ARTICLE REVIEW

Title: PERFORMANCE EVALUATION OF MUTUAL FUND INDUSTRY IN INDIA

Author: prof KP SIVAKUMAR, Dr S RAJAMOHAN, PROF DM SEZHIYAN, PROF S NARSIMHULU

Review: This article tries to analyze the performance of mutual funds in India based on the resource Mobilization by various players. This article classifies the players into two categories: private players, public players. The study revealed that there is significant contribution by all the participants for the growth of the mutual fund industry in India. At the same time, this study also found that the private participants play a greater role in resource mobilization compared to those of public sector. Starting with the introduction to the title , as we know Mutual fund is a special type of financial instrument that pools the funds of investors who seek to maximize ROI. This pooled fund is taken care of by professional investment managers who invest the accumulated amount in diversified portfolio to generate definite returns. The profits or losses are shared by the investors in proportion to their investments. 6 phases of mutual fund growth in india: 1964-87 : UTI consolidating its position by offering a variety of products 1987-93: arrival of mutual funds sponsored by public sector banks and financial institutions 1993-96: arrival of private sector players, both Indian and Foreign 1996-99: SEBI regulation came into picture 1999-2004: emergence of uniformity in industry 2004- present: mutual fund industry is consolidating its growth Now in second phase of the article, author has done some research work and done literature review. Summary of few research papers examined is given below:

By: HARSH KHANNA, PGDM(F),R.NO 09

Page 1

Malkiel, Burton G. (1995) has suggested that the equity mutual fund managers achieve superior returns. Mark M Carhart., (1997) demonstrated that common factors in stock returns and investment expenses almost completely explain persistence in equity mutual funds mean and risk adjusted-returns. Michael S Rozef (1998) has found that the Mutual fund splits occur in highpriced funds after unusually high returns Russ Wermers, (1999) found the relationship that exists between Mutual fund herding and its impact on stock prices Paulo Armada Leite, Maria Ceu Cortez, (2009) estimated and compared the performance of Portuguese-based mutual funds that invest in the domestic market and in the European market using unconditional and conditional models of performance evaluation. The results suggest that mutual fund managers are not able to outperform the market, presenting negative or neutral performance. Now for Analysis part, researcher extracted the data from releases of SEBI AMFI India, The Economic Times, Business Line and CMIE Database. Various statistical tools were used like mean, standard deviation, t test, f test, ANOVA. Few Interpretations from the analysis performed is given below:

The total resources mobilized by the private sector are 91.04%, Public sectors other than UTI are 8.49% there is a significant variation in the performance of different groups of mutual funds participation by UTI has a greater impact on the performance of public sector mutual funds there is difference in performance of mobilization of funds by both categories of the players since significance (p value) is less than .05 There is a significant difference between the quantum funds mobilized by public sector with and without UTI. Hence, it proves that the UTI has a greater role in performance of mobilization of funds

Now after performing the analysis, author has come up with Conclusion that the private sector players hold the greater strength in resources mobilization. On the other hand, in the public sector, UTI holds a favorable position. But in terms of performance UTI contributes in a big way. The other public sector players like SBI, Can Bank, LIC also hold good position in the industry. The intensity of the competition is growing day by day.
By: HARSH KHANNA, PGDM(F),R.NO 09 Page 2