PROJECT REPORT

ON
AT
BAJAJ FINANCE LTD.
SUBMITTED IN PARTIAL FULFILMENT
OF
POST GRADUATE DIPLOMA IN ANAGEMENT
(AICTE PROGRAM)
BY
NAME: MS. Pragati Dada
OF
IIEBM, INDUS BUSINESS SCHOOL WAKAD, PUNE-57
PGDM-2022-24

i
 A REPORT
ON

AT
BAJAJ FINANCE LTD.
BY
PRAGATI DADA
IIEBM, INDUS BUSINESS SCHOOL
WAKAD, PUNE-57

PGDM-2022-24

A REPORT SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS

OF THE PGDM COURSE

STUDENT DECLARATION

ii
I Pragati Dada student of Post Graduate Diploma in Management Program of Batch 2022-24 bearing
Registration Number 10009 Hereby, declare that the project report entitled under the guidance of Saravjit
Sandhu and submitted to IIEBM, Indus Business School. I hereby, declare that this work is my original and
has not been reproduced from any other source.

Date:

Place:

Name of student: Pragati Dada

Signature:

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iv
 ACKNOWLEDGEMENT

I, Pragati Dada, a PGDM student of IIEBM- Indus Business School, would like to extend my
heartfelt gratitude and appreciation to everyone who supported and guided me during my
enriching three-month summer internship at Bajaj Finance Ltd., Viman Nagar, Pune. I had
the privilege of working in the Fixed Deposit department of the Mutual Fund Business Team,
which is headed by Mr. Sarvajit Sandhu.
First and foremost, I would like to express my sincere thanks to my college Managing
Director, Dr. Jai Singh Marwa, for providing me with the opportunity to undertake this
summer internship. Your vision for the college and dedication to nurturing well-rounded
professionals have been a driving force behind my academic pursuits.
I am deeply indebted to my college mentor, Dr. Vishal Bhole, for his continuous guidance,
valuable insights, and unwavering support throughout the internship period. Your mentorship
has been instrumental in shaping my understanding of the financial industry and enhancing
my analytical skills.
I extend my sincere appreciation to Mr. Sarvajit Sandhu, the head of the Mutual Fund
Business Team at Bajaj Finance Ltd., for granting me the opportunity to work with the team.
His expertise and encouragement have motivated me to explore new horizons in the mutual
fund industry.
I would like to express my gratitude to the entire team at Bajaj Finance Ltd. for their warm
welcome and cooperation. Their willingness to share knowledge and experiences has been
invaluable in enhancing my practical understanding of the fixed deposit department and the
mutual fund business.
During the internship, I had the privilege of working on three significant projects assigned by
the organization:
1. Performance Analysis of Mutual Funds: This project provided me with insights into
evaluating mutual fund performance, analysing risk and return factors, and
understanding the impact of market fluctuations on mutual fund investments.
2. Emerging Trends in the Mutual Fund Industry: Through this project, I delved into the
latest trends and innovations in the mutual fund industry, including technological
advancements and changing investor preferences.
3. Macroeconomic Factors Affecting the Market: This project enabled me to comprehend
the influence of macroeconomic variables on the financial market, such as interest
rates, inflation, and economic growth
I would also like to express my heartfelt thanks to my friends and family for their
unwavering support and encouragement throughout this internship journey.In conclusion,
this summer internship has been an exceptional learning experience, offering me invaluable

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exposure to the financial sector and mutual fund industry. The knowledge and skills acquired
during this period will undoubtedly have a profound impact on my academic and
professional growth.

The signature of IIEBM Faculty Guide

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vii
 TABLE OF CONTENT

CHAPTER INDEX PAGE NO.

NO.
Student Declaration i.
Certificate from company mentor ii.
Acknowledgement iii.
Certificate from the Institute iv.
List of tables v.
List of charts/graphs/figures vi.
Executives’ summary vii.
1 Introduction
2 Company profile
3 Review of literature
4 Research Methodology
5 Data analysis and interpretation
6 Findings, suggestions and conclusion
References
Appendices
Questionnaire
Daily Work Log
Weekly Progress Report

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 1.

EXECUTIVE SUMMARY

During my summer internship at Bajaj Finance Ltd., I delved into a comprehensive

examination of mutual fund performance, identified emerging trends within the mutual fund
industry, and explored the impact of macroeconomic factors on the financial market. This
report serves as a succinct overview of the projects and their outcomes, contributing to a
deeper comprehension of the dynamics within the financial sector. Throughout the
internship, I had the opportunity to analyse various mutual fund schemes, assessing their
returns and risks, and gained valuable insights into the industry's current and potential future
trends. Moreover, the study explored the influence of macroeconomic variables, such as
interest rates and inflation, on the overall market conditions. The findings provide
meaningful implications for investors, financial institutions, and regulatory authorities alike,
fostering informed decision-making and fostering growth within the mutual fund domain.
This enriching internship experience has not only broadened my understanding of the
financial sector but also prepared me for a promising career in the realm of mutual fund
investments.

