COMPARATIVE ANALYSIS OF MUTUAL FUND

INTRODUCTION
COMPANY PROFILE SBI Mutual Fund (SBI MF) is one of the largest mutual funds in the country with an investor base of over 4.6 million. With over 20 years of rich experience in fund management, SBI MF brings forward its expertise in consistently delivering value to its investors.

The fund traces its lineage to SBI Indias largest banking enterprise. The institution has grown immensely since its inception and today it is India's largest bank, patronized by over 80% of the top corporate houses of the country.
SBI Mutual Fund is a joint venture between the State Bank of India and AMUNDI (France), one of the world's leading fund management companies.

OBJECTIVE
1. To compare and evaluate the performance of different equity mutual fund schemes of different companies on the basis of risk, return and volatility 2. Secondly, to suggest the schemes which are out performers and laggards. 3. To study and work in all the distribution channels of SBI mutual fund.

DEFINITION
What is Mutual fund?
An investment vehicle that is made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments and similar assets. Mutual funds are operated by money managers, who invest the fund's capital and attempt to produce capital gains and income for the fund's investors

Working of Mutual Fund

GROWTH IN AUM IN INDIAN

MUTUAL FUND INDUSTRY

Research Methodology
Research methodology is a very organized and systematic way through which a particular case or problem can be solved efficiently. Study all about mutual fund and various schemes. Identify various factors that influence the investors decision while investing in mutual fund. Based on feedback and ranking given by various organizations identify best schemes of SBI and its competitors and do a comparative analysis

Cont..
The secondary data has been collected through various channels like Websites Journals Articles Reports Fact sheets

Scope Of The Study

This study calculates different measures to compare equity diversified schemes of different fund houses . For this study past three years data of the schemes and their benchmarks have been taken into consideration. It helps us see how the funds stand in comparison with each other

Analysis
For our study here six schemes have been selected: HDFC EQUITY FUND ICICI PRUDENTIAL DISCOVERY FUND UTI OPPUTTUNITIES FUND SBI EMERGING BUSINESS FUND RELIANCE RSF FUND SUNDARAN BNP PARIBAS S.M.I.L.E

Cont..
For all the above schemes returns of the past three years i.e. 2009-12 , have been considered. Similarly returns are taken for the benchmarks of the respective schemes. Calculation of different parameters like average return , standard deviation, sharpe ratio have been done for all the schemes for all years separately.

AVERAGE MONTHLY RETURN

SCHEMES HDFC EQUITY FUND ICICI PRUDENTIAL DISCOVERY FUND UTI OPPORTUNITIES FUND 2009-10 1.72 1.11 3.27 2010-11 (2.56) (2.86) (1.83) 2011-12 5.95 6.86 4.14

IDFC PREMIER EQUITY PLANA

SBI EMERGING BUSINESS FUND

3.99
4.38

(3.31)
(2.9)

7.50
5.77

SUNDARAM BNP PARIBAS S.M.I.L.E

2.65

(3.86)

6.30

INTERPRETATION
The table above average monthly returns of the mutual fund schemes for 2009-10, 2010-11 and 2011-12. During the period of analysis, it was in the year 2011- 12, that the funds have yielded the maximum return. Among them, the top return was provided by IDFC Premier Equity Plan with a value of 7.5%. The lowest return giving fund for the year was UTI Opportunities Fund and the value was 4.14%.

Performance in the year 2010-11 was the least in all the three years. Least returns this year was from Sundaram BNP Paribas SMILE fund with the returns being -3.86% and highest were of UTI Opportunities Fund with returns of -1.83%. Low returns in this year were because of down fall of the market.
In the year 2009-10 highest returns were given by SBI Emerging Businesses Fund with returns being 4.38% and lowest returns were 1.11% of ICICI Prudential Discovery Fund.

