1

INTRODUCTION
An investment is a sacrifice of current money or other resources for future
benefits. Numerous avenues of investments are available today. The two key aspects
of any investment are time and risk. Mutual funds also offer good investment
opportunities to the investors. Like all investments, they also carry certain risks. The
investors should compare the risks and expected yields after adjustment of tax on
various instruments while taking investment decisions. The investors may seek
advice from experts and consultants including agents and distributors of mutual
funds schemes while making investment decisions.
There are a lot of investment avenues available today in the financial
market for an investor with an investable surplus. He can invest in Bank Deposits,
Corporate Debentures, and Bonds where there is low risk but low return. He may
invest in Stock of companies where the risk is high and the returns are also
proportionately high. The recent trends in the Stock Market have shown that an
average retail investor always lost with periodic bearish tends
Mutual Funds are dynamic financial institution, which play a
crucial role in an economy by mobilizing savings and investing in the capital
markets. Therefore the activities of mutual funds have both short and long term
impact on the savings and capital market and national economy. Mutual funds
provide households an option for portfolio diversification and relative risk aversion
through collection of funds from the households and makes investment in the stock
and debt market.
CONCEPT OF MUTUAL FUND:
Mutual fund is a mechanism for pooling the resources by issuing units to the
investors and investing funds in securities in accordance with objectives as
disclosed in offer document. Investments in securities are spread across a wide
cross-section of industries and sectors and thus the risk is reduced. Diversification
reduces the risk because all stocks may not move in the same direction in the same
proportion at the same time. Mutual fund issues units to the investors in accordance
with quantum of money invested by them. Investors of mutual funds are known as
unit holders. The profits or losses are shared by the investors in proportion to their
investments. The mutual funds normally come out with a number of schemes with
different investment objectives, which are launched from time to time. A mutual
fund is required to be registered with Securities and Exchange Board of India
(SEBI) which regulates securities markets before it can collect funds from the
public.
The mutual fund collects money directly or through brokers
from investors. The money is invested in various instruments depending on the
objective of the scheme. The income generated by selling securities or capital
appreciation of these securities is passed on to the investors in proportion to their
2

investment in the scheme. The investments are divided into units and the value of
the units will be reflected in Net Asset Value or NAV of the unit. NAV 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. Mutual fund companies provide daily net asset value of their
schemes to their investors. NAV is important, as it will determine the price at which
you buy or redeem the units of a scheme. Depending on the load structure of the
scheme, you have to pay entry or exit load.
NET ASSET VALUE (NAV):
Since each owner is a part owner of a mutual fund, it is necessary to establish the
value of his part. In other words, each share or unit that an investor holds needs to
be assigned a value. Since the units held by investor evidence the ownership of the
funds assets, the value of the total assets of the fund when divided by the total
number of units issued by the mutual fund gives us the value of one unit. This is
generally called the Net Asset Value (NAV) of one unit or one share. The value of
an investors part ownership is thus determined by the NAV of the number of units
held.
STRUCTURE OF A MUTUAL FUND:
The Mutual Funds in India are regulated by SEBI MF Regulations, 1996.
Under the regulations mutual fund is formed as a Public Trust under the Indian
Trusts Act, 1882. These regulations stipulate a three tiered structure of entities
sponsor (creation), trustees, and Asset Management Company (fund management)
for carrying out different functions of a mutual fund, but place the primary
responsibility on the trustees.
The Fund Sponsor SEBI regulations define Sponsor as any person who either
itself or in association with another body corporate establishes a mutual fund.
Sponsor sets up a mutual fund to earn money by doing fund management through
its subsidiary company which acts as Investment manager of the fund. Largely, a
sponsor can be compared with a promoter of a company. Sponsors activities
include setting up a Public Trust under Indian Trust Act, 1882 (the mutual fund),
appointing trustees to manage the trust with the approval of SEBI, creating an
Asset Management Company under Companies Act, 1956 (the Investment
Manager) and getting the trust registered with SEBI.The sponsor also appoints the
Asset Management Company as fund managers. The sponsor either directly or
acting through the trustees will also appoint a custodian to hold funds assets. All
these are made in accordance with the regulation and guidelines of SEBI. As per
the SEBI regulations, for the person to qualify as a sponsor, he must contribute at
least 40% of the net worth of the Asset Management Company and possesses a
sound financial track record over 5 years prior to registration.

3

ADVANTAGES OF MUTUAL FUNDS:
If mutual funds are emerging as the favorite investment vehicle, it is because of
the many advantages they have over other forms and the avenues of investing,
particularly for the investor who has limited resources available in terms of capital
and the ability to carry out detailed research and market monitoring. The
following are the major advantages offered by mutual funds to all investors:
Portfolio Diversification:
Each investor in the fund is a part owner of all the funds assets, thus enabling him
to hold a diversified investment portfolio even with a small amount of investment
that would otherwise require big capital.
Professional Management:
Even if an investor has a big amount of capital available to him, he benefits from
the professional management skills brought in by the fund in the management of
the investors portfolio. The investment management skills, along with the needed
research into available investment options, ensure a much better return than what
an investor can manage on his own. Few investors have the skill and resources of
their own to succeed in todays fast moving, global and sophisticated markets.
Reduction/Diversification Of Risk:
When an investor invests directly, all the risk of potential loss is his own, whether
he places a deposit with a company or a bank, or he buys a share or debenture on
his own or in any other from. While investing in the pool of funds with investors,
the potential losses are also shared with other investors. The risk reduction is one
of the most important benefits of a collective investment vehicle like the mutual
fund.
Reduction Of Transaction Costs:
What is true of risk as also true of the transaction costs. The investor bears all the
costs of investing such as brokerage or custody of securities. When going through
a fund, he has the benefit of economies of scale; the funds pay lesser costs because
of larger volumes, a benefit passed on to its investors.
Liquidity:
Often, investors hold shares or bonds they cannot directly, easily and quickly sell.
When they invest in the units of a fund, they can generally cash their investments
any time, by selling their units to the fund if open-ended, or selling them in the
market if the fund is close-end. Liquidity of investment is clearly a big benefit.
Convenience And Flexibility:
Mutual fund management companies offer many investor services that a direct
market investor cannot get. Investors can easily transfer their holding from one
scheme to the other; get updated market information and so on.
Tax Benefits:
Any income distributed after March 31, 2002 will be subject to tax in the
assessment of all Unit holders. However, as a measure of concession to Unit
holders of open-ended equity-oriented funds, income distributions for the year
4

ending March 31, 2003, will be taxed at a concessional rate of 10.5%. In case of
Individuals and Hindu Undivided Families a deduction up to Rs. 9,000 from the
Total Income will be admissible in respect of income from investments specified
in Section 80L,including income from Units of the Mutual Fund. Units of the
schemes are not subject to Wealth-Tax and Gift-Tax.
Choice of Schemes:
Mutual Funds offer a family of schemes to suit your varying needs over a lifetime.
Well Regulated:
All Mutual Funds are registered with SEBI and they function within the
provisions of strict regulations designed to protect the interests of investors. The
operations of Mutual Funds are regularly monitored by SEBI.
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 managers investment strategy and
outlook
















5

REVIEW OF LITERATURE

Treynor (1965) and Sharpe (1966) have provided the conceptual framework of
relative measure of performance of equity mutual funds while Treynor used
systematic risk. Sharpe used total risk to evaluate the mutual fund portfolio
performance higher value of Treynor's index indicates better performance of
portfolio and vice versa.
Gupta LC (1981) presented a detailed and well-based estimate of "Portfolio"
rate of return on equities. This pioneering study in the Indian context has been a
major contribution in this field and is regarded as the benchmark on the rate of
return on equities for the specified time. He laid the basis of rate of return
concept in performanceevaluation.
Jain (1982) evaluated performance of unit trust of India (UTI) during 1964-65 to
1979-80, including the profitability aspects of unit scheme 1964, unit scheme
1971 and unit scheme 1976. He concluded that its real rate of return have been
low indicating overall poor, performance of UTI Schemes. There has been so
significant increase in the profitability over the years.
Henriksson (1984) evaluated performance in terms of market timing abilities
with sample of 116 open ended investment schemes during the period, February
1968, June 1980. The empirical results obtained indicate unsatisfactory timing
skills of the fund managers.
Holthausen (1992) have developed a model based on 60 financial ratios that
predicts return over 12 months period. The study was found particularly useful
predictor of stock prices and can be useful in fundamental analysis while taking
equity investment decisions.
Daniel (1997) has concluded that the 'persistence in mutual funds Results show
that particularly aggressive growth funds exhibit some "selectivity" ability but no
"timing ability.
The Research on Performance Evaluation of Indian Mutual Funds was done by
Dr. S Narayan Rao in IITB (2002). The Study is conducted to understand
whether most of the mutual fund schemes were able to satisfy investors
expectations by giving excess returns over expected returns.
The research Mutual Fund Portfolio Creation Using Industry Concentration is
done by Mohit Gupta; Navdeep Agarwal in ICFAI University (2009) .There
is very little research on the construction of mutual fund portfolio. The present
study seeks to fill this gap. The objective of the research is to construct the
portfolio using uses the cluster method, taking industry concentration as a
6

variable and to compare the performance of two types of portfolios with selected
benchmarks.
Dr. B. Nimalathasan, Mr. R. Kumar Ghandhi (2012) studied the financial
performance analysis of mutual fund schemes (equity diversified schemes and
equity mid-cap schemes) of selected banks. The objective of this research work is
to analysis the financial performance of selected mutual fund schemes through
the statistical parameters (Standard Deviation, Beta and Alpha) and ratio
analysis.

1.2 OBJECTIVES OF THE STUDY

To know practical knowledge about the working of Mutual Fund Scheme.
To calculate the return of the different SBI mutual fund schemes.
To identify the risk involved in the different scheme.
Evaluate the performance of schemes of SBI Mutual funds by applying the
different performance measures viz, Sharpe Model, Treynors Model,
Jensens Alpha and Information Ratio.
To gain the practical knowledge about the performance measures.

1.3 SCOPE OF THE STUDY
This study is mainly focusing on comparative analyzing the different mutual
funds schemes of State Bank of India. So this study is confined with SBI
products especially equity funds only.
1.4 RESEARCH METHODOLOGY
DATA COLLECTION:
NAV of mutual fund scheme collected from official website of SBI
Mutual Fund.
Risk free rate is ascertained by using the 91 days Treasury bill rate.
Risk free rate is collected from the RBI website.
Benchmark return of each scheme is collected from the BSE, NSE &
Yahoo finance .com

NATURE OF DATA
Data are collected are secondary in nature. It is collected from the website.
PROCEDURE OF STUDY
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Calculation of daily return for ten previous years for each mutual fund
scheme and the market (i.e. Index) by using the historical NAV by the
following formula.

