MAHARAJA AGRASEN
INSTITUTE OF MANAGEMENT & TECHNOLOGY
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MAIMT - JOURNAL OF IT & MANAGEMENT

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Analysis Of Components Of Investment Performance Of Mutual Fund Schemes In India - Dr. Kavita Arora
Abstract:

The enormous growth in the number of mutual funds and the volume of investment in them worldwide has led to an increasing demand for techniques to evaluate their performance. In this study an attempt has been made to analyze the performance of mutual fund schemes in India by using Fama’s Methodology. The sample contains 100 mutual fund schemes selected on the basis of availability of consecutive data during the period 1st April, 2000 to 31st March, 2008.The study period 2000-2008 has been segregated into two sub-periods, sub-period I (2000-2004) and sub-period II (2004-2008) to ascertain whether the performance of mutual fund schemes varied during the two sub-periods as these were bear and bull phases. The overall analysis made in this study reveals that the fund managers of majority of growth and tax planning schemes were not able to identify the undervalued securities. All the growth schemes, tax planning schemes and balanced schemes had positive compensation for diversification, but the impact of diversification on returns was very less. Thus, we may conclude that the managers of equity schemes need to improve their stock selection as well as the diversification skills.

Key Words: Mutual Funds, Performance, Fama, Diversification, Selectivity, Decomposition.

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