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Performance Evaluation of Selected Indian Equity Diversified Mutual Fund Schemes: An Empirical Study


     

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This study has been carried out to evaluate the performance of selected 20 equity diversified schemes during the study period of June 2007 to May 2012. An attempt has been made to evaluate the fund's performance, level of diversification and manager's ability to pick the undervalued stocks. The study revealed that except one all the sampled schemes have performed better than market. . Risk adjusted performance in terms of Sharpe and Treynor ratio showed that 55% of the fund schemes bear positive values. The findings also revealed that majority of the schemes were adequately diversified. Negative correlation between level of diversification, measured by R2 and unique risk proved that, fund managers remained successful in reducing unique risk through better diversification. The study also revealed that about 60% of the schemes were able to beat the market with help of better stock selection skill of fund managers. Overall, ING Dividend Yield Fund, Tata Dividend Yield Fund, UTI MNC Fund, Quantum Long-Term Equity Fund, Canara Robeco Equity Diversified, HDFC Growth Fund, Franklin India Prima Plus Fund and Tata Pure Equity Fund are among the best performing funds among the sampled schemes, in terms of all the different performance evaluation measures.

Keywords

Mutual Funds, Performance Evaluation, Systematic Risk, Unsystematic Risk, Portfolio Return
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  • Performance Evaluation of Selected Indian Equity Diversified Mutual Fund Schemes: An Empirical Study

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Abstract


This study has been carried out to evaluate the performance of selected 20 equity diversified schemes during the study period of June 2007 to May 2012. An attempt has been made to evaluate the fund's performance, level of diversification and manager's ability to pick the undervalued stocks. The study revealed that except one all the sampled schemes have performed better than market. . Risk adjusted performance in terms of Sharpe and Treynor ratio showed that 55% of the fund schemes bear positive values. The findings also revealed that majority of the schemes were adequately diversified. Negative correlation between level of diversification, measured by R2 and unique risk proved that, fund managers remained successful in reducing unique risk through better diversification. The study also revealed that about 60% of the schemes were able to beat the market with help of better stock selection skill of fund managers. Overall, ING Dividend Yield Fund, Tata Dividend Yield Fund, UTI MNC Fund, Quantum Long-Term Equity Fund, Canara Robeco Equity Diversified, HDFC Growth Fund, Franklin India Prima Plus Fund and Tata Pure Equity Fund are among the best performing funds among the sampled schemes, in terms of all the different performance evaluation measures.

Keywords


Mutual Funds, Performance Evaluation, Systematic Risk, Unsystematic Risk, Portfolio Return

References