COMPARATIVE ANALYSIS COMPARATIVE ANALYSIS OF MUTUAL FUNDSOF MUTUAL FUNDS

MUTUAL FUND OPERATION MUTUAL FUND OPERATION FLOW CHARTFLOW CHART

TYPES OF MUTUAL FUNDS TYPES OF MUTUAL FUNDS SCHEMESSCHEMES

According to Maturity PeriodAccording to Maturity Period Open EndedOpen Ended Close EndedClose Ended

According to Investment ObjectiveAccording to Investment Objective Growth/Equity Oriented SchemeGrowth/Equity Oriented Scheme Income / Debt Oriented SchemesIncome / Debt Oriented Schemes Balanced SchemeBalanced Scheme

INSTRUMENTS OF INSTRUMENTS OF INVESTMENTINVESTMENT

EQUITYEQUITY CONVERTIBLE DEBENTURESCONVERTIBLE DEBENTURES FIXED INCOME SECURITIESFIXED INCOME SECURITIES SHORT TERM SECURITIESSHORT TERM SECURITIES

Facilities Provided by Mutual Facilities Provided by Mutual Funds to the Investors Funds to the Investors

Systematic Investment Plan (SIP)Systematic Investment Plan (SIP) Systematic Withdrawal Plan (SWP)Systematic Withdrawal Plan (SWP) Systematic Transfer Plan (STP)Systematic Transfer Plan (STP) Dividend Transfer Plan (DTP)Dividend Transfer Plan (DTP) Auto debit facility and Electronic Clearing Auto debit facility and Electronic Clearing

Service (ECS)Service (ECS) SwitchingSwitching

INTRODUCTION TO THE INTRODUCTION TO THE ORGANIZATION ORGANIZATION

SHAREKHAN BACKGROUNDSHAREKHAN BACKGROUND Retail broking arm of the Mumbai based Retail broking arm of the Mumbai based

SSKI group.SSKI group. Established in 1922Established in 1922 Share khan's ground network includes Share khan's ground network includes

over 700+ Share shops in 130+ cities in over 700+ Share shops in 130+ cities in India. India.

SSKI group ventured into institutional SSKI group ventured into institutional broking and corporate finance 18 years broking and corporate finance 18 years ago. ago.

OBJECTIVES OF THE STUDYOBJECTIVES OF THE STUDY

The present study focuses on the The present study focuses on the comparative analysis of mutual funds comparative analysis of mutual funds schemes performance.schemes performance.

To evaluate the schemes on the basis To evaluate the schemes on the basis of risk and return by calculating Beta, of risk and return by calculating Beta, Alpha, Standard Deviation.Alpha, Standard Deviation.

RESEARCH METHEDOLOGYRESEARCH METHEDOLOGY TYPE OF RESEARCHTYPE OF RESEARCH

-- -- Descriptive cum Analytical research Descriptive cum Analytical research has been used because the researcher has has been used because the researcher has no control over the variables. He can only no control over the variables. He can only report what has happened or what is report what has happened or what is happening. . In Analytical Research, the happening. . In Analytical Research, the researcher has to use facts and researcher has to use facts and information already available and make information already available and make an analysis on the basis of these only. an analysis on the basis of these only.

DATA COLLECTIONDATA COLLECTION The data has been collected from the The data has been collected from the

secondary sources i.e.secondary sources i.e. -- Fact sheets-- Fact sheets -- Annual Reports-- Annual Reports -- Offer Documents-- Offer Documents NAVs of selected schemes and NAVs of selected schemes and

closing values of S&P CNX 500 have closing values of S&P CNX 500 have been noted from www.amfindia.com and been noted from www.amfindia.com and Mutual Fund House’s Personal Sites.Mutual Fund House’s Personal Sites.

SAMPLE & SAMPLING SAMPLE & SAMPLING TECHNIQUETECHNIQUE

SAMPLE SIZESAMPLE SIZE: 7 Schemes of 4 Mutual Fund : 7 Schemes of 4 Mutual Fund Companies namely Franklin Templeton, Companies namely Franklin Templeton, Reliance, HDFC and ICICI Prudential has Reliance, HDFC and ICICI Prudential has been selected.been selected.

SAMPLING TECHNIQUE:SAMPLING TECHNIQUE: In the present In the present study Convenience Sampling technique has study Convenience Sampling technique has been used. been used.

DATA ANALYSIS AND FINDINGSDATA ANALYSIS AND FINDINGS The following parameters have been chosen The following parameters have been chosen

for comparison:for comparison: Fund ObjectiveFund Objective Fund StyleFund Style Fund DetailsFund Details HistoryHistory Portfolio CharacteristicsPortfolio Characteristics Sectoral AllocationSectoral Allocation Portfolio ConcentrationPortfolio Concentration PerformancePerformance AnalysisAnalysis

Following Test’s have been applied:Following Test’s have been applied:

BETA BETA ALPHAALPHA STANDARD DEVIATIONSTANDARD DEVIATION

BETABETA A Beta is a measure of risk. It compares a A Beta is a measure of risk. It compares a

mutual fund’s volatility with that of a mutual fund’s volatility with that of a benchmark. If the beta of the stock is 1, it benchmark. If the beta of the stock is 1, it means that the returns in the stock are highly means that the returns in the stock are highly correlated to the benchmark index. correlated to the benchmark index.

