Introduction have attempted to study the performance of mutual

 

Introduction

Investors are broadly
divided in to three categories, they are aggressive investors, moderate
investors and conservative investors. This moderate investors will always looks
into investment area where there is moderate risk and moderate returns. Exactly
mutual funds are collective investment schemes, they specializes in investing a
pool of money from the investors and investing in securities such as bonds,
stocks and money market instruments. It is managed by the experts called as
fund managers. Mutual funds are the most popular method of
indirect investing around the globe. Mutual funds play an important role in the
economy of the county. In this study an attempt is made to evaluate the
performance of 10 growth mutual funds on the basis of monthly returns compared
with benchmark returns. For this purpose, risk adjusted performance measures
suggested by Sharpe, Treynor and Jensen’s are widely known as Sharpe ratio,
Treynor ratio, Jensen’s Alpha.

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I.                  
Literature
Review

 

Researchers have
attempted to study the performance of mutual fund of all schemes, some are
especially in growth schemes and some are attempted to study the mutual fund
performance of public and private sector comparisons.

Alka (2016) this
study attempted to evaluate the performance of Reliance open-ended growth
schemes focused on large cap funds in Sensex. Reliance Focused
Large Cap Fund in Sensex has performed better than the other schemes in
comparison of risk and return which Indicates that investors who invested in
these schemes to form well diversified portfolio did receive adequate return
per unit of total risk & systematic risk undertaking.

Dr. Susheel Kumar Mehta (2010) this research attempted
to study  a comparison of performance of
mutual funds schemes of UTI & SBI and analyzed their performance. The study
concluded that preference of UTI & SBI mutual funds has been better in 2007
– 08.

Lakshmi N (2010)
this study is about performance of the Indian MF industry with a special reference
to growth schemes and it found out that MF serve those individuals including to
invest but lack the newline technical investment expertise. Funds mobilized by
the industry had grown new here by 57 percent and AUM by 14 percent during
1997-2006. Analysis of performance of newline seven schemes should that, all
the sample schemes outperformed the newline market in terms of absolute returns
without adequate returns to over total newline risk.

D.N. Rao (2006)
this study is on 4 step model to evaluate performance of mutual funds in
Saudi Arabia. It studied 4 step model for selecting the right equity fund and
illustrated the same in the context of equity mutual funds in Saudi Arabia. The
study revealed that most of the funds invested in Arab stocks had been in
existence for less than a year and the volatility of the GCC stock markets
contributed to the relatively poor performance of these funds and the
turnaround of these funds could take place only with the rallying of GCC and
other Arab markets.

Sharad Panwar and R. Madhumathi(2006) this study is on characteristics and
performance evaluation of selected mutual funds in India. This paper resulted
that public sector sponsored funds also not differ significantly from private
sector sponsored funds in term of mean returns percent however they said there
is a significant difference between public sector sponsored MFs. & private
sector sponsored MFs in terms of average standard deviation, average variance
and average co-efficient of variation.

II.               
Objectives
Of The Study

The objectives of
this  study are

·        
To evaluate the trends of growth mutual
fund schemes.

·        
To evaluate and compare the performance of
growth mutual funds using evaluation techniques.

·        
To compare the selected growth mutual
funds and rank with their performance.

III.            
Scope Of The Study.

This study focuses
on the relationship between performance of growth mutual fund and nifty returns
using evaluation tools such as sharpe’s ratio, treynor, jensen’s alpha. By
observing all these we can conclude that the fund which has highest with less
risk shows better performance. By looking at the
performance indicators it is easier to investor to find the right growth mutual
funds. Thereby help in increase profit for the investors. From this study, it
may also enable the researcher to find the better performing mutual fund.

Hypothesis

The following
hypothesis have been made.

Hypothesis
testing is carried out with a significance level of 0.05

H0:- There is no difference in
performance between growth mutual funds and Nifty Index

HA: – There is difference in performance
between growth mutual funds and Nifty Index

 

 

IV.            
Data
And Methodology

The return of the funds can be estimated by
the average return of the select funds and the risk can be calculated by using
standard deviation and beta. The risk adjusted return can be measured with the
functional tools like Sharpe, Treynor’s methods. By observing all these we can
conclude that the fund which has highest with less risk shows better
performance.