PERFORMANCE EVALUATION OF HYBRID

MUTUAL FUNDS IN SELECTED BANKS

Project submitted to the Bharathidasan University, Tiruchirappalli

in partial fulfilment of the requirements for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

Submitted by
S. STAFANA DITTAR
D. No. 21PBA212

Under the Guidance of

Dr. S. SURESH

ST. JOSEPH’S INSTITUTE OF MANAGEMENT

A Jesuit Business School
St. Joseph’s College (Autonomous)
Tiruchirappalli - 620 002, India

AUGUST 2022
 DECLARATION

I, S. STAFANA DITTAR hereby declare that the project entitled “PERFORMANCE

EVALUATION OF HYBRID MUTUAL FUNDS IN SELECTED BANKS” is a bonafide
record of research work done by me under the supervision of Dr. S. SURESH, Assistant
Professor, St. Joseph’s Institute of Management, St. Joseph’s College (Autonomous),
Tiruchirappalli District - 620 002, Tamil Nadu, India, for the PG Programme in MBA at St.
Joseph’s Institute of Management, St. Joseph’s College (Autonomous), Tiruchirappalli. I
further declare that this work has not been previously formed the basis for the award of any
degree, diploma, associate-ship or other similar title.

Place: Tiruchirappalli - 2 Signature

Date: Name: Stafana Dittar.S

ii
 CERTIFICATE

This is to certify that the project entitled “PERFORMANCE EVALUATION OF

HYBRID MUTUAL FUNDS IN SELECTED BANKS” is a record of research work done
by Ms. S. Stafana dittar (D. No.21PBA212) during 2021-2023 at St. Joseph’s
Institute of Management, St. Joseph’s College (Autonomous), Tiruchirappalli - 620 002,
Tamil Nadu, India, and that this project has not been previously formed the basis for the
award of any degree, diploma, associateship, fellowship or any other similar title to anyone
and that the project represent entirely an independent work on the part of the candidate.

Dr. S. SURESH Dr. P Jega Patrick Rev. Dr. P.Paulraj, SJ

Project Guide Dean, Academics Director

Place: Tiruchirappalli – 2
Date:

VIVA VOCE Examination has been conducted on:

Internal Examiner External Examiner

iii
 ACKNOWLEDGEMENT

I would like to express our heartfelt thanks to the St. Joseph’s Institute of Management, St.
Joseph’s College (Autonomous), for providing us the opportunity to carry out this extensive
project.

I would like to express my deep sense of gratitude to Rev. Dr. P. Paul Raj SJ, Director, St.
Joseph’s Institute of Management, St. Joseph’s College (autonomous), Tiruchirappalli,
Rev. Fr. I. Antony Inico SJ, Administrator, St. Joseph’s Institute of Management, St.
Joseph’s College (autonomous), Tiruchirappalli, Dr. P. Jega Patrick, Dean-Academics, St.
Joseph’s Institute of Management and the Faculties, St. Joseph’s Institute of Management
for their guidance and valuable support

I would like to express our immense gratitude to my project guide Dr. S. Suresh, Assistant
professor, St. Joseph’s Institute of Management, St. Joseph’s College (autonomous),
Tiruchirappalli for his constant support and valuable guidance. This project wouldn’t be
possible without your support.

To our parents and dear friends who have been our pillars of support, thank you. This
wouldn’t have been possible without you.

Stafana Dittar S

iv
 CONTENTS

Chapter Title Page

Contents 1

List of Tables 2

List of Figures 3

List of Abbreviations 4

Abstract 5

Introduction to the Study and Profile of the Industry & the

I 6-22
Company

II Review of Literature 23-33

III Research Methodology 34-40

IV Data Analysis and Interpretation 41-54

V Findings, Recommendations and Conclusion 55-58

References 59-60

Page 1 of 60
S.NO TITLES PG.NO

4.1 PERFORMANCE OF AXIS BANK

1 Table 4.1.1 Performance Measure of Sharpe Index 41

2 Table 4.1.2 Performance Measure of Treynor Index 43

4.2 PERFORMANCE OF HDFC BANK

3 Table 4.2.1 Performance Measure of Sharpe Index 44

4 Table 4.2.2 Performance Measure of Treynor Index 46

4.3 PERFORMANCE OF ICICI BANK

5 Table 4.3.1 Performance Measure of Sharpe Index 47

6 Table 4.3.2 Performance Measure of Treynor Index 49

4.4 PERFORMANCE OF IDFC BANK

7 Table 4.4.1 Performance Measure of Sharpe Index 50

8 Table 4.4.2 Performance Measure of Treynor Index 52

MEASURE OF JENSON ALPHA

9 Table 4.5 Performance Measure of Jenson Alpha 53

LIST OF TABLES

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 LIST OF FIGURES

S.NO TITLES PG.NO

MUTUAL FUND

1 Figure 1.1 Types of Mutual Fund 8

2 Figure 1.2 Types of Hybrid Mutual Fund 13

PERFORMANCE OF AXIS BANK

3 Figure 4.1.1 Performance Measure of Sharpe Index 42

4 Figure 4.1.2 Performance Measure of Treynor Index 43

PERFORMANCE OF HDFC BANK

5 Figure 4.2.1 Performance Measure of Sharpe Index 45

6 Figure 4.2.2 Performance Measure of Treynor Index 46

PERFORMANCE OF ICICI BANK

7 Figure 4.3.1 Performance Measure of Sharpe Index 48

8 Figure 4.3.2 Performance Measure of Treynor Index 49

PERFORMANCE OF IDFC BANK

9 Figure 4.4.1 Performance Measure of Sharpe Index 51

10 Figure 4.4.2 Performance Measure of Treynor Index 52

MEASURE OF JENSON ALPHA

11 Figure 4.5 Performance Measure of Jenson Alpha 54

Page 3 of 60
 LIST OF ABBREVIATIONS

NAV- Net Asset Value

FCP- fonds commun de placement

UCITS- Undertakings for the Collective Investment in Transferable Securities

AMC- Asset Management Company

ECS- Electronic Clearing Service

STP- Systematic Transfer Plan

SIP- Systematic Investment Plan

SWP- Systematic Withdrawals Plan

NFO- New Fund Offer

ELSS- Equity Linked Saving Scheme

RBI- Reserve Bank of India

ETF- Exchange Trade Fund

AUM- Asset Under Management

IDCW- Income Distribution cum Capital Withdrawal

SUUTI- Specified Undertaking of Unit Trust of India

GIC- General Insurance Corporation of India

CAGR- Compounded Annual Growth Rate

DEA- Data Envelopment Analysis

AHP- Analytical Hierarchy Process

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 ABSTRACT

In India, there are various investment opportunities for investors who want to invest and
get profitable returns. Among other financial products, investing in mutual funds
guarantees minimum risk and maximum return for investors. The need and scope of the
mutual fund operation has increased as the focus has been placed on increasing national
savings and improving diversification of investments. Thus, it is become important to
study the mutual fund industry and the performance of mutual funds. This study aims to
assess the performance of selected mutual fund systems in India on the basis of their daily
net asset value of (NAV) for the five-year period from 2017to 2021.A sample 16 open-
ended, growth-oriented equity and debt-oriented growth funds were selected for the
study. The fund’s performance is evaluated at using the Sharpe index, the Treynor index
and the Alpha Jensen index, the results of which will be useful to investors in making
better investment decisions.

Key Words: Mutual Funds, Net Asset Value, Outperformed, Sharpe Ratio and Treynor
Ratio.

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 CHAPTER I

1. INTRODUCTION

A mutual fund is a financial intermediary in the capital market which groups together
collective investments in the form of shares of individual investors and companies and
maintains a portfolio of various schemes which invest these collective investments in
shares and securities. Claim on behalf of these investors. The mutual fund is an
experienced entity that helps an investor to invest indirectly in stocks and debt securities
rather than taking the risk of investing money directly in these instruments. An ordinary
investor has no experience or knowledge to invest money directly in the stock market in
India and most of the time investors lose their money due to poor selection of stocks or
bonds. Therefore, mutual funds as intermediaries actively provide portfolio management
skills and diversify risk by spreading the investments of all investors across various
equity and debt instruments. It helps investors get good low risk returns versus high risk
returns if the investors themselves invest directly in stocks in the market. A mutual fund
is a collective reservoir or pool of funds which is managed by a qualified and experienced
fund manager. It is a trust that receives funds from a number of investors who have a
common investment objective and invests those funds in stocks, bonds, money market
instruments and other securities. The income generated by this combined portfolio is
distributed on a pro rata basis among the investors after subtracting the related expenses
and taxes by calculating the “Net asset value” or the net asset value of a program. Simply
invested, the money collected by a large number of investors is allocated in shares by a
mutual fund. This total money invested in stocks or bonds or short-term securities will
increase or decrease depending on the performance of those investments. This will be
reflected in the value of the net asset value. Mutual funds are ideal for investors who do
not have large sums to invest, or for those who do not have the knowledge or the time to
study the market, but want to increase their wealth. In return, the fund house charges a
small fee for their professional experience which is subtracted from the investment. The
fees charged by mutual funds are limited to certain limits set by the Securities and
Exchange Board of India (SEBI). Mutual funds have achieved preferred status in recent
years when investors have regularly invested in equity / balanced programs through them.

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1.1 BENEFITS OF MUTUAL FUNDS

Mutual funds are managed by a professionally organized company called AMC (Asset
Management Company) through professional fund managers who actively manage the
investment portfolios of various mutual fund programs offering the benefits following
investors:

1.1.1 PORTFOLIO DIVERSIFICATION: mutual funds invest in a portfolio of

financial instruments that allows a small investor to hold a diversified investment
portfolio even if the amount of investment is small.