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 Performance analysis of mutual funds and emerging trends in the industry.
CHAPTER-I: INTRODUCTION
1.1 Introduction

This chapter gives a brief introduction and a background description concerning the
history of mutual funds and their increased importance in the Indian market. It further
explores the existing literature and discusses the framework of present study,
including its objectives, research design, limitations and chapter scheme.

WHAT ARE MUTUAL FUNDS?

A mutual fund is a collective investment vehicle that collects & pools money from a
number of investors and invests the same in equities, bonds, government securities,
money market instruments.
The money collected in mutual fund scheme is invested by professional fund managers in
stocks and bonds etc. in line with a scheme’s investment objective. The income / gains
generated from this collective investment scheme are distributed proportionately amongst
the investors, after deducting applicable expenses and levies, by calculating a scheme’s
“Net Asset Value” or NAV. In return, mutual fund charges a small fee.
In short, mutual fund is a collective pool of money contributed by several investors and
managed by a professional Fund Manager.
Mutual Funds in India are established in the form of a Trust under Indian Trust Act,
1882, in accordance with SEBI (Mutual Funds) Regulations, 1996.
The fees and expenses charged by the mutual funds to manage a scheme are regulated
and are subject to the limits specified by SEBI.

HOW A MUTUAL FUND WORKS?

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One should avoid the temptation to review the fund's performance each time the market
falls or jumps up significantly. For an actively-managed equity scheme, one must have
patience and allow reasonable time - between 18 and 24 months - for the fund to generate
returns in the portfolio.
When you invest in a mutual fund, you are pooling your money with many other
investors. Mutual fund issues “Units” against the amount invested at the prevailing NAV.
Returns from a mutual fund may include income distributions to investors out of
dividends, interest, capital gains or other income earned by the mutual fund. You can also
have capital gains (or losses) if you sell the mutual fund units for more (or less) than the
amount you invested.

Mutual funds are ideal for investors who –

a. lack the knowledge or skill / experience of investing in stock markets directly.

b. want to grow their wealth, but do not have the inclination or time to research the stock
market.
c. wish to invest only small amounts.

WHY INVEST IN MUTUAL FUNDS?

As investment goals vary from person to person – post-retirement expenses, money for
children’s education or marriage, house purchase, etc. – the investment products required
to achieve these goals too vary. Mutual funds provide certain distinct advantages over
investing in individual securities. Mutual funds offer multiple choices for investment
across equity shares, corporate bonds, government securities, and money market
instruments, providing an excellent avenue for retail investors to participate and benefit
from the uptrends in capital markets. The main advantages are that you can invest in a
variety of securities for a relatively low cost and leave the investment decisions to a
professional manager.

TYPES OF MUTUAL FUND SCHEMES

MUTUAL FUND SCHEME CLASSIFICATION

Mutual funds come in many varieties, designed to meet different investor goals. Mutual
funds can be broadly classified based on –
1. Organisation Structure – Open ended, Close ended, Interval
2. Management of Portfolio – Actively or Passively
3. Investment Objective – Growth, Income, Liquidity
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4. Underlying Portfolio – Equity, Debt, Hybrid, Money market instruments, Multi Asset
5. Thematic / solution oriented – Tax saving, Retirement benefit, Child welfare,
Arbitrage
6. Exchange Traded Funds
7. Overseas funds
8. Fund of funds

SCHEME CLASSIFICATION BY ORGANIZATION STRUCTURE

• Open-ended schemes are perpetual, and open for subscription and repurchase on a
continuous basis on all business days at the current NAV.
• Close-ended schemes have a fixed maturity date. The units are issued at the time of the
initial offer and redeemed only on maturity. The units of close-ended schemes are
mandatorily listed to provide exit route before maturity and can be sold/traded on the
stock exchanges.
• Interval schemes allow purchase and redemption during specified transaction periods
(intervals). The transaction period has to be for a minimum of 2 days and there should be
at least a 15-day gap between two transaction periods. The units of interval schemes are
also mandatorily listed on the stock exchanges.

SCHEME CLASSIFICATION BY PORTFOLIO MANAGEMENT

Active Funds
In an Active Fund, the Fund Manager is ‘Active’ in deciding whether to Buy, Hold, or
Sell the underlying securities and in stock selection. Active funds adopt different
strategies and styles to create and manage the portfolio.
 The investment strategy and style are described upfront in the Scheme Information
document (offer document)
 Active funds expect to generate better returns (alpha) than the benchmark index.
 The risk and return in the fund will depend upon the strategy adopted.
 Active funds implement strategies to ‘select’ the stocks for the portfolio.
Passive Funds
Passive Funds hold a portfolio that replicates a stated Index or Benchmark e.g. –
 Index Funds
 Exchange Traded Funds (ETFs)
In a Passive Fund, the fund manager has a passive role, as the stock selection / Buy,
Hold, sell decision is driven by the Benchmark Index and the fund manager / dealer
merely needs to replicate the same with minimal tracking error.

