Comparative Analysis of Risk, Return and Diversification of Mutual Fund
Abstract
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. With the plethora of schemes available in the Indian markets, an investors needs to evaluate and consider various factors before making an investment decision. The present investigation is aimed to examine the performance of safest investment instrument in the security market in the eyes of investors. Five mutual fund large cap scheme have been selected for this purpose.
The examination is achieved by assessing various financial tests like Sharpe Ratio, Standard Deviation, Alpha, and Beta. Furthermore, in-depth analysis also has been done by considering return over the period of last five years on various basis, expenses ratio, corpus-size etc. The data has been taken from various websites of mutual fund schemes and from www.valueresearch.com. The study will be helpful for the researchers and financial analysts to analyze various securities or funds while selecting the best investment alternative out of the galaxy of investment alternatives.
References
Barua, S. K., Raghunathan, V., Verma, J. R. (1991). Master Share: A Bonanza for large investors, Vikalpa, January –March.
Genesan, S. J. Raja. (2000). Mutual Funds, Indian Management, Vol. 39, No. 10, p. 42
Gupta, A. (2001). Mutual Funds in India, A study of Investment Management, Finance India, Vol. 15, No. 2, p. 631.
Gupta, K. Shashi. (2006). Financial Institutions and markets, Kalyani Publishers, New Delhi, p. 18.1-18.33
Jensen, M.C. (1968). The Performance of Mutual Funds 1945-64. Journal of Finance, Vol.23, No.2, May, p. 389-314.
Mc Donald, J. G. (1974). Objectives and Performance of Mutual Funds 1960-1967. Journal of Financial and Qualitative Analysis, p. 311-333.
Mehru, K. D. (2004). Problems of Mutual Funds in India, Finance India, Vol. 18, No. 1, p. 220.
Mutual Fund 2005, the ICFAI University Press, Vol. XI, Issue 7, July 2, p. 10 - 12.
Panday, A. (2000). Assured Return Schemes by Mutual Funds: An Appraisal of regulatory Issues, Vision, Vol. 4, No. 1, p. 29.
Romacho, J. C., Cortez, M. C. (2006). Timing and selectivity in Portuguese mutual fund performance. Research in International Business and Finance, p. 348–368.
Shah, S. M. A., Hijazi, S. T. (2005). Performance Evaluation of Mutual Funds in Pakistan. Pakistan Development Review 44(4): p.863.
http://crisil.com/capital-markets/mutual-fund-rankings.html
http://crisil.com/ratings/crisil-pioneers.html
http://www.moneycontrol.com/mutual-funds/best-funds/index.
https://www.sbi.co.in/user.htm?action=viewsection&id=0,16,384,38