1.1.2 LOW RISK: Even with a small amount of investment, investors can acquire a
diversified portfolio of financial instruments. The risk in a diversified portfolio of
mutual funds is less than investing directly in only 2 or 3 stocks or bonds.

1.1.3 LOW TRANSACTION COSTS: due to economies of scale, UCITS

involve lower transaction costs. These benefits are shared with investors.

1.1.4 LIQUIDITY: the units of an FCP can be easily redeemed with funds directly
credited to the investor account via the ECS payment.

1.1.5 CHOICE: Mutual funds offer investors a variety of programs with different
investment objectives. So, investors have a lot of investment in a program that
matches their financial goals. These plans also offer various plans / options e.g.,
Dividend option or growth option or reinvestment option, etc.

1.1.6 TRANSPARENCY: funds provide investors with the latest information on

markets and programs. They actively manage the portfolios through careful
monitoring on a daily basis, which is not possible for a retail investor.

1.1.7 FLEXIBILITY: Mutual funds also offer flexibility to investors. Investors can
transfer their shares from a Debt Plan to an Equity Plan or a Balanced Plan

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 through the Systematic Transfer Plan (STP) option. The option of systematic
investment by monthly / quarterly payments (SIP) and systematic withdrawals at
regular intervals (SWP) is also available to investors in open plans.

1.1.8 SECURITY: The mutual fund industry is fully regulated by SEBI rules where
the interests of investors are protected. All funds must be registered with SEBI
and full compliance with the rules and transparency are guaranteed.

1.1.9PROFESSIONAL MANAGEMENT: Mutual fund portfolios are managed

by experienced professional managers with the skills and qualifications to analyse the
performance and outlook of companies.

1.2 TYPES OF MUTUAL FUND

FIGURE 1.1

1.2.1 FUNCTIONAL CLASSIFICATION OF MUTUAL FUNDS:

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 Open schemes: In the case of open schemes, the investor can at any time sell and
buy his units at the net asset value (NAV) or at prices based on the NAV. Investors
can enter and exit the system at any time during the life of the open fund. The
fundamental nature of open funds is liquidity. Since there is no lockout period,
these funds increase investor liquidity as stocks can be bought and sold at any
time.

 Close-ended themes: Close-ended schemes have a set corpus and an outlined

maturity period go between two to ten years. Investors will invest within the
scheme once it’s opened for subscription for few days as new fund supply (NFO).
The scheme remains open for a restricted fundamental measure not prodigious
forty-five days. The fund has no interaction with investors until redemption apart
from paying dividend or bonus. In exceptional cases some shut concluded mutual
funds could announce buy schemes like Morgan Stanley proclaimed buy back
scheme of its close ended mutual fund. There’s a restriction on buying amount in
these schemes in variety of shopping for lock in. These schemes are listed on
securities market for mercantilism.

 Interval diagrams: Interval diagrams provide the characteristics of open and

closed diagrams. They are open for sale or redemption during predetermined
intervals at prices relative to the NAV. They are also called partial open patterns.

1.2.2 PORTFOLIO CLASSIFICATION OF MUTUAL FUNDS

(1) Growth Funds (Equity bound funds): the most objective of growth funds is capital
appreciation over the medium-to-long- term. They invest most of the corpus in equity
shares with important growth potential and that they supply higher come to investors
within the long at average risk. The risks related to equity investments and no surety or
assurance of returns are the options of those equity themes. Growth funds will be
additional classified into varied schemes like corporation fund, middle cap fund and tiny

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cap fund, multi/diversified equity fund, equity connected saving scheme (ELSS), sectoral
funds and index funds.

(2) Income funds (debt-focused funds): The purpose of income funds is to provide
investment security as well as regular income to investors. These programs invest largely
in profitable instruments such as bonds, bonds, government bonds and commercial
papers. Both risks are lower in income funds than in growth funds. Debt funds, cash
funds, monthly income plans, fixed term plans and variable rate funds are different types
of income fund plans under the banner of income funds. These funds are also referred to
as fixed income funds or money market funds. These funds also have some risk if the
defects of the company’s obligations.

(3) Balanced Funds: The goal of the Balanced Diet is to provide both capital
appreciation and regular income. They allocate their investment between equities and
fixed-rate debt securities in order to balance the portfolios. These funds typically include
companies with good earnings and a history of dividends. The risk and the rate of return
are moderate.

(4) Money Market Mutual Funds: specialize in investing in short-term money market
instruments such as treasury bills and certificates of deposit. The objective of these funds
is maximum liquidity with a lower rate of return and minimum possible risk.

1.2.3 GEOGRAPHICAL CLASSIFICATION

(1) National funds: Funds that raise funds from particular geographic locations such
as a country or region are called national funds. The market is limited and
restricted to the borders of a country where the fund operates. They can only
invest in instruments issued and traded on national financial markets. The Indian
mutual fund investing in Indian stocks is a national fund.

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 (2) Offshore funds: Offshore funds are funds that facilitate cross-border investments.
These mutual funds can invest in instruments of foreign companies and thus offer
investors the benefit of international diversification.

1.2.4 OTHERS

(1) Sector funds: These funds invest in particular key sectors such as energy,
telecommunications, IT, banking, construction, transport, steel, FMCG and
financial services, etc.

(2) Tax Savings Plans: Tax Savings Plans offer specific tax advantages to investors.
These are closed funds and the investments have a lockout period of at least 3
years. These plans have various choices such as dividends, growth or capital
appreciation.

(3) ELSS: In order to encourage investors to invest in the stock market, the
government has granted tax advantages through special funds. Investing in these
funds guarantees the investor to claim a tax deduction under section 80C, but
these funds come with a 3-year lock-up period.

(4) Government funds: Mutual funds that only deal in government securities or
government bonds are called government funds. In order to create a larger
investor base for government bonds, the RBI encourages the creation of gilt
systems.

(5) Index funds: An index fund is a mutual fund that invests in the portfolio
following the exact same ratio of stocks in the index on which it is based, for
example S & P BSE Sensex or Nifty. It only invests in stocks that are part of the
market index and in exactly the same ratio as the index weight so that the value
of these index plans varies exactly with the market index. An index fund adopts a

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 passive investment strategy because the fund manager does not have to analyse
stocks for investment or redemption in these programs.

(6) Exchange Traded Funds (ETFs): Exchange Traded Funds (ETFs) are a hybrid
of open-ended mutual funds and publicly traded stocks.

1.2 CONCEPTUAL AND THEORETICAL FOUNDATIONS

1.2.1 HYBRID MUTUAL FUND

Investments can broadly be categorized into three types based on risk: equity (or high
risk) investments, debt (or low risk) investments, and hybrid investments. Most
investment advisers ask investors to create an investment plan based on their financial
goals, risk tolerance and time horizon. Everyone has different needs and aspirations and
therefore it is difficult to classify an investor as pure high or low risk. This is where
hybrid mutual funds come in. Here we will explore hybrid funds and talk about some key
features that you should know before investing in them.

1.3.2 What is hybrid mutual fund?

As the name suggests, hybrid funds are a combination of equity and debt
investments which are designed to meet the investment objective of the
scheme. Each hybrid fund has a different combination of equity and debt
targeted at different types of investors.

1.3.3 How does a hybrid mutual fund work?

A hybrid fund endeavours to create a balanced portfolio to provide ordinary

profits to its buyers alongside capital appreciation withinside the long-term.

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The fund supervisor creates a portfolio in keeping with the funding goal of
the scheme and allocates the budget in fairness and debt contraptions in
various proportions. Further, the fund supervisor additionally buys or sells
belongings if the marketplace actions are favourable.

1.3.4 TYPES OF HYBRID MUTUAL FUND

Since every hybrid fund can have a different asset allocation between equity and debt,
they can be classified into the following types:

DYNAMIC ASSET
ALLOCATION /
BALANCED
ADVANTAGE MULTI-ASSET
AGGRESSIVE FUND
HYBRID FUND ALLOCATION
FUND

BALANCED ARBITRAGE
HYBRID FUND FUND

HYBRID
CONSERVATIVE
HYBRID FUND MUTUA EQUITY SAVINGS
FUND

L FUND

FIGURE 1.2

1.4 SCOPE OF THE STUDY:

Following Hybrid mutual fund schemes have been selected for the study.

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1.4.1 AXIS MUTUAL FUND SCHEMES

 AXIS EQUITY HYBRID FUND DIRECT GROWTH

As of 17 January 2022, the current net asset value of the Axis Equity Hybrid Fund
– Direct Plan is Rs 17.2900 for the Growth option of its Direct plan. The fund’s
investment objective is to “create long-term capital appreciation as well as current
income by investing in a combination of equity and equity-related products, debt
instruments, and money market instruments.” According to SEBI’s most recent
risk-grading rules, an investment in the Axis Equity Hybrid Fund – Direct Plan
falls into the Very High-risk category.

 AXIS ARBITRAGE FUND DIRECT GROWTH

As of 17 January 2022, the current net asset value of the Axis Arbitrage Fund –
Direct Plan is Rs 16.0236 for the Growth option of its Direct plan. The fund’s
investment objective is to “generate income through low volatility absolute return
strategies that take advantage of opportunities in the cash and derivative segments
of the equity markets, including arbitrage opportunities available within the
derivative segment, by employing other derivative-based strategies, and by
investing the balance in debt and money market instruments.” According to
SEBI’s most recent risk-grading rules, an investment in the Axis Arbitrage Fund –
Direct Plan falls into the Low-risk category.

 AXIS REGULAR SAVER FUND DIRECT GROWTH

As of 18-Jan-2022, the NAV of Axis Regular Saver Fund Direct Plan Growth
Option was 27.6754. As of 18-Jan-2022, Axis Regular Saver Fund Direct Plan
Growth Option has 375 Cr in assets under management (AUM), which is less than

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 the category average. The cost ratio of the fund is 0.8 percent. To create monthly
income through debt and money market assets, as well as capital appreciation
through restricted exposure to equity and equity-related products.