ACTIVE V/S PASSIVE FUNDS

Active Fund –
 Rely on professional fund managers who manage investments.
 Aim to outperform Benchmark Index
 Suited for investors who wish to take advantage of fund managers' alpha generation
potential.
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 Passive Funds –
 Investment holdings mirror and closely track a benchmark index, e.g., Index Funds or
Exchange Traded Funds (ETFs)
 Suited for investors who want to allocate exactly as per market index.
 Lower Expense ratio hence lower costs to investors and better liquidity

CLASSIFICATION BY INVESTMENT OBJECTIVES

Mutual funds offer products that cater to the different investment objectives of the
investors such as –
a. Capital Appreciation (Growth)
b. Capital Preservation
c. Regular Income
d. Liquidity
e. Tax-Saving
Mutual funds also offer investment plans, such as Growth and Dividend options, to help
tailor the investment to the investors’ needs.

GROWTH FUNDS
 Growth Funds are schemes that are designed to provide capital appreciation.
 Primarily invest in growth-oriented assets, such as equity
 Investment in growth-oriented funds require a medium to long-term investment
horizon.
 Historically, Equity as an asset class has outperformed most other kind of investments
held over the long term. However, returns from Growth funds tend to be volatile over
the short-term since the prices of the underlying equity shares may change.
 Hence investors must be able to take volatility in the returns in the short-term.

INCOME FUNDS
 The objective of Income Funds is to provide regular and steady income to investors.
 Income funds invest in fixed income securities such as Corporate Bonds, Debentures
and Government securities.
 The fund’s return is from the interest income earned on these investments as well as
capital gains from any change in the value of the securities.
 The fund will distribute the income provided the portfolio generates the required
returns. There is no guarantee of income.
 The returns will depend upon the tenor and credit quality of the securities held.

LIQUID / OVERNIGHT /MONEY MARKET MUTUAL FUNDS

 Liquid Schemes, Overnight Funds and Money market mutual fund are investment
options for investors seeking liquidity and principal protection, with commensurate
returns.
– The funds invest in money market instruments* with maturities not exceeding 91
days.

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 – The return from the funds will depend upon the short-term interest rate prevalent in
the market.
 These are ideal for investors who wish to park their surplus funds for short periods.
– Investors who use these funds for longer holding periods may be sacrificing better
returns possible from products suitable for a longer holding period.

* Money Market Instruments includes commercial papers, commercial bills, treasury

bills, Government securities having an unexpired maturity up to one year, call or
notice money, certificate of deposit, usance bills, and any other like instruments as
specified by the Reserve Bank of India from time to time.

CLASSIFICATION BY INVESTMENT PORTFOLIO

 Mutual fund products can be classified based on their underlying portfolio
composition
– The first level of categorization will be on the basis of the asset class the fund invests
in, such as equity / debt / money market instruments or gold.
– The second level of categorization is on the basis of strategies and styles used to
create the portfolio, such as, Income fund, Dynamic Bond Fund, Infrastructure fund,
Large-cap/Mid-cap/Small-cap Equity fund, Value fund, etc.
– The portfolio composition flows out of the investment objectives of the scheme.

Importance of Mutual Funds

 Mutual funds play a pivotal role in the financial markets, providing an accessible and
diversified investment avenue for individuals and institutions.
 With a pool of funds from multiple investors, mutual funds are managed by
professionals, offering convenience and expertise to investors.
 The ability to invest in various asset classes, such as equities, bonds, and money
market instruments, makes mutual funds a versatile investment option.

ADVANTAGES OF INVESTING IN MUTUAL FUNDS

1. Professional Management — Investors may not have the time or the required knowledge
and resources to conduct their research and purchase individual stocks or bonds. A mutual
fund is managed by full-time, professional money managers who have the expertise,
experience and resources to actively buy, sell, and monitor investments. A fund manager
continuously monitors investments and rebalances the portfolio accordingly to meet the
scheme’s objectives. Portfolio management by professional fund managers is one of the most
important advantages of a mutual fund.
2. Risk Diversification — Buying shares in a mutual fund is an easy way to diversify your
investments across many securities and asset categories such as equity, debt and gold, which
helps in spreading the risk - so you won't have all your eggs in one basket. This proves to be
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beneficial when an underlying security of a given mutual fund scheme experiences market
headwinds. With diversification, the risk associated with one asset class is countered by the
others. Even if one investment in the portfolio decreases in value, other investments may not
be impacted and may even increase in value. In other words, you don’t lose out on the entire
value of your investment if a particular component of your portfolio goes through a turbulent
period. Thus, risk diversification is one of the most prominent advantages of investing in
mutual funds.
3. Affordability & Convenience (Invest Small Amounts) — For many investors, it could be
more costly to directly purchase all of the individual securities held by a single mutual fund.
By contrast, the minimum initial investments for most mutual funds are more affordable.
4. Liquidity — You can easily redeem (liquidate) units of open ended mutual fund schemes
to meet your financial needs on any business day (when the stock markets and/or banks are
open), so you have easy access to your money. Upon redemption, the redemption amount is
credited in your bank account within one day to 3-4 days, depending upon the type of
scheme e.g., in respect of Liquid Funds and Overnight Funds, the redemption amount is paid
out the next business day.