Return (R) =(P1-P0)/P0
P1= todays NAV
P0= Yesterdays NAV
Mean return for each scheme is computed by using the AVERAGE
function in the MS Excel for 10 years.
Calculation of standard deviation for each scheme using STDVP function
in MS Excel for 10 years.
Beta for the each scheme is calculated by using SLOPE function in the MS
Excel.
.
TOOLS USED
Mainly four evaluation measures have been used for the study. The following
part will help to have a clear-cut idea about these measures.

Sharpe ratio
A ratio developed by Nobel laureate William F. Sharpe to measure risk-
adjusted performance. The Sharpe ratio is calculated by subtracting the risk-free
rate - such as that of the 10-year U.S. Treasury bond - from the rate of return for a
portfolio and dividing the result by the standard deviation of the portfolio returns.
The Sharpe ratio tells us whether a portfolio's returns are due to smart
investment decisions or a result of excess risk. This measurement is very useful
because although one portfolio or fund can reap higher returns than its peers, it is
only a good investment if those higher returns do not come with too much
additional risk. The greater a portfolio's Sharpe ratio, the better its risk-adjusted
performance has been. A negative Sharpe ratio indicates that a risk-less asset
would perform better than the security being analyzed.
The Sharpe ratio (also known as the Sharpe index, the Sharpe measure, and the
reward-to-variability ratio) measures the excess return (or risk premium) per unit of
deviation in an investment asset or a trading strategy, typically referred to as risk
(and is a deviation risk measure), named after William Forsyth Sharpe.
Sharpe Index (Sp) = (Ri-Rf) / i
Ri = Return of the mutual fund
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Rf = Return on risk free assets
i = Standard Deviation of return of mutual funds

Treynor ratio
The Treynor ratio (sometimes called the reward-to-volatility ratio or Treynor
measure), named after Jack L. Treynor, is a measurement of the returns earned in
excess of that which could have been earned on an investment that has no
diversifiable risk (e.g., Treasury Bills or a completely diversified portfolio), per
each unit of market risk assumed. The Treynor ratio relates excess return over the
risk-free rate to the additional risk taken; however, systematic risk is used instead of
total risk. The higher the Treynor ratio is the better the performance of the portfolio
under analysis.

Treynor Ratio (Tp) = (Ri-Rf)/i
Ri = Return of the mutual fund
Rf = Return on risk free assets
i = Systematic or market risk of the Mutual Funds

Jensen's alpha
In finance, Jensen's alpha (or Jensen's Performance Index, ex-post alpha) is
used to determine the abnormal return of a security or portfolio of securities over
the theoretical expected return.
The security could be any asset, such as stocks, bonds, or derivatives. The
theoretical return is predicted by a market model, most commonly the Capital
Asset Pricing Model (CAPM) model. The market model uses statistical methods to
predict the appropriate risk-adjusted return of an asset. The CAPM for instance
uses beta as a multiplier. Jensens alpha was first used as a measure in the
evaluation of mutual fund managers by Michael Jensen in 1968.
In the context of CAPM, calculating alpha requires the following inputs:
Jensen's alpha = Ri [Rf + i * (Rm Rf)]
Ri = the realized return (on Mutual fund),
Rm = the market return (i.e. Index),
Rf = the risk-free rate of return, and
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i = the beta of the mutual fund returns in
relation to the Market.
Information Ratio
The Information Ratio is a risk-reward benchmark that is often used to
quantify the performance of an investment (and specifically the effectiveness of a
fund manager). Its equal to the average excess return divided by the standard
deviation of the excess returns (relative to a benchmark).
IR = (Ri-Rb)/(Ri-Rb)
Ri = Return of fund
Rb = bench mark return
A higher Information Ratio is better (indicating better stock picking by the fund
manager), with a value of 0.5 indicating upper quartile performance. Negative
Information Ratios can be misleading and should not be used to rank investments.
The Information Ratio is often used to distinguish between several funds with the
same management style. For funds with similar values of Jensens Alpha, a
higher Information Ratio indicates a better managed fund with superior stock
picking. However, this is only valid if the fund and its benchmark are strongly
correlated.
LIMITATIONS OF THE STUDY
The degree of reliability will be less because of data is in secondary
nature.
The findings of the data confined to the period for which the data have
been taken
This study only deals with SBI mutual fund and its equity scheme only.








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CHAPTER II
INDUSTRY PROFILE















11

2.1 Industry profile
Mutual Funds have become a widely popular and effective way for investors to
participate in financial markets in an easy, low-cost fashion, while muting risk
characteristics by spreading the investment across different types of securities, also
known as diversification. It can play a central role in an individual's investment
strategy. They offer the potential for capital growth and income through investment
performance, dividends and distributions under the guidance of a portfolio manager
who makes investment decisions on behalf of mutual fund unit holders. Over the
past decade, mutual funds have increasingly become the investors vehicle of choice
for long-term investment. It becomes pertinent to study the performance of the
mutual fund. The relation between risk-return determines the performance of a
mutual fund scheme. As risk is commensurate with return, therefore, providing
maximum return on the investment made within the acceptable associated risk level
helps in segregating the better performers from the laggards. Many asset
management companies are working in India, so it is necessary to study the
performance of it which may be useful for the investors to select the right mutual
fund.
In 1963, the day the concept of Mutual Fund took birth in India. 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 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 were
accustomed with guaranteed high returns by the beginning 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.

2.2 HISTORY OF MUTUAL FUNDS IN INDIA
First Phase: 1963-87 Initial Development phase (Unit Trust of India)
In 1963, UTI was established by an Act of Parliament and given a
monopoly. UTI commenced its operations from July 1964 .The impetus for
establishing a formal institution came from the desire to increase the propensity of
the middle and lower groups to save and to invest. UTI came into existence during a
period marked by great political and economic uncertainty in India. The first and still
one of the largest schemes, launched by UTI was Unit Scheme 1964. UTI created a
number of products such as monthly income plans, childrens plans, equity-
oriented schemes and offshore funds during this period. The total asset under
management for the year 1987-88 was 6,700 crores.
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Second Phase: 1987-93 (Entry of Public Sector Funds)
Second phase witnessed the entry of mutual funds sponsored
by state owned banks and financial institutions. With the opening up of the
economy, many public sector and financial institutions were allowed to establish
mutual funds. In November 1987 the State Bank of India established the first non-
UTI mutual fund-SBI Mutual Fund. This was followed by Canbank Mutual Fund
(launched in December, 1987), LIC Mutual Fund (1989), and Indian Bank Mutual
Fund (1990) followed by Bank of India Mutual Fund, GIC Mutual Fund and PNB
Mutual Fund. These mutual funds helped enlarge the investor community and the
invest able funds. During this period, investors were shifting away from bank
deposits to mutual funds. Most funds were growth-oriented closed-ended funds.
From 1987 to 1992-93, the fund industry expanded nearly seven times in terms of
Assets under Management.

Third Phase: 1993-96 (Emergence of Private Funds)
A new era in the mutual fund industry began with the
permission granted for the entry of private sector funds in 1993, both Indian and
Foreign. Also Government launched a series of measures aimed at the financial
sector as a part of the economic liberalization and reform process. This included
the setting up of the Securities and Exchange Board of India (SEBI) as a regulatory
body for the financial sector including Mutual Funds, which issued the SEBI
Mutual Fund Regulations in January 1993. During the year 1993-94, five private
sector mutual funds launched their schemes followed by six others in1994-95.
Fourth Phase: 1996-1999 (SEBI Regulations for Mutual Funds)
More investor friendly regulatory measures have been
taken both by SEBI to protect the investor and by the Government to enhance
investors returns. A comprehensive set of regulations for all mutual funds
operating in India was introduced with SEBI (Mutual Fund), 1996. These
regulations set uniform standards for all funds and will eventually be applied in full
to Unit Trust of India as well, even though UTI is governed by its own
UTI Act. In 1999 Union Government Budget took a big
step in exempting all mutual funds dividends from income tax in the hands of
investors. 1999 marks the beginning of a new phase in the history of the mutual
fund industry in India, a phase of significant growth in terms of both amounts
mobilized from investors and assets under management.
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FIFTH POSITION 1999-2002
This phase was marked by very rapid growth in the industry, and significant
increase in market shares of private sector players. Assets crossed Rs. 1,00,000.
The tax break offered to mutual funds in 1999 created arbitrage opportunities for a
number of institutional players. Bond funds and liquid funds registered the highest
growth in thisperiod, accounting for nearly 60% of the assets. UTIs share of the
industry dropped to nearly 50%

2.3 DIFFERENT TYPES OF MUTUAL FUND SCHEMES
A).BY STRUCTURE
1. Open - Ended Schemes:
An open-end fund is one that is available for subscription all through the year.
These do not have a fixed maturity. Investors can conveniently buy and sell units at
Net Asset Value("NAV") related prices. The key feature of open-end schemes is
liquidity.
2. Close - Ended Schemes:
A closed-end fund has a stipulated maturity period which generally ranging from
3 to 15years. The fund is open for subscription only during a specified period.
Investors can invest inthe scheme at the time of the initial public issue and
thereafter they can buy or sell the units ofthe scheme on the stock exchanges where
they are listed. In order to provide an exit route to theinvestors, some close-ended
funds give an option of selling back the units to the Mutual Fundthrough periodic
repurchase at NAV related prices. SEBI Regulations stipulate that at least oneof the
two exit routes is provided to the investor.
3.Interval Schemes:
Interval Schemes are that scheme, which combines the features of open-ended and
close-ended schemes. The units may be traded on the stock exchange or may be
open for sale or redemption during pre-determined intervals at NAV related prices.

B).BY NATURE
1. Equity Fund:
These funds invest a maximum part of their corpus into equities holdings. The
structure of the fund may vary different for different schemes and the fund
managers outlook on different stocks. The Equity Funds are sub-classified
depending upon their investment objective, as follows: Diversified Equity Funds
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Mid-Cap Funds Sector Specific Funds Tax Savings Funds (ELSS) Equity
investments are meant for a longer time horizon, thus Equity funds rank high on
the risk-return matrix.
2. Debt Funds:
The objective of these Funds is to invest in debt papers. Government authorities,
private companies, banks and financial institutions are some of the major issuers of
debt papers. By investing in debt instruments, these funds ensure low risk and
provide stable income to the investors. Debt funds are further classified as:
Gilt Funds: Invest their corpus in securities issued by Government,
popularly known as Government of India debt papers. These Funds carry zero
Default risk but are associated with Interest Rate risk. These schemes are safer as
they invest in papers backed by Government.
Income Funds: Invest a major portion into various debt instruments such
as bonds, corporate debentures and Government securities.
MIPs: Invests maximum of their total corpus in debt instruments while
they take minimum exposure in equities. It gets benefit of both equity and debt
market. These scheme ranks slightly high on the risk-return matrix when compared
with other debt schemes.
Short Term Plans (STPs): Meant for investment horizon for three to six
months. These funds primarily invest in short term papers like Certificate of
Deposits (CDs) and Commercial Papers (CPs). Some portion of the corpus is also
invested in corporate debentures.
Liquid Funds: Also known as Money Market Schemes, These funds
provides easy liquidity and preservation of capital. These schemes invest in short-
term instruments like Treasury Bills, inter-bank call money market, CPs and CDs.
These funds are meant for short-term cash management of corporate houses and are
meant for an investment horizon of 1day to 3 months. These schemes rank low on
risk-return matrix and are considered to be the safest amongst all categories of
mutual funds.