 AXIS BALANCED ADVANTAGE FUND DIRECT GROWTH

As of 17 January 2022, the current net asset value of the Axis Balanced
Advantage Fund – Direct Plan is Rs 15.6600 for the Growth option of its Direct
plan. The fund’s investment objective is that “The plan intends to achieve a dual
goal of capital appreciation and income generation by investing in a portfolio of
equities or equity-linked assets. It also intends to mitigate risk by utilising active
asset allocation”. According to SEBI’s most recent risk-grading rules, an
investment in the Axis Balanced Advantage Fund – Direct Plan falls into the
High-risk category.

1.4.2 HDFC MUTUAL FUND SCHEMES

 HDFC EQUITY FUND DIRECT PLAN GROWTH

As of 17 January 2022, the current net asset value of the HDFC Hybrid Equity
Fund – Direct Plan is Rs 86.9610 for the Growth option of its Direct plan. The
fund’s investment aim is to “produce capital appreciation / income through a
portfolio, principally of equities & equity linked derivatives.” According to
SEBI’s most recent risk-grading rules, an investment in the HDFC Hybrid Equity
Fund – Direct Plan falls into the Very High-risk category.

 HDFC ARBITRAGE FUND WHOLESALE DIRECT GROWTH

As of 17 January 2022, the current net asset value of the HDFC Arbitrage Fund –
Wholesale – Direct Plan is Rs 10.8480 for the IDCW option of its Direct plan.
The fund’s investing aim is to “produce income through arbitrage opportunities
and debt and money market instruments.” According to SEBI’s most recent risk-

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 grading rules, investing in the HDFC Arbitrage Fund – Wholesale – Direct Plan
falls under the Low-risk category.

 HDFC HYBRID DEBT FUND DIRECT GROWTH

As of 18-Jan-2022, the NAV of HDFC Hybrid Debt Fund Direct Plan Growth
Option was 62.9395. As of 18-Jan-2022, HDFC Hybrid Debt Fund Direct Plan
Growth Option has 2664 Cr in assets under management (AUM), which is more
than the category average. The cost ratio of the fund is 1.36 percent. To create
income/capital appreciation by investing largely in debt securities, money market
instruments, and stocks with a modest exposure. There is no guarantee that the
Scheme’s investment goal will be met.

 HDFC BALANCED ADVANTAGE FUND DIRECT PLAN GROWTH

As of 17 January 2022, the current net asset value of the HDFC Balanced
Advantage Fund – Direct Plan is Rs 304.3630 for the Growth option of its Direct
plan. The fund’s investment objective is to “provide long-term capital
appreciation / income from a dynamic mix of equity and debt investments.”
According to SEBI’s most recent risk-grading rules, an investment in the HDFC
Balanced Advantage Fund – Direct Plan falls into the Very High-risk category.

1.4.3 ICICI MUTUAL FUND SCHEMES

 ICICI PRUDENTIAL EQUITY &DEBT FUND DIRECT GROWTH

As of 17 January 2022, the current net asset value of the ICICI Prudential Equity
& Debt Fund – Direct Plan is Rs 247.1200 for the Growth option of its Direct
plan. The fund’s investment goal is that “The plan intends to provide long-term
capital appreciation and current income by investing in stocks and associated
securities, as well as fixed income and money market assets. The estimated equity

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 allocation would be in the range of 60-80%, with a minimum of 51%, while the
approximate debt allocation is 40-49%, with a minimum of 20%”. According to
SEBI’s most recent risk-grading rules, investing in the ICICI Prudential Equity &
Debt Fund – Direct Plan falls into the high-risk category.
 ICICI PRUDENTIAL EQUITY ARBITRAGE DIRECT GROWTH

As of 17 January 2022, the current net asset value of the ICICI Prudential Equity
Arbitrage Fund – Direct Plan is Rs 29.0594 for the Growth option of its Direct
plan. The fund’s investment aim is to “create low volatility returns using arbitrage
and other derivative methods in equities markets and investments in a short-term
loan portfolio.” According to SEBI’s most recent risk-grading rules, an investment
in the ICICI Prudential Equity Arbitrage Fund – Direct Plan falls into the Low-
risk category.

 ICICI PRUDENTIAL REGULAR SAVING FUND DIRECT GROWTH

As of 18-Jan-2022, ICICI Prudential Regular Savings Fund Direct Plan Growth

has 3375 Cr in assets under management (AUM), which is more than the category
average. The cost ratio of the fund is 0.84 percent. To create consistent income by
investing mostly in debt and money market securities. The Scheme also intends to
achieve long-term financial appreciation through the Scheme’s equity assets.
However, there is no assurance or guarantee that the Scheme’s investment goal
will be met.

 ICICI PRUDENTIAL BALANCED ADVANTAGE DIRECT GROWTH

The ICICI Prudential Balanced Advantage Fund’s current net asset value as of 17
January 2022 is Rs 49.9700 for the Growth option of its Regular plan. The fund’s
investment aim is to “deliver capital appreciation and income distribution to
investors through the use of equity derivatives methods, arbitrage opportunities,
and pure equity investments.” According to SEBI’s most recent risk-grading rules,
an investment in the ICICI Prudential Balanced Advantage Fund falls into the
High-risk category.

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1.4.4 IDFC MUTUAL FUND SCHEMES

 IDFC HYBRID EQUITY FUND DIRECT GROWTH

As of 17 January 2022, the current net asset value of the IDFC Hybrid Equity
Fund – Direct Plan is Rs 19.3600 for the Growth option of its Direct plan. The
fund’s investment objective is that “The Fund seeks long-term capital appreciation
by primarily investing in equity and equity-related instruments. In addition, the
Fund intends to earn current income by investing in debt securities and money
market instruments “. According to SEBI’s most recent risk-grading rules, an
investment in the IDFC Hybrid Equity Fund – Direct Plan falls into the Very
High-risk category.

 IDFC ARBITRAGE FUND DIRECT GROWTH

As of 17 January 2022, the current net asset value of the IDFC Arbitrage Fund –
Direct Plan is Rs 27.6786 for the Growth option of its Direct plan. “The scheme
aims to generate capital appreciation and income by predominantly investing in
arbitrage opportunities in the cash and derivative segments of the equity markets,
as well as arbitrage opportunities available within the derivative segment, and by
investing the balance in debt and money market instruments,” according to the
fund’s investment objective. As per SEBI’s latest guidelines to calculate risk
grades, investment in the IDFC Arbitrage Fund – Direct Plan comes under Low-
risk category.

 IDFC REGULAR SAVINGS FUND DIRECT GROWTH

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 As of 18-Jan-2022, the NAV of IDFC Regular Savings Fund Direct Plan Growth
was 28.5217. As of 18-Jan-2022, IDFC Regular Savings Fund Direct Plan Growth
has 184 Cr in assets under management (AUM), which is less than the category
average. The cost ratio of the fund is 1.15 percent. The Scheme’s principal goal is
to create consistent returns by investing primarily in debt securities. The Scheme’s
secondary goal is to achieve long-term capital appreciation by investing a
percentage of its total assets in equity securities.

 IDFC BALANCED ADVANTAGE FUND DIRECT GROWTH

As of 17 January 2022, the current net asset value of the IDFC Balanced
Advantage Fund – Direct Plan is Rs 20.5100 under the Growth option of its Direct
plan. The fund’s investment aim is to “create long-term capital appreciation with
comparatively reduced volatility through systematic allocation of money into
equities and equity-related instruments, as well as for defensive reasons in equity
derivatives.” According to SEBI’s most recent risk-grading rules, an investment in
the IDFC Balanced Advantage Fund – Direct Plan falls into the Moderately High-
risk category.

To analyse the performance of the mutual fund schemes, 16 open-ended, growth-oriented

equity mutual fund schemes from the leading mutual fund firms are chosen based on
assets under management (AUM). In the study, the daily net asset values (NAV) of
mutual fund schemes are employed.

1.5 LIMITATIONS OF THE STUDY

 The study is mainly based on secondary data. So inherent limitations of secondary

data exist
 The study is limited to the performance of selected hybrid funds Only.

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1.6 PROFILE OF THE COMPANY

1.6.1 AXIS BANK

Axis Bank is India’s third largest private sector bank. The bank provides a full range of
financial services to customers in the Large and Mid-Corporate , MSME, Agriculture, and
Retail Business categories.

As of March 31, 2020, the bank has 4,528 domestic branches (including extension
counters), 12,044 ATMs, and 5,433 cash recyclers dispersed around the country. The
Bank’s international operations are spread across eleven international offices, including
branches in Singapore, Hong Kong, Dubai (at the DIFC), Colombo, Shanghai, and Gift
City-IBU, as well as representative offices in Dhaka, Dubai, Abu Dhabi, and Sharjah, and
an overseas subsidiary in London, UK. Corporate loan, trade finance, syndication,
investment banking, and liability companies are the emphasis of the worldwide
operations.

In 1994, Axis Bank was one of the first new generation private sector banks to open its
doors. The bank was founded in 1993 by the Specified Undertaking of Unit Trust of India
(SUUTI) (then known as Unit Trust of India), the Life Insurance Corporation of India
(LIC), the General Insurance Corporation of India (GIC), the National Insurance
Company Ltd., The New India Assurance Company Ltd., The Oriental Insurance
Company Ltd., and the United India Insurance Company Ltd. The Unit Trust of India’s
shareholding was then transferred to SUUTI, an organisation founded in 2003.

Axis Bank, with a balance sheet size of Rs. 9,15,165 crores as of 31 st March 2020, has
maintained sustained growth, with a 5-year CAGR (2014-15 to 2019-20) of 15% each in
total assets, deposits and advances.