However, please note that units of close-ended mutual fund schemes can be redeemed only
on maturity. Likewise, units of ELSS have a 3-year lock-in period and can be liquidated only
thereafter.
5. Low Cost — An important advantage of mutual funds is their low cost. Due to huge
economies of scale, mutual funds schemes have a low expense ratio. Expense ratio represents
the annual fund operating expenses of a scheme, expressed as a percentage of the fund’s
daily net assets. Operating expenses of a scheme are administration, management,
advertising related expenses, etc. The limits of expense ratio for various types of schemes
have been specified under Regulation 52 of SEBI Mutual Fund Regulations, 1996.
6. Well-Regulated — Mutual Funds are regulated by the capital markets regulator, Securities
and Exchange Board of India (SEBI) under SEBI (Mutual Funds) Regulations, 1996. SEBI
has laid down stringent rules and regulations keeping investor protection, transparency with
appropriate risk mitigation framework and fair valuation principles.
7. Tax Benefits —Investment in ELSS up to ₹1,50,000 qualifies for tax benefit under section
80C of the Income Tax Act, 1961. Mutual Fund investments when held for a longer term are
tax efficient.

RISK FACTORS
STANDARD RISK FACTORS
 Mutual Fund Schemes are not guaranteed or assured return products.

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  Investment in Mutual Fund Units involves investment risks such as trading volumes,
settlement risk, liquidity risk, default risk including the possible loss of principal.
 As the price / value / interest rates of the securities in which the Scheme invests
fluctuates, the value of investment in a mutual fund Scheme may go up or down.
 In addition to the factors that affect the value of individual investments in the Scheme,
the NAV of the Scheme may fluctuate with movements in the broader equity and bond
markets and may be influenced by factors affecting capital and money markets in
general, such as, but not limited to, changes in interest rates, currency exchange rates,
changes in Government policies, taxation, political, economic or other developments
and increased volatility in the stock and bond markets.
 Past performance does not guarantee future performance of any Mutual Fund Scheme.
SPECIFIC RISK FACTORS
RISKS ASSOCIATED WITH INVESTMENTS IN EQUITIES

Risk of losing money:

Investments in equity and equity related instruments involve a degree of risk and investors
should not invest in the equity schemes unless they can afford to take the risk of possible loss
of principal.
Price Risk:
Equity shares and equity related instruments are volatile and prone to price fluctuations on a
daily basis.
Liquidity Risk for listed securities:
The liquidity of investments made in the equities may be restricted by trading volumes and
settlement periods. Settlement periods may be extended significantly by unforeseen
circumstances. While securities that are listed on the stock exchange carry lower liquidity
risk, the ability to sell these investments is limited by the overall trading volume on the stock
exchanges. The inability of a mutual fund to sell securities held in the portfolio could result
in potential losses to the scheme, should there be a subsequent decline in the value of
securities held in the scheme portfolio and may thus lead to the fund incurring losses till the
security is finally sold.
Event Risk:
Price risk due to company or sector specific event.
RISKS ASSOCIATED WITH INVESTMENT IN DEBT SECURITIES AND MONEY
MARKET INSTRUMENTS
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Debt Securities are subject to the risk of an issuer’s inability to meet principal and interest
payments on the obligation (Credit Risk) on the due date(s) and may also be subject to price
volatility due to such factors as interest rate sensitivity, market perception of the
creditworthiness of the issuer and general market liquidity (Market Risk).
The timing of transactions in debt obligations, which will often depend on the timing of the
Purchases and Redemptions in the Scheme, may result in capital appreciation or depreciation
because the value of debt obligations generally varies inversely with the prevailing interest
rates.
Interest Rate Risk
Market value of fixed income securities is generally inversely related to interest rate
movement. Generally, when interest rates rise, prices of existing fixed income securities fall
and when interest rates drop, such prices increase. Accordingly, value of a scheme portfolio
may fall if the market interest rate rises and may appreciate when the market interest rate
comes down. The extent of fall or rise in the prices depends upon the coupon and maturity of
the security. It also depends upon the yield level at which the security is being traded.

