Description
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 sane 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
Comparative Analysis on Mutual Fund Scheme
With reference to Sundaram finance Ltd.
Report submitted in partial fulfillment of
POS !RA"#A$ "%PLOMA %& MA&A!$M$&
C$R%F%CA$
This is to certify that ''''' has completed the project titled (Comparative analysis
on the mutual fund scheme) from Sundaram finance Ltd under my guidance
completed the project successfully, for the partial fulfillment of the course: Dissertation in
term= 3
rd
of the post Graduate Diploma in Management- XXXXX specialization !atch
XXXX"#
$%&'()*+G+M+'T
This project in itself is an ac,no-ledgement to the inspiration, dri.e and .alua/le guidance
contri/uted to it /y many indi.iduals# This project -ould ne.er ha.e /een the light of day
-ithout the help and guidance that ha.e /een recei.ed#
0 -ould li,e to e1press my sincere appreciation and than,s to '''' -ho guided me all
throughout the summer training# 0t is under her .alua/le guidance, constant interest and
encouragement 0 ha.e completed this project# 2e de.oted his e.er-precious time from his
/usy schedule and helped in complete understanding of the mutual fund industry in 0ndia#
3inally 0 -ould li,e to than, my professor '''', -hose most .alua/le e1pertise -as
training to me to /e success#
"$CLARA%O&
0, !#4anthosh &umar ,declare in full consciousness that this has /een carried out /y me is
original and in no -ay has /een copied or is reproduction of any prior e1isting -or,#
"ate*
Si+nature
Place*
CO&$&S*,
C-AP$R %
Introduction
Scope of study
Need for study
Objective
Methodology
Data Collection
Sampling
Sampling technique
Tools used
imitations of the study
C-AP$R %%
Industry !ro"le
Company pro"le
C-AP$R %%%
Theory of the study
C-AP$R %.
Data analysis and interpretation
C-AP$R .
#indings$ conclusion$ suggestions
C-AP$R
/
Introduction
Scope of the study
Need for study
Objective
Methodology -
• Data collection and processing
• Sampling technique
• Sam palling technique
• Tools used
imitations of the study
Mutual fund: $n 0ntroduction
$ mutual fund is a form of collecti.e in.estment# 0t is a pool of money collected from .arious
in.estors -hich is in.ested according to the stated in.estment o/jecti.e# The fund manager is the
person -ho in.ests the money in different types of securities according to the predetermined
o/jecti.es# The portfolio of a mutual fund is decided ta,ing into consideration this in.estment
o/jecti.e# Mutual fund in.estors are li,e shareholders and they o-n the fund# The income earned
through these in.estments and the capital appreciation realized /y the scheme is shared /y its unit
holders in proportion to the num/er of units o-ned /y them# The .alue of the in.estments can go
up or do-n, changing the .alue of the in.estors holding# Mutual funds are one of the /est
in.estments e.er created /ecause they are .ery cost efficient and .ery easy to in.est in#
The in.estment in securities through mutual funds is spread across -ide range of
industries and sectors and thus the ris, is reduced# Di.ersification reduces the ris,
/ecause all stoc,s may not mo.e in the same direction at the same time# 5arious fund
houses issue units to the in.estors in accordance -ith the 6uantum of money in.ested /y
them# 0n.estors of mutual funds are ,no-n as unit holders#
0n 0ndia a mutual fund is re6uired to /e registered -ith 4ecurities +1change !oard of
0ndia 74+!08 -hich regulates the securities mar,et#
$D5$'T$G+4 (3 0'5+4T0'G 0' M9T9$* 39'D4:
There are se.eral that can /e attri/uted to the gro-ing popularities and suita/ility of
mutual funds as an in.estment .ehicle especially for retail in.estors#
:rofessional management:
Mutual funds pro.ide the ser.ices of e1perienced and s,illed professionals, /ac,ed /y a
dedicated in.estment research team that analysis the performance and prospects of
companies and selects suita/le in.estments to achie.e the o/jecti.es of the scheme#
Di.ersification:
Mutual funds in.est in a num/er of companies across a /road cross- section of industries
and sectors# This di.ersification reduces the ris, /ecause seldom do all stoc,s decline at
the sane time and in the same proportion# ;ou achie.e this di.ersification through a
mutual fund -ith far less money than you can do on your o-n#
%on.enient administration:
0n.esting in a mutual fund reduces paper-or, and helps you a.oid many pro/lems such
as /ad deli.eries, delayed payment and follo- up -ith /ro,ers and companies# Mutual
funds sa.e your time and ma,e in.esting easy and con.enient#
<eturn potential:
(.er a medium to long term, mutual funds ha.e the potential to pro.ide a higher return as
they in.est in a di.ersified /as,et of selected securities#
*o- costs:
Mutual funds are a relati.ely less e1pensi.e -ay to in.est compared to directly in.esting
in the capital mar,ets /ecause the /enefits of scale in /ro,erage, custodial and other fees
translate into lo-er costs for in.estors#
*i6uidity:
0n open ended schemes, the in.estors get the money /ac, promptly at net asset .alue
related prices from the mutual fund# 0n closed end schemes, the units can /e sold on a
stoc, e1change at the pre.ailing mar,et price or the in.estor can a.ail of the facility of
direct repurchase at '$5 related prices /y mutual fund#
Transparency:
;ou get regular information on the .alue of your in.estment in addition to disclosure on
the specific in.estments made /y your scheme, the proportion in.ested in each class of
assets and the fund manager=s in.estment strategy and outloo,#
3le1i/ility:
Through features such as regular in.estment plans, regular -ithdra-al plans and di.idend
rein.estment plans, you can systematically in.est or -ithdra- funds according to your
needs and con.enience#
$fforda/ility:
0n.estors indi.idually may lac, sufficient funds to in.est in high-grade stoc,s# $ mutual
fund /ecause of its large corpus allo-s e.en a small in.estor to ta,e the /enefit of its
in.estment strategy#
%hoice of schemes:
Mutual funds offer a family of schemes to suit your .arying needs o.er a lifetime#
0mportance of Mutual 3und:
4mall in.estors face a lot of pro/lems in the share mar,et, limited resources, lac, of
professional ad.ice, lac, of information etc# Mutual funds ha.e come as a much needed
help to these in.estors# 0t is a special type of institutional de.ice or an in.estment .ehicle
through -hich the in.estors pool their sa.ings -hich are to /e in.ested under the
guidance of a team of e1perts in -ide .ariety of portfolios of corporate securities in such
a -ay, so as to minimize ris,, -hile ensuring safety and steady return on in.estment# 0t
forms an important part of the capital mar,et, pro.iding the /enefits of a di.ersified
portfolio and e1pert fund management to a large num/er, particularly small in.estors#
'o- days, mutual fund is gaining its popularity due to the follo-ing reasons#
)ith the emphasis on increase in domestic sa.ings and impro.ement in deployment of
in.estment through mar,ets, the need and scope for mutual fund operation has increased
tremendously#
The /asic purpose of reforms in the financial sector -as to enhance the generation of
domestic Tripathy, Mutual 3und in 0ndia: $ 3inancial 4er.ice in %apital # # # >?"
resources /y reducing the dependence on outside funds# This calls for a mar,et /ased
institution -hich can tap the .ast potential of domestic sa.ings and chanalise them for
profita/le in.estments# Mutual funds are not only /est suited for the purpose /ut also
capa/le of meeting this challenge#
$n ordinary in.estor -ho applies for share in a pu/lic issue of any company is not
assured of any firm allotment# !ut mutual funds -ho su/scri/e to the capital issue made
/y companies get firm allotment of shares# Mutual fund latter sell these shares in the same
mar,et and to the :romoters of the company at a much higher price# 2ence, mutual fund
creates the in.estors confidence#
The phyche of the typical 0ndian in.estor has /een summed up /y Mr# 4# $# Da.e,
%hairman of 9T0, in three -ords@ ;ield, *i6uidity and 4ecurity# The mutual funds, /eing
set up in the pu/lic sector, ha.e gi.en the impression of /eing as safe a conduit for
in.estment as /an, deposits# !esides, the assured returns promised /y them ha.e
in.estors had great appeal for the typical 0ndian in.estor#
$s mutual funds are managed /y professionals, they are considered to ha.e a /etter
,no-ledge of mar,et /eha.iors# !esides, they /ring a certain competence to their jo/#
They also ma1imize gains /y proper selection and timing of in.estment#
$nother important thing is that the di.idends and capital gains are rein.ested
automatically in mutual funds and hence are not fritted a-ay# The automatic rein.estment
feature of a mutual fund is a form of forced sa.ing and can ma,e a /ig difference in the
long run#
The mutual fund operation pro.ides a reasona/le protection to in.estors# !esides,
presently all 4chemes of mutual funds pro.ide ta1 relief under 4ection >A * of the 0ncome
Ta1 $ct and in addition, some schemes pro.ide ta1 relief under 4ection >> of the 0ncome
Ta1 $ct lead to the gro-th of importance of mutual fund in the minds of the in.estors#
$s mutual funds creates a-areness among ur/an and rural middle class people a/out the
/enefits of in.estment in capital mar,et, through profita/le and safe a.enues, mutual fund
could /e a/le to ma,e up a large amount of the surplus funds a.aila/le -ith these people#
The mutual funds attracts foreign capital flo- in the country and secure profita/le
in.estment a.enues a/road for domestic sa.ings through the opening of off shore funds in
.arious foreign in.estors# *astly another nota/le thing is that mutual funds are controlled
and regulated /y 4 + ! 0 and hence are considered safe# Due to all these /enefits the
importance of mutual fund has /een increasing#
SCOP$ OF S#"0:
The study -as carried out for a period of BA days, in -hich the main focus -as to follo-
the performance of the different-different mutual fund companies and assent management
companies# 4ince different companies come out -ith similar themes in the same season, it
/ecomes crucial for the company to constantly perform -ell so as to sur.i.e the
competition and pro.ide ma1imum capital appreciation or return as the case may /e#
(ther than the mar,et the performance of the fund depends on the ,ind of stoc, chosen
/y the fund managers of the company#
The analysis is done on the performance of funds -ith the same theme or sector and
reason out -hy a fund performs /etter than the others in the lot#
'++D 3(< T2+ 4T9D;:
The study first tries to understand the composition of the selected funds -hich determines
the scope of performance for the funds, follo-ed /y use of ratios that are rele.ant in
6uantifying and understanding the ris, and return relationships for each mutual fund
scheme under consideration# Then a comparati.e analysis of the mutual fund schemes is
done to see -hich fund has performed the /est#
This study is significant to the company as it loo,s into the minute details that
differentiate the performances of funds of different companies -ith same theme or sector
under similar mar,et conditions# This -ould help the company to de.elop#
(!C+%T05+4 (3 T2+ 4T9D;:
To understand the 3unctions of an $sset Management %ompany
To understand the performances of .arious schemes using .arious tools to measure the
performances#
To measure and compare the performance of selected mutual fund schemes of different
mutual fund companies and other $sset Management %ompanies#
M$-O"OLO!0*
"ata collection:
The data re6uired for the study may /e collected either from primary sources or from
secondary sources# $ major portion of the data in this study has /een collected through
secondary sources of data#
4econdary data sources include:
? :u/lished material and annual reports of mutual fund companies
? (ther pu/lished material of mutual funds#
? <esearch /ased online portals#
? 9npu/lished sources also#
4ample :rofile:
The sample re6uired for the study has /een selected through random sampling method
from the a.aila/le list of mutual fund schemes in the mar,et# !roadly the sample of DE
mutual fund schemes includes e6uity funds, de/t funds and /alanced funds#
The study has ta,en three /road categories of funds
? +6uity 3unds
? De/t funds
? !alanced fund
+6uity 3unds:
D#!irla $d.antage 3und F Gro-th
E#2D3% +6uity 3und F Gro-th
3# 0%0%0 :rudential Dynamic :lan F Gro-th
G#4undaram !': :ari/as gro-th fund- Gro-th
De/t funds:
D# !irla !ond 0nde1 3und F Gro-th
E# 2D3% 2igh 0nterest 3und F Gro-th
3# 0%0%0 :rudential !lended :lan - (ption ! F Gro-th
G# 4undaram !': :ari/as fund- Gro-th
!alanced fund:
D# !irla !alance 3und F Gro-th
E# 2D3% !alanced 3und F Gro-th
3# 0%0%0 :rudential !alanced F Gro-th
G# 4undaram !': :ari/as /alanced- Gro-th
3or the purpose of estimating the performance of schemes in terms of returns, '$5 of the
schemes are ta,en into consideration# $s data relating to '$5 is a.aila/le more
fre6uently than any other data it is ta,en as the /asis for estimation#
:eriod of the 4tudy:
The study co.ered a period of 3 years from EAAH to EAA> to assess the performance of the
schemes in terms of returns#
Tools I Methods:
!eta:
0t descri/es the relationship /et-een the stoc,=s return and the inde1 returns# The /eta
.alue may /e interpreted in the follo-ing manner, Ja DK change in 'ifty inde1 -ould
cause a D#AGEK /eta" change in the particular fund# 0t is the slope of characteristic
regression line#
0t signifies that a fund -ith a /eta of more than D -ill rise more than the mar,et and also
fall more than mar,et# Thus, if one li,es to /eat the mar,et on the upside, it is /est to
in.est in a high-/eta fund# !ut one must ,eep in mind that such a fund -ill also fall more
than the mar,et on the -ay do-n# 4o, o.er an entire cycle, returns may not /e much
higher than the mar,et#
4imilarly, a lo--/eta fund -ill rise less than the mar,et on the -ay up and lose less on the
-ay do-n# )hen safety of in.estment is important, a fund -ith a /eta of less than one is
a /etter option# 4uch a fund may not gain more than the mar,et on the upside, /ut it -ill
protect returns /etter -hen mar,et falls#
)here,
n F 'um/er of days
1 F <eturns of the inde1
y F <eturns of the fund
$lpha:
0t indicates that the stoc, return is independent of the mar,et return# 0f the portfolio is
-ell di.ersified, the alpha .alue -ould turn out to /e zero# The intercept of characteristic
regression line is alpha#
$lpha sho-s -hether the particular fund has produced returns justifying the ris,s it is
ta,ing /y comparing its actual return to the one LpredictedL /y the /eta#
$lpha can /e seen as a measure of a fund managerLs performance# This is -hat the fund
has earned o.er and a/o.e or under" -hat it -as e1pected to earn# Thus, this is the .alue
added or su/tracted" /y the fund managerLs in.estment decisions# This can /e clearly
seen from the fact that 0nde1 funds al-ays ha.eMor should ha.e, if they trac, their inde1
perfectlyMan alpha of zero#
Thus, a passi.e fund has an alpha of zero and an acti.e fundLs alpha is a measure of -hat
the fund managerLs acti.ity has contri/uted to the fundLs returns# (n the -hole a positi.e
alpha implies that a fund has performed /etter than e1pected, gi.en its le.el of ris,# 4o
higher the alpha /etter are returns#
)here,
y F Mean .alue of returns of the fund
? = y - ?x
? = n?xy – (?x)( ?y)
n?x
2
– (?x)
2
1 F Mean .alue of returns of the inde1
N F !eta .alue of the fund
%orrelation %o-efficient:
0t measures the nature and the e1tent of relationship /et-een the stoc, mar,et inde1
returns and a fund=s return in a particular period#
%o-efficient of Determination:
The s6uare of correlation of co-efficient is the co-efficient of determination# 0t gi.es the
percentage .ariation in the stoc,=s return e1plained /y the .ariation in the mar,et return#
r
E
Treynor=s <atio:
The Treynor <atio, named after Cac, *# Treynor, one of the fathers of modern portfolio
theory, helps analyze returns in relation to the mar,et ris, of the fund# The <atio, also
,no-n as the re-ard-to-.olatility ratio, pro.ides a measure of performance adjusted for
mar,et ris,# 2igher the Treynor <atio, the /etter the performance under analysis#
0t is a ratio that helps the portfolio managers to determine the e1cess return generated as
the difference /et-een the fund=s return and the ris, free return# The e1cess return to /eta
ratio measures the additional return on a fund per unit of systematic ris,# <an,ing of the
funds is done /ased on this ratio#
)here,
< F <eturn on in.estment#
r = n?xy – (?x)( ?y) .
?n?x
2
– (?x)
2
?n?y
2
– (?y)
2
T = R – RFR
?
<3< F <is, 3ree <eturn
4harpe=s <atio:
4harpe=s ratio is similar to treynor=s ratio the difference /eing, instead of /eta here -e
ta,e standard de.iation# $s standard de.iation represents the total ris, e1perienced /y the
fund, it reflects the returns generated /y underta,ing all possi/le ris,s# $ higher 4harpe=s
ratio is /etter as it represents a higher return generated per unit of ris,#
<eturn
$ return is a measurement of ho- much an in.estment has increased or decreased in
.alue o.er any gi.en time period# 0n particular, an annual return is the percentage /y
-hich it increased or decreased o.er any t-el.e-month period#
3ormula:
-pA"
:A
Mean:
The mean a.erage is a 6uic, mathematical measure of a num/er of data points as a unit# 0t
-ill tell you important information a/out a group of data in your /usiness# 0t is almost a
summary of all the data in your dataset#
Mean: Mean = 4um of X .alues O ' 'um/er of .alues"#
4tandard De.iation:
S = R – RFR
?
The degree that a single .alue in a group of .alues .aries from the mean a.erage" of the
distri/ution# 4tandard de.iation is a statistical measure that uses past performance of an
in.estment or portfolio to determine the potential range of future performance and assess
the pro/a/ility of that performance# 4tandard de.iations can /e calculated for an
indi.idual security or for the entire portfolio
5ariance:
5ariance: 5ariance = s
E
1ensen Ratio 21R3*
$ ris,-adjusted performance measure that represents the a.erage return on a portfolio
o.er and a/o.e that predicted /y the capital asset pricing model %$:M", gi.en the
portfolioLs /eta and the a.erage mar,et return# This is the portfolioLs alpha# 0n fact, the
concept is sometimes referred to as PCensenLs alpha#P
Q
Censen <atio C<" = -----------------
N
Data :rocessing and $nalysis:
Data is processed -ith the help of Microsoft +1cel and 4:44 4tatistical :ac,age for
4ocial 4ciences"# The '$5s for si1 months of all the funds and their /enchmar,s -ere
entered into the spreadsheet and the a/o.e mentioned tools -ere used to get the final
.alues for the comparati.e analysis and interpretations#
*imitations of the 4tudy:
The present study has the follo-ing limitations
? The study has /een restricted to only a fe- schemes#
? The data is analyzed for a limited period of 3 years#
%2$:T+<
00
0ndustry :rofile
%ompany :rofile
%&"#SR0 PROF%L$
3ollo-ing diagram gi.es the structure of 0ndian financial system:
0'D94T<; :<(30*+
3ollo-ing diagram gi.es the structure of 0ndian financial system:
0'D94T<; :<(30*+: M9T9$* 39'D4:
Mutual funds go /ac, to the times of the +gyptians and :hoenicians -hen they sold
shares in cara.ans and .essels to spread the ris, of these .entures# The foreign and
colonial go.ernment Trust of *ondon of D>B> is considered to /e the fore-runner of the
modern concept of mutual funds# The 94$ is, ho-e.er, considered to /e the Mecca of
modern mutual funds# !y the early - DR3As 6uite a large num/er of close - ended mutual
funds -ere in operation in the 9#4#$# Much latter in DRHG, the committee on finance for
the pri.ate sector recommended mo/ilization of sa.ings of the middle class in.estors
through unit trusts# 3inally in Culy DRBG, the concept too, root in 0ndia -hen 9nit Trust of
0ndia -as set up#
0'D0$' M9T9$* 39'D 0'D94T<;
The end of millennium mar,s 3B years of e1istence of mutual funds in this country# The
ride through these 3B years is not /een smooth# 0n.estor opinion is still di.ided# )hile
some are for mutual funds others are against it#
9T0 commenced its operations from Culy DRBG #The impetus for esta/lishing a formal
institution came from the desire to increase the propensity of the middle and lo-er groups
to sa.e and to in.est# 9T0 came into e1istence during a period mar,ed /y great political
and economic uncertainty in 0ndia# )ith -ar on the /orders and economic turmoil that
depressed the financial mar,et, entrepreneurs -ere hesitant to enter capital mar,et#
The already e1isting companies found it difficult to raise fresh capital, as in.estors did not
respond ade6uately to ne- issues# +arnest efforts -ere re6uired to canalize sa.ings of the
community into producti.e uses in order to speed up the process of industrial gro-th#
The then 3inance Minister, T#T# &rishnamachari set up the idea of a unit trust that -ould
/e Popen to any person or institution to purchase the units offered /y the trust# 2o-e.er,
this institution as -e see it, is intended to cater to the needs of indi.idual in.estors, and
e.en among them as far as possi/le, to those -hose means are small#P
2is ideas too, the form of the 9nit Trust of 0ndia, an intermediary that -ould help fulfill
the t-in o/jecti.es of mo/ilizing retail sa.ings and in.esting those sa.ings in the capital
mar,et and passing on the /enefits so accrued to the small in.estors#
9T0 commenced its operations from Culy DRBG P-ith a .ie- to encouraging sa.ings and
in.estment and participation in the income, profits and gains accruing to the %orporation
from the ac6uisition, holding, management and disposal of securities#P Different
pro.isions of the 9T0 $ct laid do-n the structure of management, scope of /usiness,
po-ers and functions of the Trust as -ell as accounting, disclosures and regulatory
re6uirements for the Trust#
(ne thing is certain F the fund industry is here to stay# The industry -as one-entity sho-
till DR>B -hen the 9T0 monopoly -as /ro,en -hen 4!0 and %an /an, mutual fund
entered the arena# This -as follo-ed /y the entry of others li,e !(0, *0%, G0%, etc#
sponsored /y pu/lic sector /an,s# 4tarting -ith an asset /ase of <s# EH crore in DRBG the
industry has gro-n at a compounded a.erage gro-th rate of E?K to its current size of
<s#RAAAA crore#
The period DR>B-DRR3 can /e termed as the period of pu/lic sector mutual funds :M3s"#
3rom one player in DR>H the num/er increased to > in DRR3# The party did not last long# )hen
the pri.ate sector made its de/ut in DRR3-RG, the stoc, mar,et -as /ooming#
The openings up of asset management /usiness to pri.ate sector in DRR3 sa- international
players li,e Morgan 4tanley, Cardine 3leming, C: Morgan, George 4oros and %apital
0nternational along -ith the host of domestic players join the party# !ut for the e6uity funds,
the period of DRRG-RB -as one of the -orst in the history of 0ndian Mutual 3unds#
DRRRM;+$< (3 T2+ 39'D4
Mutual funds ha.e /een around for a long period of time to /e precise for 3B yrs /ut the
year DRRR sa- immense future potential and de.elopments in this sector# This year
signaled the year of resurgence of mutual funds and the regaining of in.estor confidence
in these M3=s# This time around all the participants are in.ol.ed in the re.i.al of the
funds ----- the $M%=s, the unit holders, the other related parties# 2o-e.er the sole factor
that ga.e lifer to the re.i.al of the funds -as the 9nion !udget# The /udget /rought
a/out a large num/er of changes in one stro,e# $n insight of the 9nion !udget on mutual
funds ta1ation /enefits is pro.ided later#
0t pro.ided centre stage to the mutual funds, made them more attracti.e and pro.ides
accepta/ility among the in.estors# The 9nion !udget e1empted mutual fund di.idend
gi.en out /y e6uity-oriented schemes from ta1, /oth at the hands of the in.estor as -ell
as the mutual fund# 'o longer -ere the mutual funds interested in selling the concept of
mutual funds they -anted to tal, /usiness -hich -ould mean to increase asset /ase, and
to get asset /ase and in.estor /ase they had to /e fully armed -ith a -hole lot of schemes
for e.ery in.estor #4o ne- schemes for ne- 0
=s -ere ine.ita/le# The 6uest to attract
in.estors e1tended /eyond just ne- schemes# The funds started to regulate themsel.es
and -ere all out on -inning the trust and confidence of the in.estors under the aegis of
the $ssociation of Mutual 3unds of 0ndia $M30"
(ne cam say that the industry is mo.ing from infancy to adolescence, the industry is
maturing and the in.estors and funds are fran,ly and openly discussing difficulties
opportunities and compulsions#
3irst :hase F DRBG->?:
9nit Trust of 0ndia 9T0" -as esta/lished on DRB3 /y an $ct of :arliament# 0t -as set up
/y the <eser.e !an, of 0ndia and functioned under the <egulatory and administrati.e
control of the <eser.e !an, of 0ndia# 0n DR?> 9T0 -as de-lin,ed from the <!0 and the
0ndustrial De.elopment !an, of 0ndia 0D!0" too, o.er the regulatory and administrati.e
control in place of <!0# The first scheme launched /y 9T0 -as 9nit 4cheme DRBG# $t the
end of DR>> 9T0 had <s#B,?AA crores of assets under management#
4econd :hase F DR>?-DRR3 +ntry of :u/lic 4ector 3unds":
DR>? mar,ed the entry of non- 9T0, pu/lic sector mutual funds set up /y pu/lic sector
/an,s and *ife 0nsurance %orporation of 0ndia *0%" and General 0nsurance %orporation
of 0ndia G0%"# 4!0 Mutual 3und -as the first non- 9T0 Mutual 3und esta/lished in Cune
DR>? follo-ed /y %an/an, Mutual 3und Dec >?", :unja/ 'ational !an, Mutual 3und
$ug >R", 0ndian !an, Mutual 3und 'o. >R", !an, of 0ndia Cun RA", !an, of !aroda
Mutual 3und (ct RE"# *0% esta/lished its mutual fund in Cune DR>R -hile G0% had set up
its mutual fund in Decem/er DRRA
$t the end of DRR3, the mutual fund industry had assets under management of <s#G?, AAG
crores#
Third :hase F DRR3-EAA3 +ntry of :ri.ate 4ector 3unds":
)ith the entry of pri.ate sector funds in DRR3, a ne- era started in the 0ndian mutual fund
industry, gi.ing the 0ndian in.estors a -ider choice of fund families# $lso, DRR3 -as the
year in -hich the first Mutual 3und <egulations came into /eing, under -hich all mutual
funds, e1cept 9T0 -ere to /e registered and go.erned# The erst-hile &othari :ioneer
no- merged -ith 3ran,lin Templeton" -as the first pri.ate sector mutual fund registered
in Culy DRR3# The DRR3 4+!0 Mutual 3und" <egulations -ere su/stituted /y a more
comprehensi.e and re.ised Mutual 3und <egulations in DRRB# The industry no-
functions under the 4+!0 Mutual 3und" <egulations DRRB# The num/er of mutual fund
houses -ent on increasing, -ith many foreign mutual funds setting up funds in 0ndia and
also the industry has -itnessed se.eral mergers and ac6uisitions# $s at the end of Canuary
EAA3, there -ere 33 mutual funds -ith total assets of <s# D,ED,>AH crores# The 9nit Trust
of 0ndia -ith <s#GG,HGD crores of assets under management -as -ay ahead of other
mutual funds#
3ourth :hase F since 3e/ruary EAA3 0n 3e/ruary EAA3:
3ollo-ing the repeal of the 9nit Trust of 0ndia $ct DRB3 9T0 -as /ifurcated into t-o
separate entities# (ne is the 4pecified 9nderta,ing of the 9nit Trust of 0ndia -ith assets
under management of <s#ER, >3H crores as at the end of Canuary EAA3, representing
/roadly, the assets of 94 BG scheme, assured return and certain other schemes# The
4pecified 9nderta,ing of 9nit Trust of 0ndia, functioning under an administrator and
under the rules framed /y Go.ernment of 0ndia and does not come under the pur.ie- of
the Mutual 3und <egulations# The second is the 9T0 Mutual 3und *td, sponsored /y 4!0,
:'!, !(! and *0%# 0t is registered -ith 4+!0 and functions under the Mutual 3und
<egulations# )ith the /ifurcation of the erst-hile 9T0 -hich had in March EAAA more
than <s#?B,AAA crores of assets under management and -ith the setting up of a 9T0
Mutual 3und, conforming to the 4+!0 Mutual 3und <egulations, and -ith recent mergers
ta,ing place among different pri.ate sector funds, the mutual fund industry has entered its
current phase of consolidation and gro-th# $s at the end of 4eptem/er, EAAG, there -ere
ER funds, -hich manage assets of <s#DH3DA> crores under GED schemes#
:<+4+'T $44+T 9'D+< M$'$G+M+'T (3 M9T9$* 39'D
%(M:$'0+4:
$5+<$G+ 49M (3 M9T9$* 39'D %(M:$'0+4 3(< T2+ M('T2
+1cluding fund 3und of +1cluding fund fund of
(f funds 3unds of funds funds
D# $!' $M<( Mutual 3und B>?GG3#A> 3BHGR#?3 BEBHEH#>> 3HRBG#H3
E# $0G Glo/al 0n.estment Group
Mutual 3und
'O$ 'O$ 'O$ 'O$
3# !enchmar, Mutual 3und BGD?>H#BG A HG3EH>#AR A
G# !irla 4un *ife Mutual 3und E3?DRGB#3? DRAH#D? ED???AA#H> D>RA#BG
H# !(! Mutual 3und R?HR#DD A DAEGR#EE A
B# %an /an, Mutual 3und ERDAAG#GR A EB?ARD#RE A
?# D!4 %hola Mutual 3und EG?3A>#RR A EDD?G?#E> A
># Deutsche Mutual 3und ?E>3B>#GH A ?D>>3?#G? A
R# D4: Merrill *ynch Mutual 3und DD>H3E>#>G A DD?B3GH#?> A
DA# +scorts Mutual 3und D3EG?#HG A DD?DH#GG A
DD# 3idelity Mutual 3und >>D3G>#?3 G3BH#>B >GG3?H#>G GG?B#H3
DE# 3ran,lin Templeton Mutual 3und EBE?B3H#?G 3AB3B#E EH3BGR?#HR 3DDAD#HD
D3# 2D3% Mutual 3und
3BDGBBB#?G A 33>>>EA#>B A
DG# 24!% Mutual 3und DGH>HBG#A> A D3HAG>D A
DH# 0%0%0 :rudential Mutual 3und HA?A3AA#DD 3RA?#3> GHRRG>B#DR 3>?A#D
DB# 0'G 5ysya Mutual 3und H?D?>B#3B >D>G?#3E GGH33H#H? >3DHB#GD
D?# CM 3inancial Mutual 3und 3??EGR#?G A 3HAG>>#D3 A
D># C: Morgan Mutual 3und 'O$ 'O$ 'O$ 'O$
DR# &ota, Mahindra Mutual 3und DB?EEHH#HB HGAD>#EE DGHGH33#B3 HEBE>#AB
EA# *0% Mutual 3und RRAGGE#E A RBRE>E#HH A
ED# *otus 0ndia Mutual 3und 3BE3DG#>3 A E>AHRB#D? A
EE# Morgan 4tanley Mutual 3und 3D>ABB#RG A 3DAAAH#3R A
E3# :<0'%0:$* Mutual 3und D3DG>HD#A? A DA>RHRA#EB A
EG# Suantum Mutual 3und BDAH#HR A BADH#H A
EH# <eliance Mutual 3und HRDG3G?#BD A H?B33AG#33 A
EB# 4ahara Mutual 3und D?BGB#HG A D?3DB#>R A
E?# 4!0 Mutual 3und DRBBA>E#RD A DRHEA3B#HD A
E># 4tandard %hartered Mutual 3und DBD?AED#?B DH3G#GH DH>3B>E#E? DH?R#?E
ER# 4undaram !': :ari/as Mutual
3und
DADGHE>#B3 A >RRBRH#AB A
3A# Tata Mutual 3und DGA>D>>#>B A D3GH3G>#A? A
3D# Taurus Mutual 3und 3AHG?#E3 A 3ADR>#?H A
3E# 9T0 Mutual 3und GAA?ADB#>? A 3B???E3#3R A
Grand Total GDGD?DBA#BD EDG?BG#33 3>B3>E>H#BD EDGBB?#H
M$<&+T 42$<+ (3 M9T9$* 39'D %(M:$'0+4 $4 (' EA, C9'+
EAA?