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1.6.2 HDFC BANK

HDFC Bank is one of India’s leading financial institutions, offering a diverse variety of
financial products and services to over 43 million consumers.

HDFC Bank was founded in 1995 by Housing Development Financing Corporation

(HDFC), India’s premier housing finance corporation, with a simple mission: to create a
“World-class Indian Bank.” The bank has done this by a single-minded emphasis on
product leadership, client attention, and operational excellence, emerging as a leading
player in all of its business sectors.

HDFC Bank has made major advancements in the banking market today, from a wide
variety of goods to the simple simplicity of their delivery. It was named India’s Most
Valuable Brand for the fifth time in a row in a study performed by Kantar, a WPP
research agency.

Today, HDFC Bank is a market leader in digital banking. With the introduction of its ‘Go
Digital – Bank Aapki Muthhi Mein’ campaign on Varanasi banks, it has positioned itself
as a full-service digital bank. Since then, the bank has introduced a plethora of new
products, such as the 10-second Personal Loan and payment applications such as
Payzapp, which put the power of banking in the hands of the user.

HDFC Bank is likewise expanding its branch network, with 53 percent of its branches
located in rural and semi-urban regions.

HDFC Bank is immensely proud of its people, their honesty and ethics, and the culture
that fosters these principles. This culture guarantees that the proper individuals are hired,
nurtured, and encouraged. HDFC Bank is a growing corporation with around 1 lakh
workers.

Through Parivartan, the bank’s umbrella brand for all social activities, the bank is
empowering millions of individuals, mainly women, across the country. Parivartan, as the
name implies, means effecting change or making a difference via rural development,
education promotion, skills training, health and hygiene, and financial literacy.

1.6.3 ICICI BANK

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ICICI Bank is India’s top private sector bank, with consolidated assets of 15,72,772 crore
(US$ 211.6 billion) as of June 30, 2021. In Q2-2022, the bank’s consolidated profit after
tax was 6,092 crore (US$ 821 million).

Across India, the bank has 5,277 branches and 14,045 ATMs.

ICICI Bank provides a comprehensive range of banking products and financial services to
corporate and retail clients via a number of delivery channels, as well as through its
specialised subsidiaries in investment banking, life and non-life insurance, venture
capital, and asset management.

The information included herein is provided only for informational purposes and does not
constitute an offer, invitation, or solicitation to purchase or sell, nor is it intended to
establish any rights or responsibilities. It is also not intended for distribution or use by
anyone in any area where such distribution or use would be illegal or would subject ICICI
Bank Limited (“ICICI Bank”) or its affiliate(s) to any licence or registration
requirements. Nothing in this document is meant to be advise or opinion; please seek
professional counsel before relying on any material in this document. ICICI Bank
disclaims all obligation for the correctness of information, any mistake or omission, or
any loss or damage experienced by anybody who relies on the contents of this website.

1.6.4 IDFC BANK

IDFC FIRST Bank was formed in December 2018 by the merging of IDFC Bank and
Capital First. Individuals, small enterprises, and corporations can all benefit from the
bank’s financial services. Savings and current accounts, NRI accounts, salary accounts,
demit accounts, fixed and recurring deposits, home and personal loans, two-wheeler
loans, consumer durable loans, small business loans, currency products, payment
solutions, and wealth management services are all available from the bank. IDFC FIRST
Bank operates in the Retail Banking, Wholesale Banking, and Other Banking areas and
has a state-wide reach. Customers have the option of banking where and how they want:
351 bank liability branches, 103 asset branches, 216 ATMs, and 534 rural business
correspondent centres across the country, as well as net banking, mobile banking, and a
toll-free Banker-on-Call service available 24 hours a day, seven days a week.

Page 22 of 60
 CHAPTER II

2 REVIEW OF LITERATURE

2.1 INTRODUCTION:

The amount of information accessible about mutual funds is enormous. Mutual funds
have drawn a lot of interest from academics, researchers, and investors throughout the
years and have been a subject of research. It has also resulted in the creation of several
measurements and models for assessing performance.

 Gudala Syamala Rao (2020): Alternative modes of saving and investing such as
bank deposits, postal deposits and government bonds present minimal risk but
offer a lower return on investment than that of capital market securities. However,
they do offer protection and capital growth. Mutual funds have become an
efficient and effective way for investors to participate in financial markets in a
simple and inexpensive way, mitigating the risk characteristics by spreading the
investment across different types of securities. They offer the potential for capital
growth and income through investment returns, dividends. Over the past decade,
mutual funds have increasingly become the vehicle of choice for investors for
long-term investments. It becomes relevant to analyse the risk and return of the
mutual fund.

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 CMA Panigrahi et. Al (2020) An examination of 10 equities-linked saving
scheme mutual funds was conducted. Using financial ratios and techniques for
analysis such as the average return, coefficient of determination (R2), standard
deviation (SD), Beta, Sharpe ratio, and Jensen alpha. They discovered a more
appealing yield in ELSS mutual funds and also receive a tax advantage of 1.5
lakh.

 S Tripathi, Drgp Japee (2020) fifteen equity mutual funds of various categories
depending on company market capitalization for fund appraisal, many financial
ratios were used. They discovered that the majority of equities mutual funds are
performing well, but that a steep decrease in the NIFTY 50 in 2019 is harming the
mutual fund’s return.

 KB Sharma (2020) From the selected five Debt funds, it was discovered that
three funds performed well and two funds did not perform well over the research
period. The steep decline in the NIFTY throughout 2019 has had an influence on
the performance of all of the funds. The statistical metrics employed to evaluate
performance were alpha, beta, and standard deviation.

 S Ahmad, D Alsharif (2019) The performance of fourteen Islamic and

conventional mutual funds in Saudi Arabia is compared using financial ratios,
tools, and people’s opinions in the discussion. Islamic mutual funds were
determined to be the most beneficial in this study because they are lower risk than
conventional mutual funds and provide a higher return. The study’s data is based
on monthly data from 2013 to 2017.

 S Tripathi (2020) Although most individuals are aware of mutual funds, only a
small percentage of people invest in them. Equity, hybrid, and loan are the three
most popular options among respondents. A Systematic Investment Plan is
preferred by 75 percent of respondents (SIP). Respondents are also knowledgeable
of how the stock market works. Respondents are aware that their money is

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 invested in the stock market by the Asset Management Company (AMC). The
study relied on primary data.

 Sumninder and Smiti (2011) Performance and assessment of public and private
sector mutual fund schemes were measured. The NAV is the major focus of the
research project, which spans the years 2000 to 2010. The analysis discovered that
when compared to other plans, the private sector mutual fund ICICI Prudential
Income Fund (growth option) had the highest return. During the period April 2016
to March 2017, Rani and Hooda (2017) assessed the performance of mutual fund
schemes ranked one by CRISIL as topper performance and found Tata Equity P/E
fund to be a good performer among the selected schemes. According to Mehta
(2012), public sector mutual funds in this category fared exceptionally well and
maintained a monopoly in index market funds.

 Adhav & Chauhan (2015) Standard deviation and Sharpe’s Ratio were used to
evaluate and compare the performance of mutual fund plans from various Indian
businesses. They discovered that all of the chosen equity mutual funds
outperformed their benchmark indexes. The analysis found that the risk of debt
funds was significantly lower than that of equity funds. The authors observed that
equity-oriented hybrid funds outperformed other hybrid funds, whereas arbitrage
funds and conservative debt hybrid funds did poorly. From 2009 to 2011, Alekhya
(2012) examined the performance of public and private sector mutual fund
programmes over three years. By comparing all of the public and private sector
mutual fund schemes SBI, UTI, and HDFC, JM finance discovered that, according
to Sharpe, Treynor, and Jensen measurement. Using Market Index and Fund EX,
Gupta (2001) examined the performance of 73 chosen schemes with various
investment objectives from both the public and private sectors. From April 1994
to March 1999, the NAV of close end and open-end systems was evaluated. The
sample schemes were not sufficiently diversified, their risk and return were not in
line with their objectives, and there was little proof of the mutual fund industry in
India’s market timing ability.

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 Agarwal (2011) The Indian Mutual Fund Sector was examined, and it was
discovered that the mutual fund industry in India has experienced tremendous
expansion, garnering huge investments from both domestic and international
investors. The vast expansion in the number of AMCs offering adequate
opportunities to investors in the form of safety, hedging, arbitrage, low risk, and
higher returns than any other long-term securities has attracted more investors to
mutual fund investments. Deb’s work focuses on return-based style analysis of
Indian equities mutual funds utilising quadratic optimization of William Sharpe’s
asset class factor model. For each of the equity funds in his sample, he discovered
style benchmarks that provided the best exposure to 11 passive asset class
indexes. The research also looked into the funds’ relative performance in
comparison to their style benchmarks The findings of this analysis also revealed
that, on average, the funds were unable to outperform their style standards.

 Tripathy (2004) From 1994-95 to 2001-2002, the performance of 31 tax planning

initiatives in India is evaluated. The findings show that the fund managers under
investigation have not been successful in outperforming the market or maintaining
effective portfolio diversification. The performance of 29 open ended, growth-
oriented equity plans was examined by Sarita and Meenakshi (2012). According
to their research, 14 of the 29 sample mutual fund schemes beat the benchmark
return. The findings also revealed that several of the schemes underperformed
owing to a lack of diversity. The Sharpe ratio was positive for all schemes in the
sample, indicating that funds were giving higher returns than the risk-free rate.
The Jensen test indicated that 19 of Positive alpha was found in 29 schemes,
indicating that they performed better.

 Smita Shukla, Rakesh Malusare (2016), The research examines several forms of
mutual fund schemes that invest in Overseas Securities and categorises them
based on their investment portfolio. The paper compares the returns on overseas
mutual fund schemes to comparable portfolio schemes and returns created in the
United States and China, as well as the returns on overseas mutual fund schemes
to average returns generated in similar wide portfolio schemes in India.