Credit Risk
This is risk associated with default on interest and /or principal amounts by issuers of fixed
income securities. In case of a default, scheme may not fully receive the due amounts and
NAV of the scheme may fall to the extent of default. Even when there is no default, the price
of a security may change with expected changes in the credit rating of the issuer. It may be
mentioned here that a government security is a sovereign security and is safer. Corporate
bonds carry a higher amount of credit risk than government securities. Within corporate
bonds also there are different levels of safety and a bond rated higher by a rating agency is
safer than a bond rated lower by the same rating agency.
Spread Risk
Credit spreads on corporate bonds may change with varying market conditions. Market value
of debt securities in portfolio may depreciate if the credit spreads widen and vice versa.
Similarly, in case of floating rate securities, if the spreads over the benchmark security /
index widen, then the value of such securities may depreciate.
Liquidity Risk
Liquidity risk refers to the ease with which securities can be sold at or near its valuation
yield-to-maturity (YTM) or true value. Liquidity condition in market varies from time to
time. The liquidity of a bond may change, depending on market conditions leading to
changes in the liquidity premium attached to the price of the bond. In an environment of tight
liquidity, necessity to sell securities may have higher than usual impact cost. Further,
liquidity of any particular security in portfolio may lessen depending on market condition,
requiring higher discount at the time of selling.
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The primary measure of liquidity risk is the spread between the bid price and the offer price
quoted by a dealer. Trading volumes, settlement periods and transfer procedures may restrict
the liquidity of some of these investments. Different segments of the Indian financial markets
have different settlement periods, and such periods may be extended significantly by
unforeseen circumstances. Further, delays in settlement could result in temporary periods
when a portion of the assets of the Scheme are not invested and no return is earned thereon or
the Scheme may miss attractive investment opportunities.
At the time of selling the security, the security may become illiquid, leading to loss in value
of the portfolio. The purchase price and subsequent valuation of restricted and illiquid
securities may reflect a discount, which may be significant, from the market price of
comparable securities for which a liquid market exists.
Counterparty Risk
This is the risk of failure of the counterparty to a transaction to deliver securities against
consideration received or to pay consideration against securities delivered, in full or in part
or as per the agreed specification. There could be losses to the fund in case of a counterparty
default.

Prepayment Risk
This arises when the borrower pays off the loan sooner than the due date. This may result in
a change in the yield and tenor for the mutual fund scheme. When interest rates decline,
borrowers tend to pay off high interest loans with money borrowed at a lower interest rate,
which shortens the average maturity of Asset-backed securities (ABS). However, there is
some prepayment risk even if interest rates rise, such as when an owner pays off a mortgage
when the house is sold or an auto loan is paid off when the car is sold. Since prepayment risk
increases when interest rates decline, this also introduces reinvestment risk, which is the risk
that the principal may only be reinvested at a lower rate.
Re-investment Risk
Investments in fixed income securities carry re-investment risk as the interest rates prevailing
on the coupon payment or maturity dates may differ from the original coupon of the bond
(the purchase yield of the security). This may result in final realized yield to be lower than
that expected at the time
The additional income from reinvestment is the "interest on interest" component. There may
be a risk that the rate at which interim cash flows can be reinvested are lower than that
originally assumed.
Importance of performance analysis:
Performance analysis of mutual funds holds significant importance for various stakeholders
in the financial industry. Let's explore the key reasons why performance analysis is crucial:

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1. Informed Investment Decisions: Performance analysis provides investors with critical
information about the historical returns and risk profiles of mutual funds. This data helps
investors make well-informed decisions when selecting funds that align with their investment
objectives and risk tolerance.
2. Assessing Fund Manager's Skill: Performance analysis allows investors to evaluate the
fund manager's ability to generate consistent returns over time. It helps determine if the fund
manager's strategies and decisions have been effective in achieving the fund's objectives.
3. Risk-Return Evaluation: Investors can use performance analysis to understand the risk-
return trade-off of mutual funds. Funds with higher returns often come with higher levels of
risk. By assessing past performance, investors can better comprehend the level of risk they
are willing to take for potential rewards.
4. Comparing Fund Performance: Performance analysis enables investors to compare the
performance of various mutual funds within the same category or against benchmark indices.
This comparison assists investors in selecting the most suitable fund for their investment
needs.
5. Portfolio Monitoring: Regular performance analysis allows investors to monitor their
mutual fund investments effectively. By tracking fund performance, investors can make
necessary adjustments to their portfolios based on changing market conditions and financial
goals.
6. Long-Term Planning: Performance analysis provides valuable insights for long-term
financial planning. By examining a fund's performance over different market cycles,
investors can gain confidence in their investment strategies and align them with their long-
term goals.
7. Regulatory Compliance: Many regulatory authorities require mutual funds to disclose
their performance data to ensure transparency and protect investor interests. Performance
analysis helps verify compliance with these regulations.
8. Transparency and Accountability: Performance analysis adds transparency and
accountability to the mutual fund industry. Fund managers are accountable for the returns
they deliver to investors, and performance analysis helps investors hold fund managers
responsible for their actions.
9. Identifying Market Trends: Performance analysis allows investors to identify trends and
patterns in mutual fund performance under different market conditions. This information can
guide investors in making strategic decisions during various economic scenarios.
10. Performance Benchmarking: Performance analysis helps in setting performance
benchmarks for mutual funds. Fund managers and investors can compare a fund's
performance against its peers and relevant benchmarks to gauge its relative performance.
11. Risk Management: Performance analysis aids in evaluating a fund's risk management
strategies. By understanding a fund's historical performance during market downturns,
investors can assess how well it has managed risks during adverse conditions.
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12. Investor Education: Performance analysis serves as an educational tool for investors.
Understanding the various performance metrics and factors influencing mutual fund returns
empowers investors to make better investment decisions and navigate the complexities of the
financial markets.
In conclusion, performance analysis of mutual funds is vital for making informed investment
decisions, assessing fund manager competence, monitoring portfolio performance, and
meeting regulatory requirements. It plays a crucial role in helping investors achieve their
financial goals and manage risks effectively, making it an indispensable aspect of the mutual
fund industry.
EVALUATION FACTORS TO CONSIDER
 HISTORICAL RETURNS OVER DIFFERENT TIME PERIODS
 RISK-ADJUSTED RETURNS
 COMPARING TO BENCHMARK INDEXES
 EXPENSE RATIO ANALYSIS