3. Balanced Funds:
As the name suggest they, are a mix of both equity and debt funds. They invest in
both equities and fixed income securities, which are in line with pre-defined
investment objective of the scheme. These schemes aim to provide investors with
the best of both the worlds. Equity part provides growth and the debt part provides
stability in returns. Further the mutual funds can be broadly classified on the basis
of investment parameter viz, Each category of funds is backed by an investment
philosophy, which is pre-defined in the objectives of the fund. The investor can
align his own investment needs with the funds objective and invest accordingly.
15

C).BY INVESTMENT OBJECTIVE:
Growth Schemes
Growth Schemes are also known as equity schemes. The aim of these schemes is
to provide capital appreciation over medium to long term. These schemes normally
invest a major part of their fund in equities and are willing to bear short-term
decline in value for possible future appreciation.
Income Schemes
Income Schemes are also known as debt schemes. The aim of these schemes is to
provide regular and steady income to investors. These schemes generally invest in
fixed income securities such as bonds and corporate debentures. Capital
appreciation in such schemes may be limited.
Balanced Schemes
Balanced Schemes aim to provide both growth and income by periodically
distributing apart of the income and capital gains they earn. These schemes invest
in both shares and fixed income securities, in the proportion indicated in their offer
documents (normally 50:50).Money Market Schemes: Money Market Schemes aim
to provide easy liquidity, preservation of capital and moderate income. These
schemes generally invest in safer, short-term instruments, such a streasury bills,
certificates of deposit, commercial paper and inter-bank call money.
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.
Tax Saving Schemes: Tax-saving schemes offer tax rebates to the investors under
tax laws prescribed from time to time. Under Sec.88 of the Income Tax Act,
contributions made to any Equity Linked Savings Scheme (ELSS) are eligible for
rebate.
Index Schemes: Index schemes attempt to replicate the performance of a
particular index such as the BSE Sensex or the NSE 50. The portfolio of these
schemes will consist of only those stocks that constitute the index. The percentage
of each stock to the total holding will be identical to the stocks index weight age.
And hence, the returns from such schemes would be more or less equivalent to
those of the Index.
16

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. While these funds may give higher returns, they are
more risky compared to diversified funds. Investors need to keep a watch on the
performance of those sectors/industries and must exit at an appropriate time.






















17










CHAPTER III
CORPORATE PROFILE















18

3.1 CORPORATE PROFILE
STATE BANK OF INDIA MUTUAL FUNDS
With 25 years of rich experience in fund management, it
stands as SBI Funds Management Pvt. Ltd. Bring forward its expertise by
consistently delivering value to investors. it have a strong and proud lineage that
traces back to the State Bank of India (SBI) - India's largest bank. It is a Joint
Venture between SBI and AMUNDI (France), one of the world's leading fund
management companies. With its network of over 222 points of acceptance across
India, it delivers value and nurture the trust of SBI vast and varied family of
investors. Excellence has no substitute. And to ensure excellence right from the
first stage of product development to the post-investment stage. This dedication is
what helps customers achieve their financial objective

BOARD OF DIRECTORS

Managing Director & CEO
Mr. Deepak Kumar Chatterjee
Independent Director
Mrs. Madhu Dubhashi
Mr. Shishir Joshipura
Mr. Jashvant Raval
Dr. H. K. Pradhan
Dr. H. Sadhak
Associate Director
Mr. Thierry Raymond Mequillet
Mr. S. Vishvanathan
Alternate Director
Mr. Philippe Batchevitch

19


3.2 Schemes of SBI Mutual Funds

At SBI Mutual Fund we know that every investor has unique financial goals
and requires a different set of products. Which is why, we have a wide range of
schemes that fulfill every kind of investors requirements. Each scheme is managed
by devising a different strategy which is reflective of the investors profile and carries
with it different risks and rewards.
There are six basic asset classes, which we manage, and variations of these six asset
classes from various products:


Equity/ Growth Equity fund

SBI Magnum Equity Fund
SBI Magnum Global Fund
SBI Magnum Multicap Fund
SBI Magnum Multiplier Plus 1993
SBI Magnum Midcap Fund

THEMATIC FUNDS

SBI Magnum COMMA Fund
SBI Infrastructure fund
SBI PSU Fund


INDEX FUNDS

SBI Nifty Index Fund


SECTORAL FUNDS

SBI Emerging Business Fund
SBI Contra Fund
SBI FMCG Fund
SBI IT Fund
SBI Pharma Fund
INDEX FUNDS
SBI Magnum Tax gain Scheme 1993
SBI Tax Advantage Fund- Series 1

20

SBI Tax Advantage Fund Series 11

MARKET NEUTRAL STRAT
SBI Arbitrage opportunities Fund

21











CHAPTER IV
ANALYSIS AND INTERPRETATION















22

ANALYSIS AND INTERPRETATION
Performance of mutual funds scheme is done by using different type of
measurement techniques. That is discussed below in detail:

SHARPE RATIO
SBI Magnum Equity Fund

YEAR RI RF
BENCH
RTN STDEV SP SPm
2012-13 -0.00019 0.000932 0.00012 0.01135 -0.00113 -0.09798
2011-12 -0.00011
0.000927 -0.00031
0.01129 -0.00104 -0.09501
2010-11 -0.00143
0.000681 0.00044
0.01469 -0.00211 -0.02078
2009-10 0.00571
0.000397 0.00185
0.02434 0.00532 0.07930
2008-09 -0.00173
0.000787 -0.00102
0.02244 -0.00251 -0.06565
2007-08 0.00079
0.000781 0.00090
0.02241 0.00001 0.00566
2006-07 -0.00010
0.000733 0.00137
0.02027 -0.00082 0.03869
2005-06 0.00255
0.000635 0.00170
0.01093 0.00192 0.08376
2004-05 0.00060
0.000547 0.00125
0.01537 0.00007 0.06752
2003-04
0.00227 0.000509 0.00154
0.01917 0.00177 0.05405
Above table shows the SHARPE Ratio of SBI Magnum Equity fund and
benchmark return, S&P Nifty for the last 10 year. During the year 2012-2013
shows negative. Even though it shows negative value it is performing well as
compared to market return. When it is compared with risk free return and risk it
shows the poor performance. Not in the year 2012-13 this trend shows in 2011-
12,2010-11, and 2008-09. But in the 2005-06 the scheme shows poor performance
than the market but it is good when It is compared with the risk free return.






SBI MAGNUM INDEX FUND
23


YEAR
Ri RF BENCH
RETURN
STDEV SP SPm
2012-13 0.00021
0.000932
0.00019 0.01441
-0.05027 -0.09871
2011-12 -0.00031 0.000927 -0.00031 0.01860
-0.06646 -0.09501
2010-11 0.00049 0.000681 0.00044 0.01661
-0.01138 -0.02078
2009-10 0.00247 0.000397 0.00176 0.02755
0.07546 0.07469
2008-09 -0.00167 0.000787 -0.00099 0.03512
-0.06976 -0.06456
2007-08 0.00090 0.000781 0.00097 0.02910
0.00399 0.00946
2006-07 0.00067 0.000733 0.00095 0.02398
-0.00229 0.01305
2005-06 0.00206 0.000635 0.00217 0.01680
0.08520 0.12776
2004-05 0.00072 0.000547 0.00130 0.01974
0.00912 0.07143
2003-04 0.00258 0.000509 0.00145 0.02271
0.09135 0.04961

Above given are SHARPE ratio of SBI Magnum equity fund and its
market. Table shows that better performance of scheme as compared with the
market but is in negative during the year 2012-13,2011-12,2010-11 and it
performance is not good when it compared with the risk free rate and risk
associated with it. But this scheme shows high ratio during the year 2005-06
2003-04 also risk associated with it also less.

SBI EMERGING BUSINESS FUND
YEAR
RI
RF BNCH
RTN STDEV SP SPm
2012-13
0.00055 0.000932
0.00032
0.01052 -0.03644 -0.02100
2011-12 0.00054 0.000927 -0.00038
0.01048 -0.03674 -0.10045
2010-11 0.00059 0.000681 0.00047
0.01088 -0.00818 -0.0184
2009-10 0.00414 0.000397 -0.00198
0.01782 0.21004 0.085315
2008-09 -0.00357 0.000787 0.00142
0.02286 -0.19026 -0.07703
2007-08 0.00100 0.000781 0.00108
0.01883 0.01179 0.015593
2006-07 0.00022 0.000733 0.00068
0.01933 -0.02654 -0.00254
2005-06 0.00273 0.000635 0.00271
0.01149 0.18360 0.194996
2004-05 0.00151 0.000547 0.00103
0.01213 0.08000 0.044509
2003-04 0.00145 0.000509 0.00198
0.01877 0.05025 0.085293

Above table shows the SHARPE of emerging business
fund and its market. During the year 2012-13, 2011-12, 2010-11 it shows negative.
Here market is better than the scheme. During this same period ratio tells that it
24

perform very badly as compared with the risk free rate and its risk. It performed
well during the year 2005-06.
SBI MAGNUM GLOBAL FUND
It shows that negative value for the 5 year for the scheme
and market . among these last three years shows scheme is performing badly. Market is
better even it is in negative. According to the ratio, higher performance shown by the
scheme in the year 2005-06.
SBI Magnum Multiplier plus Scheme - 93 Growth

YEAR Ri RF BNCH RTN
STD SP SPm
2012-13 0.00021
0.000934
-0.00032
0.01081 -0.06701 0.01132
2011-12 -0.00002 0.000927 -0.00036 0.01073
-0.08826
-0.07265
2010-11 0.00024 0.000681 0.00092 0.01078
-0.04091
0.01632
2009-10 0.00275 0.000397 0.00266 0.01545
0.15249
0.10099
2008-09 -0.00166 0.000787 -0.00097 0.01855
-0.13154
-0.04746
2007-08 0.00099 0.000781 0.00143 0.01809
0.01172
0.02607
2006-07 0.00051 0.000733 0.00145 0.01708
-0.01282
0.03390
2005-06 0.00312 0.000635 0.00103 0.01034
0.24081
0.02653
2004-05 0.00177 0.000547 0.00187 0.01623
0.07554
0.09219
2003-04 0.00319 0.000509 0.00069 0.01817
0.14772
0.01388

Above table shows the ratio of scheme and market. It shows that scheme is not
performing well as compared with the market ratio. It proves it during the year 2010
to 2013. Here market ratio is higher than the scheme ratio. Scheme is performed
well during the year 2005-2006 as compared with risk and risk free rate.