Page 26 of 60
 P. Krishna Prasanna (2012) All 82 Exchange Traded Schemes are examined for
their features and growth patterns. The schemes are listed on Indian stock
exchanges and traded there. The research uses the DEA (Data Envelopment
Analysis) approach to assess performance. According to the findings, the offshore
fund of funds, as well as the gold funds, were able to mobilise more resources and
wow investors.

 S. Narend (2014) presents a comparative study on the performance of ETFs and

index funds, which was empirically carried out from the period of their respective
introduction to July 2013. The analysis shows that ETFs perform well compared
to index funds.

 Cheng-Ru Wu (2008) represents a measurable performance framework for

mutual funds The study tries to find out how investors evaluate the performance
of mutual funds not only according to quantitative, but also qualitative criteria The
study used the modified Delphi method and the analytical hierarchy process
(AHP) evaluation method to evaluate the performance of mutual funds.

 Vikas Choudhary, and Preeti Sehgal Chawla (2014), shows that most of the
funds selected for the study outperformed. The study analysed the data using the
Sharpe Index and the Treynor Index. Treynor ratio, standard deviation, beta and
coefficient of determination.

 M. Jayanthi, S. Malathy, T. Radhulya (2013), Analyse the gold ETFs and

compare the historical data of various gold ETFs in India. The study tracks
performance on a daily, weekly, monthly, quarterly, and yearly basis. The study
showed that many of the gold ETFs currently available in the Indian market show
a large variance in actual gold yields. This problem is more pronounced in India
than in developed markets.

Page 27 of 60
 Shivangi Agarwal, Nawazish Mirza (2017), nalyses the performance of selected
mutual fund systems on the basis of risk and return. The study also compares the
performance of selected mutual fund systems with their benchmark. The study
also addresses several research topics. Performance and propose strategies for
investing in a mutual fund.

 Inderjit Kaur and K.P. Kaushik (2015), In the study based on the theory of
planned behaviour, the study examined the attitude (perception of the result), the
influence of consciousness and socio-economic conditions of an investor on his
investment behaviour towards mutual funds.

 S.M. Adhav and P Chauhan (2015) evaluated the performance of mutual fund
systems of selected Indian companies in terms of risk / reward to compare the
performance of mutual fund systems of selected Indian companies based on the
benchmark, and concluded that over the past 5 years, the performance of mutual
funds of selected companies’ Indian company is superior.

 S. Sharma et al. (2014) compared the performance of various mutual fund

systems based on the benchmark to show that the system outperformed or
outperformed the benchmark index and concluded that, given India’s developing
economy, almost all sectors are likely to see strong growth in the future will.

 M. Jayalakshmi and V. Palanichamy (2020) assessed the performance of the

selected HDFC mutual fund underdevelopment program and compared the return
and risk of the programs to the benchmark using various metrics such as the
Sharpe, Treynor and Jenson investment portfolio and concluded that Sharpe and
Treynor give a positive answer to the Decision-making process, while Jenson’s
measure answers this in the negative.

Page 28 of 60
 M. Jayadev (1996) used Sharpe, Treynor, and Jenson’s portfolio investment
metrics to study whether or not growth mutual funds outperform the benchmark
and find that growth mutual funds did not outperform your benchmark indicator.

 Dhume and B. Ramesh (2011) assessed the performance of the sector mutual
fund relative to the market and the performance using various performance
metrics and examined the sector fund’s risk-return analysis to conclude that
Sharpe and Treynor said all sector funds outperformed the market, with the
exception of the infrastructure sector.
 Phanisara Raju and Mallikarjuna Rao (2011) In their study, they evaluated the
performance of mutual fund systems in terms of risk and reward. The study period
spanned 3 years from 2008 to 2010. The programs were assessed using key
performance indicators such as Treynor, Sharpe, Jensen and Fama. Indicates the
failure of many infrastructure projects and other projects that did not result in the
prescribed returns.

 Kalpesh Prajapati and Mahesh Patel (2012) In his article, he evaluated the
performance of Indian mutual funds using the relative performance index, risk-
return analysis, Treynor index, Sharpe index, Jensen measure and fame. Your
study period was from 2007 to 2011. The results suggested that most mutual funds
returned positive results. Returns during the above period.

 ShivaniInder and Shikha Vohra (2012) assessed the long-term performance of

index fund systems to conduct a comparative analysis of fund performance over
the period 2005 to 2011. Performance metrics like standard deviation, beta, alpha,
R-Squared, Sharpe, Treynor, and Jensen. The results showed that funds like
ICICI, Tata and Franklin performed better on the growth option.

 Rupeet Kaur (2014) examined the performance of open-ended mutual funds in

India. A sample of 23 systems was selected to evaluate performance based on
weekly returns versus benchmark returns. Statistical tools as mean, standard
deviation, beta, coefficient of determination, adjusted risk. Performance measures

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 from Treynor, Sharpe, Jensen and Fama were used. The analysis showed that most
systems could not do better than the benchmark.

 Deepak Aggarwal (Asst. Professor) measuring performance of mutual funds:

- This study examines prices and data in the Indian mutual fund industry at both
the fund manager and fund investor level. Incorrect fund prices can be assessed by
comparing market and share performance. Use t-test. To test the hypothesis,
analyse the standard deviation and correlation. The mutual fund industry in India
has seen tremendous growth and has attracted a large number of investments from
both domestic and overseas investors.

 Tarini and Jayant Gutam (An analysis of performance of mutual funds:

Public sector Vs private sector): - In this document, investors need to
understand how risky individual assets are and how they contribute to the overall
risk of a portfolio. The aim of the study is to evaluate the performance of Indian
mutual fund systems using risk-adjusted performance metrics such as the Treynor
Index., Sharpe’s Index, Jensen’s Index. It will help investors select the best mutual
fund that will produce the highest return with the lowest risk and can be analysed
by finding the average return, standard deviation and beta. This study shows that
the private sector performed better compared to its counterpart on median return,
standard deviation and beta.

 Dr S Narayan Rao (Associate Professor of Finance) and M Ravindran

(Manager TATA Power Company Ltd) Performance evaluation of Mutual
Fund: - The aim of this study is to assess the performance of Indian mutual funds.
This investigation is carried out on the basis of the relative performance index, the
risk-return analysis, the Sharpe ratio, the Treynor ratio, the Sharp measure, the
measurement by Jensen and Fama used with the monthly closing NAV. The
results of the performance measurement indicate that most mutual funds were able
to meet investor expectations by generating a return that was higher than
expected.

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 Michael C. Jense (Performance of Mutual Funds in the period 1945-1964): -
The aim of this study was to derive a risk-adjusted measure of portfolio
performance that estimates how much a manager’s predictive ability contributes to
fund returns. The measure is based on the capital wealth theory of Sharpe (1964),
Linter (1965) and Treynor (undated).) Not only is the mutual fund performance
evidence that these 115 mutual funds, on average, were unable to predict security
prices well enough, but there is also very little evidence that any single fund could
outperform us expected from a fortuitous coincidence.
 Roger’s Otten and Dennis Bams (European Mutual Fund Performance): -
This paper presents an overview of the European Mutual Fund Industry and
investigates mutual fund performance using a survivorship bias-controlled sample
of 506 funds from 5 most important mutual fund countries. The latter is done
using Carhart (1997) 4-factor asset-pricing model. The result suggests that
European Mutual Funds and especially small cap funds are able to add value, as
indicated by their positive after cost alphas. Most European Mutual Funds exhibit
positive returns and deliver positive risk-adjusted performance to their investors.

 Shweta Goel (performance of mutual funds and investors behaviour): - The

aim of this thesis was to analyse the performance of mutual funds in terms of
efficiency and the methods for their improvement in order to examine the
behaviour of investors when investing their savings. Mutual fund systems are free
and break even, and therefore mutual fund companies could focus on downsizing,
as most investors have invested in the growth, income, and mutual fund systems-
focused mutual funds.

 Ch. Venugopal Reddy (Performance Evaluation of Top Five Mutual Funds in

India-A Comparative study): - The study refers to the comparison of the
performance of the diversified equity fund systems of 5 AMC companies and also
examines the change in the investment pattern. The net asset value at the end of
the selected programs rose from March 2011 to March 2016. Share prices

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 encouraged investors to book profits and transfer money to debt, as the latter will
generate healthy returns as interest rates fall.

 Venkateshwara Rao (Growth of Resource Mobilization by Indian Mutual

Fund industry): - The aim of this study is to analyse the net mobilization of
resources, an asset that is institutionally managed by the mutual fund industry.
Statistical tools are used for averages, percentages and correlations.

 Mrs O.V.A.M. Sridevi (Performance Analysis of Mutual fund- A study on

selected mid cap and small cap funds): - This paper is expounded to the present
standing of mutual funds in India, live the risk return relationship and market
volatility of the chosen mutual funds. Portfolio will be measure through
completely different quantitative relations, i.e., Treynor’s ratio, Sharp quantitative
relation and so on this paper conclude that the 2 theme of each middle cap and
little cap funds have evidences of outperforming the benchmark return.

 Muralidhar Prasad Ayaluru (Performance analysis of mutual funds- selected

Reliance Mutual Fund Schemes): - The objective of this paper is to gauge the
past performance of ten elect open finished Equity Mutual theme of reliance and
perform the danger come analysis of those funds. NAV of these schemes are
collected for the amount of five yeas i.e., August 2009 to Gregorian calendar
month 2014.