If Beta is greater than 1, it means the stock is If Beta is greater than 1, it means the stock is more volatile.more volatile.

If Beta is less than 1, than the stock is less If Beta is less than 1, than the stock is less volatile. volatile.

COMPARATIVE ANALYSIS COMPARATIVE ANALYSIS (BETA)(BETA)

LARGE CAP FUNDLARGE CAP FUND

0.84

0.86

0.88

0.9

0.92

0.94

0.96

FranklinIndia

Bluechip

HDFCTOP 200

PRU ICICIGrowth

RelianceVision

BETA

MID CAP FUNDMID CAP FUND

0.840.860.88

0.90.920.940.960.98

1

FranklinPrima

HDFCCapitalBuilder

RelianceGrowth

BETA

ALPHAALPHA Alpha is a financial term describing that part Alpha is a financial term describing that part

of an investor’s return that is due to the skills of an investor’s return that is due to the skills of the investment manager, as distinct from the of the investment manager, as distinct from the return of the market as a whole. return of the market as a whole.

ααii < < rfrf: the manager or firm has destroyed : the manager or firm has destroyed valuevalue

ααii = = rfrf: the manager or firm has neither created : the manager or firm has neither created nor destroyed valuenor destroyed value

ααii > > rfrf: the manager or firm has created value: the manager or firm has created value

LARGE CAP FUNDSLARGE CAP FUNDS

00.5

11.5

22.5

33.5

44.5

5

FranklinIndia

Bluechip

HDFCTOP 200

PRU ICICIGrowth

RelianceVision

ALPHA

MID CAP FUNDSMID CAP FUNDS

-3

-2

-1

0

1

2

3

4

5

6

FranklinPrima

HDFCCapitalBuilder

RelianceGrowth

ALPHA

STANDARD DEVIATIONSTANDARD DEVIATION

The total risk of a given fund is The total risk of a given fund is measured in terms of standard measured in terms of standard deviation.deviation.

It tells us how much the values have It tells us how much the values have deviated from the mean of the values. deviated from the mean of the values.

STANDARD DEVIATIONSTANDARD DEVIATION

LARGE CAP FUNDSLARGE CAP FUNDS

21.522

22.523

23.524

24.525

25.526

FranklinIndia

Bluechip

HDFC TOP200

PRU ICICIGrowth

RelianceVision

STANDARDDEVIATION

MID CAP FUNDSMID CAP FUNDS

22

23

24

25

26

27

28

29

FranklinPrima

HDFCCapitalBuilder

RelianceGrowth

STANDARDDEVIATION

FINDINGSFINDINGS ICICI PRU--ICICI PRU--

--This fund has an aggressive stock-picking style, but This fund has an aggressive stock-picking style, but with a careful eye on risk control.with a careful eye on risk control.

-The fund has a great exposure to banking and -The fund has a great exposure to banking and software sector stocks.software sector stocks.

FRANKLIN TEMPLETON—FRANKLIN TEMPLETON—

- Franklin India Blue-chip fund is one of the biggest - Franklin India Blue-chip fund is one of the biggest diversified equity funds and is one of the most diversified equity funds and is one of the most preferred large cap funds.preferred large cap funds.

- One of the astonishing features of the fund’s - One of the astonishing features of the fund’s

investment style is the buy-and hold-strategyinvestment style is the buy-and hold-strategy ..

RELIANCE RELIANCE

--High returns can be expected from this fund but its High returns can be expected from this fund but its aggressiveness does not make it apt for conservative aggressiveness does not make it apt for conservative investors.investors.

HDFCHDFC

-The fund's exposure to large-cap stocks is a cushion -The fund's exposure to large-cap stocks is a cushion in the falling markets. It has not been a top performer in the falling markets. It has not been a top performer as some of the other mid-cap funds, but quite a as some of the other mid-cap funds, but quite a consistent one consistent one 

-This fund is a good bet for those wanting to invest in -This fund is a good bet for those wanting to invest in mid-caps but not willing to take too much of a risk.mid-caps but not willing to take too much of a risk.

--

CONCLUSIONSCONCLUSIONS

Best option consider by the investors when it Best option consider by the investors when it comes to investing their money in Mutual comes to investing their money in Mutual Funds.Funds.

This industry is growing at a good pace.This industry is growing at a good pace. Money Invested in Mutual Funds is safe.Money Invested in Mutual Funds is safe. Investors who are looking for very high instant Investors who are looking for very high instant

returns, mutual funds are not recommended; returns, mutual funds are not recommended; they are meant for investors committed to they are meant for investors committed to patient investing. patient investing.

RECOMMENDATIONSRECOMMENDATIONS Following suggestions can be made so that the Following suggestions can be made so that the

mutual fund houses can design their schemes mutual fund houses can design their schemes in such a manner that it can improve their in such a manner that it can improve their performance as compared to other AMC’s.performance as compared to other AMC’s.

A thorough analysis should be done while A thorough analysis should be done while selecting the securities for a particular selecting the securities for a particular portfolio. portfolio.

Fundamental security analysis should also be Fundamental security analysis should also be done i.e. the relationship between a security’s done i.e. the relationship between a security’s return and economy wide events. return and economy wide events.

THANK YOU..!!THANK YOU..!!