YEAR Ri RF BNCH RTN STDEV SP
SPm
2012-13 0.00051
0.00093
0.00123 0.00891 -0.00072
-0.03120
2011-12 0.00041 0.00093 -0.00024 0.00889 -0.05859 -0.09688
2010-11 0.00027 0.00068 0.00022 0.00858 -0.04825 -0.04215
2009-10 0.00380 0.00039 0.00298 0.01676 0.20356 0.15675
2008-09 -0.00300 0.00078 -0.00188 0.02051 -0.18420 -0.11934
2007-08 0.00054 0.00078 0.00111 0.01827 -0.01304 0.01544
2006-07 0.00076 0.00073 0.00083 0.01598 0.00212 0.00559
2005-06 0.00296 0.00063 0.00175 0.01003 0.23294 0.09481
2004-05 0.00214 0.00054 0.00184 0.01863 0.08598 0.12388
2003-04 0.00221 0.00050 0.00217 0.01989 0.08582 0.08274
25

SBI Magnum Sector Funds Umbrella FMCG

YEAR Ri RF BNCH RTN STDEV
SP SPm
2012-13 0.0011
0.0009344
0.00091 0.0081
0.02044
-0.01242
2011-12 0.00102 0.000926 0.00082 0.007973
0.01179
-0.01042
2010-11 0.00114 0.000679 0.00101 0.009728
0.04739
0.030747
2009-10 0.00246 0.000392 0.00155 0.011357
0.18209
0.082948
2008-09 -0.00056 0.00078 -0.0005 0.01237
-0.10833
-0.07118
2007-08 0.00062 0.000782 0.00115 0.015785
-0.01026
0.021102
2006-07 -0.0006 0.000729 -0.00026 0.017048
-0.07796
-0.05919
2005-06 0.00085 0.000625 0.00242 0.020032
0.01123
0.125164
2004-05 0.00153 0.000539 0.00139 0.012099
0.08191
0.083673
2003-04 0.00242 0.000504 0.00009 0.011498
0.16664
-0.02535

Above table gives details about the ratio of scheme and market. Schemes best
performance is 2009-2010. During this period it is better than the market also. The
years in which the fund is able to perform well than the bench mark performance
are; 2012-2013, 2011-12, 2010-11, 2009-10, 2005-06, 2003-04 and in the rest of the
periods under study i.e. exactly half of the period the fund was not able to perform
well compared to the market as the Sharpe ratio for this period is lesser than the
markets ratio.


SBI Magnum Sector Funds Umbrella IT

YEAR Ri RF BNCH
RTN
STDEV Sp SPm
2012-13 0.000731
0.0009344
-0.000165 0.0007 -0.312 -0.123
2011-12 -0.00002 0.000926 -0.00018 0.0148 -0.064 -0.112
2010-11 0.00087 0.000679 0.000882 0.0116 0.0161 0.019
2009-10 0.00397 0.000392 0.003135 0.0182 0.1966 0.1971
2008-09 -0.00323 0.00078 -0.00162 0.0221 -0.181 -0.133
2007-08 -0.00146 0.000782 -0.00045 0.0184 -0.122 -0.071
2006-07 0.00162 0.000729 0.001194 0.0171 0.0521 0.0277
2005-06 0.00234 0.000625 0.001796 0.013 0.1316 0.0818
2004-05 0.00192 0.000539 0.000436 0.0156 0.0881 -0.01
2003-04 0.00157 0.000504 0.000358 0.0228 0.0466 -0.009

Above given details are about the ratio of SBI Magnum Sector Funds Umbrella- IT
and its market. It is clear from the table that up to the year 2006-07 the fund is stable
26

and performing better than the market after that the performance is fluctuating and in
between poor performing periods are also identified.
SBI Magnum Tax Gain Scheme Growth

YEAR Ri RF BNCH
RTN
STDEV Sp SPm
2012-13 -0.00005
0.0009344
-0.00021 0.010211 0.0861 -0.081
2011-12 -0.00007 0.000926 -0.00032 0.010348 -0.0961 -0.0979
2010-11 0.0002 0.000679 0.000414 0.009805 -0.0485 -0.0237
2009-10 0.00276 0.000392 0.001951 0.016658 0.142 0.08548
2008-09 -0.00187 0.00078 -0.00113 0.021719 -0.1221 -0.0701
2007-08 0.00089 0.000782 0.001003 0.016967 0.0066 0.01086
2006-07 -0.0001 0.000729 0.000958 0.020966 -0.0395 0.01339
2005-06 0.00104 0.000625 0.002452 0.023365 0.0179 0.1539
2004-05 0.00239 0.000539 0.001341 0.017785 0.104 0.07671

In the case of SBI Magnum Tax gain scheme, in and around four years the fund is
poor performing than the market, because the Sharpe index for the fund is less
compared to the ratio of the market. Better performance is identified in the years
2012-13,2011-12,2004-05. Among the better performing periods in 2011-12, the
fund and the market is showing negative Sharpe ratio.

SBI Magnum Sector Funds Umbrella - Pharma

YEAR Ri RF BNCH
RTN
STDEV Sp SPm
2012-13 0.00031
0.0009344
0.000122 0.00601 -0.20699 -0.043
2011-12 0.00026 0.000926 0.000111 0.0101 -0.11735 -0.0578
2010-11 0.00005 0.000679 0.001939 0.01055 -0.05991 -0.0028
2009-10 0.00278 0.000392 0.004179 0.01705 0.14024 0.11852
2008-09 0.00158 0.00078 -0.00329 0.02135 -0.11059 -0.1063
2007-08 0.00119 0.000782 0.000649 0.01897 0.02129 -0.0045
2006-07 0.00054 0.000729 0.00065 0.01683 -0.0114 -0.0182
2005-06 0.00294 0.000625 0.003081 0.01075 0.21544 0.04014
2004-05 0.00199 0.000539 0.001491 0.01971 0.07344 0.00229
2003-04 0.00058 0.000504 -0.00124 0.02771 0.00278 0.08573

It is evident from the table that in most of the periods the Sharpes index for
the fund is lesser compared to the market. This means that the fund is basically
showing a poor performance. A better performance was identified only in three
years viz, 2009-102007-20082005-06.. Overall the fund is a poor performing one.
27


SBI Magnum Sector Funds Umbrella Contra - Growth


The trend in the performance of the fund shown by the table is not a favorable one.
In the last few previous years, the fund shows poor performance than the market. The
better performance was identified only in four years under the study i.e. in the years
2003-04, , and 2008-09 ,2009-10,when the Sharpe ratio for the fund is more
compared to the market.
TREYNOR RATIO
SBI MAGNUM INDEX FUND

YEAR Ri RF BNCH RTN STDEV Sp SPm
2012-13 0.00051
0.0009344
0.000518 0.00715 -0.05939 0.0142
2011-12 0.00041 0.000926 0.000422 0.00715 -0.07183 -0.051
2010-11 0.00065 0.000679 0.000653 0.00804 -0.00408 0.07604
2009-10 0.00327 0.000392 0.002166 0.01432 0.201245 0.17455
2008-09 -0.00184 0.00078 -0.00104 0.01941 -0.13486 -0.1476
2007-08 -0.0005 0.000782 0.000715 0.01772 -0.07252 -0.0058
2006-07 -0.00008 0.000729 0.000466 0.0172 -0.04709 -0.0037
2005-06 0.00232 0.000625 0.001146 0.01108 0.152845 0.11832
2004-05 0.00027 0.000539 0.000563 0.01992 -0.01358 0.04561
2003-04 0.00321 0.000504 0.001826 0.01707 0.158297 -0.1405
year Ri
BENCH
RETURN rf beta tp TPm
2012-13 -0.0001936 0.00012 0.0009344 0.0001000 -2.93602 0.12356
2011-12 -0.0001104
-0.00031 0.000926 -0.00901
-0.98775
0.13748
2010-11 -0.0014275
0.00044 0.000679 -0.055
-0.97404
0.00431
2009-10 0.00571379
0.00185 0.000392 -0.03636
-1.15715
-0.04004
2008-09 -0.0017279
-0.00102 0.00078 0.023931
-1.0722
-0.07524
2007-08 0.00078845
0.00090 0.000782 -0.01329
-1.05933
-0.00854
2006-07 -9.587E-05
0.00137 0.000729 -0.02642
-0.99637
-0.02416
2005-06 0.00254716
0.00170 0.000625 0.020065
-0.87305
0.0537
2004-05 0.00060426
0.00125 0.000539 -0.05929
-1.01019
-0.01206
2003-04
0.00227 0.00154 0.000504 0.03553
-0.93611
0.02907
28

Above given table says that SBI Magnum Equity Fund, performing very badly when
it is compared with the market ratio. And also when it is compared with the beta and
risk free its performance is reducing.
SBI MAGNUM INDEX FUND
YEAR
Ri RF BNCH RTN
BETA TP TPm
201213 0.00021
0.0009344
0.00019
-0.011 0.0647 0.0651
2011-12 -0.00031 0.000926 -0.00031 -0.013 0.0972 0.0974
2010-11 0.00049 0.000679 0.000442
-0.066 0.0029 0.0036
2009-10 0.002471 0.000392 0.001764
-0.065 -0.032 -0.021
2008-09 -0.00167 0.00078 -0.00099
0.1185 -0.021 -0.015
2007-08 0.000898 0.000782 0.000971
-0.08 -0.001 -0.002
2006-07 0.000674 0.000729 0.000954
-0.026 0.0021 -0.009
2005-06 0.002056 0.000625 0.00217
-0.095 -0.015 -0.016
2004-05 0.000719 0.000539 0.001297
-0.042 -0.004 -0.018
2003-04 0.002579 0.000504 0.001453
0.0858 0.0242 0.0111

From the above table can say that the SBI Magnum equity fund performed
very well in the years from 2003 to 2007 because market ratio giving lesser value
than the scheme value. After this period say 2007 to 2013 schemes ratio showing
positive result because it showing higher ratio than the market ratio.