 Jani D and Jain R (2013) wrote in the Abhinav Journal (International Monthly
Referred Journal of Research in Management & Technology) article “Role of
Mutual Funds in Indian Financial System as a Key Resource Mobilizer” that the
Indian economy will be successful in the coming year because the fundamentals
are relatively strong. Mutual funds will become a crucial resource mobilizer for
the Indian financial sector as the economy grows. In the near future, the Indian
mutual fund business is expected to grow at a rapid pace.

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  Although mutual funds are predominantly present in urban areas, they have begun
to capture rural markets through new ranges of products, new strategies adopted
for Rural Market Penetration, and new awareness programmes, according to Iqbal
N (2013) in an article titled “Market Penetration and Investment Pattern of Mutual
Fund Industry” from the International Journal of Advanced Research in
Management and Social Sciences. There will be a massive flood of investment as
the rural market merges more and more with the urban economy. The
responsibilities of various intermediaries, particularly mutual funds, will multiply.

 Equity funds outperform debt funds, according to Srivastava S and Malhotra S

(2015) in their work “A Paradigm Shift in Risk Measuring Tools of Mutual Fund
Industry” published in the International Journal of Informative & Futuristic
Research. Risk and return were discovered to have a strong linear relationship.
Calmar and safety-first ratios can be used by fund managers to assess the risk of
specific funds. No fund is risk-free, so investors should diversify their risk by
investing in equities and equity-related securities.

 In their article “Evaluating the Performance of some selected open-ended equity

diversified Mutual funds in the Indian mutual fund industry,” Vasantha S. et al
(2013) from the International Journal of Innovative Research in Science,
Engineering, and Technology stated that an investor’s risk appetite plays an
important role in mutual fund selection. Investors should decide on mutual fund
investments based on their investment objectives and examine the fund based on
numerous parameters such as market risk, return variations, and deviations from
the return, among others.

2.2 CONCLUSION:

After reviewing varied reviews of literature, it’s evident that several studies were
conducted on performance mutual funds. A number of them were regarding investors’
behaviour, some of them such their study on plane figure basis and a few analysed the
performance of all kinds of mutual funds in a combined basis, however an awfully few

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works has been through with special focuses on the performance analysis of Hybrid
Mutual funds. This study principally thinks about the performance of open-end fund with
special focuses on Hybrid Mutual funds.

CHAPTER III

3 RESEARCH METHODOLOGY

3.1 STATEMENT OF THE PROBLEM:

In the Indian financial market, the mutual fund business is rapidly expanding. Though
there are other investment possibilities, investing in mutual funds via competent fund
management allows investors to invest in the capital market with low risk and high rate of
return due to fund diversification. Investors can choose from a variety of investment
options. Investors must be well-versed in the risk and return characteristics of the funds in
which they are investing. As a result, this study aids in analysing the performance of the
hybrid mutual fund schemes chosen for investing.

3.2 OBJECTIVES

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 1. To study various aspects and forms of Hybrid Mutual Funds.
2. To analyse a comparative analysis of the trend of performance of hybrid mutual
funds of HDFC Bank, ICICI Bank, IDFC Bank, and Axis Bank.
3. To study the risk and return component among the selected hybrid mutual fund.
4. To find out the best investment option from the types of hybrid mutual funds.
5. To make a comparative analysis on the performance of the hybrid mutual fund
schemes using performance measures like Sharpe index, Treynor index and
Jensen alpha.

3.1 HYPOTHESIS:

 H0 – There is no significant difference among the performances of the select

Hybrid Mutual Fund schemes.
 H1 –There is significant difference among the performances of the select
Hybrid Mutual Fund schemes.

3.4 SOURCES OF DATA:

The research is analytical in nature, with secondary data gathered from books, journals,
and numerous websites.

www.rrfinance.com

www.investing.com

www.rbi.org.in

www.nseindia.com

3.5 TOOLS FOR ANALYSIS:

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The following statistical methods were utilised in the study: average, standard deviation,
and percentage.

The following performance indicators are used:

3.6 KEY CONCEPTS USED IN STUDY

3.6.1 AGGRESSIVE HYBRID MUTUAL FUND

Aggressive Mutual Funds are hybrid funds that invest 65-80% of their entire assets in
equities and equity-related products and the remaining 20-35 percent in debt securities
and money market instruments. Even if the fund management is certain of achieving
strong returns, hybrid funds with a balanced approach are often not authorised to take
advantage of any arbitrage possibilities.

3.6.2 CONSERVATIVE HYBRID MUTUAL FUND

Conservative mutual funds invest in debt and equity instruments that are less risky. They
invest mostly in debt securities (75-90 percent), with a tiny percentage in equity and
equity-related derivatives (around 10-25 percent). Because of their minimal equity
involvement, these plans can yield higher returns than pure debt schemes. Furthermore,
conservative funds often invest in high-quality debt and large-cap equities. These funds
strive to provide both regular income and capital appreciation while focusing on capital
preservation. They are less exposed to stocks than aggressive funds and have a stated goal
of outperforming inflation.

3.6.3 ARBITRAGE HYBRID MUTUAL FUND

Arbitrage Funds are equity-oriented hybrid funds that take advantage of market arbitrage
possibilities. These can include a pricing discrepancy between two exchanges, pricing
differences in the spot and futures markets, and so forth. An arbitrage fund’s fund

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management buys and sells shares at the same time, earning the difference between the
selling and purchasing prices.

3.6.4 DYNAMIC ASSET ALLOCATION FUND

Dynamic asset allocation funds are a sort of balanced fund, sometimes known as a hybrid
fund. The majority of funds in this category are invested and dispersed over numerous
industries such as equities funds, real estate, stocks, and bonds.

If the market slows down during a recession or a bear market, a dynamic asset allocation
fund is the only option available to all customers, regardless of risk tolerance. Each of
these funds is handled by a skilled manager who takes care to guarantee that the
investment quality is not compromised.

Given that equities funds provide the largest returns, it is important to remember that the
associated risks are also rather substantial. In an economy that has been in a depression in
recent months, many investors are leery about putting too much of their money into a
single mutual fund. They can choose from a choice of dynamic asset allocation funds in
order to earn assured returns.

3.6.5 PERFORMANCE SHARPE INDEX MEASURE

William F. Sharpe invented this ratio, which is used to assess the return on an investment
in relation to its risk. It is thought of as a reward-to-variability ratio. The Sharpe ratio
quantifies the portfolio’s risk premium in terms of risk. The risk premium is defined as
the difference between the portfolio’s return and the risk-free rate of return. The standard
deviation shows the portfolio’s risk.

Rp−Rf
St =
σp

R (p): Portfolio return

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R (f): Risk free rate of return

σp : Standard deviation of the portfolio

A high and positive ratio reflects a fund’s stronger risk-adjusted performance, whilst a
low and negative ratio implies poor performance.

3.6.6 PERFORMANCE TREYNOR INDEX MEASURE

Jack Treynor invented this ratio. It’s known as the reward-to-volatility ratio. The
difference between the average return and the risk-free rate of return is referred to as the
excess return. The Treynor ratio differs from the Sharpe ratio in that it uses beta as a
measure of systematic risk. The risk premium in a portfolio is determined by the
systematic risk accepted.

Rp−Rf
Tn=
βp

R (p): Portfolio Return

R (f): Risk-Free Rate

βp: Beta of the portfolio

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The higher ratio fund is preferable because it yields a bigger risk premium per unit of
systematic risk.

3.6.7 JENSEN’S PERFORMANCE MEASURE

Michael Jensen created this risk-adjusted return metric, which is sometimes known as
Jensen’s index or Jensen’s alpha. Because the performance is assessed against a specific
benchmark, it is a measure of absolute performance. The specified benchmark is based on
the manager’s capacity to forecast.

α = Rp – (Rf + β (Rm – Rf))

R(i) = the realized return of the portfolio or investment

R(m) = the realized return of the appropriate market index

R(f) = the risk-free rate of return for the time period

B = the beta of the portfolio of investment with respect to the chosen market index

A positive alpha reflects the fund’s outperformance, whereas a negative alpha shows the
fund’s underperformance

3.6.8 BETA

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It is a measure of the fund’s volatility in contrast to the market. It is computed using a
statistical procedure known as “regression analysis.” The slope of the typical regression
line is denoted by beta.

It describes the link between the fund’s return and the returns of the indices. A 1% change
in the market index return produces a 1% change in the fund return. It denotes that the
fund moves in lockstep with the market. Aggressive investors prefer mutual fund schemes
with greater beta values because they provide larger rewards at a higher risk.

Covariance (Ri , Rm )
β=
Variance(Rm)

Ri = Return of the fund

Rm = Return of the market

3.6.9 STANDARD DEVIATION

The risk of a mutual fund is quantified using the term “Standard Deviation.” It calculates
how much a fund’s returns stray from its excess returns based on its previous
performance. In other words, standard deviation is used to assess the fund’s volatility.
The fund with a greater standard deviation has a more fluctuating net asset value and is
thus regarded riskier than a fund with a low standard deviation.

TIME PERIOD

The time period which I have taken into consideration is 5 years. I have collected the Net
Asset Value (NAV) for the past 5 years (Nov 2016 – November 2021). After collected the
data, I have taken monthly average to calculate the Sharpe Ratio, Treynor Ratio and
Jensen’s Alpha.

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 CHAPTER IV

4 DATA ANALYSIS AND INTEREPRETATIONS

Data Analysis is the procedure of cleaning, transforming and designing the data to
determine valuable information for the process of decision making in a business. Data
analysis' goal is to extract usable information from data and make decisions based
on that knowledge. Gaining a deeper understanding of diverse data analysis
methodologies, quantitative research methods, and qualitative insights can offer your data
analysis efforts a more clearly defined direction, so it’s worth taking the time to soak up
this information. In addition, you will be able to generate a thorough analytical report that
will speed up your analysis.