D# $!' $M<( Mutual 3und D#BEDHDH?33
E# $0G Glo/al 0n.estment Group Mutual 3und
3# !enchmar, Mutual 3und D#GABAAR>E
G# !irla 4un *ife Mutual 3und H#B3BDEDD3D
H# !(! Mutual 3und A#AEBHEBA?3
B# %an/an, Mutual 3und A#BRDEBE3G?
?# D!4 %hola Mutual 3und A#HG>AEGHEE
># Deutsche Mutual 3und D#>BAGE?RB3
R# D4: Merrill *ynch Mutual 3und 3#AGGHA>EDB
DA# +scorts Mutual 3und A#A3A3EA>A?
DD# 3idelity Mutual 3und E#D>H33GBGD
DE# 3ran,lin Templeton Mutual 3und B#HBG?EBAEE
D3# 2D3% Mutual 3und >#??ABERGHR
DG# 24!% Mutual 3und 3#GRHD>>?DR
DH# 0%0%0 :rudential Mutual 3und DD#RA3RBA33
DB# 0'G 5ysya Mutual 3und D#DHEH?HRAH
D?# CM 3inancial Mutual 3und A#RA?DAABEG
D># C:Morgan Mutual 3und
DR# &ota, Mahindra Mutual 3und 3#?BGG>>ADE
EA# *0% Mutual 3und E#HA>BABHDH
ED# *otus 0ndia Mutual 3und A#?EBEDE?>H
EE# Morgan 4tanley Mutual 3und A#>AE3EBR>
E3# :<0'%0:$* Mutual 3und E#>DRR?HB>?
EG# Suantum Mutual 3und A#ADHHB>?HH
EH# <eliance Mutual 3und DG#RDBAGHB>
EB# 4ahara Mutual 3und A#AGG>D?RHB
E?# 4!0 Mutual 3und H#AHEA?>G?G
E># 4tandard %hartered Mutual 3und G#AR>?3>GH3
ER# 4undaram !': :ari/as Mutual 3und E#3E>HABB?B
3A# Tata Mutual 3und 3#G>DRAGDH
3D# Taurus Mutual 3und A#A?>DH?H>3
3E# 9T0 Mutual 3und R#HD>33RR>>
COMPA&0 PROF%L$
The %ompany -as incorporated in DRHG, -ith the o/ject of financing the purchase of
commercial .ehicles and passenger cars#
The company -as started -ith a paid-up capital of <s#E#AA *acs and later -ent pu/lic in
DR?E# The %ompanyLs shares -ere listed in the Madras 4toc, +1change in DR?E and in the
'ational 4toc, +1change in Canuary DRR>#
4u/se6uently, the e6uity shares of the %ompany ha.e /een delisted from Madras 4toc,
+1change *imited M4+" -ith effect from Canuary E?, EAAG, in accordance -ith 4+!0
Delisting of 4ecurities" Guidelines, EAA3, for .oluntary delisting#
4undaram !': :ari/as $sset Management %ompany *td#, the in.estment managers of
4undaram !': :ari/as Mutual 3und, is a joint .enture /et-een the 4undaram finance
Group and the !': :ari/as asset management# The joint .enture /rings together the
4undaram 3inance GroupLs e1perience in the 0ndian mar,et and !': :ari/as glo/al
e1perience#
4ince its inception in DRRB, 4undaram Mutual fund has emerged as one of 0ndiaLs leading
Mutual 3unds managing assets of a large in.estor /ase# The fund offers a range of in.estment
options, -hich include di.ersified and sector specific e6uity schemes, fund of fund schemes,
hy/rid and monthly income funds, a -ide range of de/t and treasury products and offshore
funds#
4undaram !': :ari/as follo-s a long-term, fundamental research /ased approach to
in.estment# The approach is to identify companies, -hich ha.e e1cellent gro-th prospects
and strong fundamentals# The fundamentals include the 6uality of the company=s
management, sustaina/ility of its /usiness model and its competiti.e position, amongst other
factors# 4undaram !': :ari/as $sset Management %ompany has one of the largest team of
research analysts in the industry, dedicated to trac,ing do-n the /est companies to in.est in#
49'D$<$M 30'$'%+:
4undaram 3inance *imited is engaged primarily in the /usiness of financing# The acti.ities of
the %ompany span sa.ings products li,e deposits and mutual funds, car and commercial
.ehicle finance, insurance, home loans, soft-are solutions, /usiness process outsourcing, tyre
finance, fleet cards and logistics ser.ices# 4undaram 3inance *imited has a net-or, of o.er
DHA /ranches spread across 0ndia#
The %ompany -as incorporated in DRHG, -ith the o/ject of financing the purchase of
commercial .ehicles and passenger cars# The company -as started -ith a paid-up capital of
<s#E#AA *a,es and later -ent pu/lic in DR?E#The %ompanyLs shares -ere listed in the Madras
4toc, +1change in DR?E and in the 'ational 4toc, +1change in Canuary DRR>#
Company -ierarchy
Organizational Hierarchy
Managing Director
Chief Executive Officer
Directors
Vice President
National Head
Zonal Head
Regional Head
erritory Manager
!ssistant Manager
rainee Manager
Mana+erial Functions
"ales #ranch
Re+ional Sales Mana+er 4ranch Mana+er
erritory Mana+er
Re+ional Mana+er
Assistant Mana+er
C-AP$R
000
Theory of the study
Types of Mutual 3unds:
Mutual fund schemes may /e classified on the /asis of its structure and its in.estment
o/jecti.e#
!y 4tructure:
Open,end Funds: $n open-end fund is one that is a.aila/le for su/scription all through the
year# These do not ha.e a fi1ed maturity# 0n.estors can con.eniently /uy and sell units at 'et
$sset 5alue P'$5P" related prices# The ,ey feature of open-end schemes is li6uidity#
Closed,end Funds: $ closed-end fund has a stipulated maturity period -hich generally
ranging from 3 to DH years# The fund is open for su/scription only during a specified period#
0n.estors can in.est in the scheme at the time of the initial pu/lic issue and thereafter they
can /uy or sell the units of the scheme on the stoc, e1changes -here they are listed# 0n order
to pro.ide an e1it route to the in.estors, some close-ended funds gi.e an option of selling
/ac, the units to the Mutual 3und through periodic repurchase at '$5 related prices# 4+!0
<egulations stipulate that at least one of the t-o e1it routes is pro.ided to the in.estor#
0nter.al 3unds: 0nter.al funds com/ine the features of open-ended and close-ended schemes#
They are open for sale or redemption during pre-determined inter.als at '$5 related prices#
!y 0n.estment (/jecti.e:
Gro-th 3unds: The aim of gro-th funds is to pro.ide capital appreciation o.er the medium to
long term# 4uch schemes normally in.est a majority of their corpus in e6uities# 0t has /een
pro.ed that returns from stoc,s, ha.e outperformed most other ,ind of in.estments held o.er
the long term# Gro-th schemes are ideal for in.estors ha.ing a long-term outloo, see,ing
gro-th o.er a period of time#
0ncome 3unds: The aim of income funds is to pro.ide regular and steady income to in.estors#
4uch schemes generally in.est in fi1ed income securities such as /onds, corporate de/entures
and Go.ernment securities# 0ncome 3unds are ideal for capital sta/ility and regular income#
!alanced 3unds: The aim of /alanced funds is to pro.ide /oth gro-th and regular income#
4uch schemes periodically distri/ute a part of their earning and in.est /oth in e6uities and
fi1ed income securities in the proportion indicated in their offer documents# 0n a rising stoc,
mar,et, the '$5 of these schemes may not normally ,eep pace, or fall e6ually -hen the
mar,et falls# These are ideal for in.estors loo,ing for a com/ination of income and moderate
gro-th#
Money Mar,et 3unds: The aim of money mar,et funds is to pro.ide easy li6uidity,
preser.ation of capital and moderate income# These schemes generally in.est in safer short-
term instruments such as treasury /ills, certificates of deposit, commercial paper and inter-
/an, call money# <eturns on these schemes may fluctuate depending upon the interest rates
pre.ailing in the mar,et#
These are ideal for %orporate and indi.idual in.estors as a means to par, their surplus funds
for short periods#
(ther 4chemes:
Ta1 4a.ing 4chemes: These schemes offer ta1 re/ates to the in.estors under specific
pro.isions of the 0ndian 0ncome Ta1 la-s as the Go.ernment offers ta1 incenti.es for
in.estment in specified a.enues# 0n.estments made in +6uity *in,ed 4a.ings 4chemes
+*44" and :ension 4chemes are allo-ed as deduction uOs >> of the 0ncome Ta1 $ct, DRBD#
The $ct also pro.ides opportunities to in.estors to sa.e capital gains uOs HG+$ and HG+! /y
in.esting in Mutual 3unds#
0ndustry 4pecific 4chemes :0ndustry 4pecific 4chemes in.est only in the industries specified
in the offer document# The in.estment of these funds is limited to specific industries li,e
0nfotech, 3M%G, and :harmaceuticals etc#
0nde1 4chemes: 0nde1 3unds attempt to replicate the performance of a particular inde1 such
as the !4+ 4ense1 or the '4+ HA
4ectoral 4chemes: 4ectoral 3unds are those, -hich in.est, e1clusi.ely in a specified sector#
This could /e an industry or a group of industries or .arious segments such as L$L Group
shares or initial pu/lic offerings#
<04&4 $44(%0$T+D )0T2 M9T9$* 39'D4
0n.esting in mutual funds, as -ith any security, does not come -ithout ris,# (ne of the most
/asic economic principles is that ris, and re-ard are directly correlated# 0n other -ords, the
greater the potential ris, the greater the potential return# The types of ris, commonly
associated -ith mutual funds are:
Mar,et ris,:
Mar,et ris, relates to the mar,et .alue of a security in the future# Mar,et prices fluctuate and
are suscepti/le to economic and financial trends, supply and demand, and many other factors
that cannot /e precisely predicted or controlled#
litical ris,:
%hanges in the ta1 la-s, trade regulations, administrated prices, etc are some of the many
political factors that create mar,et ris,# $lthough collecti.ely, as citizens, -e ha.e indirect
control through the po-er of our .ote indi.idually, as in.estors, -e ha.e .irtually no control#
0nflation ris,:
0nterest rate ris, relates to futures changes in interest rates# 3or instance, if an in.estor in.ests
in a long F term de/t mutual fund scheme and interest rates increase, the '$5 of the scheme
-ill fall /ecause the scheme -ill /e end up holding de/t offering lo-er interest rates#
!usiness ris,:
!usiness ris, is the uncertainty concerning the future e1istence, sta/ility, and profita/ility of
the issuer of the security# !usiness ris, is inherent in all /usiness .entures# The future
financial sta/ility of a company cannot /e predicted or guaranteed, nor can the price of its
securities# $d.erse changes in /usiness circumstances -ill reduce the mar,et price of the
company=s e6uity resulting in proportionate fall in the '$5 of the mutual fund scheme,
-hich has in.ested in the e6uity of such a company#
+conomic ris,:
+conomic ris, in.ol.es uncertainty in the economy, -hich, in turn, can ha.e an ad.erse effect
on a company=s /usiness# 3or instance, if monsoons fail in a year, e6uity stoc,s of agriculture
F /ased companies -ill fall and '$5=s of mutual funds, -hich ha.e in.ested in such stoc,s,
-ill fall proportionately#
T$X !+'+30T4:-
The ta1man has o.er the years, /een more or less ,ind to mutual funds, -ith la-s .arying
from time to time@ the o.erall o/jecti.e has /een to encourage the gro-th of the mutual
funds industry# %urrently, a .ariety of ta1 la-s apply to mutual funds, -hich are /roadly
listed /elo-:
%apital gains:
9nits of mutual fund schemes held for a period more than DE months are treated as long
term capital assets# 0n such cases, the unit holder has the option to pay capital gains ta1 at
either EAK -ith inde1ation" or DAK -ithout inde1ation#
Ta1 deducted at source:
3or any income credited or paid /y a fund, no ta1 is deducted or -ithheld at source# The
rele.ant sections in the income ta1 act go.erning this pro.ision are section DRG& and
DRB$#
)ealth ta1:
Mutual fund units are not currently treated as assets under section E of the -ealth ta1 act
and are therefore not lia/le to ta1#
0ncome from units:
$ny income recei.ed from units of the schemes of the mutual fund specified under
section E3D" is e1empt under section DA33" of the act# )hile section DAE3D" e1empts
income of specified mutual funds from ta1 -hich currently includes all mutual funds
operating in 0ndia", section DA33" e1empts income from funds in the hands of the unit
holder# 2o-e.er, this does not mean that there is no ta1 at all on income distri/utions /y
mutual fund#
0ncome distri/ution ta1:
$s per pre.ailing ta1 la-s, income distri/uted /y schemes other than open-end e6uity
schemes is su/ject to ta1 at EAK plus surcharge of DAK"# 3or this purpose, e6uity
schemes ha.e /een defined to /e those schemes that ha.e more than HAK of their assets
in the form of e6uity# (pen-end e6uity schemes ha.e /een left out of the pur.ie- of this
distri/ution ta1 for a period of three years /eginning from $pril DRRR#
"ifferent Modes of Receivin+ the %ncome $arned From Mutual
Fund %nvestments
Mutual funds offer three methods of recei.ing income:
Gro-th plan:
0n this plan, di.idend is neither declared or paid out to the in.estor /ut is /uilt into the
.alue of the '$5# 0n other -ords, the '$5 increases o.er time due to such incomes and
the in.estor realizes only the capital appreciation on redemption of his in.estment#
0ncome funds:
0n this plan, di.idend are paid out=s to the in.estor# 0n other -ords, the '$5 only reflects
the capital appreciation or depreciation in mar,et price of the underlying portfolio#
Di.idend re-in.estment plan:
0n this case, di.idend is declared /ut not paid out to the in.estor, instead, it is rein.ested
/ac, into the scheme at the then pre.ailing '$5# 0n other -ords, the in.estor is gi.en
additional units and not cash as di.idend#
'et asset .alue '$5"
The net asset .alue of the fund is the cumulati.e mar,et .alue of the asset fund net of its
lia/ilities# 0n other -ords, if the fund is dissol.ed or li6uidated, /y selling off all the
assets in the fund, this is the amount that the shareholders -ould collecti.ely o-n# This
gi.es ride to the concept of net asset .alue per unit, -hich is the .alue, represented /y the
o-nership of one unit in the fund# 0t is calculated simply /y di.iding the net asset .alue of
the fund /y the num/er of units# 2o-e.er, most people refer loosely to the '$5 per unit
as '$5, ignoring the Tper unitU# )e also a/ide /y the same con.ention#
CALC#LA%O& OF &A.
The most important part of the calculation is the .aluation of the assets o-ned /y the
fund# (nce its is calculated, the '$5 is simply the net .alue of assets di.ided /y the
num/er of units outstanding# The detailed methodology for the calculation of the asset
.alue is gi.en /elo-#
$sset .alue is e6ual to
4um of mar,et .alue of sharesOde/entures
Vli6uid assetsOcash held, if any
Vdi.idendOinterest accrued
$mount due on unpaid assets
+1penses accrued /ut not paid
Details on the a/o.e items:
3or li6uid sharesOde/entures, .aluation is done on the /asis of the last or closing mar,et
price on the principal e1change -here the security is traded#
3or illi6uid and unlisted andOor thinly traded sharesOde/entures, the .alue has to /e
estimated# 3or shares, this could /e the /oo, .alue per share or an estimated mar,et price#
0f suita/le /enchmar,s are a.aila/le# 3ore de/entures and /onds, .alue is estimated on the
/asis of yields of compara/le li6uid securities after adjusting for illi6uidity# The .alue of
fi1ed interest /earing securities mo.es in a direction opposite to interest rate changes
.aluation of de/entures and /onds is a /ig pro/lem since most of them are unlisted and
thinly traded# This gi.es considera/le lee-ay to the $M%=s on .aluation and some of the
$M%=s are /elie.ed to ta,e ad.antage of this and adopt fle1i/le .aluation policies
depending on the situation#
0nterest is paya/le on de/enturesO/onds on periodic /asis say e.ery B months# !ut, -ith
e.ery passing day, interest is said to /e accrued, at the daily interest rate, -hich is
calculated /y di.iding the periodic interest payment -ith the num/er of days in each
period#
Thus, accrued interest on a particular day is e6ual to the daily interest rate multiplied /y
the num/er of days since the last interest payment date#
9sually, di.idends are proposed at the time of annual general meeting and /ecome due on
the record date# There is a gap /et-een the dates on -hich it /ecomes due and the actual
payment date# 0n the immediate period, it is deemed to /e T$ccruedU# +1penses including
management fees, custody charges etc# $re calculated on daily /asis#
M##AL F#&" %&.$S%&! SRA$!%$S
4ystematic in.estment plan 40:=s":
These are /est suited for young people -ho ha.e started there careers and needs to /uilt
there -ealth# 4ips entail the in.estor to in.est a fi1ed sum of money at regular inter.als in
the mutual fund schemes the in.estor as chosen, an in.estor opting for sip in 1yz mutual
fund scheme -ill need to in.est certain sum on money e.ery monthO6uarterOhalf yearly in
the scheme# !y in.esting through sip, one ends up /uying more units -hen the price is
lo- and fe-er units -hen the price is high# 2o-e.er, o.er a period of time these mar,et
fluctuations are generally a.eraged# $nd the a.erage cost of the in.estment is often
reduced# 0t is far /etter to in.est small amount of money regularly, rather than sa.e up to
ma,e a large in.estment# This is /ecause -hile sa.ing is in the lump sum, it may not earn
much interest#
4ystematic -ithdra-al plan 4):=s":
These plans are suited for people nearing retirement #0n these plans, an in.estor in.est in a
mutual fund scheme and is allo-ed to -ithdra- a fi1ed sum of money at regular inter.als
to ta,e care of its e1penses#
4ystematic transfer plan 4T:=s":
They allo-s in.estor to transfer on a periodic /asis a specified amount from one scheme
to another -ithin the same fund family- meaning t-o schemes /elonging to the same
mutual fund# $ transfer -ill /e treated as redemption of units from the scheme from
-hich the transfer is made# 4uch redemption or in.estment -ill /e at the applica/le '$5#
This ser.ice allo-s the in.estor to manage his in.estments acti.ely to achie.e his
o/jecti.es# Many funds do not e.en charge any transaction fees for his ser.ice- an added
ad.antage for the acti.e in.estor#
%2$:T+<
05
Data analysis and interpretation
Data $nalysis and 0nterpretation
0ntroduction:
$sset allocation strategies of .arious select mutual fund schemes are presented in the
follo-ing ta/les#
+6uity 3unds:
4undaram !': :ari/as Gro-th 3und G":
0n.estment 0nformation
3und type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize <s cr" EB#AH Cul-3D-EAA>"
Min #0n.estment <s H,AAA
*ast Di.idend '#$#
!onus '#$#
$sset $llocation :ercentage held
+6uity A#AA
De/t ?3#>?
