8 64 .19 59 1 8 3 .84. 3 31 5 9 . 3 54 5 2 6 9. 8 5 9 2 62 4 . 75 0 1 3 . 97 21 1 8 2 2 05 1.13 57 1 1 6 . 6 2 3 7 7 2 0 0 95 1 . 16 67 3 4 7 4 10 4. 2 2 0 0 81 0 0 . 2 0 0 64 3 . 5 38 8 .

Overall the fund has performed quite satisfactory and has been a good investment for investors who do not require risky instruments. • • • The difference in the fund return and benchmark return is negligible. There is not much volatility in the fund when compared to benchmark index.) • The fund has always performed in tune with the benchmark returns during the last 5 years.9 Comparison of Tata Pure equity growth fund with market indicators (Sensex. 59 .FIGURE 4.

8 6 1 3 . 9 21 2 3 .97 49 2 2 . 2141 7 9 4 . 487. 6 2 5 1 64 3 2 0 0 9 6 0 .u Ve a l R m R m ^2R p . 5 11 4 0 6 . 7 0. 7 5 8 4 .94 39 9 7 . 8 1 2 0 0 7 7 3 . 5 24 7 5 9 . 3 14 1 1 . 7 12 1 8 2 .14397 8 6 . 12 47 . 3 83 2 9 2 . 8 0 8 4 6 7 . 7 31 4 . 3 22 1 4 5 . V Ca l . 6 65 6 .4969. 3 41 9 3 .A( R m ).6 5 A rm 3 2 . 2 01 6 1 5 .4 8 . 4949 3 5 . 3 97 2 . 3 51 2 . V Ca l .8 5 0 . 4 94 0 . 5 5 9 . 5 89 4 .15754 6 4 .97 76 2 0 . 02 18 . 91 95 1 8 3 .0 4 Sp Tp 0 . 94 31 . 5 7 1 4 3 . 21 21 . 8 5 2 0 0 6 5 2 . 8 78 8 .5 8 β r* 0 . 0 4 9 . 0 21 1 4 . 2 63 1 6 4 . 6 76 3 4 7 . 9 6 5 1 8 .10 Comparison of HSBC equity fund with market indicators (Sensex) NAV SEN SEX Y e a rO p . 2 7 7 .2 2 S D rm 4 4 .A R m ) ^ 2 Rp O ue ( p o t 2 0 0 5 3 7 .7 3 3 3 .4 0 Source: secondary data S D rp 3 9 . 9 77 6 .16348 2 72.7891.10 HSBC EQUITY FUND This part of the chapter provides the comparison of HSBC Equity with Market Indicators (Sensex) TABLE: 4.4. 1202 3 4 . 4 45 2 .u Ve a l u e R p ^2 p . 8 21 7 4 9 . 1 2 3 1 4 . 8732 1 3 . 2 71 3 0 5 . 1 3 1 6 1 . 9 2 7 . 6 14 7 . 7 5 A rp 2 8 . 9 0 5 2 0 0 8 1 1 5 . 0 43 7 .AP Rr m d) (uRc m .20093 2 59.68 65 2 6 . 4 3 1 0 8 .4961. 3 12 0 4 .07 27 8 6 .5 7 60 .

• The fund has performed quite poorly when compared to its benchmark and other similar funds in the industry. 61 . ignoring its return.10 Comparison of HSBC equity fund with market indicators (Sensex) • The fund return has been consistent during the last 5 years however many of the times. • The volatility of the fund is quite low which means that the fund has been managed improperly to reduce the risk factor.FIGURE 4. it has dipped below the benchmark returns.

7 3 3 9 . 7 11 . 6 50 . fu7n 4 0 . 9 54 0 . 9 30 . r5o9 w4 t4h. 9 6 5 70 4 5 4 5 2 1 0 H S B C e q u it y f u n d 2 8 . 4r 70 . 4a 90 .h7 93 4 . 6 50 . 3 24 0 . 8 5 9 8 2 8 2 7 4. 2 23 3 .g4r 73 w .it4y70g. 2 10 2 9 3 s w 8 S u n d a r a m B N P P a3 r2ib. 9 43 4 .Table: 4.g6r 9o 4 6 t.d5 80 . 5 70 . 9 7 1 0 1 0 6 2u 10 7 10 6 K o t a k 3 0 g r o w t h f3u 3n . 1 60 . 0 9 4 7 8 9 10 9 r .n7it5ie4s7 . 8 63 3 . 1 2 y3 6 . t2h00f u8n4d 5 2 . 0 8 1 4 . 7 8 4 2 . 9 7 6 5 4 5 6 4 7 R e lia n c e m u t u a l g r o4 w . M u t u a l F u n d sA r p S h a r pS D T r e y n Bo er t a N A V S h a r pS D R p r e y n B er t aO v e r a l l T o 1 B ir la S u n life F r o n t ilin e.h7 8 4 3 . 8 0 4 9 . 5 22 7 .11 Overall Ranking of 10 Mutual Funds O V E R A LL R A N K S l . 9 65 4 . 7 6 2 4 1 41 u it 1 1 1 1 1 tu o2 2 D S P B la c k r o c k o p3 p5 o. 9 4 7 9 7 6 4 8 9 T A T A p u r e e q u it y 3g3r . 9 2 8 6 3 7 3 6 4 H D F C E q u it y f u n d 3 9 . 3 13 5 . 4 60 . 8 90 . h 7 d 3 I C I C I P r u d e n t ia l g 3 o1 w3 t00 . N o . 9 9 3 3 9 3 8 4 5 J M M u t u a l f u n d e q 6 . t6h 11 . 3 00 .o8 w t. 4 E q. 2 60 .12 Top 5 Mutual Funds Ran k 1 NAV Sharp SD Treynor Beta Overall Reliance mutual growth fund Birla Sunlife Frontiline Equity HDFC Equity fund DSP Blackrock opportunities growth TATA pure equity growth 2 3 Birla Sunlife Frontiline Equity Reliance mutual growth fund HDFC Equity fund TATA pure equity growth Kotak 30 growth Birla Sunlife Frontiline Equity HSBC equity fund ICICI Prudential growth fund Kotak 30 growth fund TATA pure equity Birla Sunlife Frontiline Equity Reliance mutual growth fund HDFC Equity fund TATA pure equity growth Kotak 30 growth Birla Sunlife Frontiline Equity HSBC equity fund ICICI Prudential growth fund Sundaram BNP Paribas growth TATA pure equity Birla Sunlife Frontiline Equity TATA pure equity growth Reliance mutual growth fund HDFC Equity fund Kotak 30 growth 62 4 5 . 4 70 .