4.1PERFORMANCE OF AXIS BANK

TABLE 4.1.1 PERFORMANCE MEASURE OF SHARPE INDEX

SI.NO TYPE OF HYBRID NAME OF THE AXIS SHARPE

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 MUTUAL FUND MUTUAL FUND SCHEMES INDEX
1 AGGRESSIVE AXIS EQUITY HYBRID 4.093789453
HYBRID MUTUAL FUND DIRECT GROWTH
FUND
2 ARBITRAGE AXIS ARBITRAGE FUND 9.674573472
HYBRID MUTUAL DIRECT GROWTH
FUND
3 CONSERVATIVE AXIS REGULAR SAVER 7.851341918
HYBRID MUTUAL FUND DIRECT GROWTH
FUND
4 DYNAMIC ASSET AXIS BALANCED 6.504338675
ALLOCATION FUND ADVANTAGE FUND
DIRECT GROWTH

RANK

Fig 4.1.1

INTEREPRETATION:

Sharpe Ratio based on the market return the formula is SR = (Rm-Rf)/σ and the funds are
ranked in the similar way as it was ranked considering the fund returns (Rp). The AXIS

Page 42 of 60
Arbitrage Hybrid Fund ranks FIRST among the four funds because of the comparatively
reasonable return and low volatility in returns. The AXIS Regular Saver Fund ranks
SECOND as this fund has a slightly higher return than the AXIS Arbitrage Fund with
high volatility. The AXIS Balanced Advantage Fund ranks THIRD as this fund have
slightly higher return When compared to the AXIS Equity Hybrid Fund. The AXIS equity
Fund ranks FOURTH as this fund have a lower return as compared to other funds.

TABLE 4.1.2 PERFORMANCE MEASURE OF TREYNOR INDEX

SI.NO TYPE OF HYBRID NAME OF THE AXIS TREYNOR

MUTUAL FUND MUTUAL FUND SCHEMES INDEX
1 AGGRESSIVE AXIS EQUITY HYBRID -0.02722217
HYBRID MUTUAL FUND DIRECT GROWTH
FUND
2 ARBITRAGE AXIS ARBITRAGE FUND -13.61386432
HYBRID MUTUAL DIRECT GROWTH
FUND
3 CONSERVATIVE AXIS REGULAR SAVER -0.513401407
HYBRID MUTUAL FUND DIRECT GROWTH
FUND
4 DYNAMIC ASSET AXIS BALANCED -0.278524429
ALLOCATION FUND ADVANTAGE FUND DIRECT
GROWTH

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 RANK
AXIS EQUITY HYBRID FUND AXIS ARBITRAGE FUND AXIS REGULAR SAVER AXIS BALANCED AD-
DIRECT GROWTH DIRECT GROWTH FUND DIRECT GROWTH VANTAGE FUND DIRECT
GROWTH
1 2
3

Fig 4.1.2

INTEREPRETATION:

Treynor’s Ratio based on the market return the formula is TR = (Rm-Rf)/β and the funds
are ranked in the similar way as it was ranked considering the fund returns (Rp). The
AXIS Equity Hybrid Fund ranks FIRST among the four funds because of the
comparatively reasonable return and low volatility in returns. The AXIS Balanced
Advantage Fund ranks SECOND as this fund has a slightly higher return than the AXIS
Equity Hybrid Fund with high volatility. The AXIS Regular Saver Fund ranks THIRD as
this fund have slightly higher return When compared to the AXIS Arbitrage Fund. The
AXIS Arbitrage Fund ranks FOURTH as this fund have a lower return as compared to
other funds.

4.1 PERFORMANCE OF HDFC BANK

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 TABLE 4.2.1 PERFORMANCE MEASURE OF SHARPE INDEX

SI.NO TYPE OF HYBRID NAME OF THE HDFC SHARPE INDEX

MUTUAL FUND MUTUAL FUND SCHEMES
1 AGGRESSIVE HDFC EQUITY FUND 7.689622189
HYBRID MUTUAL DIRECT PLAN GROWTH
FUND
2 ARBITRAGE HDFC ARBITRAGE FUND 11.55200414
HYBRID MUTUAL WHOLESALE DIRECT
FUND GROWTH
3 CONSERVATIVE HDFC HYBRID DEBT FUND 8.47798556
HYBRID MUTUAL DIRECT GROWTH
FUND
4 DYNAMIC ASSET HDFC BALANCED 5.834652261
ALLOCATION ADVANTAGE FUND DIRECT
FUND PLAN GROWTH

RANK

Fig 4.2.1

Page 45 of 60
INTEREPRETATION:

Sharpe Ratio based on the market return the formula is SR = (Rm-Rf)/σ and the funds are
ranked in the similar way as it was ranked considering the fund returns (Rp). The HDFC
Arbitrage Hybrid Fund ranks FIRST among the four funds because of the comparatively
reasonable return and low volatility in returns. The HDFC Hybrid Debt Fund ranks
SECOND as this fund has a slightly higher return than the HDFC Arbitrage Hybrid Fund
with high volatility. The HDFC Hybrid Equity Fund ranks THIRD as this fund have
slightly higher return When compared to the HDFC Balanced Advantage Fund. The
HDFC Balanced Advantage Fund ranks FOURTH as this fund have a lower return as
compared to other funds.

TABLE 4.2.2 PERFORMANCE MEASURE OF TREYNOR INDEX

SI.NO TYPE OF HYBRID NAME OF THE HDFC TREYNOR INDEX

MUTUAL FUND MUTUAL FUND SCHEMES
1 AGGRESSIVE HDFC EQUITY FUND -4.050562979
HYBRID MUTUAL DIRECT PLAN GROWTH
FUND
2 ARBITRAGE HDFC ARBITRAGE FUND 0.781278242
HYBRID MUTUAL WHOLESALE DIRECT
FUND GROWTH

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 3 CONSERVATIVE HDFC HYBRID DEBT FUND 17.34799794
HYBRID MUTUAL DIRECT GROWTH
FUND
4 DYNAMIC ASSET HDFC BALANCED 0.129024872
ALLOCATION ADVANTAGE FUND DIRECT
FUND PLAN GROWTH

RANK

Fig 4.2.2

INTEREPRETATION:

Treynor’s Ratio based on the market return the formula is TR = (Rm-Rf)/β and the funds
are ranked in the similar way as it was ranked considering the fund returns (Rp). The
HDFC Hybrid Debt Fund ranks FIRST among the four funds because of the
comparatively reasonable return and low volatility in returns. The HDFC Arbitrage Fund
ranks SECOND as this fund has a slightly higher return than the HDFC Hybrid Debt
Fund with high volatility. The HDFC Balanced Advantage Fund ranks THIRD as this
fund have slightly higher return When compared to the HDFC Hybrid Equity Fund. The

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HDFC Hybrid Equity Fund ranks FOURTH as this fund have a lower return as compared
to other funds.

4.2 PERFORMANCE OF ICICI BANK

TABLE 4.3.1 PERFORMANCE MEASURE OF SHARPE INDEX

SI.NO TYPE OF HYBRID NAME OF THE ICICI MUTUAL SHARPE

MUTUAL FUND FUND SCHEMES INDEX
1 AGGRESSIVE ICICI PRUDENTIAL EQUITY 7.747137427
HYBRID MUTUAL &DEBT FUND DIRECT GROWTH
FUND
2 ARBITRAGE ICICI PRUDENTIAL EQUITY 11.08026036
HYBRID MUTUAL ARBITRAGE DIRECT GROWTH
FUND
3 CONSERVATIVE ICICI PRUDENTIAL REGULAR 7.301495059
HYBRID MUTUAL SAVING FUND DIRECT
FUND GROWTH
4 DYNAMIC ASSET ICICI PRUDENTIAL BALANCED 6.017598582
ALLOCATION FUND ADVANTAGE DIRECT GROWTH

RANK

Page 48 of 60
 Fig 4.3.1

INTEREPRETATION:

Sharpe Ratio based on the market return the formula is SR = (Rm-Rf)/σ and the funds are
ranked in the similar way as it was ranked considering the fund returns (Rp). The ICICI
Prudential Equity Arbitrage Fund ranks FIRST among the four funds because of the
comparatively reasonable return and low volatility in returns. The ICICI Prudential
Equity & Debt Fund ranks SECOND as this fund has a slightly higher return than the
ICICI Prudential Equity Arbitrage Fund with high volatility. The ICICI Prudential
Regular Saving Fund ranks THIRD as this fund have slightly higher return When
compared to the ICICI Prudential Balanced Advantage Fund. The ICICI Prudential
Balanced Advantage Fund ranks FOURTH as this fund have a lower return as compared
to other funds.

TABLE 4.3.2 PERFORMANCE MEASURE OF TREYNOR INDEX

SI.NO TYPE OF HYBRID NAME OF THE ICICI TREYNOR INDEX

MUTUAL FUND MUTUAL FUND SCHEMES
1 AGGRESSIVE ICICI PRUDENTIAL EQUITY 0.18851394
HYBRID MUTUAL &DEBT FUND DIRECT
FUND GROWTH
2 ARBITRAGE ICICI PRUDENTIAL EQUITY 1.294970132
HYBRID MUTUAL ARBITRAGE DIRECT
FUND GROWTH
3 CONSERVATIVE ICICI PRUDENTIAL -0.879290626

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 HYBRID MUTUAL REGULAR SAVING FUND
FUND DIRECT GROWTH
4 DYNAMIC ASSET ICICI PRUDENTIAL 0.168368603
ALLOCATION BALANCED ADVANTAGE
FUND DIRECT GROWTH

RANK

Fig 4.3.2

INTEREPRETATION:

Treynor’s Ratio based on the market return the formula is TR = (Rm-Rf)/β and the funds
are ranked in the similar way as it was ranked considering the fund returns (Rp). The
ICICI Prudential Equity Arbitrage Fund ranks FIRST among the four funds because of
the comparatively reasonable return and low volatility in returns. The ICICI Prudential
Equity & Debt Fund ranks SECOND as this fund has a slightly higher return than the
ICICI Prudential Equity Arbitrage Fund with high volatility. The ICICI Prudential
Balanced Advantage Fund ranks THIRD as this fund have slightly higher return When
compared to the ICICI Prudential Regular Saving Fund. The ICICI Prudential Regular

Page 50 of 60
Saving Fund ranks FOURTH as this fund have a lower return as compared to other
funds.