Mutual 3unds '#$
Money Mar,et A#AA
%ash O %all EB#D3
4%2+M+ :+<3(<M$'%+:
Dmonth 3month Bmonth Dyear
-A#AHB3H A#AB A#3BEA?H -A#DBA>R
!irla $d.antage 3und F Gro-th
0n.estment information
3und Type (pen- +nded
0n.estment :lan Gro-th
$sset 4ize <4 cr" G33#BDMay-3A-EAA>"
Min #0n.estment <s# H,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity >G#>R
De/t A#AA
Money Mar,et A#AA
%ash O %all DH#DA
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
-A#AA??R A#3HEA?H -A#AEHR3 -A#DHG3R
2D3% +6uity 3und F Gro-th
0n.estment 0nformation
3und Type (pen- +nded
0n.estment :lan Gro-th
$sset 4ize<s cr" G,A3A#REMay-3A-EAA>"
Min# 0n.estment <s#H,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity R>#HD
De/t A#AA
Mutual fund '#$
Mutual Mar,et D#>H
%ash O %all -A#3B
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
A#A>ARGD A#DHDEA3 A#D3BHH? -A#A>GGG
0%0%0 :rudential Dynamic :lan F Gro-th
0n.estment 0nformation
3und Type (pen-+nded
0n.estment Type Gro-th
0n.estment :lan D,?>3#DEMay-3A-EAA>"
$sset 4ize <s cr" <s# H,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocationK" :ercentage held
+6uity >H#EG
De/t 3#?>
Mutual 3und '#$
Money Mar,et A#AA
%ash O %all DD#AD
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
A#ARDHR? A#DDRGGR A#A>EHGG -A#AB>R>
+S90T; 39'D ('+ M('T2 %(M:$<04(' (3 <+T9<'"
%ompany 'ame
and 3und
$/solute
return
Mean return 4tandard
De.iation
5ariance
2D3% +6uity
3und - Gro-th
5.56578/ 5.5596: 25.96;3 5.5//<=>
A#AAAD3??33
!irla $d.antage
3und - Gro-th
,5.55<<7 ,5.=/6/<
2,=/.6/;3
/./59977
D#EDHAB3A>H
0%0%0 :rudential
Dynamic :lan F
Gro-th
5.57/:7< 5.55=9/> 25.=9;3 5.5/9767
A#AAADB>?DG
4undaram !':
:ari/as Gro-th
,5.5:>=: ,5.5598725.9:;3 5.5/6597
A#AAA3EH
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 0%0%0 :rudential Dynamic :lan - Gro-th fund is
gi.ing the highest a/solute return o.er D months A#ARDHR?" -hile it is highest in term of
fluctuation of returns .ariance=A#AAADB>?DG"# 2D3% +6uity 3und - Gro-th is ha.ing
the minimum fluctuation in return generated .ariance=A# A#AAAD3??33"#
"$%%E"&ON"'
a" 3or in.estor -ith high ris, appetite go for: 4undaram !': :ari/as - Gro-th
/" 3or in.estor -ith moderate ris, appetite: Go for 0%0%0 :rudential Dynamic :lan -
Gro-th
c" 3or in.estor -ith lo- ris, appetite: 2D3% +6uity 3und - Gro-th
+S90T; 39'D 40X M('T24 %(M:$<04(' (3 <+T9<'"
%ompany 'ame
and 3und
$/solute
return
Mean return 4tandard
De.iation
5ariance
2D3% +6uity
3und - Gro-th
A#D3BHH? A#AAA>R? A#AD>R?> A#AAA3BAD
!irla $d.antage
3und - Gro-th
-A#AEHR3 A#ADBRH D#AEAD3D D#AGABB?E
0%0%0 :rudential
Dynamic :lan -
Gro-th 0%
A#A>EHGG A#AAABE> A#ADREE? A#AAA3BRB
4undaram !':
:ari/as Gro-th
A#3BEA?H A#AADRAR A#AEGED> A#AAAH>B
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 4undaram !': :ari/as Gro-th fund is gi.ing
the highest a/solute return o.er B months A#3BEA?H" -hile it is highest in term of
fluctuation of returns .ariance=A#AAAH>B"# 2D3% +6uity 3und - Gro-th is also ha.ing
the less fluctuation in return generated .ariance=A#AAA3BAD"#
"$%%E"&ON"'
a" 3or in.estor -ith high ris, appetite go for: !irla $d.antage 3und - Gro-th
/" 3or in.estor -ith moderate ris, appetite: Go for 2D3% +6uity 3und F Gro-th
c" 3or in.estor -ith lo- ris, appetite: 4undaram !': :ari/as Gro-th
Sundaram 4&P Paribas fund 2!ro?th3
"A$ S@P C&'
&%F0
R$#R&
2'3
&A. R$#R&
203
'
9
0
9
'0 20,0/3 20,03
9
D-jun-AH EA>?#HH 3G#HDER
3-(ct-AH EB3A#AH EH#R>?G G3#B>3E EB#H?ABG B?H#3GH ?AH#RRRE BRA#HAE DH#BE?R>GEG EGG#E33R
D-3e/-AB ER?D#HH DE#R>GHG HD#R>GR DR#AAG33 DB>#HR>G 3BD#DBGB EGB#?BEB >#ABDB?A>EH BG#RRAHG
D-Cun-AB ERBE#EH -A#3DER? H3#EB>R E#GBRRG> -A#AR?RGR B#DAABG3 -A#??3AD -
>#G?E?DE3HB
?D#?>B>H
3-(ct-AB 3HBR#B EA#HA3 BD#D3BH DG#?BRHR GEA#3?E> ED>#DGAR 3AE#>EAR 3#>EBR33DHH DG#BGHGE
D-3e/-A? GD3?#E DH#RAARG ?A#BBGH DH#H>G> EHE#>3RR EGE#>>HR EG?#>D3 G#BGED3?HRE ED#HGRGG
D-Cun-A? GER?#AH 3#>B3?EG ?H#?EB? ?#DB3?D DG#RE>3? HD#3D>?G E?#B?>B -
3#??>RHADHE
DG#E>AGB
D-(ct-A? HAB>#RH D?#RB3GR >>#BG?3 D?#ABEDH 3EE#B>BR ERD#DDB> 3AB#GRHB B#DDRG>HG>> 3?#GG>D
D-3e/-A> H3D?#EH G#>R>GH RG#3H3H B#G3BR? E3#RRG>E GD#G3GH> 3D#H3DD>
-G#HAHBRAG>
EA#3ADEH
E-Cun-A> G?3R#B -DA#>B3? >G#3?EB -DA#H?>E DD>#ADRR DDD#>R>3 DDG#RD>G -
ED#HEA>H>3D GB3#DG?3
OAL 75.79866 76.86=78 /77>.668 95=5.5> /7><.<87 =.<9>:/$,57 7:9.=6==
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.7599 /.69:7: /5.96>7 5.7:77 6.>:599 76.>977: 9.59>/
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
4irla Advanta+e Fund D !ro?th
"A$ S@P
C&'
&%F0
R$#R&
2'3
&A. R$#R&
203
'
9
0
9
'0 20,0/3 20,03
9
D-jun-AH EA>?#HH
BB#>B
3-(ct-AH EB3A#AH EH#R>?G
>G#3G EB#DGGD>
EB#H?ABG
B>3#HD>E B?R#GDRG DB#AGDGD?? EH?#3E?D
D-3e/-AB ER?D#HH DE#R>GHG
R>#G DB#B?ABE
DR#AAG33
E??#RARH EDB#GBAG B#HB?>H>RE G3#D3B??
D-Cun-AB ERBE#EH -A#3DER?
RB#A> -E#3H??E
E#GBRRG>
H#HH>>B A#?3?>RE -DE#GBAG>3B DHH#EB3?
3-(ct-AB 3HBR#B EA#HA3
DDD#3B DH#RA3GD
DG#?BRHR
EHE#RD>B 3EB#AB?B H#>AABH3>E 33#BG?H>
D-3e/-A? GD3?#E DH#RAARG
DER#ED DB#AERAR
DH#H>G>
EHB#R3DR EHG#>??? H#REB33G>3 3H#DEDGG
D-Cun-A? GER?#AH 3#>B3?EG
D3E#R? E#RARRRD
?#DB3?D
>#GB>AH DD#EG3G -?#DRE?B>HD HD#?3HRE
D-(ct-A? HAB>#RH D?#RB3GR
DH3#RH DH#??>
D?#ABEDH
EG>#RGHD E>3#GE?> H#B?HE3HAG 3E#EA>ER
D-3e/-A> H3D?#EH G#>R>GH
DHR#A> 3#33EEHD
B#G3BR?
DD#DA3>R DB#3EE>B -B#??AHARE? GH#>3R>
E-Cun-A> G?3R#B -DA#>B3?
D3R#R? -DE#ADE>
-DA#H?>E
DGG#3A?R D3A#HA3? -EE#DDHH>3? G>R#ARR
OAL
75.79866
69.=7<
76.86=78
/667.>>9 /7/7.5>/ 69.=7>7778 //8=.=6
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
/.556 ,/.59: //.9</= 5.7=79 8.<6//> :=.8>9= ,/.5/>6
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
-"FC $Euity Fund D !ro?th
"A$ S@P
C&'
&%F0
R$#R&
2'3
&A. R$#R&
203
'
9
0
9
'0 20,0/3 20,03
9
D-jun-AH EA>?#HH
?D#?>
3-(ct-AH EB3A#AH EH#R>?G
RG#3EG 3D#GA?A>
EB#H?ABG
R>B#GAGH >DB#D>>3 ED#3AG3D3 GH3#>?3>
D-3e/-AB ER?D#HH DE#R>GHG
DDE#G>3 DR#EHD?3
DR#AAG33
3?A#BER EGR#R?GR R#DG>RB>AR >3#?A3BE
D-Cun-AB ERBE#EH -A#3DER?
DDE#3E? -A#D3>BR
E#GBRRG>
A#ADRE3G A#AG3GAH
-
DA#EGDGG?B DAG#>>?E
3-(ct-AB 3HBR#B EA#HA3
D3E#B3G D>#A?>G?
DG#?BRHR
3EB#>3D 3?A#BBE? ?#R?H?A?33 B3#BDDRD
D-3e/-A? GD3?#E DH#RAARG
DHE#GDH DG#RD3R?
DH#H>G>
EEE#GEBB E3?#DGBE G#>DDED3?R E3#DG??>
D-Cun-A? GER?#AH 3#>B3?EG
DBD#RA3 B#EEHDAR
?#DB3?D
3>#?HDR> EG#AHED
-
3#>??BHARE DH#A3BD>
D-(ct-A? HAB>#RH D?#RB3GR
D>G#DBH D3#?HAED
D?#ABEDH
D>R#AB>E EG?#AAD? 3#BG?GG>GB D3#3A3>>
D-3e/-A> H3D?#EH G#>R>GH
DRD#A?H 3#?HEA?
B#G3BR?
DG#A?>A3 D>#3?R33
-
B#3HAB>R>H GA#33DEB
E-Cun-A> G?3R#B -DA#>B3?
DB?#E3? -DE#G?H?
-DA#H?>E
DHH#BG3> D3H#H3EB
-
EE#H?>G>RG HAR#?>>E
OAL
75.79866
78.<>899
76.86=78 9=5=.6:9 9576.76/ 78.<>89/< /=5<.>68
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
/.5:7 ,5./> /9.55 5.7><55 :.:99 >9.:<99 ,5./:9
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
%C%C% Prudential "ynamic Plan D !ro?th
"A$ S@P
C&'
&%F0
R$#R&
2'3
&A. R$#R&
203
'
9
0
9
'0 20,0/3 20,03
9
D-jun-AH EA>?#HH
E>#??BG
3-(ct-AH EB3A#AH EH#R>?G
3>#>AAE 3G#>33GD
EB#H?ABG
DED3#3BB RAH#EER? EG#?3ABG BDD#BAGB
D-3e/-AB ER?D#HH DE#R>GHG
GG#D3G> D3#?G>R
DR#AAG33
D>R#A3EE D?>#HE3E 3#BGBD3> D3#ERG3E
D-Cun-AB ERBE#EH -A#3DER?
G>#?>33 DA#H3EH
E#GBRRG>
DDA#R33? -3#ERB3G A#GER?GH A#D>GB>D
3-(ct-AB 3HBR#B EA#HA3
HH#BD3E DG#AAAGR
DG#?BRHR
DRB#AD3? E>?#AHDR 3#>R??E> DH#DREE>
D-3e/-A? GD3?#E DH#RAARG
B>#DGD3 EE#HE?ED
DH#H>G>
HA?#G?H 3H>#EA3> DE#GEGGH DHG#3BBR
D-Cun-A? GER?#AH 3#>B3?EG
?A#A>RE E#>H>BDR
?#DB3?D
>#D?D?AD DD#AGGRD -?#EGGDG HE#G??H>
D-(ct-A? HAB>#RH D?#RB3GR
??#R3BD DD#DRHHR
D?#ABEDH
DEH#3GD3 EAD#DDD> D#ARE>3D D#DRGE?R
D-3e/-A> H3D?#EH G#>R>GH
>D#B>BD G#>DDB3G
B#G3BR?
E3#DHD>E E3#HBRHH -H#ERDD3 E?#RRBAD
E-Cun-A> G?3R#B -DA#>B3?
?G#HERD ->#?BDHR
-DA#H?>E
?B#?BHG3 RH#D>3EB -D>#>BG3 3HH#>B3B
OAL 75.79866 /5:.<8>6 76.86=78 98:5.9:/ 95:>.>99 /8.69/7/ /9=9./<8
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.7/<= 9.869 //.< 5.6<5>: >.>5/< 68.95= 9.<5:
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
Findin+s and Su++estions*
CompanyFs
&ame
4eta Alfa Standard
"eviation
Coefficien
t of
determina
tion
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
%C%C% Prudential
dynamic plan,
!ro?th
5.7/<= 9.869 //.< 5.6<5>: >.>5/< 68.95= 9.<5:
-"FC eEuity
fund,!ro?th
/.5:7 ,5./> /9.55 5.7><55 :.:99 >9.:<9 ,5./:9
4irla advanta+e
fund,!ro?th
/.556 ,/.59: //.9</= 5.7=79 8.<6//> :=.8>9 ,/.5/>6
Sundaram 4&P
Paribas,!ro?th
5.7599 /.69:7: /5.96>7 5.7:77 6.>:599 76.>977: 9.59>/
Alpha @ 4eta*
The a/o.e ta/le sho-s that 0%0%0 :rudential dynamic plan-Gro-th fund is comparati.ely
more .olatile -ith a /eta of , A#RD?3 though compared to the mar,et all the funds are
safer to in.est# $nd also the alpha .alues of fe- funds are positi.e and fe- funds are
negati.e# 0%0%0 :rudential dynamic plan-Gro-th is sho-ing an alpha of E#G>E -hich
suggests that the fund is -ell di.ersified and 6uite efficient in reducing the impact of
mar,et ris,#
Co,efficient of "etermination*
$ll company is ha.ing positi.e co- efficient of determination
SharpeFs Ratio @ reynorFs Ratio*
4harp 0n the a/o.e ta/le, the Treynor=s ratio for !irla $d.antage 3und - Gro-th follo-ed
/y 0%0%0 :rudential Dynamic :lan - Gro-th and then 2D3% +6uity 3und - Gro-th# 0t
suggests that !irla $d.antage 3und - Gro-th is gi.ing highest returns o.er the ris, free
returns after ta,ing the mar,et ris, in to account# (n the other hand 2D3% e6uity fund-
Gro-th is gi.ing the lo-est returns# The sharpe=s ratio of !irla $d.antage 3und - Gro-th
fund highest suggesting that after ta,ing the total ris, in to consideration the fund is
gi.ing good return return o.er and a/o.e the ris, free returns#
3rom the a/o.e it can /e suggested that 2D3% e6uity fund-Gro-th can /e ruled out of
in.estment decision alternati.e# $mong the other three funds !irla is gi.ing higher
returns ta,ing lo-er ris, as compared to 4undaram !': :ari/as-Gro-th and 0%0%0, and
2D3% -hich is gi.ing lo-er returns#
De/t 3und
Sundaram 4&P Paribas 4ond Saver 2!3*
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize<s cr" EB#AHjul-3D-EAA>"
Min# 0n.estment <s H,AAA
*ast Di.idend '#$#
!onus '#$#
$sset $llocationK" :ercentage held
+6uity A#AA
De/t ?3#>?
Mutual 3unds '#$#
Money Mar,et A#AA
%ashO%all EB#D3
4%2+M+ :+<3(<M$'%+
%C%C% Prudential 4lended Plan , Option 4 D !ro?th*
D month 3 months B months D year
-A#AA?D?D A#AAHHGD -A#AEGHD -A#ABRBB
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize<s cr" DB#RAMay-3A-EAA>"
Min #0n.estment <s# H,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocationK" :ercentage held
+6uity A#AA
De/t >E#D3
Money Mar,et A#AA
%ash O %all D?#>?
4%2+M+ :+<3(<M$'%+
-"FC -i+h %nterest Fund D !ro?th*
D month 3 months B months D yrsW
,5.5575/ ,5.59=/< ,5.5>5/8 ,5.//7=7
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize <s cr" GE#?GMay-3A-EAA>"
Min # 0n.estment <s,HAAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity A#AA
De/t B?#?E
Money Mar,et E>#?B
%ash O %all 3#HE
4%2+M+ :+<3(<M$'%+
4irla 4ond %ndeB Fund D !ro?th*
D month 3 months B months D yrsW
5.5589/< 5.55:::8 ,5.58:/> ,5.5<>6=
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize<s cr" A#3HMay-3A-EAA>"
Min # 0n.estment <s#EH,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity A#AA
De/t 33#GA
Money Mar,et A#AA
%ash O %all BB#BA
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
,5.558/6 ,5.5/:< ,5.5=67: ,5.5<>66
D+!T 39'D ('+ M('T2 %(M:$<04(' (3 <+T9<'"
%ompany 'ame
and 3und
$/solute
return
Mean return 4tandard
De.iation
5ariance
!irla !ond 0nde1
3und F Gro-th
-A#AAGD> -A#AAADH A#AAAEHB A#AAAAAAABH
2D3% 2igh
0nterest 3und F
Gro-th
A#AAGED? A#AAADHD A#AAA>3D A#AAAAAABR
0%0%0 :rudential
!lended :lan -
(ption ! F
Gro-th
-A#AARAD -A#AAA3E A#AAAEAE A#AAAAAAAG
4undaram !':
pari/as /ond
sa.er-Gro-th
-A#AA?D?D -A#AAAED A#AADBDG A#AAAAAEBA
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 2D3% 2igh 0nterest 3und F Gro-th fund is gi.ing
the highest a/solute return o.er D months A#AAGED?" -hile it is highest in term of
fluctuation of returns .ariance=A#AAAAAABR"# 0%0%0 :rudential !lended :lan - (ption ! -
Gro-th is ha.ing the minimum fluctuation in return generated .ariance=A#AAAAAAAG"#
"$%%E"&ON"'
a"3or in.estor -ith high ris, appetite go for 4undaram !': :ari/as /ond sa.er-Gro-th
/"3or in.estor -ith moderate ris, appetite: Go for 2D3% 2igh 0nterest 3und - Gro-th
c"3or in.estor -ith lo- ris, appetite: 0%0%0 :rudential !lended :lan - (ption ! F Gro-th
D+!T 39'D 40X M('T24 %(M:$<04(' (3 <+T9<'"
%ompany 'ame
and 3und
$/solute
return
Mean 4tandard
De.iation
5ariance
!irla !ond
0nde1 3und F
Gro-th
-A#A3>RH -A#AAAEE A#AAA3BB A#AAAAAAD33
2D3% 2igh
0nterest 3und F
Gro-th
-A#AGHDB -A#AAAEB A#AADEBE A#AAAAADHRE
0%0%0 :rudential
!lended :lan -
(ption ! F
Gro-th
-A#ABADG -A#AAA3H A#AAA>3E A,AAAAAABRE
4undaram !':
:ari/as /alance
fund-Gro-th
-A#AEGHD
-A#AAAD3 A#AADEE3
A#AAAAADH
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 4undaram !': :ari/as /alance fund-Gro-th is
gi.ing the highest a/solute return o.er D months -A#AEGHD" -hile it is highest in term of
fluctuation of returns .ariance=A#AAAAADH"# !irla !ond 0nde1 3und - Gro-th is ha.ing
the minimum fluctuation in return generated .ariance=A#AAAAAAD33"#
"$%%E"&ON"'
a"3or in.estor -ith high ris, appetite go for 2D3% 2igh 0nterest 3und F Gro-th
/"3or in.estor -ith moderate ris, appetite: Go for 0%0%0 :rudential !lended :lan -
(ption ! F Gro-th
c"3or in.estor -ith lo- ris, appetite: 4undaram !': :ari/as /alance fund-Gro-th
Sundaram 4&P Paribas 4ond Saver 2!3*
"A$ S@P
C&'
&%F0
R$#R&
S
2'3
&A. R$#R&S
203
'9 09 ' 0 20,0/3 20,0/39
D-jun-AH EA>?#HH 3G#HDER
3-(ct-AH EB3A#AH EH#R>?G G3#B>3E EB#H?ABG B?H#3GH D#HAHBEB 3D#>>?H? -A#3H3DBE3A> A#DEG?EG
D-3e/-AB ER?D#HH DE#R>GHG HD#R>GR
DR#AAG33
DB>#HR>G
A#3EER>H ?#3?R3GR
-D#ADD>>GAGB D#AE3RAR
D-Cun-AB ERBE#EH -A#3DER? H3#EB>R E#GBRRG> -A#AR?RGR
A#GDBR3H
-A#EAEA>
-A#R3GGR?ADR
A#>?3E>H
3-(ct-AB 3HBR#B EA#HA3 BD#D3BH DG#?BRHR GEA#3?E> 3#3>H>AG 3?#?EBBH A#EHR>H33R3 A#AB?HEG
D-3e/-A? GD3?#E DH#RAARG ?A#BBGH
DH#H>G>
EHE#>3RR D#>HR3R3 ED#B>EGB
-A#EDBBABD>R
A#AGBRD>
D-Cun-A? GER?#AH 3#>B3?EG ?H#?EB? ?#DB3?D DG#RE>3? E#EEEEDE H#?HRB>B -A#A>RGR3HDR
A#AA>AAR
D-(ct-A? HAB>#RH D?#RB3GR >>#BG?3 D?#ABEDH 3EE#B>BR G#DG>>>G 3B#H>RG>
A#GHBB?RA?G A#EA>HHB
D-3e/-A> H3D?#EH G#>R>GH RG#3H3H B#G3BR? E3#RRG>E
D?#3HB3>
EA#GA?G3
E#H>H>R?EE
B#B>B>BG
E-Cun-A> G?3R#B -DA#>B3? >G#3?EB -DA#H?>E DD>#ADRR A#?>AGE3 -R#HR?DB -A#BRB?>BBA> A#G>HHDE
OAL 75.79866 76.86=78
/77>.668 =/.776>8 /:/.>==8 ,=.<:>=6 7.:9:=5/
CALC#LA%O& OF A4O.$ A4L$*
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
,5.<6957 /7.:556 /.596<< ,5.<78/76 6>.87:: ,//=.<<</ ,98.7=89
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
4irla 4ond %ndeB Fund D !ro?th:
"A$ S@P
C&'
&%F0
R$#R&
S
2'3
&A. R$#R&S
203
'9 09 ' 0 20,0/3 20,0/39
D-jun-AH EA>?#HH
DA#?EA?
3-(ct-AH EB3A#AH EH#R>?G
DA#R3DE D#RB3GRD
B?H#3GH
3#>HHER> HD#AEBA3 ->#D3RE? BB#EG??B
D-3e/-AB ER?D#HH DE#R>GHG
DD#AE3R A#>G>A3D
DB>#HR>G
A#?DRDH? DD#ADD3 -R#EHG?3 >H#BH
D-Cun-AB ERBE#EH -A#3DER?
DD#D>>H D#GR3DDR
-A#AR?RGR
E#EERGAB -A#GB?3 ->#BARBG ?G#DEHRD
3-(ct-AB 3HBR#B EA#HA3 DD#3R3G D#>3D3GH GEA#3?E> 3#3H3>E3 3?#HG>AH ->#E?DGE B>#GDB3D
D-3e/-A? GD3?#E DH#RAARG
DD#H>?G D#?AE?G
EHE#>3RR
E#>RR3EG E?#A?HD? ->#GAAAE ?A#HBA33
D-Cun-A? GER?#AH 3#>B3?EG DD#?B?3 D#HHEHG> DG#RE>3? E#GDAGA? H#RR>BDR ->#HHAED ?3#DABDE
D-(ct-A? HAB>#RH D?#RB3GR DE#AD?H E#DEBE3D 3EE#B>BR G#HEA>HR 3>#DRGH3 -?#R?BH3 B3#BEHAD
D-3e/-A> H3D?#EH G#>R>GH
DE#ERDE E#E??HDE
E3#RRG>E
H#D>?ABD DD#DHBE> -?#>EHEH BD#E3GHD
E-Cun-A> G?3R#B -DA#>B3?
DE#G>>G D#BAGG
DD>#ADRR
E#H?GARR -D?#GER? ->#GR>3B ?E#EEEDE
OAL
75.79866
/:.=7789
/77>.668
9<.<878= />8.//= ,<:.:9:8 >=:./66/
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.55<79 /.>=/ 6.8557 5.9957<< ,/.::7 ,/>:8./ /5./5
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
2D3% 2igh 0nterest 3und F Gro-th:
"A$ S@P
C&'
&%F0
R$#R&S
2'3
&A. R$#R&S
203
'9 09 ' 0 20,0/3 20,0/39
D-jun-AH EA>?#HH
E3#3
3-(ct-AH EB3A#AH EH#R>?G
E3#B>ER D#BG33G>
B?H#3GH
E#?AAHRD EG#3GGAH
-
>#GHRGE ?D#HBD?3
D-3e/-AB ER?D#HH DE#R>GHG
E3#???B A#3RR>B?