SBI EMERGING BUSINESS FUND


This schemes performance is showing fluctuating trend. Last year 2012-2103 it
evidence that its performance is poor when it is compared with the market. Then
YEAR
RI
RF BNCH
RTRN BETA TP TPm
2012-13
0.000551 0.000934
0.000310
0.065290 -0.005872 0.006342
2011-12 0.000541 0.000926 -0.000380
0.143291 -0.002687 -0.009110
2010-11 0.000590 0.000679 0.000474
-0.029890 0.002978 0.006841
2009-10 0.004135 0.000392 0.001977
0.022932 0.163222 0.069110
2008-09 -0.003570 0.000780 -0.001420
-0.034130 0.127454 0.064352
2007-08 0.001004 0.000782 0.001081
0.046933 0.004730 0.006371
2006-07 0.000216 0.000729 0.000684
0.002855 -0.179685 -0.015650
2005-06 0.002734 0.000625 0.002706
0.087828 0.024013 0.023692
2004-05 0.001509 0.000539 0.001031
-0.018250 -0.053151 -0.026910
2003-04 0.001447 0.000504 0.001976
0.033579 0.028083 0.043832
29

after,2011-12 showing good performance as compared with the market ratio. Again in
the year 2010-11 it shows the poor performance because the market ratio is greater
than the schemes ratio. This trend is follows in the following years. It should be noted
that the performance is becoming poor only after the financial crisis.(After 2008-09)
SBI MAGNUM GLOBAL FUND

YEAR Ri RF BNCH RTN
FUND TP TPm
2012-13 0.00051
0.0009344
0.00123
0.03988 -0.0106419 -0.03012
2011-12 0.000405 0.000926 -0.00024
0.039163 -0.0133034 -0.02985
2010-11 0.000265 0.000679 0.00022
0.016397 -0.0252485 -0.02808
2009-10 0.003804 0.000392 0.00298
-0.05102 -0.0668757 -0.05071
2008-09 -0.003 0.00078 -0.00188
0.098241 -0.0384768 -0.02708
2007-08 0.000544 0.000782 0.00111
-0.12125 0.0019629 -0.00267
2006-07 0.000763 0.000729 0.00083
-0.05902 -0.0005761 -0.00164
2005-06 0.002961 0.000625 0.00175
-0.06166 -0.0378852 -0.01816
2004-05 0.002141 0.000539 0.00184
-0.0199 -0.0805025 -0.06545
2003-04 0.002212 0.000504 0.00217
0.063671 0.0268254 0.026074

In the year 2010-2011 to 2012-13 shows the stable good performance
because it shows higher ratio when compared with the market ratio. During the period
2008-09 to 2009-10 it evidence that the scheme is performing well when it is compared
with the market ratio.
SBI Magnum Multiplier Plus Scheme - 93 Growth

YEAR Ri RF BNCH
RTN FUND
TP TPm
2012-13 0.00021
0.0009344
-0.000321
0.200287
-0.00073 -0.00612
2011-12 -0.0000210 0.000926 -0.00036
0.20656 -0.00458 -0.00623
2010-11 0.000238 0.000679 0.000924
-0.00095 0.464211 -0.257
2009-10 0.002748 0.000392 0.002659
0.0286 0.082378 0.079256
2008-09 -0.00166 0.00078 -0.00097
0.01533 -0.15917 -0.11435
2007-08 0.000994 0.000782 0.001431
0.03419 0.006201 0.018997
2006-07 0.00051 0.000729 0.001451
0.03101 -0.00706 0.023277
2005-06 0.003115 0.000625 0.001025
-0.0022 -1.13182 -0.1818
2004-05 0.001765 0.000539 0.001865
-0.08975 -0.01366 -0.01477
2003-04 0.003188 0.000504 0.000694
0.00759 0.353623 0.024994

In the case of this fund the performance for exactly four years in the
middle of the study period, the performance was poor compared to the market. But the
remaining six years it is outperformed to the market. It is important to note that the
30

performance became poor in the financial crisis periods. Otherwise the fund is showing a
good record of return which is better than the market.


SBI Magnum Sector Funds Umbrella FMCG

YEAR Ri RF BNCH
RTN FUND TP TPm
2012-13 0.0011
0.0009344
0.00091
0.0011 0.15055 -0.16124
2011-12 0.00102 0.000926 0.00082
0.000575 0.16348 -0.17917
2010-11 0.00114 0.000679 0.00101
0.020576 0.0224 0.016004
2009-10 0.00246 0.000392 0.00155
0.018536 0.11157 0.062281
2008-09 -0.00056 0.00078 -0.0005
0.025292 -0.05298 -0.05067
2007-08 0.00062 0.000782 0.00115
-0.00924 0.01753 -0.03966
2006-07 -0.0006 0.000729 -0.00026
-0.15274 0.0087 0.006505
2005-06 0.00085 0.000625 0.00242
-0.05529 -0.00407 -0.03243
2004-05 0.00153 0.000539 0.00139
0.135877 0.00729 0.006224
2003-04 0.00242 0.000504 0.00009
-0.0033 -0.58061 0.126262

The poor performance was identified in the years 2002-03, 2003-04, and
2008-09. On the whole this fund can be considered as a better performing fund as
represented by the higher Treynor ratio than the market. Except four years are performing
good it is compared with the market ratio.




SBI Magnum Sector Funds Umbrella IT

YEAR Ri
BNCH
RTN
RF
FUND Tp TPm
2012-13 0.000731 -0.000165
0.0009344 0.0157 -0.013 0.0045
2011-12 -0.0000200
-0.00018 0.000926
0.1465 -0.006 -0.0076
2010-11 0.000866
0.000882 0.000679
-0.0042 -0.045 -0.0485
2009-10 0.00397
0.003135 0.000392
0.1113 0.0321 0.02465
2008-09 -0.00323
-0.00162 0.00078
0.0198 -0.202 -0.1211
2007-08 -0.00146
-0.00045 0.000782
-0.0465 0.0482 0.02647
2006-07 0.00162
0.001194 0.000729
-0.1194 -0.007 -0.0039
2005-06 0.00234
0.001796 0.000625
0.0047 0.3611 0.24716
2004-05 0.00192
0.000436 0.000539
-0.0374 -0.037 0.00277
2003-04 0.00157
0.000358 0.000504
0.0516 0.0206 -0.0028


Here we can say during 2012-13 the ratio of scheme shows the poor performance as
compared to the ratio of benchmark. More over the 6,year scheme having good
31

performance because its ratio is greater than the market ratio. Better performing years are
2011-12,2010-11,2009-10,2007-08,2005-06,2003-04.


SBI Magnum Tax Gain Scheme Growth


YEAR Ri RF BNCH
RTN
FUND Tp TPm
2012-13 -0.00005
0.0009344
-0.00021 0.000737 -1.3357 0.2432
2011-12 -7.00E-05 0.000926 -0.00032 0.000717 1.3862 -1.742
2010-11 0.000203 0.000679 0.000414 -0.00419 0.1134 0.063
2009-10 0.00276 0.000392 0.001951 0.11128 0.0213 0.014
2008-09 -0.00187 0.00078 -0.00113 0.019827 -0.1338 -0.0966
2007-08 0.00089 0.000782 0.001003 -0.04653 -0.0024 -0.0048
2006-07 -0.0001 0.000729 0.000958 -0.11943 0.0069 -0.0019
2005-06 0.00104 0.000625 0.002452 0.004739 0.0882 0.3856
2004-05 0.002389 0.000539 0.001341 -0.03736 -0.0495 -0.0215
2003-04 0.0032 0.000504 0.051592 0.051592 0.0522 0.0223

There is a good performance that shown by the scheme during year 2009-10 to 2011-12,
it having higher ratio than the market ratio. Period of recession its performance is
declined. From the period 2005-06 to 2007-08 it having good performance but after that it
starts to decline.

SBI Magnum Sector Funds Umbrella Contra Growth

YEAR Ri RF BNCH
RTN
FUND Tp TPm
2012-13 -0.00031
0.0009344
0.000122 0.21229 -0.0058 -0.041
2011-12 -0.0003 0.000926 0.000111 0.21666 -0.0055
-0.0401
2010-11 4.67E-05 0.000679 0.001939 -0.0237 0.02665
-0.0017
2009-10 0.00278 0.000392 0.004179 0.03458 0.06917
-0.2221
2008-09 -0.00158 0.00078 -0.00329 0.13745 -0.01718
-0.0278
2007-08 0.00119 0.000782 0.000649 0.14433 0.0028
0.00027
2006-07 0.00054 0.000729 0.00065 0.0646 -0.00297
0.02258
2005-06 0.00294 0.000625 0.003081 0.0107 0.21639
-0.0133
2004-05 0.00199 0.000539 0.001491 0.00566 0.2556
0.00236
2003-04 0.00058 0.000504 -0.00124 -0.1051 0.00073
-0.0461

From the above table it gives the details that only one year its performance is poor. As
compared with the market ratio. Rest all the year schemes ratio is greater than the market
ratio. In the year 2006-07 only it is having poor performance.
32

SBI Magnum Sector Funds Umbrella - Pharma
YEAR Ri
RF BNCH RTN
FUND Tp TPm
2012-13
0.00051
0.0009344
0.000518
0.01198 -0.04135 -0.042
2011-12 0.000412
0.000926 0.000422
0.01258 -0.04086 -0.041
2010-11 0.000646
0.000679 0.000653
0.01495 -0.00219 -0.002
2009-10 0.00327
0.000392 0.002166
-0.00799 -0.36082 -0.222
2008-09 -0.00184
0.00078 -0.00104
0.06566 -0.03985 -0.028
2007-08 -0.0005
0.000782 0.000715
-0.2474 0.005194 0.0003
2006-07 -0.00008
0.000729 0.000466
-0.01162 0.069699 0.0226
2005-06 0.00232
0.000625 0.001146
-0.03916 -0.04325 -0.013
2004-05 0.00027
0.000539 0.000563
0.01001 -0.02703 0.0024
2003-04 0.00321
0.000504 0.001826
-0.0287 -0.09416 -0.046

During the previous 3 year (2010-11 to 2012-13) it having better performance because its
ratio is greater in the case of scheme than the market. During the year 2006-07 to 2008 -
09 market performance is better than the schemes ratio is higher than the scheme.
JENSENS ALPHA
In finance, Jensen's alpha (or Jensen's Performance Index, ex-post alpha) is used to
determine the abnormal return of a security or portfolio of securities over the theoretical
expected return
SBI Magnum Equity Fund

year ri beta Rf bench alpha
2012-13 -2E-04 0.000100 0.0009344 0.0001 0.0011281
2011-12 -1E-04
-0.00901 0.000926 -3E-04
-0.0010252
2010-11 -0.001
-0.055 0.000679 0.0004
-0.0020934
2009-10 0.0057
-0.03636 0.000392 0.0019
0.0052688
2008-09 -0.002
0.023931 0.00078 -0.001
-0.002551
2007-08 0.0008 -0.01329 0.000782 0.0009 0.0000048
2006-07 -1E-04
-0.02642 0.000729 0.0014
-0.0008418
2005-06 0.0025
0.020065 0.000625 0.0017
0.0019437
2004-05 0.0006
-0.05929 0.000539 0.0013
0.0000231
2003-04 0.0023
0.03553 0.000504 0.0015
0.0018028