STANDARD DEVIATION
SCHEMES 2009-10 0.08 0.09 0.09 2010-11 0.12 0.11 0.10 2011-12 0.10 0.09 0.08

HDFC EQUITY FUND

ICICI PRUDENTIAL DISCOVERY FUND UTI OPPORTUNITIES FUND IDFC PREMIER EQUITY PLANA SBI EMERGING BUSINESS FUND SUNDARAM BNP PARIBAS S.M.I.L.E

0.09
0.10 0.10

0.11
0.13 0.12

0.07
0.12 0 .10

INTERPRETATION
Standard Deviation of a fund depicts, that how much the returns of the fund have deviated from the mean level. The higher the value of standard deviation, the greater will be the volatility in the fund's returns. In 2009-10 ,standard deviation of 10% was highest among all for SBI Emerging Businesses and Sundaram BNP Paribas SMILE meaning that the fund's return fluctuated in either direction (up or down) by 10% from its average return ,whereas HDFC Equity fund showed minimum deviation of 8%. In the year 2010-11 SBI Emerging Businesses Fund showed the maximum volatility by having standard deviation of 13%. UTI Opportunities Fund had the minimum standard deviation of 10% For the year 2011-12 SBI Emerging Businesses Fund was the most volatile fund with standard deviation of 12%. IDFC Premier Equity Plan A had the least value of 7%

SHARPE RATIO
SCHEMES HDFC EQUITY FUND ICICI PRUDENTIAL DISCOVERY FUND UTI OPPORTUNITIES FUND 2009-10 2010-11 2011-12

2.06 3.63 4.11

(3.40) (3.47) (3.64) (3.23) (3.64) (3.54)

11.44 13.97 9.94 14.63 10.48 10.87

IDFC PREMIER EQUITY PLANA SBI EMERGING BUSINESS FUND SUNDARAM BNP PARIBAS S.M.I.L.E

6.11 5.24 3.59

INTERPRETATION
Sharpe ratio is a measure of the excess return per unit of risk in an investment asset of a trading strategy. The Sharpe ratio is used to characterize how well the return of an asset compensates the investor for the risk taken. The selected mutual fund schemes showed the best risk adjusted performance during the financial year 2011- 12. Among them, IDFC Equity Plan A was considered as the best one with a ratio of 14.63. The least performance was shown by UTI Opportunities Fund which has a ratio of 9.94. The performance of all selected mutual fund schemes was really low during the financial year 2010- 11. Funds were even having negative Sharpe ratio. The lowest risk adjusted performance was shown byUTI Opportunities Fund and the value was -3.64. ICICI Prudential Discovery Fund which showed the risk adjusted performance with a Sharpe ratio of 3.23 which was best among all. In the year 2009-10, IDFC Premier Equity Plan A is the fund which has shown the maximum Sharpe ratio of 6.11. It means that the fund has provided the maximum risk adjusted return as compared to other funds. The fund having the least Sharpe value is HDFC equity fund with a value of 0.63.

Rankings
RANK AVERAGE MONTHLY RETURN STANDARD DEVIATION SHARP RATIO

IDFC PREMIER EQUITY PLANA SBI EMERGING BUSINESS FUND ICICI PRUDENTIAL DISCOVERY FUND

SBI EMERGING BUSINESS FUND SUNDARAM BNP PARIBAS S.M.I.L.E

IDFC PREMIER EQUITY PLANA ICICI PRUDENTIAL DISCOVERY FUND

2
3

UTI OPPORTUNITIES SBI EMERGING FUND BUSINESS FUND

Recommendation
On analysis, it was revealed that there is a certain amount of risk involved, while investing in equity diversified scheme IDFC Equity Plan A and SBI Emerging Businesses Fund is best scheme to invest now a days. In todays time when market movements cannot be predicted investors tend to go for SIP as it does help them take advantage of the low market rates. Also it removes the burden of investing large amount of money at one time. To improve market penetration by targeting not only metros but mini-metros and smaller towns more effectively. To better operations management so as to reduce the time lag and improve customer feedback.

THANKS