63 . Birla Sunlife Frontline Equity Fund & Reliance Mutual Growth Fund has outperformed in the industry during the last 5 years in terms of average return on funds.  None of the fund has performed poorly as per various measures of performance of mutual fund.20% per year.1 FINDINGS  All funds had a steep decline in their returns in the year 2008 as markets in india tanked due to recessionary pressures in the American markets. Sundaram BNP Paribas Growth fund & HSBC equity fund. However.fund growth fund growth fund 5.  Birla Sunlife Frontline Equity Fund has managed its portfolio in the best possible manager and thus can easily be regarded as the overall best performed mutual fund.  Overall performance comparison of the mutual fund after taking into consideration the risk and return involved will put Birla Sunlife Fronline Equity fund at the top due to its efficient management of its fund.  The analysis of 10 Equity Diversified Mutual funds based on NAV returns for a period of 5 years ranked Reliance Equity fund as the top performer with an average rate of return of 44.  All Equity schemes have shown better returns than their respective benchmark index except JM Equity Mutual fund.  The beta of the funds suggest that they are no highly volatile funds when it is compared to their respective benchmark indices.

 To induce investments into mutual funds.  The risk management systems and the benchmarking of indices may be improved by AMFI (Association of Mutual Funds in India) to give the investors more guidelines and tools to take a good investment decision. the government may provide tax benefits to attract investment into mutual funds.2 RECOMMENDATIONS  The Mutual Fund Asset Management companies can educate and give awareness about the concept of Mutual Funds to the investors. it should highlight the benefits of mutual fund over other investment and attract more number of customers  The Mutual Fund Asset Management companies can come up with more advertisements and promotional measures and it should also target the FII’s and individual investors who invest in the capital markets.5. As majority of the investors do not know about this type of investment. 64 .  The fund distributors should clearly state the objective of each fund floated by the Asset Management Companies to help the investors choose the right investment plan.

Mutual fund is the one of the best available investment option available to individual future growing requirements and needs.5. 65 . Each of us also need to invest one’s savings intelligently in order to have enough money available for funding the higher education of one s children.a chance to put their hard earned money in the best and diversifies investment plans effectively and efficiently managed by market professionals. It is quite clear from the analysis that such type of investment give small investors of invested sum as low as `3000/. The study recommends new investors to go for equity schemes due to their high return and managed risk by professionals.3 CONCLUSION Saving money is not enough. HDFC Equity fund. From the analysis of equity schemes with their respective benchmark index it is known that Reliance Growth is the best scheme with high NAV returns followed by Birla Sunlife Frontiline Equity. This study will guide the new investor who wants to invest in equity-diversified schemes by providing knowledge about how to measure the risk and return of particular mutual fund scheme. Such type of analysis by the mutual fund regulators and various investor assisting agency can not only enhance the customer confidence in mutual funds but can also help them understand the various advantages and disadvantages of investing their money in the mutual funds. Thus. DSP Blackrock opportunities growth & TATA pure equity growth. for buying a house and many other future dreams. The biggest advantage of the Mutual Fund is its various diversified investment plan and transparency in the operation of the Asset management Company.

com www. – “Mutual Fund Industry in India”.com www.   JOURNALS  Value Research.com www.nseindia.indiainfoline.mutualfundsindia.BIBLIOGRAPHY BOOKS  Fischer & Jordan “Securities Analysis & Portfolio Management” Prasanna Chandra. WEBSITES       www.com www.com www..bseindia. The ICFAI Journal of Applied Finance.com 66 .valueresearchonline.“Financial management: Theory and Practice” Chakrabarthi A. Feb 2008.amfiindia. Rungta H.

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