From the above table can conclude that out of ten years only 5 year having positive
value that tells that these 5 years earning excess earning. The years in which having
the positive values are 2003-04 to 2005-06 and 2007-08



33


SBI MAGNUM INDEX FUND
year ri
Beta
Rf Bench
return Alpha
2012-13 0.00021
0.0009344
0.00019
-0.0112 -0.00041
2011-12 -0.00031 0.000926 -0.00031 -0.01272 -0.00122
2010-11 0.00049 0.000679 0.000442
-0.0662 -0.000173
2009-10 0.00247 0.000392 0.001764
-0.06508 0.0019897
2008-09 -0.00167 0.00078 -0.00099
0.11848 -0.00266
2007-08 0.0009 0.000782 0.000971
-0.07996 0.0001009
2006-07 0.00067 0.000729 0.000954
-0.02598 -0.0000608
2005-06 0.00206 0.000625 0.00217
-0.09461 0.0012848
2004-05 0.00072 0.000539 0.001297
-0.04207 0.0001481
2003-04 0.00258 0.000504 0.001453
0.085777 0.0021564

Here only five year having positive value it means that only that year having excess
return over the 10 years. From 2004-05 to 2005-06 having positive value, but after
during 2006-07 it incur losses this time is the starting phase of depression period.
SBI EMERGING BUSINESS FUND

YEAR
RI
RF
BETA
BNCH RTN
ALPHA
2012-13
0.000551 0.0009344 0.06529
0.00031
-0.000413
2011-12 0.000541 0.000926 0.143291 -0.00038 -0.000572
2010-11 0.00059 0.000679
-0.02989
0.000474
-8.29E-05
2009-10 0.004135 0.000392
0.022932
0.001977
0.0037793
2008-09 -0.00357 0.00078
-0.03413
-0.00142
-0.004275
2007-08 0.001004 0.000782
0.046933
0.001081
0.000236
2006-07 0.000216 0.000729
0.002855
0.000684
-0.000513
2005-06 0.002734 0.000625
0.087828
0.002706
0.0022918
2004-05 0.001509 0.000539
-0.01825
0.001031
0.000961
2003-04 0.001447 0.000504
0.033579
0.001976
0.0009924

SBI Emerging Business Funds alpha ratio shows that six year having the positive value
and it shows those years having excess return. Here also same as in the case of SBI
Magnum index fund that is during the starting time of depression it start to incur losses
because it shows negative value.




34

SBI MAGNUM GLOBAL FUND

YEAR Ri BCH RTR
BETA
RF
ALPHA
2012-13 0.00051 0.00123
0.03988 0.0009344 -0.00041261
2011-12 0.000405 -0.00024
0.039163
0.000926
-0.00056666
2010-11 0.000265 0.000218
0.016397
0.000679
-0.00042156
2009-10 0.003804 0.002979
-0.05102
0.000392
0.003280011
2008-09 -0.003 -0.00188
0.098241
0.00078
-0.00404132
2007-08 0.000544 0.001105
-0.12125
0.000782
-0.00027716
2006-07 0.000763 0.000826
-0.05902
0.000729
2.82751E-05
2005-06 0.002961 0.001745
-0.06166
0.000625
0.002266941
2004-05 0.002141 0.001842
-0.0199
0.000539
0.00157607
2003-04 0.002212 0.002165
0.063671
0.000504
0.001813758

From the above table shows that, from the year 2007-08 it starting to incur losses,
because it shows the negative value, due to the depression during the year. From the
there up to 2008-09 it shows negative value. Only in 2009-10 having excess return
after the depression.

SBI Magnum Multiplier Plus Scheme - 93 Growth

YEAR Ri RF
FUND
BNCH
RTN
ALPHA
2012-13 0.00021
0.0009344 0.200287
-0.000321
-0.00098
2011-12 -0.0000210 0.000926
0.20656
-0.00036
-0.00121
2010-11 0.000238 0.000679
-0.00095
0.000924
-0.00044
2009-10 0.002748 0.000392
0.0286
0.002659
0.002421
2008-09 -0.00166 0.00078
0.01533
-0.00097
-0.00247
2007-08 0.000994 0.000782
0.03419
0.001431
0.000234
2006-07 0.00051 0.000729
0.03101
0.001451
-0.0002
2005-06 0.003115 0.000625
-0.0022
0.001025
0.002489
2004-05 0.001765 0.000539
-0.08975
0.001865
0.001107
2003-04 0.003188 0.000504
0.00759
0.000694
0.002685

Over the ten years, only 5 years having positive value and rest negative value.
from 2003-04 to 2005-06 it shows the excess return but in 2006-07, 2008-09,2010-
11,2011-12,2012-13 shows the negative value it indicates that during these years it didnt
incur excess return.




35

SBI Magnum Sector Funds Umbrella FMCG

YEAR Ri RF
FUND
BNCH RTN
ALPHA
2012-13 0.0011
0.0009344 0.0011
0.00091
0.000166
2011-12 0.00102 0.000926
0.000575
0.00082
0.0000939
2010-11 0.00114 0.000679
0.020576
0.00101
0.000468
2009-10 0.00246 0.000392
0.018536
0.00155
0.002089
2008-09 -0.00056 0.00078
0.025292
-0.0005
-0.001372
2007-08 0.00062 0.000782
-0.00924
0.00115
-0.000165
2006-07 -0.0006 0.000729
-0.15274
-0.00026
-0.001178
2005-06 0.00085 0.000625
-0.05529
0.00242
0.000126
2004-05 0.00153 0.000539
0.135877
0.00139
0.001107
2003-04 0.00242 0.000504
-0.0033
0.00009
0.001917

Here can say that only 3 years having negative value. Rest seven years having positive
value and it indicates that, it having excess return. Negative values incurring in the year in
which it suffer from great depression.


SBI Magnum Sector Funds Umbrella IT

YEAR Ri BNCH RTN RF ALPHA
2012-13 0.000731 -0.0001
0.0009344
0.0001
2011-12 -2.40E-05 -0.00018 0.000926 -0.0008
2010-11 0.000866 0.000882 0.000679 0.0002
2009-10 0.003965 0.003135 0.000392 0.0033
2008-09 -0.00323 -0.00162 0.00078 -0.004
2007-08 -0.00146 -0.00045 0.000782 -0.0023
2006-07 0.001619 0.001194 0.000729 0.001
2005-06 0.002336 0.001796 0.000625 0.0017
2004-05 0.001915 0.000436 0.000539 0.0014
2003-04 0.001569 0.000358 0.000504 0.0011


SBI Magnum Sector Funds Umbrella IT shows positive value for Jensens alpha for last
year (2012-13). In 2009-10, 2010-11,2012-13 Jensens alpha shows positive values which
means earning excess returns. During the study period 7 out of 10 years the scheme
earned excess return.so the fund manger efficiently managing the fund.







36

SBI Magnum Sector Funds Umbrella Contra Growth

YEAR Ri BNCH RTN RF ALPHA
2012-13 -0.00031 0.000122 0.000934 0.00231
2011-12 -0.00026 0.000111
0.000926
-0.001
2010-11 4.67E-05 0.001939 0.0009679 -0.0006
2009-10 0.002783 0.004179 0.000392 0.00226
2008-09 -0.00158 -0.00329 0.00078 -0.0018
2007-08 0.001186 0.000649 0.000782 0.00042
2006-07 0.000537 0.00065 0.000729 -0.0002
2005-06 0.002941 0.003081 0.000625 0.00229
2004-05 0.001987 0.001491 0.000539 0.00144
2003-04 0.000581 -0.00124 0.000504 -0.0001

SBI Magnum Sector Funds Umbrella Contra Growth scheme shows negative values for
5 years, it earns excess returns only for 5years. Last year the scheme makes excess
returns. The fund managers cant pick the stocks efficiently. Values of Jensens alpha are
positive for only 5 years out of 10 years. In 2009-10 and 2102-13 it is positive.
SBI Magnum Sector Funds Umbrella - Pharma


YEAR Ri BNCH RTN Rf ALPHA
2012-13 0.000516 0.000518
0.0009344
-0.000413
2011-12 0.000412 0.000422 0.000926 -0.00051
2010-11 0.000646 0.000653 0.000679 -0.0000300
2009-10 0.003274 0.002166 0.000392 0.0029
2008-09 -0.00184 -0.00104 0.00078 -0.0025
2007-08 -0.0005 0.000715 0.000782 -0.0013
2006-07 -8.10E05 0.000466 0.000729 -0.00081
2005-06 0.002318 0.001146 0.000625 0.00171
2004-05 0.000269 0.000563 0.000539 -0.00027
2003-04 0.003207 0.001826 0.000504 0.00274

During the last 4 years it having negative return this implicates that the managers cant
manage the fund efficiently. During the year 2009-10 it has excess return, again having
negative values. Out of ten years only three years having positive value it indicates that
the managers are efficiently manage the fund during the years. But rest seven years it
shows the negative value.



37

INFORMATIO RATIO
The Information Ratio is a risk-reward benchmark that is often used to quantify the
performance of an investment (and specifically the effectiveness of a fund manager). Its
equal to the average excess return divided by the standard deviation of the excess returns
(relative to a benchmark).
SBI MAGNUM EQUITY FUND
YEAR RI
BENC
RTNN SD IR
2012-13 -0.000194 0.0001 0.01135 0.00000760
2011-12 -0.00011
-0.00031
0.01129 0.00000353
2010-11 -0.001428
0.00044
0.01469 0.00023744
2009-10 0.0057138
0.00185
0.02434 -0.0006134
2008-09 -0.001728
-0.00102
0.02244 0.00002234
2007-08 0.0007884
0.0009
0.02241 -0.0000005
2006-07 -0.0000959
0.00137
0.02027 0.00010599
2005-06 0.0025472
0.0017
0.01093 -0.0000656
2004-05 0.0006043
0.00125
0.01537 0.00002713
2003-04 0.00227
0.00154
0.01917 0.00002780

From the above table it shows during the 2009-10 it having negative value and 2005-06
and 2007-08 having same situation. Negative IR will mislead the investor. From the given
table, highest positive value during the year 2010-11 (0.00023744). It indicates that the
highest performance of the scheme.
SBI MAGNUM INDUX FUND
YEAR
Ri BNCH RTN stdev INF
2012-13 0.00021 0.00019 0.014411
0.0133200
2011-12 -0.00031 -0.00031 0.018598 0.01443
2010-11 0.00049 0.000442 0.016613 0.000828
2009-10 0.00247 0.001764 0.027552 0.042487
2008-09 -0.00167 -0.00099 0.035118 -0.02124
2007-08 0.0009 0.000971 0.029101 0.006534
2006-07 0.00067 0.000954 0.023975 -0.05038
2005-06 0.00206 0.00217 0.016795 0.0553
2004-05 0.00072 0.001297 0.019741 -0.02284
2003-04 0.00258 0.001453 0.022714 0.027666

From the given table say, from 2009-10 to 2012-2103 it having positive value and it
indicates the good performance of the scheme. Negative value of scheme is shown in the
38

year 2008-2009, it is the period of depression. Here can say that the depression influence
the performance of the scheme, that tells the negative value.