DB>#HR>G
A#DHR>R3 DE#H>GB>
-
R#?AE>R RG#DGBDG
D-Cun-AB ERBE#EH -A#3DER?
E3#RHRG A#?BGH>H
-
A#AR?RGR
A#H>GHR -D#A??HH
-
R#33>D? >?#EADHD
3-(ct-AB 3HBR#B EA#HA3
EG#3HA? D#B33D?R
GEA#3?E>
E#BB?E?H D>#>BR>E
-
>#GBRH> ?D#?33?R
D-3e/-A? GD3?#E DH#RAARG
EG#G>?B A#HBEEAD
EHE#>3RR
A#3DBA?D DH#33>?G
-
R#HGAHB RD#AEEEB
D-Cun-A? GER?#AH 3#>B3?EG
EG#HEG3 A#DGR>?E
DG#RE>3?
A#AEEGBE 3#?D3>HE
-
R#RHE>R RR#AHRR>
D-(ct-A? HAB>#RH D?#RB3GR
EH#3?3H 3#GBEB>>
3EE#B>BR
DD#RRAED DG#HAA>
-
B#BGAA? GG#ARAHB
D-3e/-A> H3D?#EH G#>R>GH
EB#BHHB H#AHERD
E3#RRG>E
EH#H3D>R -A#DHGGB
-
H#AGR>H EH#HAARR
E-Cun-A> G?3R#B -DA#>B3?
EB#B??B A#A>EH3G
DD>#ADRR
A#AAB>DE -DA#RGBE
-
DA#AEAE DAA#GAGR
OAL
75.79866 /=.<://6
/77>.668 8=.7<76 <<./<=>7
,
<<./<=< >68.<9/7
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
,5.5:/7 9.5:/ 6.<99 ,5.=:<9 ,/.<:< 97:.9 ,=7.:9
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
%C%C% Prudential 4lended Plan , Option 4 D !ro?th:
"A$ S@P
C&'
&%F0
R$#R&S
2'3
&A. R$#R&S
203
'9 09 ' 0 20,0/3 20,0/39
D-jun-AH EA>?#HH DA#ADR?
3-(ct-AH EB3A#AH EH#R>?G
DA#EDE D#RDREDR
B?H#3GH
3#B>3GAE GR#>?HHE
-
>#D>3HH BB#R?AGD
D-3e/-AB ER?D#HH DE#R>GHG
DA#3RGE D#?>GD?H
DB>#HR>G
3#D>3E>E E3#DBB?D
-
>#3D>H> BR#DR>>H
D-Cun-AB ERBE#EH -A#3DER?
DA#B>>B E#>3E3GR
-
A#AR?RGR >#AEEE -A#>>BG3
-
?#E?AGD HE#>H>>>
3-(ct-AB 3HBR#B EA#HA3 DA#>??D D#?B3HBD GEA#3?E> 3#DDADG> 3B#DH>ER ->#33RE BR#HGEEG
D-3e/-A? GD3?#E DH#RAARG
DD#DEBR E#ERBHB>
EHE#>3RR
H#E?GEEH 3B#HD?HR
-
?#>ABDR BA#R3BB3
D-Cun-A? GER?#AH 3#>B3?EG
DD#GDG E#H>AE33
DG#RE>3?
B#BH?BAH R#RBR3DD
-
?#HEEH3 HB#H>>GD
D-(ct-A? HAB>#RH D?#RB3GR
DD#>DH> 3#HEAE3>
3EE#B>BR
DE#3REA> B3#E3H?H
-
B#H>EHE G3#3ERHR
D-3e/-A> H3D?#EH G#>R>GH
DE#EHG3 3#?DDD33
E3#RRG>E
D3#??EH D>#D?>>
-
B#3RDB3 GA#>HER
E-Cun-A> G?3R#B -DA#>B3?
DE#HABG E#AH?E3?
DD>#ADRR
G#E3EEEG -EE#3GRE
-
>#AGHHE BG#?3AGG
OAL 75.79866 99.8>8</ /77>.668 >5.=9<>< 9/=.6>>=
,
>6.8>5/ :9:.556=
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
,5.5/97 9.>9> <.>=<> ,5.95>7> ,5.<75 ,8>:.>> ,959.>9
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
Findin+s and Su++estions*
CompanyFs
&ame
4eta Alfa Standard
"eviation
Coefficient
of
determinat
ion
Sharpe
ratio
2SR3
reynor
Ratio 2R
1ensen Ratio
21R3
%C%C% Prudential
4lended plan option,
4,!ro?th
,5.5/97 9.>9> <.>=<> ,5.95>7> ,5.<75 ,8>:.>> ,959.>9
-"FC hi+h interest
fund,!ro?th
,5.5:/7 9.5:/ 6.<99 ,5.=:<9 ,/.<:< 97:.9 ,=7.:9
4irla 4ond indeB
fund,!ro?th
5.55<79 /.>=/ 6.8557 5.9957<< ,/.::7 ,/>:8./ /5./5
Sundaram 4&P
Paribas 4ond Saver,
!ro?th
,5.<6957 /7.:556 /.596<< ,5.<78/76 6>.87:: ,//=.<<</ ,98.7=89
Alpha @ 4eta*
The a/o.e ta/le sho-s that !irla !ond inde1 fund-Gro-th is comparati.ely more .olatile
-ith a /eta of A#AA?RE, though compared to the mar,et all the funds are safer to in.est#
$nd also the alpha .alues of all the funds are positi.e -hich sho-s that the funds are
gi.ing returns justifying the ris, ta,en# 4undaram !': :ari/as !ond 4a.er-Gro-th is
sho-ing an alpha of DR#HAA> -hich suggests that the fund is -ell di.ersified and 6uite
efficient in reducing the impact of mar,et ris,#
Co,efficient of "etermination*
2ere all .alues are not in positi.e form of the co-efficient of determination of all the fund
of the de/t#
SharpeFs Ratio @ reynorFs Ratio
4harp 0n the a/o.e ta/le, the Treynor=s ratio for 2D3% 2igh 0nterest 3und F Gro-th fund
the highest here almost all funds are in negati.e form and same are in positi.e form# 0t
suggests that 2D3% 2igh 0nterest 3und F Gro-th fund fund is gi.ing highest returns o.er
the ris, free returns after ta,ing the mar,et ris, in to account# (n the other hand
4undaram !': :ari/as !ond 4a.er-Gro-th 3und is gi.ing the lo-est returns#
)ith more .olatility the 4harpe=s ratio here all fund are in negati.e or 2D3% 2igh
0nterest 3und F Gro-th fund gi.ing highest, suggesting that after ta,ing the total ris, in to
consideration the fund is gi.ing good return o.er and a/o.e the ris, free returns#
!alance 3und
Sundaram 4&P Paribas 4alance Fund,!ro?th*
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize <s cr" 3>#R3jul-3D-EAA>"
Min# 0n.estment <s H,AAA
*ast Di.idend '#$#
!onus '#$#
$sset $llocation K" :ercentage held
+6uity BH#EG
De/t A#AA
Mutual 3unds '#$#
Money Mar,et A#AA
%ashO%all 3G#?3
4%2+M+ :+<3(<M$'%+ :
Dmonth 3 months B months Dyear
-A#ABD?D A#AGRHGR A#EH>D3G -A#DDEGH
-"FC 4alanced Fund D !ro?th
0n.estment 0nformation
3und Type (pen-+nded
0n.estment Type Gro-th
$sset 4ize <s cr" DAG#>HMay-3A-EAA>"
Min #0n.estment <s#H,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity BR#AA
De/t E3#RE
Money Mar,et H#?>
%ash O %all D#3A
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
A#ABA?D? A#D3G?3H A#A3R3G -A#AG33>
%C%C% Prudential 4alanced D !ro?th
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize <s cr" 33B#R?May-3A-EAA>"
Min# 0n.estment <s#HAAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity ?A#?H
De/t ED#DB
Mutual 3und '#$
Money Mar,et A#AA
%ash O %all >#AR
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
A#A>G3E A#DRD?BH A#D3GHD> -A#ADAG3
4irla 4alance Fund D !ro?th
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize<s cr" DAB#3>May-3A-EAA>"
Min# 0n.estment <s#HAAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity B?#3R
De/t D?#?3
Money Mar,et A#AA
%ash O %all DG#>>
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
A#AG?G3 A#AB3AD> A#DA?GB3 -A#ABGAD
!$*$'%+D 39'D-('+ M('T2 %(M:$<04(' (3 <+T9<'"
%ompany 'ame
and fund
$/solute
return
Mean return 4tandard
De.iation
5ariance
!irla !alance 3und -
Gro-th
A#AG?G3 A#AADB>G A#DBK" A#AA?H? A#AAAAH?3AG
2D3% !alanced
3und - Gro-th
A#ABA?D? A#AAEDGG A#EDK" A#AA>B>D A#AAAA?H3HHR
0%0%0 :rudential
!alanced - Gro-th
A#A>G3E A#AAERG? A#ERK" A#ADA3E A#AAADABHAE
4undaram !':
:ari/as !alance
fund-Gro-th
-A#ABD?D
-A#AAEDD
A#ADBG?H
A#AAAE?D
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 0%0%0 :<9D+'T0$* /alanced gro-th fund is
gi.ing the ma1imum a/solute one month return A#A>G3E"/ut is also highest in terms of
.olatility 5ariance=A#AAADABHAE" -hile 4undaram !': :ari/as !alance fund-Gro-th is
ha.ing the lo-est .olatility .ariance=A#AAAE?D" so far as return in concerned#
49GG+4T0('4:
a" 3or in.estor -ith high ris, appetite: Go for the 0%0%0 /alanced gro-th fund#
/" 3or in.estor -ith moderate ris, appetite: Go !irla !alance 3und F Gro-th#
c" 3or in.estor -ith lo- ris, appetite: Go 4undaram !': :ari/as !alance fund-
Gro-th#
!$*$'%+D 39'D-40X M('T24 %(M:$<04(' (3 <+T9<'"
%ompany
'ame and fund
$/solute
return
Mean return 4tandard
De.iation
5ariance
!irla !alance
3und - Gro-th
A#DA?GB3 A#AAABB A#AD3EB? A#AAAD?B
2D3% !alanced
3und - Gro-th
A#A3R3G A#AAA3DE>G3 A#AD3RG? A#AAADRG
0%0%0 :rudential
!alanced - Gro-th
c
A#D3GHD> A#AAA>G>3ER A#ADB?H3 A#AAAE>A
4undaram !':
:ari/as /alance
fund-Gro-th
A#EH>D3G A#AADGAG A#ADHH>G A#AAAEG3
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 4undaram !': :ari/as /alance fund-Gro-th is
gi.ing the highest a/solute return o.er B months A#EH>D3G" -hile it is highest in term of
fluctuation of returns .ariance=A#AAAEG3"# !0<*$ /alanced fund is ha.ing the minimum
fluctuation in return generated .ariance=A#AAAD?B"#
"$%%E"&ON"'
a"3or in.estor -ith high ris, appetite: Go for 0%0%0 prudential !$*$'%+D 39'D
/"3or in.estor -ith moderate ris, appetite: Go for !0<*$ !$*$'%+D fund
c"3or in.estor -ith lo- ris, appetite: Go for !0<*$ !$*$'%+D fund#
Sundaram 4np Paribas 4alance fund*
"A$ S@P
C&'
&%F0
R$#R&
2'3
&A. R$#R&
203
'
9
0
9
'0 20,0/3 20,0/39
D-jun-AH EA>?#HH EA#>D?
3-(ct-AH EB3A#AH EH#R>?G E3#HRDH D3#3E>AH B?H#3GH D??#B3BR 3GB#3BDG B#3HABEE GA#33AG
D-3e/-AB ER?D#HH DE#R>GHG E?#B?D D?#EREEH DB>#HR>G ERR#AED? EEG#H3DR DA#3DG>E DAB#3RHH
D-Cun-AB ERBE#EH -A#3DER? E>#GB>B E#>>EGG -
A#AR?RGR
>#3A>GBD -A#RAEDD -G#ARGRR DB#?B>RE
3-(ct-AB 3HBR#B EA#HA3 ER#BRRR G#3EHDDB GEA#3?E> D>#?ABB3 >>#B??>G -E#BHE3D ?#A3G?H3
D-3e/-A? GD3?#E DH#RAARG 3E#>3R DA#HBRG EHE#>3RR DDD#?DED DB>#AB33 3#HRDRBR DE#RAEEG
D-Cun-A? GER?#AH 3#>B3?EG 3G#HD>E H#DD3G3E DG#RE>3? EB#DG?DR DR#?HB>R -D#>B3RR
3#G?GG??
D-(ct-A? HAB>#RH D?#RB3GR GA#AHHE DB#AGA>D 3EE#B>BR EH?#3A??
E>>#DG>R
R#AB33>B >E#DGGR?
D-3e/-A> H3D?#EH G#>R>GH GD#RHD> G#?3GRBB E3#RRG>E EE#GDRR E3#DR3RR -E#EGEGB
H#AE>B3E
E-Cun-A> G?3R#B -DA#>B3? 3?#D3D? -DD#G>RB DD>#ADRR D3E#ADDE DEG#>DR? -D>#GB?
3GD#A3DB
ssOA
L
75.79866
>9.<7>68
/77>.668
/5:=.9<9
/969.>:9
5.55558<
>/:.///:
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe ratio
2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.>5//> 5.7585 6.9><9 5.<7:7 >.88>6 66.>:>< /.:5=>
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
4irla 4alance Fund D !ro?th
"A$ S@P C&'
&%F0
R$#R&
2'3
&A. R$#R&S
203
'9 09 '0 20,0/3 20,0/39
D-jun-AH EA>?#HH
D>#AD
3-(ct-AH EB3A#AH EH#R>?G
EA#RB DB#3?R?R
B?H#3GH
EB>#ER?H GEH#BB>E B#E??AEH 3R#GADAG
D-3e/-AB ER?D#HH DE#R>GHG
E3#A3 R#>?HRHG
DB>#HR>G
R?#H3GG? DE>#E3G> -A#EEB>D A#AHDGGD
D-Cun-AB ERBE#EH -A#3DER?
EE#>G -A#>EHAD
-A#AR?RGR
A#B>ABG3 A#EH>EAE -DA#RE?> DDR#GDBE
3-(ct-AB 3HBR#B EA#HA3
EB#DG DG#GG>3G
GEA#3?E>
EA>#?HGG ERB#E3GE G#3GHH?B D>#>>GA3
D-3e/-A? GD3?#E DH#RAARG
E>#3? >#H3AR>?
EHE#>3RR
?E#????G D3H#BHA? -D#H?D?? E#G?AG?
D-Cun-A? GER?#AH 3#>B3?EG
ER#HR G#3AA3D?
DG#RE>3?
D>#GRE?3 DB#BDHEG -H#>AEGG 33#BB>3G
D-(ct-A? HAB>#RH D?#RB3GR
33#B3 D3#BH3EB
3EE#B>BR
D>B#GDDH EGH#EBAE 3#HHAHAD DE#BABAB
D-3e/-A> H3D?#EH G#>R>GH
3E#GH -3#HA>??
E3#RRG>E
DE#3DDG> -D?#D>?H -D3#BDDH D>H#E?3>
E-Cun-A> G?3R#B -DA#>B3?
3A#RD -G#?GH?B
DD>#ADRR
EE#HEEEB HD#HHBH3 -DG#>G>H EEA#G?>B
O
AL
75.
79866 :6./57/
/77
>.668 66<.<696 /969.97 :6./57/ >=9.9:
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.>8: ,5.57 6.=6/: 5.7855/9 =.:=9> 8:.75: 5./=7:
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
-"FC 4alanced Fund D !ro?th
"A$ S@P C&'
&%F0
R$#R&
2'3
&A. R$#R&S
203
'9 09 '0 20,0/3 20,0/39
D-jun-AH EA>?#HH
EA#H?B
3-(ct-AH EB3A#AH EH#R>?G
EG#GBG ER#RA?BR
B?H#3GH
>RG#G?AD ???#EE3E DR#>AGR3 3RE#E3HE
D-3e/-AB ER?D#HH DE#R>GHG
EB#AH? DE#EH3>H
DB>#HR>G
DHA#DHB? DHR#DDAB E#DHDA>B G#BE?D?E
D-Cun-AB ERBE#EH -A#3DER?
EB#GH> 3#A>GBDH
-A#AR?RGR
R#HDG>HE -A#RBH3R -?#AD>DG GR#EHG3H
3-(ct-AB 3HBR#B EA#HA3
ER#RGG EB#>DH3>
GEA#3?E>
?DR#ABGR HGR#?RH? DB#?DEBE E?R#3DD>
D-3e/-A? GD3?#E DH#RAARG
3E#AR DB#HA?BR
EHE#>3RR
E?E#HA3R EBE#G>?> B#GAGR3E GD#AE3DB
D-Cun-A? GER?#AH 3#>B3?EG
3E#AAE -A#B?BRE
DG#RE>3?
A#GH>EEH -E#BDHGG -DA#??R? DDB#EADB
D-(ct-A? HAB>#RH D?#RB3GR
3G#RH? EE#?3A??
3EE#B>BR
HDB#B>?R GA>#3E3R DE#BE>AD DHR#GBBB
D-3e/-A> H3D?#EH G#>R>GH
3>#DH> EG#BE3A>
E3#RRG>E
BAB#ERHR DEA#BDGR DG#HEA3E EDA#>3RB
E-Cun-A> G?3R#B -DA#>B3?
3G#>G3 -EH#H
DD>#ADRR
BHA#EH E??#AEG3 -3H#BAE> DEB?#HH?
OAL
75.7
9866 /57.<8>9
/77
>.668 =6/7.859 9::/ /6.69/=/ 9:95.:/>
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
/.==6> ,/.=97 />.<=:/ 5.66>= 8.6:86 >5.>78 ,5.779
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
%C%C% Prudential 4alanced D !ro?th
"A$ S@P
C&'
&%F0
R$#R&
2'3
&A. R$#R&S
203
'9 09 '0 20,0/3 20,0/39
D-jun-AH EA>?#HH
EA#3?
3-(ct-AH EB3A#AH EH#R>?G
EH#DB E3#HDGR?
B?H#3GH
HHE#RHG BDD#AR3 3H#>HD>? DE>H#3HB
D-3e/-AB ER?D#HH DE#R>GHG
E>#EB DE#3EDDG
DB>#HR>G
DHD#>DAB DHR#R>GG -H3#D3>E E>E3#BBG
D-Cun-AB ERBE#EH -A#3DER?
E>#? D#HHBR?D
-
A#AR?RGR E#GEGDHR -A#G>?E> D#HHBR?D E#GEGDHR
3-(ct-AB 3HBR#B EA#HA3
3D#GH R#H>D>>E
GEA#3?E>
RD#>DEGH DRB#GH?3 R#H>D>>E RD#>DEGH
D-3e/-A? GD3?#E DH#RAARG
3H#>G D3#RH>BB
EHE#>3RR
DRG#>GG3 EED#RHHR D3#RH>BB DRG#>GG3
D-Cun-A? GER?#AH 3#>B3?EG
3B#GH D#?AEAAR
DG#RE>3?
E#>RB>3G B#H?BAR3 D#?AEAAR E#>RB>3G
D-(ct-A? HAB>#RH D?#RB3GR
GA#3H DA#BRRHR
3EE#B>BR
DDG#G>DE DRE#EADR DA#BRRHR DDG#G>DE
D-3e/-A> H3D?#EH G#>R>GH
GE#DH G#GBARB?
E3#RRG>E
DR#RAAEE ED#>HD>E G#GBARB? DR#RAAEE
E-Cun-A> G?3R#B -DA#>B3?
3B#RH -DE#33BR
DD>#ADRR
DHE#DR>R D3G#AEG3 -DE#33BR DHE#DR>R
OAL 75.79866 >:.8:7=/
/77>.66
8 /96=.=9= /:8=.>:< /9.==>67 8>6<.:<7
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.6/67 ,5.775< 99.69/7 5.7:5>6 /.>/7 8:./=97 ,/.957
&ote 2% have taAen Rf benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
Findin+s and Su++estions*
CompanyFs
&ame
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio
2SR3
reynor
Ratio
2R3
1ensen
Ratio 21R3
%C%C% Prudential
4alanced D !ro?th
5.6/67 ,5.775< 99.69/7 5.7:5>6 /.>/7 8:./=97 ,/.957
-"FC 4alanced
Fund D !ro?th
/.==6> ,/.=97 />.<=:/ 5.66>= 8.6:86 >5.>78 ,5.779
4irla 4alance
Fund D !ro?th
5.>8: ,5.57 6.=6/: 5.7855/9 =.:=9> 8:.75: 5./=7:
S#&"ARAM 4&P
PAR%4AS
4ALA&C$"
F#&"*
5.>5//> 5.7585 6.9><9 5.<7:7 >.88>6 66.>:>< /.:5=>
Alpha @ 4eta
The a/o.e ta/le sho-s that 2D3% !alanced 3und - Gro-th fund is comparati.ely more
.olatile -ith a /eta of D#33>B, though compared to the mar,et all the funds are safer to
in.est and they are ha.ing less .olatility also# $nd also the alpha .alues of all the funds
are negati.e e1pected 4undaram !': :ari/as !alance 3und -hich sho-s that the funds
are gi.ing returns not justifying the ris, ta,en# 4undaram !': :ari/as !alance 3und is
sho-ing an alpha of A#RAGA -hich suggests that the fund is -ell di.ersified and 6uite
efficient in reducing the impact of mar,et ris,#
Co,efficient of "etermination
$ll company is ha.ing positi.e co- efficient of determination#
SharpeFs Ratio @ reynorFs Ratio
4harp 0n the a/o.e ta/le, the Treynor=s ratio for 4undaram !': :ari/as !alance 3und is
the highest follo-ed /y 2D3% and then !0<*$# 0t suggests that 4undaram !': :ari/as
!alance 3und is gi.ing highest returns o.er the ris, free returns after ta,ing the mar,et
ris, in to account# (n the other hand 0%0%0 :rudential !alanced - Gro-th fund is gi.ing
the lo-est returns# The 4harpe=s ratio of 4undaram !': :ari/as !alance 3und is highest
suggesting that after ta,ing the total ris, in to consideration the fund is gi.ing good return
o.er and a/o.e the ris, free returns# 3rom the a/o.e it can /e suggested that 4undaram
!': :ari/as !alance 3und can /e ruled out of in.estment decision alternati.e# $mong
the other three funds#
%2$:T+<
5
3indings , conclusion , suggestions
Su++estion +iven to the Company
The study has tried pro.e that mere returns of a fund or the past performance is not good enough
to ma,e a sound decision on in.estment for the future#
There is a need to understand .arious a.aila/le tools of comparati.e analysis and their
significance in ma,ing an in.estment decision#
There tools help in analyzing the consistency of performance of the funds o.er a period of time#
Thus -hile gi.ing a suggestion to a potential in.estor on in.estments#
The ad.isor can
? Ta,e the /eta ratios of .arious funds and suggest -ither the fund is .olatile or not
? 9se correlations and suggest -hether the /enchmar, ta,en /y the company for judging
the performance is good enough or not#
? 9se treynor=s ratio and tell -ither the fund of the company is gi.ing returns justifying the
mar,et ris, to -hich all the similar funds are su/ject to#
Mutual fund: $n 0ntroduction
$ mutual fund is a form of collecti.e in.estment# 0t is a pool of money collected from .arious
in.estors -hich is in.ested according to the stated in.estment o/jecti.e# The fund manager is the
person -ho in.ests the money in different types of securities according to the predetermined
o/jecti.es# The portfolio of a mutual fund is decided ta,ing into consideration this in.estment
o/jecti.e# Mutual fund in.estors are li,e shareholders and they o-n the fund# The income earned
through these in.estments and the capital appreciation realized /y the scheme is shared /y its unit
holders in proportion to the num/er of units o-ned /y them# The .alue of the in.estments can go
up or do-n, changing the .alue of the in.estors holding# Mutual funds are one of the /est
in.estments e.er created /ecause they are .ery cost efficient and .ery easy to in.est in#
4iblio+raphy and references
4ooAs: T4ecurity $nalysis and portfolio ManagementU /y Donald 3ischer I <onald
Cordan, Bth edition pu/lished /y prentice 2all DRRH#
Web sites*
? ---#amfi #com
? )--# Money control#com
? ---#historical nifty#yahoofinancial#com
? ---#sundaram !': :ari/as# in
? ---#share,an#com
1ournal*
? $uthor /y ,annan, I 'edunchez 0ndian T$ comparati.e study on performance of
pri.ate mutual fundsU+conomic panorama issue date, BAODAOEAAH
? 4isodiya, $mith 4ingh, TMutual funds performance-%omparati.e analysisU 0%3$0,
DHO?OEAAG#
doc_763851048.doc
Mutual funds invest in a number of companies across a broad cross- section of industries and sectors. This diversification reduces the risk because seldom do all stocks decline at the sane time and in the same proportion. You achieve this diversification through a mutual fund with far less money than you can do on your own
Comparative Analysis on Mutual Fund Scheme
With reference to Sundaram finance Ltd.