1. Historical Returns over Different Time Periods: Historical returns refer to the past
performance of a mutual fund over specific time periods, such as one year, three years, five
years, or even longer. Analysing historical returns allows investors to see how the fund has
performed in various market conditions and economic cycles. This evaluation provides
insights into the fund's ability to generate consistent returns and helps investors gauge the
fund's performance over different investment horizons.
2. Risk-Adjusted Returns: Risk-adjusted returns take into account the level of risk a mutual
fund has taken to achieve its returns. Simply looking at raw returns may not provide a
complete picture of a fund's performance, as higher returns may come with higher levels of
risk. Risk-adjusted metrics, such as the Sharpe ratio or the Treynor ratio, factor in the fund's
volatility and assess how well it has performed relative to the risk it has undertaken.
Investors use these metrics to compare funds and choose those that offer the best risk-
adjusted returns.
3. Comparing to Benchmark Indexes: Benchmark indexes represent a market or a specific
segment of the market against which the performance of a mutual fund can be compared.
Funds often have specific benchmark indexes that reflect their investment focus. Comparing
a fund's performance to its benchmark index provides insights into how well the fund has
outperformed or underperformed its target market. Outperformance against the benchmark
may indicate skilled fund management, while underperformance may prompt investors to
reevaluate their investment choices.
4. Expense Ratio Analysis: The expense ratio is the annual cost investors pay to own a
mutual fund and covers the fund's operating expenses. It includes management fees,
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administrative costs, and other charges. A low expense ratio is generally more favourable, as
it means that a larger portion of the investment returns goes to the investor. High expense
ratios can eat into returns and may impact the fund's overall performance over time. Expense
ratio analysis is essential for cost-conscious investors who seek to maximize their investment
returns.
In summary, performance analysis of mutual funds involves assessing their historical returns,
risk-adjusted performance, benchmark comparison, and expense ratio analysis. These factors
collectively provide valuable insights into the fund's past performance, its ability to manage
risk, how it compares to its peers or benchmark, and the impact of fees on the fund's overall
returns. Investors can use this information to make informed decisions and build a well-
structured investment portfolio that aligns with their financial goals and risk tolerance.

EMERGING TRENDS IN THE MUTUAL FUND INDUSTRY

• Increasing Popularity of Passive Investing
• Artificial Intelligence (AI) and Big Data Analytics
• Sustainable Investing
• Growth of Robo-Advisory Services
• Increasing Adoption of Digital Platforms

1. Increasing Popularity of Passive Investing:

Passive investing involves building a portfolio that closely mirrors a market index rather than
actively selecting individual securities. Exchange-Traded Funds (ETFs) and index funds are
common examples of passive investment vehicles. The popularity of passive investing has
grown significantly due to its lower fees, tax efficiency, and simplicity. Investors are
increasingly drawn to passive funds, especially in efficient and well-established markets, as
they seek to achieve market returns without the need for active stock picking.
2. Artificial Intelligence (AI) and Big Data Analytics:
AI and big data analytics are revolutionizing the mutual fund industry. Fund managers and
financial institutions leverage AI algorithms to analyse vast amounts of data and extract
insights that inform investment decisions. AI-powered systems can identify patterns, trends,
and correlations in financial data, aiding in stock selection, risk management, and portfolio
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optimization. Big data analytics help fund managers gain a deeper understanding of market
dynamics and investor behaviour, enabling more informed and data-driven investment
strategies.
3. Sustainable Investing:
Sustainable investing, also known as Environmental, Social, and Governance (ESG)
investing, has gained significant traction in recent years. Investors are increasingly seeking
investments that align with their values and focus on companies with strong ESG practices.
Funds incorporating ESG criteria aim to support environmentally and socially responsible
businesses while seeking to generate financial returns. As environmental and social concerns
grow, sustainable investing is becoming a crucial aspect of the mutual fund industry.
4. Growth of Robo-Advisory Services:
Robo-advisors are automated investment platforms that use algorithms to create and manage
investment portfolios based on individual investors' goals and risk profiles. These platforms
offer cost-effective, accessible, and personalized investment solutions. Robo-advisors appeal
to tech-savvy and cost-conscious investors seeking simplified investment processes and
financial advice. The rise of robo-advisory services has democratized investing, making it
accessible to a broader range of investors.