SBI EMERGING BUSINESS FUND

YEAR Ri BNCH RTN stdev inr INF RATIO
2012-13
0.000551
0.00031 0.1517 0.061013
2011-12 0.000541 -0.00038 0.015177 0.060666
2010-11 0.00059 0.000474 0.015788 0.00732
2009-10 0.004135 0.001977 0.025432 0.084863
2008-09 -0.00357 -0.00142 0.037298 -0.05776
2007-08 0.001004 0.001081 0.026227 -0.00292
2006-07 0.000216 0.000684 0.026104 -0.01793
2005-06 0.002734 0.002706 0.015028 0.001903
2004-05 0.001509 0.001031 0.01653 0.028959
2003-04 0.001447 0.001976 0.0251 -0.02109

Above table gives the details during the year 2009-10 to 2012-13 it having good
performance because it shows the positive value. Up to the period of depression (2008-
09) shows the negative value. It is also influenced by this period. But after this year (200-
09) it started to recover.



SBI MAGNUM GLOBAL FUND

YEAR Ri BCH RTR
STD IR
2012-13 0.00051 0.00123
0.151 0.14321100
2011-12 0.000405 -0.00024 0.014605 0.044364
2010-11 0.000265 0.000218 0.013751 0.003367
2009-10 0.003804 0.002979 0.024105 0.034221
2008-09 -0.003 -0.00188 0.028633 -0.03899
2007-08 0.000544 0.001105 0.029641 -0.01894
2006-07 0.000763 0.000826 0.02433 -0.00259
2005-06 0.002961 0.001745 0.016039 0.075813
2004-05 0.002141 0.001842 0.021537 0.013919
2003-04 0.002212 0.002165 0.027333 0.001724

Above table says that the IR of SBI Global Fund shows the negative value during the year
2006-07 to 2008-09 it is the result of depression. Only these years negative value shows.
39

Rest seven years it shows the positive values. Here highest value comes under the year
2012-2013 (0.14221) it shows the good performance over the others.
SBI Magnum Multiplier Plus Scheme - 93 Growth

YEAR Ri BNCH RTN stdev INF RATIO
2012-13 0.00021 -0.000321 0.01719 0.0173
2011-12 -0.0000210 -0.00036 0.017294 0.019604
2010-11 0.000238 0.000924 0.018508 -0.03708
2009-10 0.002748 0.002659 0.026721 0.003321
2008-09 -0.00166 -0.00097 0.040821 -0.0169
2007-08 0.000994 0.001431 0.030096 -0.01452
2006-07 0.00051 0.001451 0.026781 -0.03511
2005-06 0.003115 0.001025 0.018309 0.114165
2004-05 0.001765 0.001865 0.022528 -0.00445
2003-04 0.003188 0.000694 0.022669 0.110029

This table shows the IR of Magnum Multiplier 93 growth out of ten years
only five years it have the positive value it implies that the good performance over the
other values which having negative values. Highest value is 0.019604 during the year
2011-12.



SBI Magnum Sector Funds Umbrella FMCG

YEAR Ri BNCH RTN STDV INF RATIO
2012-13 0.0011
0.0009344
0.01371 0.0091
2011-12 0.001019 0.000823 0.012692 0.015382
2010-11 0.001135 0.001008 0.014316 0.008892
2009-10 0.002459 0.001546 0.017763 0.051356
2008-09 -0.00056 -0.0005 0.021466 -0.00271
2007-08 0.000624 0.001148 0.02358 -0.02221
2006-07 -0.0006 -0.00026 0.025661 -0.01325
2005-06 0.000848 0.002418 0.025082 -0.06257
2004-05 0.001534 0.001385 0.014859 0.010024
2003-04 0.002425 8.76E-05 0.020107 0.116236
2002-03 -0.00057 -4.40E-05 0.014787 -0.03572

Given table shows the IR of Magnum Sector Funds Umbrella- FMCG. Only 4 years have
negative value, rest six years are shows the positive values, it implies that it performed
good in ten years.



40

SBI Magnum Sector Funds Umbrella - IT

YEAR Ri BNCH RTN stdev INF RATIO
2012-13 0.000731 -0.0001 0.01102 0.00623
2011-12 -2.40E-05 -0.00018 0.020167 0.00784
2010-11 0.000866 0.000882 0.017077 -0.00095
2009-10 0.003965 0.003135 0.025058 0.03313
2008-09 -0.00323 -0.00162 0.035688 -0.04516
2007-08 -0.00146 -0.00045 0.029393 -0.03436
2006-07 0.001619 0.001194 0.028172 0.01509
2005-06 0.002336 0.001796 0.020413 0.02646
2004-05 0.001915 0.000436 0.029869 0.04953
2003-04 0.001569 0.000358 0.026023 0.04656

Here also out of ten years three years have negative values, and rest shows the good
performance over the three years. The years are in which the performance is poor is 2007-
08,2008-09, and 2011-12.

SBI Magnum Tax Gain Scheme Growth

YEAR Ri BNCH
RTN
stdev INF RATIO
2012-13 -0.00005 -0.00021 0.0156 0.009823
2011-12 -0.0000680 -0.00032 0.016417 0.015539
2010-11 0.000203 0.000414 0.014599 -0.01447
2009-10 0.002757 0.001951 0.025032 0.032204
2008-09 -0.00187 -0.00113 0.037373 -0.01973
2007-08 0.000893 0.001003 0.0277 -0.00396
2006-07 -0.0001 0.000958 0.028211 -0.03751
2005-06 0.001043 0.002452 0.026891 -0.05241
2004-05 0.002389 0.001341 0.020827 0.05034
2003-04 0.003199 0.001652 0.025603 0.06042

Here while looking the table can identifies that out of ten years only 5 year have the
positive it indicates that only those years the scheme shows good performance. Rest 5 has
the negative value.









41

SBI Magnum Sector Funds Umbrella Contra Growth

YEAR Ri BNCH
RTN
stdev INF RATIO
2012-13 -0.00031 0.000122 0.0167 -0.0231
2011-12 -0.00026 0.000111 0.01571 -0.0236
2010-11 4.67E-05 0.001939 0.019977 -0.0947
2009-10 0.002783 0.004179 0.027001 -0.0517
2008-09 -0.00158 -0.00329 0.03172 0.0538
2007-08 0.001186 0.000649 0.027078 0.01983
2006-07 0.000537 0.00065 0.026323 -0.0043
2005-06 0.002941 0.003081 0.023178 -0.006
2004-05 0.001987 0.001491 0.028612 0.01733
2003-04 0.000581 -0.00124 0.030898 0.05901

In case of SBI Magnum Sector Funds Umbrella Contra Growth IR shows negative
values for 6 years and last year the fund shows negative but it is better compared to
previous year. The highest positive value was shown in the year 2003-04 followed by
2008-09 (0.059, 0.053).

SBI Magnum Sector Funds Umbrella - Pharma

YEAR Ri BNCH
RTN
Stdev INF RATIO
2012-13 0.000516 0.000518 0.01219 -0.0007
2011-12 0.000412 0.000422 0.011206 -0.00082
2010-11 0.000646 0.000653 0.012178 -0.00059
2009-10 0.003274 0.002166 0.020807 0.053244
2008-09 -0.00184 -0.00104 0.025139 -0.0316
2007-08 -0.0005 0.000715 0.025495 -0.04779
2006-07 -8.10E05 0.000466 0.022572 -0.02426
2005-06 0.002318 0.001146 0.017448 0.067196
2004-05 0.000269 0.000563 0.02237 -0.01315
2003-04 0.003207 0.001826 0.023297 0.05927


SBI Magnum Sector Funds Umbrella Pharma fund is not at all a well-managed fund
because 7 years out of 10 years the fund showing the negative values for IR. Last year
also the fund shows a very least negative value and it is the least value for IR for this
fund.


42

RANKINGS

Ranking under Sharpe ratio


SHEME NAME
SHARPE
RATIO RANKING
SBI Magnum Equity Fund -0.09798 10
SBI GlobL Fund -0.03120 5
SBI Magnum Multiplus Scheme-93-growth 0.01132 2
SBI Magnum Tax Gain Scheme-Growth
-0.0812
7
Sbi Magnum Sector funds umbrella Contra-growth
-0.04251
6
SBI Magnum Sector Funds Umbrella IT
-0.12312
9
SBI Emerging Business Fund -0.02100 4
SBI magnum Index Fund -0.09871 8
SBI Magnum Sector Funds umbrella- Pharma
0.0142
1
SBI Magnum Sector Funds Umbrella FMCG
-0.01242
3
















SBI EBS
SBI GF
SBI MEF
-SBI MIF
SBISBI MMS-93
SBI MSFUC
SBI MSFU FMCG
SBI MSFU-IT
SBI MSFU-PHARMA
SBI MTG-GROWTH
-0.14
-0.12
-0.1
-0.08
-0.06
-0.04
-0.02
0
0.02
0.04
1 2 3 4 5 6 7 8 9 10
SHARPE RATIO
SHARPE RATIO
43

Ranking under Treynors Ratio















SBI MSFU IT
SBI MSFU FMCG
SBI MEF
SBI EBF
-SBI MFUC-
GROWTH
SBI MMS-93
SBI MTG-GROWTH
SBI MIF
SBI MSFU-PHARMA
SBI GF
-3.5
-3
-2.5
-2
-1.5
-1
-0.5
0
0.5
1 2 3 4 5 6 7 8 9 10
TREYNOR RANKING
TREYNOR RANKING
SHEME NAME
TREYNORS
RATIO RANKING
SBI Magnum Equity Fund -2.936023906 10
SBI Magnum Sector Funds Umbrella FMCG -0.16124 9
Sbi Magnum Sector funds umbrella Contra-growth
-0.0412
8
SBI GlobL Fund -0.03012 7
SBI Magnum Multiplus Scheme-93-growth
-0.006124
6
SBI magnum Index Fund 0.002937 5
SBI Magnum Sector Funds Umbrella IT 0.00451 4
SBI Emerging Business Fund 0.006342 3
SBI Magnum Sector Funds umbrella- Pharma 0.042 2
SBI Magnum Tax Gain Scheme-Growth
0.243209
1
44