Report submitted in partial fulfillment of
POS !RA"#A$ "%PLOMA %& MA&A!$M$&
C$R%F%CA$
This is to certify that ''''' has completed the project titled (Comparative analysis
on the mutual fund scheme) from Sundaram finance Ltd under my guidance
completed the project successfully, for the partial fulfillment of the course: Dissertation in
term= 3
rd
of the post Graduate Diploma in Management- XXXXX specialization !atch
XXXX"#
$%&'()*+G+M+'T
This project in itself is an ac,no-ledgement to the inspiration, dri.e and .alua/le guidance
contri/uted to it /y many indi.iduals# This project -ould ne.er ha.e /een the light of day
-ithout the help and guidance that ha.e /een recei.ed#
0 -ould li,e to e1press my sincere appreciation and than,s to '''' -ho guided me all
throughout the summer training# 0t is under her .alua/le guidance, constant interest and
encouragement 0 ha.e completed this project# 2e de.oted his e.er-precious time from his
/usy schedule and helped in complete understanding of the mutual fund industry in 0ndia#
3inally 0 -ould li,e to than, my professor '''', -hose most .alua/le e1pertise -as
training to me to /e success#
"$CLARA%O&
0, !#4anthosh &umar ,declare in full consciousness that this has /een carried out /y me is
original and in no -ay has /een copied or is reproduction of any prior e1isting -or,#
"ate*
Si+nature
Place*
CO&$&S*,
C-AP$R %
Introduction
Scope of study
Need for study
Objective
Methodology
Data Collection
Sampling
Sampling technique
Tools used
imitations of the study
C-AP$R %%
Industry !ro"le
Company pro"le
C-AP$R %%%
Theory of the study
C-AP$R %.
Data analysis and interpretation
C-AP$R .
#indings$ conclusion$ suggestions
C-AP$R
/
Introduction
Scope of the study
Need for study
Objective
Methodology -
• Data collection and processing
• Sampling technique
• Sam palling technique
• Tools used
imitations of the study
Mutual fund: $n 0ntroduction
$ mutual fund is a form of collecti.e in.estment# 0t is a pool of money collected from .arious
in.estors -hich is in.ested according to the stated in.estment o/jecti.e# The fund manager is the
person -ho in.ests the money in different types of securities according to the predetermined
o/jecti.es# The portfolio of a mutual fund is decided ta,ing into consideration this in.estment
o/jecti.e# Mutual fund in.estors are li,e shareholders and they o-n the fund# The income earned
through these in.estments and the capital appreciation realized /y the scheme is shared /y its unit
holders in proportion to the num/er of units o-ned /y them# The .alue of the in.estments can go
up or do-n, changing the .alue of the in.estors holding# Mutual funds are one of the /est
in.estments e.er created /ecause they are .ery cost efficient and .ery easy to in.est in#
The in.estment in securities through mutual funds is spread across -ide range of
industries and sectors and thus the ris, is reduced# Di.ersification reduces the ris,
/ecause all stoc,s may not mo.e in the same direction at the same time# 5arious fund
houses issue units to the in.estors in accordance -ith the 6uantum of money in.ested /y
them# 0n.estors of mutual funds are ,no-n as unit holders#
0n 0ndia a mutual fund is re6uired to /e registered -ith 4ecurities +1change !oard of
0ndia 74+!08 -hich regulates the securities mar,et#
$D5$'T$G+4 (3 0'5+4T0'G 0' M9T9$* 39'D4:
There are se.eral that can /e attri/uted to the gro-ing popularities and suita/ility of
mutual funds as an in.estment .ehicle especially for retail in.estors#
:rofessional management:
Mutual funds pro.ide the ser.ices of e1perienced and s,illed professionals, /ac,ed /y a
dedicated in.estment research team that analysis the performance and prospects of
companies and selects suita/le in.estments to achie.e the o/jecti.es of the scheme#
Di.ersification:
Mutual funds in.est in a num/er of companies across a /road cross- section of industries
and sectors# This di.ersification reduces the ris, /ecause seldom do all stoc,s decline at
the sane time and in the same proportion# ;ou achie.e this di.ersification through a
mutual fund -ith far less money than you can do on your o-n#
%on.enient administration:
0n.esting in a mutual fund reduces paper-or, and helps you a.oid many pro/lems such
as /ad deli.eries, delayed payment and follo- up -ith /ro,ers and companies# Mutual
funds sa.e your time and ma,e in.esting easy and con.enient#
<eturn potential:
(.er a medium to long term, mutual funds ha.e the potential to pro.ide a higher return as
they in.est in a di.ersified /as,et of selected securities#
*o- costs:
Mutual funds are a relati.ely less e1pensi.e -ay to in.est compared to directly in.esting
in the capital mar,ets /ecause the /enefits of scale in /ro,erage, custodial and other fees
translate into lo-er costs for in.estors#
*i6uidity:
0n open ended schemes, the in.estors get the money /ac, promptly at net asset .alue
related prices from the mutual fund# 0n closed end schemes, the units can /e sold on a
stoc, e1change at the pre.ailing mar,et price or the in.estor can a.ail of the facility of
direct repurchase at '$5 related prices /y mutual fund#
Transparency:
;ou get regular information on the .alue of your in.estment in addition to disclosure on
the specific in.estments made /y your scheme, the proportion in.ested in each class of
assets and the fund manager=s in.estment strategy and outloo,#
3le1i/ility:
Through features such as regular in.estment plans, regular -ithdra-al plans and di.idend
rein.estment plans, you can systematically in.est or -ithdra- funds according to your
needs and con.enience#
$fforda/ility:
0n.estors indi.idually may lac, sufficient funds to in.est in high-grade stoc,s# $ mutual
fund /ecause of its large corpus allo-s e.en a small in.estor to ta,e the /enefit of its
in.estment strategy#
%hoice of schemes:
Mutual funds offer a family of schemes to suit your .arying needs o.er a lifetime#
0mportance of Mutual 3und:
4mall in.estors face a lot of pro/lems in the share mar,et, limited resources, lac, of
professional ad.ice, lac, of information etc# Mutual funds ha.e come as a much needed
help to these in.estors# 0t is a special type of institutional de.ice or an in.estment .ehicle
through -hich the in.estors pool their sa.ings -hich are to /e in.ested under the
guidance of a team of e1perts in -ide .ariety of portfolios of corporate securities in such
a -ay, so as to minimize ris,, -hile ensuring safety and steady return on in.estment# 0t
forms an important part of the capital mar,et, pro.iding the /enefits of a di.ersified
portfolio and e1pert fund management to a large num/er, particularly small in.estors#
'o- days, mutual fund is gaining its popularity due to the follo-ing reasons#
)ith the emphasis on increase in domestic sa.ings and impro.ement in deployment of
in.estment through mar,ets, the need and scope for mutual fund operation has increased
tremendously#
The /asic purpose of reforms in the financial sector -as to enhance the generation of
domestic Tripathy, Mutual 3und in 0ndia: $ 3inancial 4er.ice in %apital # # # >?"
resources /y reducing the dependence on outside funds# This calls for a mar,et /ased
institution -hich can tap the .ast potential of domestic sa.ings and chanalise them for
profita/le in.estments# Mutual funds are not only /est suited for the purpose /ut also
capa/le of meeting this challenge#
$n ordinary in.estor -ho applies for share in a pu/lic issue of any company is not
assured of any firm allotment# !ut mutual funds -ho su/scri/e to the capital issue made
/y companies get firm allotment of shares# Mutual fund latter sell these shares in the same
mar,et and to the :romoters of the company at a much higher price# 2ence, mutual fund
creates the in.estors confidence#
The phyche of the typical 0ndian in.estor has /een summed up /y Mr# 4# $# Da.e,
%hairman of 9T0, in three -ords@ ;ield, *i6uidity and 4ecurity# The mutual funds, /eing
set up in the pu/lic sector, ha.e gi.en the impression of /eing as safe a conduit for
in.estment as /an, deposits# !esides, the assured returns promised /y them ha.e
in.estors had great appeal for the typical 0ndian in.estor#
$s mutual funds are managed /y professionals, they are considered to ha.e a /etter
,no-ledge of mar,et /eha.iors# !esides, they /ring a certain competence to their jo/#
They also ma1imize gains /y proper selection and timing of in.estment#
$nother important thing is that the di.idends and capital gains are rein.ested
automatically in mutual funds and hence are not fritted a-ay# The automatic rein.estment
feature of a mutual fund is a form of forced sa.ing and can ma,e a /ig difference in the
long run#
The mutual fund operation pro.ides a reasona/le protection to in.estors# !esides,
presently all 4chemes of mutual funds pro.ide ta1 relief under 4ection >A * of the 0ncome
Ta1 $ct and in addition, some schemes pro.ide ta1 relief under 4ection >> of the 0ncome
Ta1 $ct lead to the gro-th of importance of mutual fund in the minds of the in.estors#
$s mutual funds creates a-areness among ur/an and rural middle class people a/out the
/enefits of in.estment in capital mar,et, through profita/le and safe a.enues, mutual fund
could /e a/le to ma,e up a large amount of the surplus funds a.aila/le -ith these people#
The mutual funds attracts foreign capital flo- in the country and secure profita/le
in.estment a.enues a/road for domestic sa.ings through the opening of off shore funds in
.arious foreign in.estors# *astly another nota/le thing is that mutual funds are controlled
and regulated /y 4 + ! 0 and hence are considered safe# Due to all these /enefits the
importance of mutual fund has /een increasing#
SCOP$ OF S#"0:
The study -as carried out for a period of BA days, in -hich the main focus -as to follo-
the performance of the different-different mutual fund companies and assent management
companies# 4ince different companies come out -ith similar themes in the same season, it
/ecomes crucial for the company to constantly perform -ell so as to sur.i.e the
competition and pro.ide ma1imum capital appreciation or return as the case may /e#
(ther than the mar,et the performance of the fund depends on the ,ind of stoc, chosen
/y the fund managers of the company#
The analysis is done on the performance of funds -ith the same theme or sector and
reason out -hy a fund performs /etter than the others in the lot#
'++D 3(< T2+ 4T9D;:
The study first tries to understand the composition of the selected funds -hich determines
the scope of performance for the funds, follo-ed /y use of ratios that are rele.ant in
6uantifying and understanding the ris, and return relationships for each mutual fund
scheme under consideration# Then a comparati.e analysis of the mutual fund schemes is
done to see -hich fund has performed the /est#
This study is significant to the company as it loo,s into the minute details that
differentiate the performances of funds of different companies -ith same theme or sector
under similar mar,et conditions# This -ould help the company to de.elop#
(!C+%T05+4 (3 T2+ 4T9D;:
To understand the 3unctions of an $sset Management %ompany
To understand the performances of .arious schemes using .arious tools to measure the
performances#
To measure and compare the performance of selected mutual fund schemes of different
mutual fund companies and other $sset Management %ompanies#
M$-O"OLO!0*
"ata collection:
The data re6uired for the study may /e collected either from primary sources or from
secondary sources# $ major portion of the data in this study has /een collected through
secondary sources of data#
4econdary data sources include:
? :u/lished material and annual reports of mutual fund companies
? (ther pu/lished material of mutual funds#
? <esearch /ased online portals#
? 9npu/lished sources also#
4ample :rofile:
The sample re6uired for the study has /een selected through random sampling method
from the a.aila/le list of mutual fund schemes in the mar,et# !roadly the sample of DE
mutual fund schemes includes e6uity funds, de/t funds and /alanced funds#
The study has ta,en three /road categories of funds
? +6uity 3unds
? De/t funds
? !alanced fund
+6uity 3unds:
D#!irla $d.antage 3und F Gro-th
E#2D3% +6uity 3und F Gro-th
3# 0%0%0 :rudential Dynamic :lan F Gro-th
G#4undaram !': :ari/as gro-th fund- Gro-th
De/t funds:
D# !irla !ond 0nde1 3und F Gro-th
E# 2D3% 2igh 0nterest 3und F Gro-th
3# 0%0%0 :rudential !lended :lan - (ption ! F Gro-th
G# 4undaram !': :ari/as fund- Gro-th
!alanced fund:
D# !irla !alance 3und F Gro-th
E# 2D3% !alanced 3und F Gro-th
3# 0%0%0 :rudential !alanced F Gro-th
G# 4undaram !': :ari/as /alanced- Gro-th
3or the purpose of estimating the performance of schemes in terms of returns, '$5 of the
schemes are ta,en into consideration# $s data relating to '$5 is a.aila/le more
fre6uently than any other data it is ta,en as the /asis for estimation#
:eriod of the 4tudy:
The study co.ered a period of 3 years from EAAH to EAA> to assess the performance of the
schemes in terms of returns#
Tools I Methods:
!eta:
0t descri/es the relationship /et-een the stoc,=s return and the inde1 returns# The /eta
.alue may /e interpreted in the follo-ing manner, Ja DK change in 'ifty inde1 -ould
cause a D#AGEK /eta" change in the particular fund# 0t is the slope of characteristic
regression line#
0t signifies that a fund -ith a /eta of more than D -ill rise more than the mar,et and also
fall more than mar,et# Thus, if one li,es to /eat the mar,et on the upside, it is /est to
in.est in a high-/eta fund# !ut one must ,eep in mind that such a fund -ill also fall more
than the mar,et on the -ay do-n# 4o, o.er an entire cycle, returns may not /e much
higher than the mar,et#
4imilarly, a lo--/eta fund -ill rise less than the mar,et on the -ay up and lose less on the
-ay do-n# )hen safety of in.estment is important, a fund -ith a /eta of less than one is
a /etter option# 4uch a fund may not gain more than the mar,et on the upside, /ut it -ill
protect returns /etter -hen mar,et falls#
)here,
n F 'um/er of days
1 F <eturns of the inde1
y F <eturns of the fund
$lpha:
0t indicates that the stoc, return is independent of the mar,et return# 0f the portfolio is
-ell di.ersified, the alpha .alue -ould turn out to /e zero# The intercept of characteristic
regression line is alpha#
$lpha sho-s -hether the particular fund has produced returns justifying the ris,s it is
ta,ing /y comparing its actual return to the one LpredictedL /y the /eta#
$lpha can /e seen as a measure of a fund managerLs performance# This is -hat the fund
has earned o.er and a/o.e or under" -hat it -as e1pected to earn# Thus, this is the .alue
added or su/tracted" /y the fund managerLs in.estment decisions# This can /e clearly
seen from the fact that 0nde1 funds al-ays ha.eMor should ha.e, if they trac, their inde1
perfectlyMan alpha of zero#
Thus, a passi.e fund has an alpha of zero and an acti.e fundLs alpha is a measure of -hat
the fund managerLs acti.ity has contri/uted to the fundLs returns# (n the -hole a positi.e
alpha implies that a fund has performed /etter than e1pected, gi.en its le.el of ris,# 4o
higher the alpha /etter are returns#
)here,
y F Mean .alue of returns of the fund
? = y - ?x
? = n?xy – (?x)( ?y)
n?x
2
– (?x)
2
1 F Mean .alue of returns of the inde1
N F !eta .alue of the fund
%orrelation %o-efficient:
0t measures the nature and the e1tent of relationship /et-een the stoc, mar,et inde1
returns and a fund=s return in a particular period#
%o-efficient of Determination:
The s6uare of correlation of co-efficient is the co-efficient of determination# 0t gi.es the
percentage .ariation in the stoc,=s return e1plained /y the .ariation in the mar,et return#
r
E
Treynor=s <atio:
The Treynor <atio, named after Cac, *# Treynor, one of the fathers of modern portfolio
theory, helps analyze returns in relation to the mar,et ris, of the fund# The <atio, also
,no-n as the re-ard-to-.olatility ratio, pro.ides a measure of performance adjusted for
mar,et ris,# 2igher the Treynor <atio, the /etter the performance under analysis#
0t is a ratio that helps the portfolio managers to determine the e1cess return generated as
the difference /et-een the fund=s return and the ris, free return# The e1cess return to /eta
ratio measures the additional return on a fund per unit of systematic ris,# <an,ing of the
funds is done /ased on this ratio#
)here,
< F <eturn on in.estment#
r = n?xy – (?x)( ?y) .
?n?x
2
– (?x)
2
?n?y
2
– (?y)
2
T = R – RFR
?
<3< F <is, 3ree <eturn
4harpe=s <atio:
4harpe=s ratio is similar to treynor=s ratio the difference /eing, instead of /eta here -e
ta,e standard de.iation# $s standard de.iation represents the total ris, e1perienced /y the
fund, it reflects the returns generated /y underta,ing all possi/le ris,s# $ higher 4harpe=s
ratio is /etter as it represents a higher return generated per unit of ris,#
<eturn
$ return is a measurement of ho- much an in.estment has increased or decreased in
.alue o.er any gi.en time period# 0n particular, an annual return is the percentage /y
-hich it increased or decreased o.er any t-el.e-month period#
3ormula:
-pA":A
Mean:
The mean a.erage is a 6uic, mathematical measure of a num/er of data points as a unit# 0t
-ill tell you important information a/out a group of data in your /usiness# 0t is almost a
summary of all the data in your dataset#
Mean: Mean = 4um of X .alues O ' 'um/er of .alues"#
4tandard De.iation:
S = R – RFR
?
The degree that a single .alue in a group of .alues .aries from the mean a.erage" of the
distri/ution# 4tandard de.iation is a statistical measure that uses past performance of an
in.estment or portfolio to determine the potential range of future performance and assess
the pro/a/ility of that performance# 4tandard de.iations can /e calculated for an
indi.idual security or for the entire portfolio
5ariance:
5ariance: 5ariance = s
E
1ensen Ratio 21R3*
$ ris,-adjusted performance measure that represents the a.erage return on a portfolio
o.er and a/o.e that predicted /y the capital asset pricing model %$:M", gi.en the
portfolioLs /eta and the a.erage mar,et return# This is the portfolioLs alpha# 0n fact, the
concept is sometimes referred to as PCensenLs alpha#P
Q
Censen <atio C<" = -----------------
N
Data :rocessing and $nalysis:
Data is processed -ith the help of Microsoft +1cel and 4:44 4tatistical :ac,age for
4ocial 4ciences"# The '$5s for si1 months of all the funds and their /enchmar,s -ere
entered into the spreadsheet and the a/o.e mentioned tools -ere used to get the final
.alues for the comparati.e analysis and interpretations#
*imitations of the 4tudy:
The present study has the follo-ing limitations
? The study has /een restricted to only a fe- schemes#
? The data is analyzed for a limited period of 3 years#
%2$:T+<
00
0ndustry :rofile
%ompany :rofile
%&"#SR0 PROF%L$
3ollo-ing diagram gi.es the structure of 0ndian financial system:
0'D94T<; :<(30*+
3ollo-ing diagram gi.es the structure of 0ndian financial system:
0'D94T<; :<(30*+: M9T9$* 39'D4:
Mutual funds go /ac, to the times of the +gyptians and :hoenicians -hen they sold
shares in cara.ans and .essels to spread the ris, of these .entures# The foreign and
colonial go.ernment Trust of *ondon of D>B> is considered to /e the fore-runner of the
modern concept of mutual funds# The 94$ is, ho-e.er, considered to /e the Mecca of
modern mutual funds# !y the early - DR3As 6uite a large num/er of close - ended mutual
funds -ere in operation in the 9#4#$# Much latter in DRHG, the committee on finance for
the pri.ate sector recommended mo/ilization of sa.ings of the middle class in.estors
through unit trusts# 3inally in Culy DRBG, the concept too, root in 0ndia -hen 9nit Trust of
0ndia -as set up#
0'D0$' M9T9$* 39'D 0'D94T<;
The end of millennium mar,s 3B years of e1istence of mutual funds in this country# The
ride through these 3B years is not /een smooth# 0n.estor opinion is still di.ided# )hile
some are for mutual funds others are against it#
9T0 commenced its operations from Culy DRBG #The impetus for esta/lishing a formal
institution came from the desire to increase the propensity of the middle and lo-er groups
to sa.e and to in.est# 9T0 came into e1istence during a period mar,ed /y great political
and economic uncertainty in 0ndia# )ith -ar on the /orders and economic turmoil that
depressed the financial mar,et, entrepreneurs -ere hesitant to enter capital mar,et#
The already e1isting companies found it difficult to raise fresh capital, as in.estors did not
respond ade6uately to ne- issues# +arnest efforts -ere re6uired to canalize sa.ings of the
community into producti.e uses in order to speed up the process of industrial gro-th#
The then 3inance Minister, T#T# &rishnamachari set up the idea of a unit trust that -ould
/e Popen to any person or institution to purchase the units offered /y the trust# 2o-e.er,
this institution as -e see it, is intended to cater to the needs of indi.idual in.estors, and
e.en among them as far as possi/le, to those -hose means are small#P
2is ideas too, the form of the 9nit Trust of 0ndia, an intermediary that -ould help fulfill
the t-in o/jecti.es of mo/ilizing retail sa.ings and in.esting those sa.ings in the capital
mar,et and passing on the /enefits so accrued to the small in.estors#
9T0 commenced its operations from Culy DRBG P-ith a .ie- to encouraging sa.ings and
in.estment and participation in the income, profits and gains accruing to the %orporation
from the ac6uisition, holding, management and disposal of securities#P Different
pro.isions of the 9T0 $ct laid do-n the structure of management, scope of /usiness,
po-ers and functions of the Trust as -ell as accounting, disclosures and regulatory
re6uirements for the Trust#
(ne thing is certain F the fund industry is here to stay# The industry -as one-entity sho-
till DR>B -hen the 9T0 monopoly -as /ro,en -hen 4!0 and %an /an, mutual fund
entered the arena# This -as follo-ed /y the entry of others li,e !(0, *0%, G0%, etc#
sponsored /y pu/lic sector /an,s# 4tarting -ith an asset /ase of <s# EH crore in DRBG the
industry has gro-n at a compounded a.erage gro-th rate of E?K to its current size of
<s#RAAAA crore#
The period DR>B-DRR3 can /e termed as the period of pu/lic sector mutual funds :M3s"#
3rom one player in DR>H the num/er increased to > in DRR3# The party did not last long# )hen
the pri.ate sector made its de/ut in DRR3-RG, the stoc, mar,et -as /ooming#
The openings up of asset management /usiness to pri.ate sector in DRR3 sa- international
players li,e Morgan 4tanley, Cardine 3leming, C: Morgan, George 4oros and %apital
0nternational along -ith the host of domestic players join the party# !ut for the e6uity funds,
the period of DRRG-RB -as one of the -orst in the history of 0ndian Mutual 3unds#
DRRRM;+$< (3 T2+ 39'D4
Mutual funds ha.e /een around for a long period of time to /e precise for 3B yrs /ut the
year DRRR sa- immense future potential and de.elopments in this sector# This year
signaled the year of resurgence of mutual funds and the regaining of in.estor confidence
in these M3=s# This time around all the participants are in.ol.ed in the re.i.al of the
funds ----- the $M%=s, the unit holders, the other related parties# 2o-e.er the sole factor
that ga.e lifer to the re.i.al of the funds -as the 9nion !udget# The /udget /rought
a/out a large num/er of changes in one stro,e# $n insight of the 9nion !udget on mutual
funds ta1ation /enefits is pro.ided later#
0t pro.ided centre stage to the mutual funds, made them more attracti.e and pro.ides
accepta/ility among the in.estors# The 9nion !udget e1empted mutual fund di.idend
gi.en out /y e6uity-oriented schemes from ta1, /oth at the hands of the in.estor as -ell
as the mutual fund# 'o longer -ere the mutual funds interested in selling the concept of
mutual funds they -anted to tal, /usiness -hich -ould mean to increase asset /ase, and
to get asset /ase and in.estor /ase they had to /e fully armed -ith a -hole lot of schemes
for e.ery in.estor #4o ne- schemes for ne- 0
=s -ere ine.ita/le# The 6uest to attractin.estors e1tended /eyond just ne- schemes# The funds started to regulate themsel.es
and -ere all out on -inning the trust and confidence of the in.estors under the aegis of
the $ssociation of Mutual 3unds of 0ndia $M30"
(ne cam say that the industry is mo.ing from infancy to adolescence, the industry is
maturing and the in.estors and funds are fran,ly and openly discussing difficulties
opportunities and compulsions#
3irst :hase F DRBG->?:
9nit Trust of 0ndia 9T0" -as esta/lished on DRB3 /y an $ct of :arliament# 0t -as set up
/y the <eser.e !an, of 0ndia and functioned under the <egulatory and administrati.e
control of the <eser.e !an, of 0ndia# 0n DR?> 9T0 -as de-lin,ed from the <!0 and the
0ndustrial De.elopment !an, of 0ndia 0D!0" too, o.er the regulatory and administrati.e
control in place of <!0# The first scheme launched /y 9T0 -as 9nit 4cheme DRBG# $t the
end of DR>> 9T0 had <s#B,?AA crores of assets under management#
4econd :hase F DR>?-DRR3 +ntry of :u/lic 4ector 3unds":
DR>? mar,ed the entry of non- 9T0, pu/lic sector mutual funds set up /y pu/lic sector
/an,s and *ife 0nsurance %orporation of 0ndia *0%" and General 0nsurance %orporation
of 0ndia G0%"# 4!0 Mutual 3und -as the first non- 9T0 Mutual 3und esta/lished in Cune
DR>? follo-ed /y %an/an, Mutual 3und Dec >?", :unja/ 'ational !an, Mutual 3und
$ug >R", 0ndian !an, Mutual 3und 'o. >R", !an, of 0ndia Cun RA", !an, of !aroda
Mutual 3und (ct RE"# *0% esta/lished its mutual fund in Cune DR>R -hile G0% had set up
its mutual fund in Decem/er DRRA
$t the end of DRR3, the mutual fund industry had assets under management of <s#G?, AAG
crores#
Third :hase F DRR3-EAA3 +ntry of :ri.ate 4ector 3unds":
)ith the entry of pri.ate sector funds in DRR3, a ne- era started in the 0ndian mutual fund
industry, gi.ing the 0ndian in.estors a -ider choice of fund families# $lso, DRR3 -as the
year in -hich the first Mutual 3und <egulations came into /eing, under -hich all mutual
funds, e1cept 9T0 -ere to /e registered and go.erned# The erst-hile &othari :ioneer
no- merged -ith 3ran,lin Templeton" -as the first pri.ate sector mutual fund registered
in Culy DRR3# The DRR3 4+!0 Mutual 3und" <egulations -ere su/stituted /y a more
comprehensi.e and re.ised Mutual 3und <egulations in DRRB# The industry no-
functions under the 4+!0 Mutual 3und" <egulations DRRB# The num/er of mutual fund
houses -ent on increasing, -ith many foreign mutual funds setting up funds in 0ndia and
also the industry has -itnessed se.eral mergers and ac6uisitions# $s at the end of Canuary
EAA3, there -ere 33 mutual funds -ith total assets of <s# D,ED,>AH crores# The 9nit Trust
of 0ndia -ith <s#GG,HGD crores of assets under management -as -ay ahead of other
mutual funds#
3ourth :hase F since 3e/ruary EAA3 0n 3e/ruary EAA3:
3ollo-ing the repeal of the 9nit Trust of 0ndia $ct DRB3 9T0 -as /ifurcated into t-o
separate entities# (ne is the 4pecified 9nderta,ing of the 9nit Trust of 0ndia -ith assets
under management of <s#ER, >3H crores as at the end of Canuary EAA3, representing
/roadly, the assets of 94 BG scheme, assured return and certain other schemes# The
4pecified 9nderta,ing of 9nit Trust of 0ndia, functioning under an administrator and
under the rules framed /y Go.ernment of 0ndia and does not come under the pur.ie- of
the Mutual 3und <egulations# The second is the 9T0 Mutual 3und *td, sponsored /y 4!0,
:'!, !(! and *0%# 0t is registered -ith 4+!0 and functions under the Mutual 3und
<egulations# )ith the /ifurcation of the erst-hile 9T0 -hich had in March EAAA more
than <s#?B,AAA crores of assets under management and -ith the setting up of a 9T0
Mutual 3und, conforming to the 4+!0 Mutual 3und <egulations, and -ith recent mergers
ta,ing place among different pri.ate sector funds, the mutual fund industry has entered its
current phase of consolidation and gro-th# $s at the end of 4eptem/er, EAAG, there -ere
ER funds, -hich manage assets of <s#DH3DA> crores under GED schemes#
:<+4+'T $44+T 9'D+< M$'$G+M+'T (3 M9T9$* 39'D
%(M:$'0+4:
$5+<$G+ 49M (3 M9T9$* 39'D %(M:$'0+4 3(< T2+ M('T2
+1cluding fund 3und of +1cluding fund fund of
(f funds 3unds of funds funds
D# $!' $M<( Mutual 3und B>?GG3#A> 3BHGR#?3 BEBHEH#>> 3HRBG#H3
E# $0G Glo/al 0n.estment Group
Mutual 3und
'O$ 'O$ 'O$ 'O$
3# !enchmar, Mutual 3und BGD?>H#BG A HG3EH>#AR A
G# !irla 4un *ife Mutual 3und E3?DRGB#3? DRAH#D? ED???AA#H> D>RA#BG
H# !(! Mutual 3und R?HR#DD A DAEGR#EE A
B# %an /an, Mutual 3und ERDAAG#GR A EB?ARD#RE A
?# D!4 %hola Mutual 3und EG?3A>#RR A EDD?G?#E> A
># Deutsche Mutual 3und ?E>3B>#GH A ?D>>3?#G? A
R# D4: Merrill *ynch Mutual 3und DD>H3E>#>G A DD?B3GH#?> A
DA# +scorts Mutual 3und D3EG?#HG A DD?DH#GG A
DD# 3idelity Mutual 3und >>D3G>#?3 G3BH#>B >GG3?H#>G GG?B#H3
DE# 3ran,lin Templeton Mutual 3und EBE?B3H#?G 3AB3B#E EH3BGR?#HR 3DDAD#HD
D3# 2D3% Mutual 3und
3BDGBBB#?G A 33>>>EA#>B A
DG# 24!% Mutual 3und DGH>HBG#A> A D3HAG>D A
DH# 0%0%0 :rudential Mutual 3und HA?A3AA#DD 3RA?#3> GHRRG>B#DR 3>?A#D
DB# 0'G 5ysya Mutual 3und H?D?>B#3B >D>G?#3E GGH33H#H? >3DHB#GD
D?# CM 3inancial Mutual 3und 3??EGR#?G A 3HAG>>#D3 A
D># C: Morgan Mutual 3und 'O$ 'O$ 'O$ 'O$
DR# &ota, Mahindra Mutual 3und DB?EEHH#HB HGAD>#EE DGHGH33#B3 HEBE>#AB
EA# *0% Mutual 3und RRAGGE#E A RBRE>E#HH A
ED# *otus 0ndia Mutual 3und 3BE3DG#>3 A E>AHRB#D? A
EE# Morgan 4tanley Mutual 3und 3D>ABB#RG A 3DAAAH#3R A
E3# :<0'%0:$* Mutual 3und D3DG>HD#A? A DA>RHRA#EB A
EG# Suantum Mutual 3und BDAH#HR A BADH#H A
EH# <eliance Mutual 3und HRDG3G?#BD A H?B33AG#33 A
EB# 4ahara Mutual 3und D?BGB#HG A D?3DB#>R A
E?# 4!0 Mutual 3und DRBBA>E#RD A DRHEA3B#HD A
E># 4tandard %hartered Mutual 3und DBD?AED#?B DH3G#GH DH>3B>E#E? DH?R#?E
ER# 4undaram !': :ari/as Mutual
3und
DADGHE>#B3 A >RRBRH#AB A
3A# Tata Mutual 3und DGA>D>>#>B A D3GH3G>#A? A
3D# Taurus Mutual 3und 3AHG?#E3 A 3ADR>#?H A
3E# 9T0 Mutual 3und GAA?ADB#>? A 3B???E3#3R A
Grand Total GDGD?DBA#BD EDG?BG#33 3>B3>E>H#BD EDGBB?#H
M$<&+T 42$<+ (3 M9T9$* 39'D %(M:$'0+4 $4 (' EA, C9'+
EAA?