5. Increasing Adoption of Digital Platforms:

The mutual fund industry is embracing digital transformation, with firms increasingly
adopting digital platforms to enhance customer experiences and streamline operations.
Digital platforms enable investors to access and manage their funds online, facilitating faster
transactions, real-time portfolio tracking, and seamless communication with fund providers.
Moreover, digital platforms improve customer engagement and empower investors with tools
and resources to make more informed investment decisions.

In conclusion, the mutual fund industry is experiencing dynamic changes due to emerging
trends. Passive investing, driven by ETFs and index funds, provides cost-effective and
simplified investment options. AI and big data analytics are transforming how fund managers
analyse data and make investment decisions. Sustainable investing aligns financial goals with
environmental and social responsibility. Robo-advisory services offer automated and
personalized investment advice. Finally, the increasing adoption of digital platforms
enhances investor experiences and operational efficiency in the mutual fund industry. These
trends shape the future of mutual fund investing, catering to the evolving preferences and
expectations of investors.

1.2 Importance of the study:

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The study of performance analysis of mutual funds and its emerging trends in the
industry holds immense importance for various stakeholders:

1. Investors: For individual and institutional investors, understanding the performance

analysis of mutual funds is crucial for making informed investment decisions. By
evaluating past performance, risk-adjusted returns, and benchmark comparisons,
investors can identify funds that align with their financial goals and risk tolerance.
Additionally, awareness of emerging trends helps investors stay ahead of market
developments and capitalize on new opportunities.

2. Fund Managers: Performance analysis provides fund managers with valuable insights
into the effectiveness of their investment strategies. It allows them to assess the success
of their stock picking, asset allocation, and risk management approaches. Studying
emerging trends helps fund managers identify shifts in investor preferences and market
dynamics, enabling them to adapt their strategies to meet evolving demands.

3. Regulators and Compliance Bodies: Regulators monitor the performance of mutual

funds to ensure transparency, accountability, and investor protection. Performance
analysis assists regulators in verifying compliance with industry standards and

identifying funds that may require further scrutiny. Understanding emerging trends
allows regulators to respond proactively to changes in the industry landscape.
4. Financial Advisors and Consultants: Financial advisors rely on performance analysis to
provide objective advice to their clients. A comprehensive understanding of historical
returns and risk metrics helps advisors recommend suitable funds based on their clients'
financial objectives and risk appetite. Knowledge of emerging trends enables advisors to
stay relevant and offer innovative investment solutions.

5. Academia and Researchers: Academic researchers study the performance analysis of

mutual funds to contribute to the existing body of knowledge on finance and investment.
Their research helps uncover patterns, identify factors that contribute to fund
performance, and explore the impact of emerging trends on the industry.

6. Industry Professionals and Analysts: Professionals working in the financial industry,

including analysts and portfolio managers, rely on performance analysis to assess fund
performance and guide their investment decisions. Understanding emerging trends helps
industry professionals anticipate market changes and develop forward-looking strategies.

7. Overall Market Efficiency and Stability: A robust performance analysis of mutual

funds enhances market efficiency and stability. Investors can allocate their capital to
funds with proven track records, leading to better allocation of resources and a more
efficient market.

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 8. Innovation and Progress: Studying emerging trends in the mutual fund industry fosters
innovation and progress. It encourages the development of new investment products,
technologies, and sustainable investment practices. This innovation drives positive
changes in the industry, benefiting both investors and the broader financial ecosystem.

In conclusion, the study of performance analysis of mutual funds and its emerging trends
is essential for investors, fund managers, regulators, financial advisors, researchers, and
industry professionals. It contributes to better decision-making, market efficiency, and
innovation within the mutual fund industry, ultimately enhancing the overall financial
landscape and investor outcomes.

1.3 The research problem:

The topic "Performance analysis of mutual funds and its emerging trends in the industry" is
to assess and understand the factors that contribute to the performance of mutual funds and to
identify the impact of emerging trends on the mutual fund industry.
Specifically, the research problem may encompass the following aspects:
1. Performance Factors: Investigating the key factors that influence the performance of
mutual funds, such as asset allocation, fund manager skill, expense ratios, turnover,
and the impact of market conditions on returns.
2. Risk-Adjusted Performance: Analysing the risk-adjusted performance of mutual funds
to determine if funds are generating returns commensurate with the level of risk taken.
3. Benchmark Comparison: Assessing how mutual funds perform relative to their
benchmark indexes and identifying the reasons for any over or underperformance.
4. Impact of Emerging Trends: Understanding the implications of emerging trends in the
mutual fund industry, such as the increasing popularity of passive investing, AI and
big data analytics, sustainable investing, robo-advisory services, and digital platforms.
5. Investor Behaviour: Exploring how investor behaviour and preferences influence fund
performance and how the adoption of emerging trends affects investor decisions.