4.3 PERFORMANCE OF IDFC BANK

TABLE 4.4.1 PERFORMANCE MEASURE OF SHARPE INDEX

SI.NO TYPE OF HYBRID NAME OF THE IDFC SHARPE

MUTUAL FUND MUTUAL FUND SCHEMES INDEX
1 AGGRESSIVE HYBRID IDFC HYBRID EQUITY FUND 4.384782298
MUTUAL FUND DIRECT GROWTH
2 ARBITRAGE HYBRID IDFC ARBITRAGE FUND 11.14011415
MUTUAL FUND DIRECT GROWTH
3 CONSERVATIVE IDFC REGULAR SAVINGS 9.209344146
HYBRID MUTUAL FUND DIRECT GROWTH
FUND
4 DYNAMIC ASSET IDFC BALANCED 5.30142293
ALLOCATION FUND ADVANTAGE FUND DIRECT
GROWTH

RANK

Page 51 of 60
 Fig 4.4.1

INTEREPRETATION:

Sharpe Ratio based on the market return the formula is SR = (Rm-Rf)/σ and the funds are
ranked in the similar way as it was ranked considering the fund returns (Rp). The IDFC
Arbitrage Hybrid Fund ranks FIRST among the four funds because of the comparatively
reasonable return and low volatility in returns. The IDFC Regular Savings Fund ranks
SECOND as this fund has a slightly higher return than the IDFC Arbitrage Hybrid Fund
with high volatility. The IDFC Balanced Advantage Fund ranks THIRD as this fund have
slightly higher return When compared to the IDFC Hybrid Equity Fund. The IDFC
Hybrid Equity Fund ranks FOURTH as this fund have a lower return as compared to
other funds.

TABLE 4.4.2 PERFORMANCE MEASURE OF TREYNOR INDEX

SI.NO TYPE OF HYBRID NAME OF THE IDFC TREYNOR INDEX

MUTUAL FUND MUTUAL FUND SCHEMES
1 AGGRESSIVE IDFC HYBRID EQUITY 3.821913775
HYBRID MUTUAL FUND DIRECT GROWTH
FUND
2 ARBITRAGE IDFC ARBITRAGE FUND 0.972479399
HYBRID MUTUAL DIRECT GROWTH
FUND

Page 52 of 60
 3 CONSERVATIVE IDFC REGULAR SAVINGS 14.03531174
HYBRID MUTUAL FUND DIRECT GROWTH
FUND
4 DYNAMIC ASSET IDFC BALANCED 0.09352888
ALLOCATION FUND ADVANTAGE FUND DIRECT
GROWTH

RANK

TH TH TH TH
W OW W W
G RO GR G RO G RO
CT T CT CT
RE R EC RE RE
DI DI DI DI
ND ND ND ND
FU FU FU FU
IT
Y
A GE NG
S
AG
E
U
EQ TR VI NT
ID BI SA VA
BR AR AR AD
HY FC UL D
FC
ID G CE
ID RE N
FC LA
ID BA
FC
ID

Fig 4.4.2

INTEREPRETATION:

Treynor’s Ratio based on the market return the formula is TR = (Rm-Rf)/β and the funds
are ranked in the similar way as it was ranked considering the fund returns (Rp)The IDFC
Regular Savings Fund ranks FIRST among the four funds because of the comparatively
reasonable return and low volatility in returns. The IDFC Hybrid Equity Fund ranks
SECOND as this fund has a slightly higher return than the IDFC Regular Savings Fund
with high volatility. The IDFC Arbitrage Fund ranks THIRD as this fund have slightly
higher return When compared to the IDFC Balanced Advantage Fund. The SBI Debt

Page 53 of 60
Hybrid Fund ranks FOURTH as this fund have a lower return as compared to other
funds.

TABLE 4.5 PERFORMANCE MEASURE OF JENSON ALPHA

RETURN
DATE PORTFOLIO MARKET
2016-2017 0.77906569 22618.551
2017-2018 0.78417454 26023.1569
2018-2019 0.77924667 29034.1426
2019-2020 0.82320535 24624.1402
2020-2021 0.84225075 35049.269

MEAN 0.81490092 27469.852

BETA 0.000003698
ALPHA 0.71085701

Page 54 of 60
 Fig 4.5

INTEREPRETATION:

The Jensen’s Alpha is sharply low when compared to the market index (0.710<27469).
This is not good for the banks. They should be stable when compared with the market
index.

CHAPTER V

5 FINDINGS, RECOMMENDATIONS AND CONCLUSION

5.1 FINDINGS OF THE STUDY

 As I have calculated the Sharpe Ratio, Treynor’s Ratio and Jensen’s Alpha for the
10 schemes which I have chosen, I have found their performance in each ratio.

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 I have found out that which is the best possible scheme available in the bank and
the scheme in which the investors can invest.

 Axis Equity Hybrid Fund Direct - Growth returns of last 1-year are 25.86%. Since
launch, it has delivered 16.98% average annual returns. The fund has doubled the
money invested in it every 2 yrs.

 Axis Arbitrage Fund Direct-Growth returns of last 1-year are 4.82%. Since
launch, it has delivered 6.56% average annual returns.

 Axis Regular Saver Fund -Growth returns of last 1-year are 11.10%. Since launch,
it has delivered 8.18% average annual returns. The fund has doubled the money
invested in it every 8 yrs.

 Axis Balanced Advantage Fund Direct - Growth returns of last 1-year are 17.09%.
Since launch, it has delivered 10.53% average annual returns.

 HDFC Flexi Cap Direct Plan-Growth returns of last 1-year are 35.78%. Since
launch, it has delivered 15.67% average annual returns. The fund has doubled the
money invested in it every 2 yrs.

 HDFC Arbitrage Fund Wholesale Direct-Growth returns of last 1-year are 4.38%.
Since launch, it has delivered 6.19% average annual returns.

 HDFC Hybrid Debt Fund Direct-Growth returns of last 1-year are 13.40%. Since
launch, it has delivered 10.04% average annual returns. The fund has doubled the
money invested in it every 8 yrs.

 HDFC Balanced Advantage Fund Direct Plan-Growth returns of last 1-year are
26.14%. Since launch, it has delivered 14.52% average annual returns. The fund
has doubled the money invested in it every 2 yrs.

Page 56 of 60
 ICICI Prudential Equity & Debt Fund Direct-Growth returns of last 1-year are
40.52%. Since launch, it has delivered 17.72% average annual returns. The fund
has doubled the money invested in it every 2 yrs.

 ICICI Prudential Equity Arbitrage Direct-Growth returns of last 1-year are 4.60%.
Since launch, it has delivered 7.06% average annual returns.

 ICICI Prudential Regular Savings Fund Direct-Growth returns of last 1-year are
11.54%. Since launch, it has delivered 11.22% average annual returns. The fund
has doubled the money invested in it every 8 yrs.

 ICICI Prudential Balanced Advantage Direct-Growth returns of last 1-year are

15.53%. Since launch, it has delivered 13.47% average annual returns. The fund
has doubled the money invested in it every 6 yrs.

 IDFC Hybrid Equity Fund Direct - Growth returns of last 1-year are 29.84%.
Since launch, it has delivered 13.85% average annual returns. The fund has
doubled the money invested in it every 2 yrs.

 IDFC Arbitrage Fund Direct-Growth returns of last 1-year are 4.42%. Since
launch, it has delivered 6.90% average annual returns.

 IDFC Regular Savings Fund Direct Plan-Growth returns of last 1-year are 7.30%.
Since launch, it has delivered 9.12% average annual returns. The fund has doubled
the money invested in it every 8 yrs.

 IDFC Balanced Advantage Fund Direct-Growth returns of last 1-year are 16.60%.
Since launch, it has delivered 10.34% average annual returns. The fund has
doubled the money invested in it every 8 yrs.

 There are multiple researches on mutual fund related areas and this is not the end
of it. There is scope for future research on the same topic, combinations, periods
etc
Page 57 of 60
5.2 SUGGESTIONS FOR THE STUDY

 For those people who hesitate to invest in share market can invest in mutual funds.
But some of these mutual funds has the ability to increase their own value.
 If their value increases, they can stay on a stable situation when compared to the
benchmark.
 The true value of a mutual fund can only be determined during market downturns,
as evidenced by fund history.

5.2CONCLUSION

Mutual funds are a popular investment option among investors because they are
simple to invest in and provide higher returns than other traditional asset classes
such as fixed-income securities or savings bank accounts. Numerous research has
been conducted on mutual fund performance evaluation. The vast majority of
these studies, failed to provide a fair assessment of manager skill because they
assume managers are measured against an implied market benchmark. Managers,
on the other hand, are frequently evaluated by self-reported benchmarks, and their

Page 58 of 60
 ability to identify high-performing stocks, correctly time the market, or consider
other market elements should be measured against that benchmark. I propose
measuring stock selection skill and market timing ability in the same way that
standard asset management practise does, namely by risk adjusting mutual fund
managers' excess returns over their self-designated benchmarks.

REFERENCE

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Pharmaceutical Companies in India, Journal of Advanced Research in Dynamical
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Profitability of Selected Pharmaceutical Companies in India” Journal of Advance

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11. Singh, R. G., & Mishra, S. (2019). Performance Evaluation of Growth Mutual
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