D# $!' $M<( Mutual 3und D#BEDHDH?33
E# $0G Glo/al 0n.estment Group Mutual 3und
3# !enchmar, Mutual 3und D#GABAAR>E
G# !irla 4un *ife Mutual 3und H#B3BDEDD3D
H# !(! Mutual 3und A#AEBHEBA?3
B# %an/an, Mutual 3und A#BRDEBE3G?
?# D!4 %hola Mutual 3und A#HG>AEGHEE
># Deutsche Mutual 3und D#>BAGE?RB3
R# D4: Merrill *ynch Mutual 3und 3#AGGHA>EDB
DA# +scorts Mutual 3und A#A3A3EA>A?
DD# 3idelity Mutual 3und E#D>H33GBGD
DE# 3ran,lin Templeton Mutual 3und B#HBG?EBAEE
D3# 2D3% Mutual 3und >#??ABERGHR
DG# 24!% Mutual 3und 3#GRHD>>?DR
DH# 0%0%0 :rudential Mutual 3und DD#RA3RBA33
DB# 0'G 5ysya Mutual 3und D#DHEH?HRAH
D?# CM 3inancial Mutual 3und A#RA?DAABEG
D># C:Morgan Mutual 3und
DR# &ota, Mahindra Mutual 3und 3#?BGG>>ADE
EA# *0% Mutual 3und E#HA>BABHDH
ED# *otus 0ndia Mutual 3und A#?EBEDE?>H
EE# Morgan 4tanley Mutual 3und A#>AE3EBR>
E3# :<0'%0:$* Mutual 3und E#>DRR?HB>?
EG# Suantum Mutual 3und A#ADHHB>?HH
EH# <eliance Mutual 3und DG#RDBAGHB>
EB# 4ahara Mutual 3und A#AGG>D?RHB
E?# 4!0 Mutual 3und H#AHEA?>G?G
E># 4tandard %hartered Mutual 3und G#AR>?3>GH3
ER# 4undaram !': :ari/as Mutual 3und E#3E>HABB?B
3A# Tata Mutual 3und 3#G>DRAGDH
3D# Taurus Mutual 3und A#A?>DH?H>3
3E# 9T0 Mutual 3und R#HD>33RR>>
COMPA&0 PROF%L$
The %ompany -as incorporated in DRHG, -ith the o/ject of financing the purchase of
commercial .ehicles and passenger cars#
The company -as started -ith a paid-up capital of <s#E#AA *acs and later -ent pu/lic in
DR?E# The %ompanyLs shares -ere listed in the Madras 4toc, +1change in DR?E and in the
'ational 4toc, +1change in Canuary DRR>#
4u/se6uently, the e6uity shares of the %ompany ha.e /een delisted from Madras 4toc,
+1change *imited M4+" -ith effect from Canuary E?, EAAG, in accordance -ith 4+!0
Delisting of 4ecurities" Guidelines, EAA3, for .oluntary delisting#
4undaram !': :ari/as $sset Management %ompany *td#, the in.estment managers of
4undaram !': :ari/as Mutual 3und, is a joint .enture /et-een the 4undaram finance
Group and the !': :ari/as asset management# The joint .enture /rings together the
4undaram 3inance GroupLs e1perience in the 0ndian mar,et and !': :ari/as glo/al
e1perience#
4ince its inception in DRRB, 4undaram Mutual fund has emerged as one of 0ndiaLs leading
Mutual 3unds managing assets of a large in.estor /ase# The fund offers a range of in.estment
options, -hich include di.ersified and sector specific e6uity schemes, fund of fund schemes,
hy/rid and monthly income funds, a -ide range of de/t and treasury products and offshore
funds#
4undaram !': :ari/as follo-s a long-term, fundamental research /ased approach to
in.estment# The approach is to identify companies, -hich ha.e e1cellent gro-th prospects
and strong fundamentals# The fundamentals include the 6uality of the company=s
management, sustaina/ility of its /usiness model and its competiti.e position, amongst other
factors# 4undaram !': :ari/as $sset Management %ompany has one of the largest team of
research analysts in the industry, dedicated to trac,ing do-n the /est companies to in.est in#
49'D$<$M 30'$'%+:
4undaram 3inance *imited is engaged primarily in the /usiness of financing# The acti.ities of
the %ompany span sa.ings products li,e deposits and mutual funds, car and commercial
.ehicle finance, insurance, home loans, soft-are solutions, /usiness process outsourcing, tyre
finance, fleet cards and logistics ser.ices# 4undaram 3inance *imited has a net-or, of o.er
DHA /ranches spread across 0ndia#
The %ompany -as incorporated in DRHG, -ith the o/ject of financing the purchase of
commercial .ehicles and passenger cars# The company -as started -ith a paid-up capital of
<s#E#AA *a,es and later -ent pu/lic in DR?E#The %ompanyLs shares -ere listed in the Madras
4toc, +1change in DR?E and in the 'ational 4toc, +1change in Canuary DRR>#
Company -ierarchy
Organizational Hierarchy
Managing Director
Chief Executive Officer
Directors
Vice President
National Head
Zonal Head
Regional Head
erritory Manager
!ssistant Manager
rainee Manager
Mana+erial Functions
"ales #ranch
Re+ional Sales Mana+er 4ranch Mana+er
erritory Mana+er
Re+ional Mana+er
Assistant Mana+er
C-AP$R
000
Theory of the study
Types of Mutual 3unds:
Mutual fund schemes may /e classified on the /asis of its structure and its in.estment
o/jecti.e#
!y 4tructure:
Open,end Funds: $n open-end fund is one that is a.aila/le for su/scription all through the
year# These do not ha.e a fi1ed maturity# 0n.estors can con.eniently /uy and sell units at 'et
$sset 5alue P'$5P" related prices# The ,ey feature of open-end schemes is li6uidity#
Closed,end Funds: $ closed-end fund has a stipulated maturity period -hich generally
ranging from 3 to DH years# The fund is open for su/scription only during a specified period#
0n.estors can in.est in the scheme at the time of the initial pu/lic issue and thereafter they
can /uy or sell the units of the scheme on the stoc, e1changes -here they are listed# 0n order
to pro.ide an e1it route to the in.estors, some close-ended funds gi.e an option of selling
/ac, the units to the Mutual 3und through periodic repurchase at '$5 related prices# 4+!0
<egulations stipulate that at least one of the t-o e1it routes is pro.ided to the in.estor#
0nter.al 3unds: 0nter.al funds com/ine the features of open-ended and close-ended schemes#
They are open for sale or redemption during pre-determined inter.als at '$5 related prices#
!y 0n.estment (/jecti.e:
Gro-th 3unds: The aim of gro-th funds is to pro.ide capital appreciation o.er the medium to
long term# 4uch schemes normally in.est a majority of their corpus in e6uities# 0t has /een
pro.ed that returns from stoc,s, ha.e outperformed most other ,ind of in.estments held o.er
the long term# Gro-th schemes are ideal for in.estors ha.ing a long-term outloo, see,ing
gro-th o.er a period of time#
0ncome 3unds: The aim of income funds is to pro.ide regular and steady income to in.estors#
4uch schemes generally in.est in fi1ed income securities such as /onds, corporate de/entures
and Go.ernment securities# 0ncome 3unds are ideal for capital sta/ility and regular income#
!alanced 3unds: The aim of /alanced funds is to pro.ide /oth gro-th and regular income#
4uch schemes periodically distri/ute a part of their earning and in.est /oth in e6uities and
fi1ed income securities in the proportion indicated in their offer documents# 0n a rising stoc,
mar,et, the '$5 of these schemes may not normally ,eep pace, or fall e6ually -hen the
mar,et falls# These are ideal for in.estors loo,ing for a com/ination of income and moderate
gro-th#
Money Mar,et 3unds: The aim of money mar,et funds is to pro.ide easy li6uidity,
preser.ation of capital and moderate income# These schemes generally in.est in safer short-
term instruments such as treasury /ills, certificates of deposit, commercial paper and inter-
/an, call money# <eturns on these schemes may fluctuate depending upon the interest rates
pre.ailing in the mar,et#
These are ideal for %orporate and indi.idual in.estors as a means to par, their surplus funds
for short periods#
(ther 4chemes:
Ta1 4a.ing 4chemes: These schemes offer ta1 re/ates to the in.estors under specific
pro.isions of the 0ndian 0ncome Ta1 la-s as the Go.ernment offers ta1 incenti.es for
in.estment in specified a.enues# 0n.estments made in +6uity *in,ed 4a.ings 4chemes
+*44" and :ension 4chemes are allo-ed as deduction uOs >> of the 0ncome Ta1 $ct, DRBD#
The $ct also pro.ides opportunities to in.estors to sa.e capital gains uOs HG+$ and HG+! /y
in.esting in Mutual 3unds#
0ndustry 4pecific 4chemes :0ndustry 4pecific 4chemes in.est only in the industries specified
in the offer document# The in.estment of these funds is limited to specific industries li,e
0nfotech, 3M%G, and :harmaceuticals etc#
0nde1 4chemes: 0nde1 3unds attempt to replicate the performance of a particular inde1 such
as the !4+ 4ense1 or the '4+ HA
4ectoral 4chemes: 4ectoral 3unds are those, -hich in.est, e1clusi.ely in a specified sector#
This could /e an industry or a group of industries or .arious segments such as L$L Group
shares or initial pu/lic offerings#
<04&4 $44(%0$T+D )0T2 M9T9$* 39'D4
0n.esting in mutual funds, as -ith any security, does not come -ithout ris,# (ne of the most
/asic economic principles is that ris, and re-ard are directly correlated# 0n other -ords, the
greater the potential ris, the greater the potential return# The types of ris, commonly
associated -ith mutual funds are:
Mar,et ris,:
Mar,et ris, relates to the mar,et .alue of a security in the future# Mar,et prices fluctuate and
are suscepti/le to economic and financial trends, supply and demand, and many other factors
that cannot /e precisely predicted or controlled#
litical ris,:%hanges in the ta1 la-s, trade regulations, administrated prices, etc are some of the many
political factors that create mar,et ris,# $lthough collecti.ely, as citizens, -e ha.e indirect
control through the po-er of our .ote indi.idually, as in.estors, -e ha.e .irtually no control#
0nflation ris,:
0nterest rate ris, relates to futures changes in interest rates# 3or instance, if an in.estor in.ests
in a long F term de/t mutual fund scheme and interest rates increase, the '$5 of the scheme
-ill fall /ecause the scheme -ill /e end up holding de/t offering lo-er interest rates#
!usiness ris,:
!usiness ris, is the uncertainty concerning the future e1istence, sta/ility, and profita/ility of
the issuer of the security# !usiness ris, is inherent in all /usiness .entures# The future
financial sta/ility of a company cannot /e predicted or guaranteed, nor can the price of its
securities# $d.erse changes in /usiness circumstances -ill reduce the mar,et price of the
company=s e6uity resulting in proportionate fall in the '$5 of the mutual fund scheme,
-hich has in.ested in the e6uity of such a company#
+conomic ris,:
+conomic ris, in.ol.es uncertainty in the economy, -hich, in turn, can ha.e an ad.erse effect
on a company=s /usiness# 3or instance, if monsoons fail in a year, e6uity stoc,s of agriculture
F /ased companies -ill fall and '$5=s of mutual funds, -hich ha.e in.ested in such stoc,s,
-ill fall proportionately#
T$X !+'+30T4:-
The ta1man has o.er the years, /een more or less ,ind to mutual funds, -ith la-s .arying
from time to time@ the o.erall o/jecti.e has /een to encourage the gro-th of the mutual
funds industry# %urrently, a .ariety of ta1 la-s apply to mutual funds, -hich are /roadly
listed /elo-:
%apital gains:
9nits of mutual fund schemes held for a period more than DE months are treated as long
term capital assets# 0n such cases, the unit holder has the option to pay capital gains ta1 at
either EAK -ith inde1ation" or DAK -ithout inde1ation#
Ta1 deducted at source:
3or any income credited or paid /y a fund, no ta1 is deducted or -ithheld at source# The
rele.ant sections in the income ta1 act go.erning this pro.ision are section DRG& and
DRB$#
)ealth ta1:
Mutual fund units are not currently treated as assets under section E of the -ealth ta1 act
and are therefore not lia/le to ta1#
0ncome from units:
$ny income recei.ed from units of the schemes of the mutual fund specified under
section E3D" is e1empt under section DA33" of the act# )hile section DAE3D" e1empts
income of specified mutual funds from ta1 -hich currently includes all mutual funds
operating in 0ndia", section DA33" e1empts income from funds in the hands of the unit
holder# 2o-e.er, this does not mean that there is no ta1 at all on income distri/utions /y
mutual fund#
0ncome distri/ution ta1:
$s per pre.ailing ta1 la-s, income distri/uted /y schemes other than open-end e6uity
schemes is su/ject to ta1 at EAK plus surcharge of DAK"# 3or this purpose, e6uity
schemes ha.e /een defined to /e those schemes that ha.e more than HAK of their assets
in the form of e6uity# (pen-end e6uity schemes ha.e /een left out of the pur.ie- of this
distri/ution ta1 for a period of three years /eginning from $pril DRRR#
"ifferent Modes of Receivin+ the %ncome $arned From Mutual
Fund %nvestments
Mutual funds offer three methods of recei.ing income:
Gro-th plan:
0n this plan, di.idend is neither declared or paid out to the in.estor /ut is /uilt into the
.alue of the '$5# 0n other -ords, the '$5 increases o.er time due to such incomes and
the in.estor realizes only the capital appreciation on redemption of his in.estment#
0ncome funds:
0n this plan, di.idend are paid out=s to the in.estor# 0n other -ords, the '$5 only reflects
the capital appreciation or depreciation in mar,et price of the underlying portfolio#
Di.idend re-in.estment plan:
0n this case, di.idend is declared /ut not paid out to the in.estor, instead, it is rein.ested
/ac, into the scheme at the then pre.ailing '$5# 0n other -ords, the in.estor is gi.en
additional units and not cash as di.idend#
'et asset .alue '$5"
The net asset .alue of the fund is the cumulati.e mar,et .alue of the asset fund net of its
lia/ilities# 0n other -ords, if the fund is dissol.ed or li6uidated, /y selling off all the
assets in the fund, this is the amount that the shareholders -ould collecti.ely o-n# This
gi.es ride to the concept of net asset .alue per unit, -hich is the .alue, represented /y the
o-nership of one unit in the fund# 0t is calculated simply /y di.iding the net asset .alue of
the fund /y the num/er of units# 2o-e.er, most people refer loosely to the '$5 per unit
as '$5, ignoring the Tper unitU# )e also a/ide /y the same con.ention#
CALC#LA%O& OF &A.
The most important part of the calculation is the .aluation of the assets o-ned /y the
fund# (nce its is calculated, the '$5 is simply the net .alue of assets di.ided /y the
num/er of units outstanding# The detailed methodology for the calculation of the asset
.alue is gi.en /elo-#
$sset .alue is e6ual to
4um of mar,et .alue of sharesOde/entures
Vli6uid assetsOcash held, if any
Vdi.idendOinterest accrued
$mount due on unpaid assets
+1penses accrued /ut not paid
Details on the a/o.e items:
3or li6uid sharesOde/entures, .aluation is done on the /asis of the last or closing mar,et
price on the principal e1change -here the security is traded#
3or illi6uid and unlisted andOor thinly traded sharesOde/entures, the .alue has to /e
estimated# 3or shares, this could /e the /oo, .alue per share or an estimated mar,et price#
0f suita/le /enchmar,s are a.aila/le# 3ore de/entures and /onds, .alue is estimated on the
/asis of yields of compara/le li6uid securities after adjusting for illi6uidity# The .alue of
fi1ed interest /earing securities mo.es in a direction opposite to interest rate changes
.aluation of de/entures and /onds is a /ig pro/lem since most of them are unlisted and
thinly traded# This gi.es considera/le lee-ay to the $M%=s on .aluation and some of the
$M%=s are /elie.ed to ta,e ad.antage of this and adopt fle1i/le .aluation policies
depending on the situation#
0nterest is paya/le on de/enturesO/onds on periodic /asis say e.ery B months# !ut, -ith
e.ery passing day, interest is said to /e accrued, at the daily interest rate, -hich is
calculated /y di.iding the periodic interest payment -ith the num/er of days in each
period#
Thus, accrued interest on a particular day is e6ual to the daily interest rate multiplied /y
the num/er of days since the last interest payment date#
9sually, di.idends are proposed at the time of annual general meeting and /ecome due on
the record date# There is a gap /et-een the dates on -hich it /ecomes due and the actual
payment date# 0n the immediate period, it is deemed to /e T$ccruedU# +1penses including
management fees, custody charges etc# $re calculated on daily /asis#
M##AL F#&" %&.$S%&! SRA$!%$S
4ystematic in.estment plan 40:=s":
These are /est suited for young people -ho ha.e started there careers and needs to /uilt
there -ealth# 4ips entail the in.estor to in.est a fi1ed sum of money at regular inter.als in
the mutual fund schemes the in.estor as chosen, an in.estor opting for sip in 1yz mutual
fund scheme -ill need to in.est certain sum on money e.ery monthO6uarterOhalf yearly in
the scheme# !y in.esting through sip, one ends up /uying more units -hen the price is
lo- and fe-er units -hen the price is high# 2o-e.er, o.er a period of time these mar,et
fluctuations are generally a.eraged# $nd the a.erage cost of the in.estment is often
reduced# 0t is far /etter to in.est small amount of money regularly, rather than sa.e up to
ma,e a large in.estment# This is /ecause -hile sa.ing is in the lump sum, it may not earn
much interest#
4ystematic -ithdra-al plan 4):=s":
These plans are suited for people nearing retirement #0n these plans, an in.estor in.est in a
mutual fund scheme and is allo-ed to -ithdra- a fi1ed sum of money at regular inter.als
to ta,e care of its e1penses#
4ystematic transfer plan 4T:=s":
They allo-s in.estor to transfer on a periodic /asis a specified amount from one scheme
to another -ithin the same fund family- meaning t-o schemes /elonging to the same
mutual fund# $ transfer -ill /e treated as redemption of units from the scheme from
-hich the transfer is made# 4uch redemption or in.estment -ill /e at the applica/le '$5#
This ser.ice allo-s the in.estor to manage his in.estments acti.ely to achie.e his
o/jecti.es# Many funds do not e.en charge any transaction fees for his ser.ice- an added
ad.antage for the acti.e in.estor#
%2$:T+<
05
Data analysis and interpretation
Data $nalysis and 0nterpretation
0ntroduction:
$sset allocation strategies of .arious select mutual fund schemes are presented in the
follo-ing ta/les#
+6uity 3unds:
4undaram !': :ari/as Gro-th 3und G":
0n.estment 0nformation
3und type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize <s cr" EB#AH Cul-3D-EAA>"
Min #0n.estment <s H,AAA
*ast Di.idend '#$#
!onus '#$#
$sset $llocation :ercentage held
+6uity A#AA
De/t ?3#>?