Ranking under Jensens Alpha


ALPHA RANKING
SBI Magnum Equity Fund -0.00113 10
SBI Magnum Multiplier Scheme-93-growth -0.001 9
SBI Magnum Sector Funds Umbrella FMCG
-0.0004
8
SBI magnum Index Fund -0.0004 7
SBI Emerging Business Fund -0.0004 6
SBI Global Fund -0.0004 5
SBI Magnum Sector Funds Umbrella IT
0.00012
4
SBI Magnum Sector Funds umbrella- Pharma 0.00017 3
SBI Magnum Tax Gain Scheme-Growth
0.00023
2
SBI Magnum Sector funds umbrella Contra-growth
0.00231
1
















SBI MSFU IT
SBI MMS-93
SBI MEF
SBI MSFU-PHARMA
SBI FMCG
SBI EBF
SBI MSFU-GROWTH
SBI GF
SBI MTG-GROWTH
SBI MIF
-0.0015
-0.001
-0.0005
0
0.0005
0.001
0.0015
0.002
0.0025
1 2 3 4 5 6 7 8 9 10
JENSEN'S ALPHA
JENSONS ALPHA
45

Ranking under Information Ratio


SCHEME NAME IR RANKING
SBI Magnum Sector funds umbrella Contra-
growth
-0.0231
10
SBI Magnum Sector Funds umbrella- Pharma
-0.0007
9
SBI magnum eq fund 0.00000760 8
SBI Magnum Sector Funds Umbrella IT
0.00623
7
SBI Magnum Sector Funds Umbrella FMCG
0.0091
6
SBI Magnum Tax Gain Scheme-Growth
0.009823
5
SBI magnum Index Fund 0.0133200 4
SBI Magnum Multiplier Scheme-93-growth
0.0173
3
SBI Emerging Business Fund
0.061013
2
SBI GlobL Fund 0.4321100 1

















SBI MSFUC-Growth
SBI MSFU-Pharma
SBI MEF
SBI-IT
FMCG
SBI TGS
SBI MIF
SBI MMS-93
SBI EBF
SBI GF
-0.1
0
0.1
0.2
0.3
0.4
0.5
1 2 3 4 5 6 7 8 9 10
INFORMATION RATIO
INFORMATION RATIO
46

Rankings of Schemes Under different measures


SHEME NAME
SHARP
E
TREYNO
R
ALPH
A IR
SBI Emerging Business Fund 4 3 6 2
SBI GlobL Fund 5 7 5 1
SBI Magnum Equity Fund 8 10 10 8
SBI magnum Index Fund 9 5 7 4
SBI Magnum Multiplus Scheme-93-growth 2 6 9 3
Sbi Magnum Sector funds umbrella
Contra-growth 6 8 1 10
SBI Magnum Sector Funds Umbrella
FMCG 3 9 8 6
SBI Magnum Sector Funds Umbrella IT 10 4 4 7
SBI Magnum Sector Funds umbrella-
Pharma 1 2 3 9
SBI Magnum Tax Gain Scheme-Growth 7 1 2 5









Above plotted graph gives detailed information about the
ranking of schemes under different performance measures.
Here 1 denotes SBI Emerging fund,
0
2
4
6
8
10
12
1 2 3 4 5 6 7 8 9 10 11
SHARPE
TREYNOR
ALPHA
IR
47

2-SBI Global Fund,
3-SBI Magnum Equity Fund,
4-SBI magnum Index Fund
5-SBI Magnum Multipliers Scheme-93-
growth
6-SBI Magnum Sector funds umbrella
Contra-growth
7-SBI Magnum Sector Funds Umbrella
FMCG
8-SBI Magnum Sector Funds Umbrella IT
9-SBI Magnum Sector Funds umbrella-
Pharma
10-SBI Magnum Tax Gain Scheme-Growth

SBI magnum Equity Fund, under Sharpe ratio it is ranked as 4 and under Treynors ratio
it is 3. There is no vast difference between them. And Jensens alpha and information
ratio tells that 6 & 2 respectively. This is because the systematic risk content in the total
risk of the fund may be higher, which automatically result in a lesser index and poor
ranking. The ranking according to Sharpe index and Jensons index are one and the same.
Here unsystematic risk is assumed as 0 and systematic risk is considered.
SBI Global fund says as in Sharpe Ratio , Treyners Ratio tells that 5 & 7 respectively.
Here also no big difference in their rankings this due to the systematic risk in the total risk
may be higher. More over under Jensens alpha and Information Ratio are 5 & 1.
SBI Magnum Index fund , in the case Sharpe it comes as 8 position and under Treynor it
as 5. Here we can see there is a difference in their ranking. Because, it consider the two
different type of risk. Under Jensens alpha and Information ratio tells as 5 and 1. This
scheme is good in under Information ratio. It tells about the performance of the funds.
In the case of SBI Global Fund, under Sharpe ratio it comes in 5 and under traynor as 7
This is because the systematic risk content in the total risk of the fund may be higher,
which automatically result in a lesser index and poor ranking. The ranking according to
Sharpe index and Jensons index are one and the same.
SBI Magnum Equity Fund all rankings are poor. Under the alla measure are tells as 8 , 10,
10, 8. The fund poorly managed by the manager. This conclusion can attain from here.
For SBI Magnum Index Fund ranked under Sharpe, Treynor , Jensens Alpha ,and
Information Ratio are 9,5,7,4 respectively. In the case of Sharpe and Teynor there is wide
difference in their ranking.
SBI Magnum Multiplier Scheme-93 Growth is ranked under Sharpe -2, Treynor-6,
Jensens Alpha-9, and under Information Ratio- 3. Under Sharpe and Information ratio is
well ranked this. There is only a slight difference in their ranking. But in the case of
Treynor and Alpha is poorly ranked.
48

For SBI Magnum sector fund umbrella Pharma, under Sharpe its rank as 1 and under
Traynor it comes as . Here can see the difference because the risk associated with it.
Under the Sharpe, it uses total risk (standard deviation) and under Treynor ratio
systematic risk (). Under Jensens alpha and information ratio tells about the stock
picking ability of manager. It takes into consideration the excess return of market
adjusted according to the systematic risk and the actual return of a fund information ratio
relates excess fund return over the benchmark return with the standard deviation the
same. That may be the reason behind the difference in ranking under these methods.
SBI Sector Fund Umbrella Contra- Growth it well ranked in Jensens Alpha the rank is 1
and can see the entirely contradiction when looks into the Information ratio. It ranked as
10 . under the Sharpe it is ranked as 6 and in Treynor as 2 this is because the risk level
associated with it.
SBI Magnum Sector Fund Umbrella IT except Treynors and Jensens alpha this scheme
is ranked poorly. Under Jensens alpha and Treynor this fund is arranged in same position
ie. 4. But in the case of Sharpe it ranked as 10. It because of the total risk is very high in
this case.

SBI Magnum Sector Funds Umbrella FMCG this scheme properly ranked under Sharp is
good, that is 3. It better than the Treynors Ratio that is 9. This difference is because of
the risk which is used to compute the ratio. Under Jensen alpha for this scheme is 8 and
Information Ratio is 6.
SBI Tax Gain Scheme Growth when look in to the Treynors ratio it is positioned as 1
rank. It is very poor when it is compared with Sharpe ratio that is 7. Here the risk element
of the Treynor is very low in total risk. That is why it positioned as first rank. Another
two measures are tells about the ability of a manager in relates with selecting of the best
stock. Here Jensens Alpha tells as 2 rank. it is also good when compared with the
Information ratio.








49








CHAPTER V
Findings and Conclusion

















50

FINDINGS OF THE STUDY
From analyzing the data what I have collected for the study by applying different tools
and techniques, I have arrived in the following major findings.
The different mutual funds schemes are showing different returns.
The performance of every mutual funds are fluctuating with market
fluctuations during this study
In the last year 2012-13 SBI Magnum Sector fund umbrella Pharma is the
best performing scheme of SBI mutual fund based on Sharpe ratio, Treynor
Ratio. Based on Information Ratio, SBI Global Fund is the best performing
scheme. Under Jensens Alpha it is SBI Sector Fund Umbrella Growth This
indicates that by taking the return from risk free asset as a basis for
evaluation of performance SBI Magnum Sector fund umbrella-Pharma is
best performing.
For several schemes the ranking of performance based on Sharpe ratio and
Treynor ratio are different. This indicates the existence of systematic
component of risk for such schemes because the only difference between
the two ratios S is that Sharpe ratio takes total risk and Treynor ratio takes
Systematic risk for evaluation of mutual fund schemes.
Under the Sharpe Ratio SBI Magnum Index fund, SBI Global Fund, SBI
Magnum Sector Fund Umbrella IT, SBI Magnum Sector Fund Umbrella
Contra- Growth is performing good for 5 out of 10 years. Moreover SBI
Magnum Index Fund, SBI Tax Gain Growth, SBI Magnum Sector Fund
Umbrella Pharma are more or less performing good than the market for 4
out of 10 years. Under SBI Emerging Business Fund only 2 years are
performing well out of ten years. When it looks into the SBI magnum
Multiplier-93-Growth only having 3 years better performance than the
market return.

According to Treynor ratio SBI Magnum Sector Funds Umbrella FMCG,
SBI Magnum Sector Contra- Growth having 7 years as better performing
year out of 10 years SBI Magnum Multiplier -93 performed good than the
market for 6 years. Another scheme IT &Tax gain Growth are performing
for 5 years as better than the market. Under this ratio SBI magnum Equity
Fund having no year as better performance than the market.

Jensens Alpha says about the efficiency of the selection of stock for the
purpose of investing on it. Here SBI Magnum Index Scheme Umbrella
FMCG & IT have 7 years as positive value. This indicates that the these
years only the managers are performing good in their stock selection. And
others have 5 and 3 years have positive values out of 10 years.
51

The information ratio also tells about the stock picking skill of fund
managers in my study the information ratio is positive in around 5 or more
years for all the schemes


CONCLUSION
From the above study can conclude that the scheme under the sector
funds only SBI Magnum FMCG is performing good. It is showing better performance as
compared with the market and risk free rate. Other scheme which are falls under this
scheme are showing poor performance when look in to the Sharpe and Treynors Ratio.
SBI Magnum Equity Fund showing very poor performance, and it is
ranked is very low in all measurements. Moreover, the out of 10 years it shows only 4 &
5 as better performance than the market, and under the treynors ratio it doesnt have any
year in which it performed good than the market.
Under Jensens alpha and Information Ratio the performance are
different in different schemes. But most of the schemes are well managed by the
managers. The schemes having more than 5 0r 7 seven years as better managed. And the
different in the two measures due to the elements that used to compute. Under Jensens
Alpha it is used risk free return and fund return, while the Information is based on the
market return and standard deviation.

REFERENCES
www.nseindia.cm
www.google.com
www.sbi.com
www.yahoofinance.com