Mutual 3unds '#$
Money Mar,et A#AA
%ash O %all EB#D3
4%2+M+ :+<3(<M$'%+:
Dmonth 3month Bmonth Dyear
-A#AHB3H A#AB A#3BEA?H -A#DBA>R
!irla $d.antage 3und F Gro-th
0n.estment information
3und Type (pen- +nded
0n.estment :lan Gro-th
$sset 4ize <4 cr" G33#BDMay-3A-EAA>"
Min #0n.estment <s# H,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity >G#>R
De/t A#AA
Money Mar,et A#AA
%ash O %all DH#DA
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
-A#AA??R A#3HEA?H -A#AEHR3 -A#DHG3R
2D3% +6uity 3und F Gro-th
0n.estment 0nformation
3und Type (pen- +nded
0n.estment :lan Gro-th
$sset 4ize<s cr" G,A3A#REMay-3A-EAA>"
Min# 0n.estment <s#H,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity R>#HD
De/t A#AA
Mutual fund '#$
Mutual Mar,et D#>H
%ash O %all -A#3B
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
A#A>ARGD A#DHDEA3 A#D3BHH? -A#A>GGG
0%0%0 :rudential Dynamic :lan F Gro-th
0n.estment 0nformation
3und Type (pen-+nded
0n.estment Type Gro-th
0n.estment :lan D,?>3#DEMay-3A-EAA>"
$sset 4ize <s cr" <s# H,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocationK" :ercentage held
+6uity >H#EG
De/t 3#?>
Mutual 3und '#$
Money Mar,et A#AA
%ash O %all DD#AD
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
A#ARDHR? A#DDRGGR A#A>EHGG -A#AB>R>
+S90T; 39'D ('+ M('T2 %(M:$<04(' (3 <+T9<'"
%ompany 'ame
and 3und
$/solute
return
Mean return 4tandard
De.iation
5ariance
2D3% +6uity
3und - Gro-th
5.56578/ 5.5596: 25.96;3 5.5//<=>
A#AAAD3??33
!irla $d.antage
3und - Gro-th
,5.55<<7 ,5.=/6/<
2,=/.6/;3
/./59977
D#EDHAB3A>H
0%0%0 :rudential
Dynamic :lan F
Gro-th
5.57/:7< 5.55=9/> 25.=9;3 5.5/9767
A#AAADB>?DG
4undaram !':
:ari/as Gro-th
,5.5:>=: ,5.5598725.9:;3 5.5/6597
A#AAA3EH
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 0%0%0 :rudential Dynamic :lan - Gro-th fund is
gi.ing the highest a/solute return o.er D months A#ARDHR?" -hile it is highest in term of
fluctuation of returns .ariance=A#AAADB>?DG"# 2D3% +6uity 3und - Gro-th is ha.ing
the minimum fluctuation in return generated .ariance=A# A#AAAD3??33"#
"$%%E"&ON"'
a" 3or in.estor -ith high ris, appetite go for: 4undaram !': :ari/as - Gro-th
/" 3or in.estor -ith moderate ris, appetite: Go for 0%0%0 :rudential Dynamic :lan -
Gro-th
c" 3or in.estor -ith lo- ris, appetite: 2D3% +6uity 3und - Gro-th
+S90T; 39'D 40X M('T24 %(M:$<04(' (3 <+T9<'"
%ompany 'ame
and 3und
$/solute
return
Mean return 4tandard
De.iation
5ariance
2D3% +6uity
3und - Gro-th
A#D3BHH? A#AAA>R? A#AD>R?> A#AAA3BAD
!irla $d.antage
3und - Gro-th
-A#AEHR3 A#ADBRH D#AEAD3D D#AGABB?E
0%0%0 :rudential
Dynamic :lan -
Gro-th 0%
A#A>EHGG A#AAABE> A#ADREE? A#AAA3BRB
4undaram !':
:ari/as Gro-th
A#3BEA?H A#AADRAR A#AEGED> A#AAAH>B
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 4undaram !': :ari/as Gro-th fund is gi.ing
the highest a/solute return o.er B months A#3BEA?H" -hile it is highest in term of
fluctuation of returns .ariance=A#AAAH>B"# 2D3% +6uity 3und - Gro-th is also ha.ing
the less fluctuation in return generated .ariance=A#AAA3BAD"#
"$%%E"&ON"'
a" 3or in.estor -ith high ris, appetite go for: !irla $d.antage 3und - Gro-th
/" 3or in.estor -ith moderate ris, appetite: Go for 2D3% +6uity 3und F Gro-th
c" 3or in.estor -ith lo- ris, appetite: 4undaram !': :ari/as Gro-th
Sundaram 4&P Paribas fund 2!ro?th3
"A$ S@P C&'
&%F0
R$#R&
2'3
&A. R$#R&
203
'
9
0
9
'0 20,0/3 20,03
9
D-jun-AH EA>?#HH 3G#HDER
3-(ct-AH EB3A#AH EH#R>?G G3#B>3E EB#H?ABG B?H#3GH ?AH#RRRE BRA#HAE DH#BE?R>GEG EGG#E33R
D-3e/-AB ER?D#HH DE#R>GHG HD#R>GR DR#AAG33 DB>#HR>G 3BD#DBGB EGB#?BEB >#ABDB?A>EH BG#RRAHG
D-Cun-AB ERBE#EH -A#3DER? H3#EB>R E#GBRRG> -A#AR?RGR B#DAABG3 -A#??3AD -
>#G?E?DE3HB
?D#?>B>H
3-(ct-AB 3HBR#B EA#HA3 BD#D3BH DG#?BRHR GEA#3?E> ED>#DGAR 3AE#>EAR 3#>EBR33DHH DG#BGHGE
D-3e/-A? GD3?#E DH#RAARG ?A#BBGH DH#H>G> EHE#>3RR EGE#>>HR EG?#>D3 G#BGED3?HRE ED#HGRGG
D-Cun-A? GER?#AH 3#>B3?EG ?H#?EB? ?#DB3?D DG#RE>3? HD#3D>?G E?#B?>B -
3#??>RHADHE
DG#E>AGB
D-(ct-A? HAB>#RH D?#RB3GR >>#BG?3 D?#ABEDH 3EE#B>BR ERD#DDB> 3AB#GRHB B#DDRG>HG>> 3?#GG>D
D-3e/-A> H3D?#EH G#>R>GH RG#3H3H B#G3BR? E3#RRG>E GD#G3GH> 3D#H3DD>
-G#HAHBRAG>
EA#3ADEH
E-Cun-A> G?3R#B -DA#>B3? >G#3?EB -DA#H?>E DD>#ADRR DDD#>R>3 DDG#RD>G -
ED#HEA>H>3D GB3#DG?3
OAL 75.79866 76.86=78 /77>.668 95=5.5> /7><.<87 =.<9>:/$,57 7:9.=6==
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.7599 /.69:7: /5.96>7 5.7:77 6.>:599 76.>977: 9.59>/
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
4irla Advanta+e Fund D !ro?th
"A$ S@P
C&'
&%F0
R$#R&
2'3
&A. R$#R&
203
'
9
0
9
'0 20,0/3 20,03
9
D-jun-AH EA>?#HH
BB#>B
3-(ct-AH EB3A#AH EH#R>?G
>G#3G EB#DGGD>
EB#H?ABG
B>3#HD>E B?R#GDRG DB#AGDGD?? EH?#3E?D
D-3e/-AB ER?D#HH DE#R>GHG
R>#G DB#B?ABE
DR#AAG33
E??#RARH EDB#GBAG B#HB?>H>RE G3#D3B??
D-Cun-AB ERBE#EH -A#3DER?
RB#A> -E#3H??E
E#GBRRG>
H#HH>>B A#?3?>RE -DE#GBAG>3B DHH#EB3?
3-(ct-AB 3HBR#B EA#HA3
DDD#3B DH#RA3GD
DG#?BRHR
EHE#RD>B 3EB#AB?B H#>AABH3>E 33#BG?H>
D-3e/-A? GD3?#E DH#RAARG
DER#ED DB#AERAR
DH#H>G>
EHB#R3DR EHG#>??? H#REB33G>3 3H#DEDGG
D-Cun-A? GER?#AH 3#>B3?EG
D3E#R? E#RARRRD
?#DB3?D
>#GB>AH DD#EG3G -?#DRE?B>HD HD#?3HRE
D-(ct-A? HAB>#RH D?#RB3GR
DH3#RH DH#??>
D?#ABEDH
EG>#RGHD E>3#GE?> H#B?HE3HAG 3E#EA>ER
D-3e/-A> H3D?#EH G#>R>GH
DHR#A> 3#33EEHD
B#G3BR?
DD#DA3>R DB#3EE>B -B#??AHARE? GH#>3R>
E-Cun-A> G?3R#B -DA#>B3?
D3R#R? -DE#ADE>
-DA#H?>E
DGG#3A?R D3A#HA3? -EE#DDHH>3? G>R#ARR
OAL
75.79866
69.=7<
76.86=78
/667.>>9 /7/7.5>/ 69.=7>7778 //8=.=6
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
/.556 ,/.59: //.9</= 5.7=79 8.<6//> :=.8>9= ,/.5/>6
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
-"FC $Euity Fund D !ro?th
"A$ S@P
C&'
&%F0
R$#R&
2'3
&A. R$#R&
203
'
9
0
9
'0 20,0/3 20,03
9
D-jun-AH EA>?#HH
?D#?>
3-(ct-AH EB3A#AH EH#R>?G
RG#3EG 3D#GA?A>
EB#H?ABG
R>B#GAGH >DB#D>>3 ED#3AG3D3 GH3#>?3>
D-3e/-AB ER?D#HH DE#R>GHG
DDE#G>3 DR#EHD?3
DR#AAG33
3?A#BER EGR#R?GR R#DG>RB>AR >3#?A3BE
D-Cun-AB ERBE#EH -A#3DER?
DDE#3E? -A#D3>BR
E#GBRRG>
A#ADRE3G A#AG3GAH
-
DA#EGDGG?B DAG#>>?E
3-(ct-AB 3HBR#B EA#HA3
D3E#B3G D>#A?>G?
DG#?BRHR
3EB#>3D 3?A#BBE? ?#R?H?A?33 B3#BDDRD
D-3e/-A? GD3?#E DH#RAARG
DHE#GDH DG#RD3R?
DH#H>G>
EEE#GEBB E3?#DGBE G#>DDED3?R E3#DG??>
D-Cun-A? GER?#AH 3#>B3?EG
DBD#RA3 B#EEHDAR
?#DB3?D
3>#?HDR> EG#AHED
-
3#>??BHARE DH#A3BD>
D-(ct-A? HAB>#RH D?#RB3GR
D>G#DBH D3#?HAED
D?#ABEDH
D>R#AB>E EG?#AAD? 3#BG?GG>GB D3#3A3>>
D-3e/-A> H3D?#EH G#>R>GH
DRD#A?H 3#?HEA?
B#G3BR?
DG#A?>A3 D>#3?R33
-
B#3HAB>R>H GA#33DEB
E-Cun-A> G?3R#B -DA#>B3?
DB?#E3? -DE#G?H?
-DA#H?>E
DHH#BG3> D3H#H3EB
-
EE#H?>G>RG HAR#?>>E
OAL
75.79866
78.<>899
76.86=78 9=5=.6:9 9576.76/ 78.<>89/< /=5<.>68
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
/.5:7 ,5./> /9.55 5.7><55 :.:99 >9.:<99 ,5./:9
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
%C%C% Prudential "ynamic Plan D !ro?th
"A$ S@P
C&'
&%F0
R$#R&
2'3
&A. R$#R&
203
'
9
0
9
'0 20,0/3 20,03
9
D-jun-AH EA>?#HH
E>#??BG
3-(ct-AH EB3A#AH EH#R>?G
3>#>AAE 3G#>33GD
EB#H?ABG
DED3#3BB RAH#EER? EG#?3ABG BDD#BAGB
D-3e/-AB ER?D#HH DE#R>GHG
GG#D3G> D3#?G>R
DR#AAG33
D>R#A3EE D?>#HE3E 3#BGBD3> D3#ERG3E
D-Cun-AB ERBE#EH -A#3DER?
G>#?>33 DA#H3EH
E#GBRRG>
DDA#R33? -3#ERB3G A#GER?GH A#D>GB>D
3-(ct-AB 3HBR#B EA#HA3
HH#BD3E DG#AAAGR
DG#?BRHR
DRB#AD3? E>?#AHDR 3#>R??E> DH#DREE>
D-3e/-A? GD3?#E DH#RAARG
B>#DGD3 EE#HE?ED
DH#H>G>
HA?#G?H 3H>#EA3> DE#GEGGH DHG#3BBR
D-Cun-A? GER?#AH 3#>B3?EG
?A#A>RE E#>H>BDR
?#DB3?D
>#D?D?AD DD#AGGRD -?#EGGDG HE#G??H>
D-(ct-A? HAB>#RH D?#RB3GR
??#R3BD DD#DRHHR
D?#ABEDH
DEH#3GD3 EAD#DDD> D#ARE>3D D#DRGE?R
D-3e/-A> H3D?#EH G#>R>GH
>D#B>BD G#>DDB3G
B#G3BR?
E3#DHD>E E3#HBRHH -H#ERDD3 E?#RRBAD
E-Cun-A> G?3R#B -DA#>B3?
?G#HERD ->#?BDHR
-DA#H?>E
?B#?BHG3 RH#D>3EB -D>#>BG3 3HH#>B3B
OAL 75.79866 /5:.<8>6 76.86=78 98:5.9:/ 95:>.>99 /8.69/7/ /9=9./<8
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.7/<= 9.869 //.< 5.6<5>: >.>5/< 68.95= 9.<5:
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
Findin+s and Su++estions*
CompanyFs
&ame
4eta Alfa Standard
"eviation
Coefficien
t of
determina
tion
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
%C%C% Prudential
dynamic plan,
!ro?th
5.7/<= 9.869 //.< 5.6<5>: >.>5/< 68.95= 9.<5:
-"FC eEuity
fund,!ro?th
/.5:7 ,5./> /9.55 5.7><55 :.:99 >9.:<9 ,5./:9
4irla advanta+e
fund,!ro?th
/.556 ,/.59: //.9</= 5.7=79 8.<6//> :=.8>9 ,/.5/>6
Sundaram 4&P
Paribas,!ro?th
5.7599 /.69:7: /5.96>7 5.7:77 6.>:599 76.>977: 9.59>/
Alpha @ 4eta*
The a/o.e ta/le sho-s that 0%0%0 :rudential dynamic plan-Gro-th fund is comparati.ely
more .olatile -ith a /eta of , A#RD?3 though compared to the mar,et all the funds are
safer to in.est# $nd also the alpha .alues of fe- funds are positi.e and fe- funds are
negati.e# 0%0%0 :rudential dynamic plan-Gro-th is sho-ing an alpha of E#G>E -hich
suggests that the fund is -ell di.ersified and 6uite efficient in reducing the impact of
mar,et ris,#
Co,efficient of "etermination*
$ll company is ha.ing positi.e co- efficient of determination
SharpeFs Ratio @ reynorFs Ratio*
4harp 0n the a/o.e ta/le, the Treynor=s ratio for !irla $d.antage 3und - Gro-th follo-ed
/y 0%0%0 :rudential Dynamic :lan - Gro-th and then 2D3% +6uity 3und - Gro-th# 0t
suggests that !irla $d.antage 3und - Gro-th is gi.ing highest returns o.er the ris, free
returns after ta,ing the mar,et ris, in to account# (n the other hand 2D3% e6uity fund-
Gro-th is gi.ing the lo-est returns# The sharpe=s ratio of !irla $d.antage 3und - Gro-th
fund highest suggesting that after ta,ing the total ris, in to consideration the fund is
gi.ing good return return o.er and a/o.e the ris, free returns#
3rom the a/o.e it can /e suggested that 2D3% e6uity fund-Gro-th can /e ruled out of
in.estment decision alternati.e# $mong the other three funds !irla is gi.ing higher
returns ta,ing lo-er ris, as compared to 4undaram !': :ari/as-Gro-th and 0%0%0, and
2D3% -hich is gi.ing lo-er returns#
De/t 3und
Sundaram 4&P Paribas 4ond Saver 2!3*
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize<s cr" EB#AHjul-3D-EAA>"
Min# 0n.estment <s H,AAA
*ast Di.idend '#$#
!onus '#$#
$sset $llocationK" :ercentage held
+6uity A#AA
De/t ?3#>?
Mutual 3unds '#$#
Money Mar,et A#AA
%ashO%all EB#D3
4%2+M+ :+<3(<M$'%+
%C%C% Prudential 4lended Plan , Option 4 D !ro?th*
D month 3 months B months D year
-A#AA?D?D A#AAHHGD -A#AEGHD -A#ABRBB
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize<s cr" DB#RAMay-3A-EAA>"
Min #0n.estment <s# H,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocationK" :ercentage held
+6uity A#AA
De/t >E#D3
Money Mar,et A#AA
%ash O %all D?#>?
4%2+M+ :+<3(<M$'%+
-"FC -i+h %nterest Fund D !ro?th*
D month 3 months B months D yrsW
,5.5575/ ,5.59=/< ,5.5>5/8 ,5.//7=7
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize <s cr" GE#?GMay-3A-EAA>"
Min # 0n.estment <s,HAAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity A#AA
De/t B?#?E
Money Mar,et E>#?B
%ash O %all 3#HE
4%2+M+ :+<3(<M$'%+
4irla 4ond %ndeB Fund D !ro?th*
D month 3 months B months D yrsW
5.5589/< 5.55:::8 ,5.58:/> ,5.5<>6=
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize<s cr" A#3HMay-3A-EAA>"
Min # 0n.estment <s#EH,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity A#AA
De/t 33#GA
Money Mar,et A#AA
%ash O %all BB#BA
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
,5.558/6 ,5.5/:< ,5.5=67: ,5.5<>66
D+!T 39'D ('+ M('T2 %(M:$<04(' (3 <+T9<'"
%ompany 'ame
and 3und
$/solute
return
Mean return 4tandard
De.iation
5ariance
!irla !ond 0nde1
3und F Gro-th
-A#AAGD> -A#AAADH A#AAAEHB A#AAAAAAABH
2D3% 2igh
0nterest 3und F
Gro-th
A#AAGED? A#AAADHD A#AAA>3D A#AAAAAABR
0%0%0 :rudential
!lended :lan -
(ption ! F
Gro-th
-A#AARAD -A#AAA3E A#AAAEAE A#AAAAAAAG
4undaram !':
pari/as /ond
sa.er-Gro-th
-A#AA?D?D -A#AAAED A#AADBDG A#AAAAAEBA
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 2D3% 2igh 0nterest 3und F Gro-th fund is gi.ing
the highest a/solute return o.er D months A#AAGED?" -hile it is highest in term of
fluctuation of returns .ariance=A#AAAAAABR"# 0%0%0 :rudential !lended :lan - (ption ! -
Gro-th is ha.ing the minimum fluctuation in return generated .ariance=A#AAAAAAAG"#
"$%%E"&ON"'
a"3or in.estor -ith high ris, appetite go for 4undaram !': :ari/as /ond sa.er-Gro-th
/"3or in.estor -ith moderate ris, appetite: Go for 2D3% 2igh 0nterest 3und - Gro-th
c"3or in.estor -ith lo- ris, appetite: 0%0%0 :rudential !lended :lan - (ption ! F Gro-th
D+!T 39'D 40X M('T24 %(M:$<04(' (3 <+T9<'"
%ompany 'ame
and 3und
$/solute
return
Mean 4tandard
De.iation
5ariance
!irla !ond
0nde1 3und F
Gro-th
-A#A3>RH -A#AAAEE A#AAA3BB A#AAAAAAD33
2D3% 2igh
0nterest 3und F
Gro-th
-A#AGHDB -A#AAAEB A#AADEBE A#AAAAADHRE
0%0%0 :rudential
!lended :lan -
(ption ! F
Gro-th
-A#ABADG -A#AAA3H A#AAA>3E A,AAAAAABRE
4undaram !':
:ari/as /alance
fund-Gro-th
-A#AEGHD
-A#AAAD3 A#AADEE3
A#AAAAADH
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 4undaram !': :ari/as /alance fund-Gro-th is
gi.ing the highest a/solute return o.er D months -A#AEGHD" -hile it is highest in term of
fluctuation of returns .ariance=A#AAAAADH"# !irla !ond 0nde1 3und - Gro-th is ha.ing
the minimum fluctuation in return generated .ariance=A#AAAAAAD33"#
"$%%E"&ON"'
a"3or in.estor -ith high ris, appetite go for 2D3% 2igh 0nterest 3und F Gro-th
/"3or in.estor -ith moderate ris, appetite: Go for 0%0%0 :rudential !lended :lan -
(ption ! F Gro-th
c"3or in.estor -ith lo- ris, appetite: 4undaram !': :ari/as /alance fund-Gro-th
Sundaram 4&P Paribas 4ond Saver 2!3*
"A$ S@P
C&'
&%F0
R$#R&
S
2'3
&A. R$#R&S
203
'9 09 ' 0 20,0/3 20,0/39
D-jun-AH EA>?#HH 3G#HDER
3-(ct-AH EB3A#AH EH#R>?G G3#B>3E EB#H?ABG B?H#3GH D#HAHBEB 3D#>>?H? -A#3H3DBE3A> A#DEG?EG
D-3e/-AB ER?D#HH DE#R>GHG HD#R>GR
DR#AAG33
DB>#HR>G
A#3EER>H ?#3?R3GR
-D#ADD>>GAGB D#AE3RAR
D-Cun-AB ERBE#EH -A#3DER? H3#EB>R E#GBRRG> -A#AR?RGR
A#GDBR3H
-A#EAEA>
-A#R3GGR?ADR
A#>?3E>H
3-(ct-AB 3HBR#B EA#HA3 BD#D3BH DG#?BRHR GEA#3?E> 3#3>H>AG 3?#?EBBH A#EHR>H33R3 A#AB?HEG
D-3e/-A? GD3?#E DH#RAARG ?A#BBGH
DH#H>G>
EHE#>3RR D#>HR3R3 ED#B>EGB
-A#EDBBABD>R
A#AGBRD>
D-Cun-A? GER?#AH 3#>B3?EG ?H#?EB? ?#DB3?D DG#RE>3? E#EEEEDE H#?HRB>B -A#A>RGR3HDR
A#AA>AAR
D-(ct-A? HAB>#RH D?#RB3GR >>#BG?3 D?#ABEDH 3EE#B>BR G#DG>>>G 3B#H>RG>
A#GHBB?RA?G A#EA>HHB
D-3e/-A> H3D?#EH G#>R>GH RG#3H3H B#G3BR? E3#RRG>E
D?#3HB3>
EA#GA?G3
E#H>H>R?EE
B#B>B>BG
E-Cun-A> G?3R#B -DA#>B3? >G#3?EB -DA#H?>E DD>#ADRR A#?>AGE3 -R#HR?DB -A#BRB?>BBA> A#G>HHDE
OAL 75.79866 76.86=78
/77>.668 =/.776>8 /:/.>==8 ,=.<:>=6 7.:9:=5/
CALC#LA%O& OF A4O.$ A4L$*
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
,5.<6957 /7.:556 /.596<< ,5.<78/76 6>.87:: ,//=.<<</ ,98.7=89
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
4irla 4ond %ndeB Fund D !ro?th:
"A$ S@P
C&'
&%F0
R$#R&
S
2'3
&A. R$#R&S
203
'9 09 ' 0 20,0/3 20,0/39
D-jun-AH EA>?#HH
DA#?EA?
3-(ct-AH EB3A#AH EH#R>?G
DA#R3DE D#RB3GRD
B?H#3GH
3#>HHER> HD#AEBA3 ->#D3RE? BB#EG??B
D-3e/-AB ER?D#HH DE#R>GHG
DD#AE3R A#>G>A3D
DB>#HR>G
A#?DRDH? DD#ADD3 -R#EHG?3 >H#BH
D-Cun-AB ERBE#EH -A#3DER?
DD#D>>H D#GR3DDR
-A#AR?RGR
E#EERGAB -A#GB?3 ->#BARBG ?G#DEHRD
3-(ct-AB 3HBR#B EA#HA3 DD#3R3G D#>3D3GH GEA#3?E> 3#3H3>E3 3?#HG>AH ->#E?DGE B>#GDB3D
D-3e/-A? GD3?#E DH#RAARG
DD#H>?G D#?AE?G
EHE#>3RR
E#>RR3EG E?#A?HD? ->#GAAAE ?A#HBA33
D-Cun-A? GER?#AH 3#>B3?EG DD#?B?3 D#HHEHG> DG#RE>3? E#GDAGA? H#RR>BDR ->#HHAED ?3#DABDE
D-(ct-A? HAB>#RH D?#RB3GR DE#AD?H E#DEBE3D 3EE#B>BR G#HEA>HR 3>#DRGH3 -?#R?BH3 B3#BEHAD
D-3e/-A> H3D?#EH G#>R>GH
DE#ERDE E#E??HDE
E3#RRG>E
H#D>?ABD DD#DHBE> -?#>EHEH BD#E3GHD
E-Cun-A> G?3R#B -DA#>B3?
DE#G>>G D#BAGG
DD>#ADRR
E#H?GARR -D?#GER? ->#GR>3B ?E#EEEDE
OAL
75.79866
/:.=7789
/77>.668
9<.<878= />8.//= ,<:.:9:8 >=:./66/
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.55<79 /.>=/ 6.8557 5.9957<< ,/.::7 ,/>:8./ /5./5
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
2D3% 2igh 0nterest 3und F Gro-th:
"A$ S@P
C&'
&%F0
R$#R&S
2'3
&A. R$#R&S
203
'9 09 ' 0 20,0/3 20,0/39
D-jun-AH EA>?#HH
E3#3
3-(ct-AH EB3A#AH EH#R>?G
E3#B>ER D#BG33G>
B?H#3GH
E#?AAHRD EG#3GGAH
-
>#GHRGE ?D#HBD?3
D-3e/-AB ER?D#HH DE#R>GHG
E3#???B A#3RR>B?
DB>#HR>G
A#DHR>R3 DE#H>GB>
-
R#?AE>R RG#DGBDG
D-Cun-AB ERBE#EH -A#3DER?
E3#RHRG A#?BGH>H
-
A#AR?RGR
A#H>GHR -D#A??HH
-
R#33>D? >?#EADHD
3-(ct-AB 3HBR#B EA#HA3
EG#3HA? D#B33D?R
GEA#3?E>
E#BB?E?H D>#>BR>E
-
>#GBRH> ?D#?33?R
D-3e/-A? GD3?#E DH#RAARG
EG#G>?B A#HBEEAD
EHE#>3RR
A#3DBA?D DH#33>?G
-
R#HGAHB RD#AEEEB
D-Cun-A? GER?#AH 3#>B3?EG
EG#HEG3 A#DGR>?E
DG#RE>3?
A#AEEGBE 3#?D3>HE
-
R#RHE>R RR#AHRR>
D-(ct-A? HAB>#RH D?#RB3GR
EH#3?3H 3#GBEB>>
3EE#B>BR
DD#RRAED DG#HAA>
-
B#BGAA? GG#ARAHB
D-3e/-A> H3D?#EH G#>R>GH
EB#BHHB H#AHERD
E3#RRG>E
EH#H3D>R -A#DHGGB
-
H#AGR>H EH#HAARR
E-Cun-A> G?3R#B -DA#>B3?
EB#B??B A#A>EH3G
DD>#ADRR
A#AAB>DE -DA#RGBE
-
DA#AEAE DAA#GAGR
OAL
75.79866 /=.<://6
/77>.668 8=.7<76 <<./<=>7
,
<<./<=< >68.<9/7
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
,5.5:/7 9.5:/ 6.<99 ,5.=:<9 ,/.<:< 97:.9 ,=7.:9
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
%C%C% Prudential 4lended Plan , Option 4 D !ro?th:
"A$ S@P
C&'
&%F0
R$#R&S
2'3
&A. R$#R&S
203
'9 09 ' 0 20,0/3 20,0/39
D-jun-AH EA>?#HH DA#ADR?
3-(ct-AH EB3A#AH EH#R>?G
DA#EDE D#RDREDR
B?H#3GH
3#B>3GAE GR#>?HHE
-
>#D>3HH BB#R?AGD
D-3e/-AB ER?D#HH DE#R>GHG
DA#3RGE D#?>GD?H
DB>#HR>G
3#D>3E>E E3#DBB?D
-
>#3D>H> BR#DR>>H
D-Cun-AB ERBE#EH -A#3DER?
DA#B>>B E#>3E3GR
-
A#AR?RGR >#AEEE -A#>>BG3
-
?#E?AGD HE#>H>>>
3-(ct-AB 3HBR#B EA#HA3 DA#>??D D#?B3HBD GEA#3?E> 3#DDADG> 3B#DH>ER ->#33RE BR#HGEEG
D-3e/-A? GD3?#E DH#RAARG
DD#DEBR E#ERBHB>
EHE#>3RR
H#E?GEEH 3B#HD?HR
-
?#>ABDR BA#R3BB3
D-Cun-A? GER?#AH 3#>B3?EG
DD#GDG E#H>AE33
DG#RE>3?
B#BH?BAH R#RBR3DD
-
?#HEEH3 HB#H>>GD
D-(ct-A? HAB>#RH D?#RB3GR
DD#>DH> 3#HEAE3>
3EE#B>BR
DE#3REA> B3#E3H?H
-
B#H>EHE G3#3ERHR
D-3e/-A> H3D?#EH G#>R>GH
DE#EHG3 3#?DDD33
E3#RRG>E
D3#??EH D>#D?>>
-
B#3RDB3 GA#>HER
E-Cun-A> G?3R#B -DA#>B3?
DE#HABG E#AH?E3?
DD>#ADRR
G#E3EEEG -EE#3GRE
-
>#AGHHE BG#?3AGG
OAL 75.79866 99.8>8</ /77>.668 >5.=9<>< 9/=.6>>=
,
>6.8>5/ :9:.556=
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
,5.5/97 9.>9> <.>=<> ,5.95>7> ,5.<75 ,8>:.>> ,959.>9
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
Findin+s and Su++estions*
CompanyFs
&ame
4eta Alfa Standard
"eviation
Coefficient
of
determinat
ion
Sharpe
ratio
2SR3
reynor
Ratio 2R
1ensen Ratio
21R3
%C%C% Prudential
4lended plan option,
4,!ro?th
,5.5/97 9.>9> <.>=<> ,5.95>7> ,5.<75 ,8>:.>> ,959.>9
-"FC hi+h interest
fund,!ro?th
,5.5:/7 9.5:/ 6.<99 ,5.=:<9 ,/.<:< 97:.9 ,=7.:9
4irla 4ond indeB
fund,!ro?th
5.55<79 /.>=/ 6.8557 5.9957<< ,/.::7 ,/>:8./ /5./5
Sundaram 4&P
Paribas 4ond Saver,
!ro?th
,5.<6957 /7.:556 /.596<< ,5.<78/76 6>.87:: ,//=.<<</ ,98.7=89
Alpha @ 4eta*
The a/o.e ta/le sho-s that !irla !ond inde1 fund-Gro-th is comparati.ely more .olatile
-ith a /eta of A#AA?RE, though compared to the mar,et all the funds are safer to in.est#
$nd also the alpha .alues of all the funds are positi.e -hich sho-s that the funds are
gi.ing returns justifying the ris, ta,en# 4undaram !': :ari/as !ond 4a.er-Gro-th is
sho-ing an alpha of DR#HAA> -hich suggests that the fund is -ell di.ersified and 6uite
efficient in reducing the impact of mar,et ris,#
Co,efficient of "etermination*
2ere all .alues are not in positi.e form of the co-efficient of determination of all the fund
of the de/t#
SharpeFs Ratio @ reynorFs Ratio
4harp 0n the a/o.e ta/le, the Treynor=s ratio for 2D3% 2igh 0nterest 3und F Gro-th fund
the highest here almost all funds are in negati.e form and same are in positi.e form# 0t
suggests that 2D3% 2igh 0nterest 3und F Gro-th fund fund is gi.ing highest returns o.er
the ris, free returns after ta,ing the mar,et ris, in to account# (n the other hand
4undaram !': :ari/as !ond 4a.er-Gro-th 3und is gi.ing the lo-est returns#
)ith more .olatility the 4harpe=s ratio here all fund are in negati.e or 2D3% 2igh
0nterest 3und F Gro-th fund gi.ing highest, suggesting that after ta,ing the total ris, in to
consideration the fund is gi.ing good return o.er and a/o.e the ris, free returns#
!alance 3und
Sundaram 4&P Paribas 4alance Fund,!ro?th*
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize <s cr" 3>#R3jul-3D-EAA>"
Min# 0n.estment <s H,AAA
*ast Di.idend '#$#
!onus '#$#
$sset $llocation K" :ercentage held
+6uity BH#EG
De/t A#AA
Mutual 3unds '#$#
Money Mar,et A#AA
%ashO%all 3G#?3
4%2+M+ :+<3(<M$'%+ :
Dmonth 3 months B months Dyear
-A#ABD?D A#AGRHGR A#EH>D3G -A#DDEGH
-"FC 4alanced Fund D !ro?th
0n.estment 0nformation
3und Type (pen-+nded
0n.estment Type Gro-th
$sset 4ize <s cr" DAG#>HMay-3A-EAA>"
Min #0n.estment <s#H,AAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity BR#AA
De/t E3#RE
Money Mar,et H#?>
%ash O %all D#3A
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
A#ABA?D? A#D3G?3H A#A3R3G -A#AG33>
%C%C% Prudential 4alanced D !ro?th
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize <s cr" 33B#R?May-3A-EAA>"
Min# 0n.estment <s#HAAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity ?A#?H
De/t ED#DB
Mutual 3und '#$
Money Mar,et A#AA
%ash O %all >#AR
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
A#A>G3E A#DRD?BH A#D3GHD> -A#ADAG3
4irla 4alance Fund D !ro?th
0n.estment 0nformation
3und Type (pen-+nded
0n.estment :lan Gro-th
$sset 4ize<s cr" DAB#3>May-3A-EAA>"
Min# 0n.estment <s#HAAA
*ast Di.idend '#$
!onus '#$
$sset $llocation K" :ercentage held
+6uity B?#3R
De/t D?#?3
Money Mar,et A#AA
%ash O %all DG#>>
4%2+M+ :+<3(<M$'%+
D month 3 months B months D yrsW
A#AG?G3 A#AB3AD> A#DA?GB3 -A#ABGAD
!$*$'%+D 39'D-('+ M('T2 %(M:$<04(' (3 <+T9<'"
%ompany 'ame
and fund
$/solute
return
Mean return 4tandard
De.iation
5ariance
!irla !alance 3und -
Gro-th
A#AG?G3 A#AADB>G A#DBK" A#AA?H? A#AAAAH?3AG
2D3% !alanced
3und - Gro-th
A#ABA?D? A#AAEDGG A#EDK" A#AA>B>D A#AAAA?H3HHR
0%0%0 :rudential
!alanced - Gro-th
A#A>G3E A#AAERG? A#ERK" A#ADA3E A#AAADABHAE
4undaram !':
:ari/as !alance
fund-Gro-th
-A#ABD?D
-A#AAEDD
A#ADBG?H
A#AAAE?D
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 0%0%0 :<9D+'T0$* /alanced gro-th fund is
gi.ing the ma1imum a/solute one month return A#A>G3E"/ut is also highest in terms of
.olatility 5ariance=A#AAADABHAE" -hile 4undaram !': :ari/as !alance fund-Gro-th is
ha.ing the lo-est .olatility .ariance=A#AAAE?D" so far as return in concerned#
49GG+4T0('4:
a" 3or in.estor -ith high ris, appetite: Go for the 0%0%0 /alanced gro-th fund#
/" 3or in.estor -ith moderate ris, appetite: Go !irla !alance 3und F Gro-th#
c" 3or in.estor -ith lo- ris, appetite: Go 4undaram !': :ari/as !alance fund-
Gro-th#
!$*$'%+D 39'D-40X M('T24 %(M:$<04(' (3 <+T9<'"
%ompany
'ame and fund
$/solute
return
Mean return 4tandard
De.iation
5ariance
!irla !alance
3und - Gro-th
A#DA?GB3 A#AAABB A#AD3EB? A#AAAD?B
2D3% !alanced
3und - Gro-th
A#A3R3G A#AAA3DE>G3 A#AD3RG? A#AAADRG
0%0%0 :rudential
!alanced - Gro-th
c
A#D3GHD> A#AAA>G>3ER A#ADB?H3 A#AAAE>A
4undaram !':
:ari/as /alance
fund-Gro-th
A#EH>D3G A#AADGAG A#ADHH>G A#AAAEG3
F%&"%&!S*
3rom the a/o.e ta/le -e can see that 4undaram !': :ari/as /alance fund-Gro-th is
gi.ing the highest a/solute return o.er B months A#EH>D3G" -hile it is highest in term of
fluctuation of returns .ariance=A#AAAEG3"# !0<*$ /alanced fund is ha.ing the minimum
fluctuation in return generated .ariance=A#AAAD?B"#
"$%%E"&ON"'
a"3or in.estor -ith high ris, appetite: Go for 0%0%0 prudential !$*$'%+D 39'D
/"3or in.estor -ith moderate ris, appetite: Go for !0<*$ !$*$'%+D fund
c"3or in.estor -ith lo- ris, appetite: Go for !0<*$ !$*$'%+D fund#
Sundaram 4np Paribas 4alance fund*
"A$ S@P
C&'
&%F0
R$#R&
2'3
&A. R$#R&
203
'
9
0
9
'0 20,0/3 20,0/39
D-jun-AH EA>?#HH EA#>D?
3-(ct-AH EB3A#AH EH#R>?G E3#HRDH D3#3E>AH B?H#3GH D??#B3BR 3GB#3BDG B#3HABEE GA#33AG
D-3e/-AB ER?D#HH DE#R>GHG E?#B?D D?#EREEH DB>#HR>G ERR#AED? EEG#H3DR DA#3DG>E DAB#3RHH
D-Cun-AB ERBE#EH -A#3DER? E>#GB>B E#>>EGG -
A#AR?RGR
>#3A>GBD -A#RAEDD -G#ARGRR DB#?B>RE
3-(ct-AB 3HBR#B EA#HA3 ER#BRRR G#3EHDDB GEA#3?E> D>#?ABB3 >>#B??>G -E#BHE3D ?#A3G?H3
D-3e/-A? GD3?#E DH#RAARG 3E#>3R DA#HBRG EHE#>3RR DDD#?DED DB>#AB33 3#HRDRBR DE#RAEEG
D-Cun-A? GER?#AH 3#>B3?EG 3G#HD>E H#DD3G3E DG#RE>3? EB#DG?DR DR#?HB>R -D#>B3RR
3#G?GG??
D-(ct-A? HAB>#RH D?#RB3GR GA#AHHE DB#AGA>D 3EE#B>BR EH?#3A??
E>>#DG>R
R#AB33>B >E#DGGR?
D-3e/-A> H3D?#EH G#>R>GH GD#RHD> G#?3GRBB E3#RRG>E EE#GDRR E3#DR3RR -E#EGEGB
H#AE>B3E
E-Cun-A> G?3R#B -DA#>B3? 3?#D3D? -DD#G>RB DD>#ADRR D3E#ADDE DEG#>DR? -D>#GB?
3GD#A3DB
ssOA
L
75.79866
>9.<7>68
/77>.668
/5:=.9<9
/969.>:9
5.55558<
>/:.///:
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe ratio
2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.>5//> 5.7585 6.9><9 5.<7:7 >.88>6 66.>:>< /.:5=>
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
4irla 4alance Fund D !ro?th
"A$ S@P C&'
&%F0
R$#R&
2'3
&A. R$#R&S
203
'9 09 '0 20,0/3 20,0/39
D-jun-AH EA>?#HH
D>#AD
3-(ct-AH EB3A#AH EH#R>?G
EA#RB DB#3?R?R
B?H#3GH
EB>#ER?H GEH#BB>E B#E??AEH 3R#GADAG
D-3e/-AB ER?D#HH DE#R>GHG
E3#A3 R#>?HRHG
DB>#HR>G
R?#H3GG? DE>#E3G> -A#EEB>D A#AHDGGD
D-Cun-AB ERBE#EH -A#3DER?
EE#>G -A#>EHAD
-A#AR?RGR
A#B>ABG3 A#EH>EAE -DA#RE?> DDR#GDBE
3-(ct-AB 3HBR#B EA#HA3
EB#DG DG#GG>3G
GEA#3?E>
EA>#?HGG ERB#E3GE G#3GHH?B D>#>>GA3
D-3e/-A? GD3?#E DH#RAARG
E>#3? >#H3AR>?
EHE#>3RR
?E#????G D3H#BHA? -D#H?D?? E#G?AG?
D-Cun-A? GER?#AH 3#>B3?EG
ER#HR G#3AA3D?
DG#RE>3?
D>#GRE?3 DB#BDHEG -H#>AEGG 33#BB>3G
D-(ct-A? HAB>#RH D?#RB3GR
33#B3 D3#BH3EB
3EE#B>BR
D>B#GDDH EGH#EBAE 3#HHAHAD DE#BABAB
D-3e/-A> H3D?#EH G#>R>GH
3E#GH -3#HA>??
E3#RRG>E
DE#3DDG> -D?#D>?H -D3#BDDH D>H#E?3>
E-Cun-A> G?3R#B -DA#>B3?
3A#RD -G#?GH?B
DD>#ADRR
EE#HEEEB HD#HHBH3 -DG#>G>H EEA#G?>B
O
AL
75.
79866 :6./57/
/77
>.668 66<.<696 /969.97 :6./57/ >=9.9:
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.>8: ,5.57 6.=6/: 5.7855/9 =.:=9> 8:.75: 5./=7:
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
-"FC 4alanced Fund D !ro?th
"A$ S@P C&'
&%F0
R$#R&
2'3
&A. R$#R&S
203
'9 09 '0 20,0/3 20,0/39
D-jun-AH EA>?#HH
EA#H?B
3-(ct-AH EB3A#AH EH#R>?G
EG#GBG ER#RA?BR
B?H#3GH
>RG#G?AD ???#EE3E DR#>AGR3 3RE#E3HE
D-3e/-AB ER?D#HH DE#R>GHG
EB#AH? DE#EH3>H
DB>#HR>G
DHA#DHB? DHR#DDAB E#DHDA>B G#BE?D?E
D-Cun-AB ERBE#EH -A#3DER?
EB#GH> 3#A>GBDH
-A#AR?RGR
R#HDG>HE -A#RBH3R -?#AD>DG GR#EHG3H
3-(ct-AB 3HBR#B EA#HA3
ER#RGG EB#>DH3>
GEA#3?E>
?DR#ABGR HGR#?RH? DB#?DEBE E?R#3DD>
D-3e/-A? GD3?#E DH#RAARG
3E#AR DB#HA?BR
EHE#>3RR
E?E#HA3R EBE#G>?> B#GAGR3E GD#AE3DB
D-Cun-A? GER?#AH 3#>B3?EG
3E#AAE -A#B?BRE
DG#RE>3?
A#GH>EEH -E#BDHGG -DA#??R? DDB#EADB
D-(ct-A? HAB>#RH D?#RB3GR
3G#RH? EE#?3A??
3EE#B>BR
HDB#B>?R GA>#3E3R DE#BE>AD DHR#GBBB
D-3e/-A> H3D?#EH G#>R>GH
3>#DH> EG#BE3A>
E3#RRG>E
BAB#ERHR DEA#BDGR DG#HEA3E EDA#>3RB
E-Cun-A> G?3R#B -DA#>B3?
3G#>G3 -EH#H
DD>#ADRR
BHA#EH E??#AEG3 -3H#BAE> DEB?#HH?
OAL
75.7
9866 /57.<8>9
/77
>.668 =6/7.859 9::/ /6.69/=/ 9:95.:/>
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
/.==6> ,/.=97 />.<=:/ 5.66>= 8.6:86 >5.>78 ,5.779
&ote 2% have taAen RF benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
%C%C% Prudential 4alanced D !ro?th
"A$ S@P
C&'
&%F0
R$#R&
2'3
&A. R$#R&S
203
'9 09 '0 20,0/3 20,0/39
D-jun-AH EA>?#HH
EA#3?
3-(ct-AH EB3A#AH EH#R>?G
EH#DB E3#HDGR?
B?H#3GH
HHE#RHG BDD#AR3 3H#>HD>? DE>H#3HB
D-3e/-AB ER?D#HH DE#R>GHG
E>#EB DE#3EDDG
DB>#HR>G
DHD#>DAB DHR#R>GG -H3#D3>E E>E3#BBG
D-Cun-AB ERBE#EH -A#3DER?
E>#? D#HHBR?D
-
A#AR?RGR E#GEGDHR -A#G>?E> D#HHBR?D E#GEGDHR
3-(ct-AB 3HBR#B EA#HA3
3D#GH R#H>D>>E
GEA#3?E>
RD#>DEGH DRB#GH?3 R#H>D>>E RD#>DEGH
D-3e/-A? GD3?#E DH#RAARG
3H#>G D3#RH>BB
EHE#>3RR
DRG#>GG3 EED#RHHR D3#RH>BB DRG#>GG3
D-Cun-A? GER?#AH 3#>B3?EG
3B#GH D#?AEAAR
DG#RE>3?
E#>RB>3G B#H?BAR3 D#?AEAAR E#>RB>3G
D-(ct-A? HAB>#RH D?#RB3GR
GA#3H DA#BRRHR
3EE#B>BR
DDG#G>DE DRE#EADR DA#BRRHR DDG#G>DE
D-3e/-A> H3D?#EH G#>R>GH
GE#DH G#GBARB?
E3#RRG>E
DR#RAAEE ED#>HD>E G#GBARB? DR#RAAEE
E-Cun-A> G?3R#B -DA#>B3?
3B#RH -DE#33BR
DD>#ADRR
DHE#DR>R D3G#AEG3 -DE#33BR DHE#DR>R
OAL 75.79866 >:.8:7=/
/77>.66
8 /96=.=9= /:8=.>:< /9.==>67 8>6<.:<7
CALC#LA%O& OF A4O.$ A4L$
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio 2SR3
reynor
Ratio 2R
1ensen
Ratio 21R3
5.6/67 ,5.775< 99.69/7 5.7:5>6 /.>/7 8:./=97 ,/.957
&ote 2% have taAen Rf benchmarA 7.: the fiBed deposit of banA interestC the days
duration is = year3
Findin+s and Su++estions*
CompanyFs
&ame
4eta Alfa Standard
"eviation
Coefficient of
determination
Sharpe
ratio
2SR3
reynor
Ratio
2R3
1ensen
Ratio 21R3
%C%C% Prudential
4alanced D !ro?th
5.6/67 ,5.775< 99.69/7 5.7:5>6 /.>/7 8:./=97 ,/.957
-"FC 4alanced
Fund D !ro?th
/.==6> ,/.=97 />.<=:/ 5.66>= 8.6:86 >5.>78 ,5.779
4irla 4alance
Fund D !ro?th
5.>8: ,5.57 6.=6/: 5.7855/9 =.:=9> 8:.75: 5./=7:
S#&"ARAM 4&P
PAR%4AS
4ALA&C$"
F#&"*
5.>5//> 5.7585 6.9><9 5.<7:7 >.88>6 66.>:>< /.:5=>
Alpha @ 4eta
The a/o.e ta/le sho-s that 2D3% !alanced 3und - Gro-th fund is comparati.ely more
.olatile -ith a /eta of D#33>B, though compared to the mar,et all the funds are safer to
in.est and they are ha.ing less .olatility also# $nd also the alpha .alues of all the funds
are negati.e e1pected 4undaram !': :ari/as !alance 3und -hich sho-s that the funds
are gi.ing returns not justifying the ris, ta,en# 4undaram !': :ari/as !alance 3und is
sho-ing an alpha of A#RAGA -hich suggests that the fund is -ell di.ersified and 6uite
efficient in reducing the impact of mar,et ris,#
Co,efficient of "etermination
$ll company is ha.ing positi.e co- efficient of determination#
SharpeFs Ratio @ reynorFs Ratio
4harp 0n the a/o.e ta/le, the Treynor=s ratio for 4undaram !': :ari/as !alance 3und is
the highest follo-ed /y 2D3% and then !0<*$# 0t suggests that 4undaram !': :ari/as
!alance 3und is gi.ing highest returns o.er the ris, free returns after ta,ing the mar,et
ris, in to account# (n the other hand 0%0%0 :rudential !alanced - Gro-th fund is gi.ing
the lo-est returns# The 4harpe=s ratio of 4undaram !': :ari/as !alance 3und is highest
suggesting that after ta,ing the total ris, in to consideration the fund is gi.ing good return
o.er and a/o.e the ris, free returns# 3rom the a/o.e it can /e suggested that 4undaram
!': :ari/as !alance 3und can /e ruled out of in.estment decision alternati.e# $mong
the other three funds#
%2$:T+<
5
3indings , conclusion , suggestions
Su++estion +iven to the Company
The study has tried pro.e that mere returns of a fund or the past performance is not good enough
to ma,e a sound decision on in.estment for the future#
There is a need to understand .arious a.aila/le tools of comparati.e analysis and their
significance in ma,ing an in.estment decision#
There tools help in analyzing the consistency of performance of the funds o.er a period of time#
Thus -hile gi.ing a suggestion to a potential in.estor on in.estments#
The ad.isor can
? Ta,e the /eta ratios of .arious funds and suggest -ither the fund is .olatile or not
? 9se correlations and suggest -hether the /enchmar, ta,en /y the company for judging
the performance is good enough or not#
? 9se treynor=s ratio and tell -ither the fund of the company is gi.ing returns justifying the
mar,et ris, to -hich all the similar funds are su/ject to#
Mutual fund: $n 0ntroduction
$ mutual fund is a form of collecti.e in.estment# 0t is a pool of money collected from .arious
in.estors -hich is in.ested according to the stated in.estment o/jecti.e# The fund manager is the
person -ho in.ests the money in different types of securities according to the predetermined
o/jecti.es# The portfolio of a mutual fund is decided ta,ing into consideration this in.estment
o/jecti.e# Mutual fund in.estors are li,e shareholders and they o-n the fund# The income earned
through these in.estments and the capital appreciation realized /y the scheme is shared /y its unit
holders in proportion to the num/er of units o-ned /y them# The .alue of the in.estments can go
up or do-n, changing the .alue of the in.estors holding# Mutual funds are one of the /est
in.estments e.er created /ecause they are .ery cost efficient and .ery easy to in.est in#
4iblio+raphy and references
4ooAs: T4ecurity $nalysis and portfolio ManagementU /y Donald 3ischer I <onald
Cordan, Bth edition pu/lished /y prentice 2all DRRH#
Web sites*
? ---#amfi #com
? )--# Money control#com
? ---#historical nifty#yahoofinancial#com
? ---#sundaram !': :ari/as# in
? ---#share,an#com
1ournal*
? $uthor /y ,annan, I 'edunchez 0ndian T$ comparati.e study on performance of
pri.ate mutual fundsU+conomic panorama issue date, BAODAOEAAH
? 4isodiya, $mith 4ingh, TMutual funds performance-%omparati.e analysisU 0%3$0,
DHO?OEAAG#
doc_763851048.doc