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 6. Performance Persistence: Investigating whether past performance of mutual funds is
indicative of future performance, and if certain funds consistently outperform their
peers.
7. ESG Integration: Examining how ESG criteria are incorporated into investment
decisions and the impact of sustainable investing on fund performance.
8. Managerial Implications: Identifying the implications of performance analysis and
emerging trends for fund managers, regulators, financial advisors, and other industry
stakeholders.
Overall, the research problem seeks to provide insights into the performance dynamics of
mutual funds, highlight the significance of various factors, and shed light on the effects of
emerging trends on the industry. The research aims to contribute to the understanding of
mutual fund performance and guide investors and industry professionals in making informed
decisions.

COMPANY PROFILE

Bajaj Finance Limited (BFL) is a prominent Indian non-banking financial company (NBFC)
that operates under the umbrella of Bajaj Finserv Ltd. The company is registered with the
Reserve Bank of India (RBI) as a deposit-taking NBFC (NBFC-D) and is classified as an
NBFC-Investment and Credit Company (NBFC-ICC). Headquartered in Pune, Bajaj Finance
has established itself as a leading player in the NBFC sector in India, catering to a diverse
range of customers across the country.
History and Background:
Originally incorporated as Bajaj Auto Finance Limited on March 25, 1987, the company
primarily focused on providing financing for two and three-wheelers. Over the years, Bajaj
Auto Finance expanded its operations and ventured into the consumer durables finance
sector, offering small-size loans at zero interest rates. With the passage of time, Bajaj Auto
Finance further diversified its portfolio, offering loans for businesses and property as well. In
2010, the company underwent a name change to Bajaj Finance Limited to better reflect its
broadened scope of operations and services.
Business Activities:

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Bajaj Finance Limited is engaged in the business of lending and acceptance of deposits. The
company has developed a diverse lending portfolio catering to various segments of the
market, including retail, small and medium-sized enterprises (SMEs), and commercial
customers. Bajaj Finance offers a wide array of financial products and services to meet the
diverse needs of its customers.
Retail Finance:
Under the retail finance category, Bajaj Finance provides a comprehensive range of finance
options for consumers to purchase lifestyle and digital products. This includes durable
finance for household items such as washing machines, refrigerators, and TVs, as well as
lifestyle finance for products like fashion, travel, and healthcare. The company also offers
digital product finance for electronics and mobile products, along with an EMI card that
allows customers to shop on easy instalments at partner stores.
Two and Three-Wheeler Finance:
Bajaj Finance facilitates vehicle loans for the purchase of Bajaj motorcycles and RE three-
wheelers through its network of showrooms and authorized service stations.
Personal Loans and Loans against FDs:
For individuals in need of funds, Bajaj Finance offers personal loans without the requirement
for collateral. Additionally, the company provides loans against Fixed Deposits (FDs) at
attractive interest rates, making it easier for customers to access finance when needed.

Home Loans and Loan against Property:

Bajaj Finance extends home loans up to significant amounts, providing added features like
top-up loans and doorstep services. The company also offers loans against property to
support the financial needs of its customers.
SME Finance:
Bajaj Finance serves the small and medium-sized enterprise (SME) segment by offering
convenient and quick SME loans. These loans are tailor-made to help businesses maintain a
healthy cash flow and address their critical working capital requirements.
Commercial Lending:
The commercial lending arm of Bajaj Finance provides credit solutions to established
businesses to enhance their working capital and support growth. This includes vendor
financing, lease rental discounting, loans against securities, and other financing options.
Rural Lending:
Recognizing the importance of empowering rural residents, Bajaj Finance offers specialized
lending services in rural areas. The company caters to the financing needs of rural customers
with services such as gold loans and loans against vehicles. Additionally, Bajaj Finance

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assists rural customers with their financial needs related to agriculture, business, and legal
matters.
Investment:
Bajaj Finance also offers investment options, including Fixed Deposits and Mutual Funds,
allowing customers to build a corpus of funds over time and grow their savings.
Partnerships & Services:
Bajaj Finance Limited has leveraged the power of big data and AI to collaborate with various
companies and deliver comprehensive plans to its customers. The company's successful
partnerships focus on persistent business needs, helping to cut costs, increase revenue,
empower customers, and improve their overall experience.
Financial Highlights (FY 2022):
 Revenue: ₹17,090 crore (US$2.1 billion)
 Operating income: ₹9,510 crore (US$1.2 billion)
 Net income: ₹7,030 crore (US$880 million)
 Assets Under Management (AUM): ₹270,050 crore (US$34 billion)
 Total assets: ₹138,003.57 crore (US$17 billion)

Stock Performance:
Bajaj Finance's stock performance has been impressive, outperforming the market and
delivering significant returns to its investors. Over the past three years, the company's stock
has recorded a return of 129.7%, surpassing the Nifty 100 index's return of 75.06%.
Future Growth and Strategies:
Bajaj Finance has laid out a long-term growth strategy that involves the introduction of
various online and offline products. The company recently launched its loan against property
(LAP) business for micro, small, and medium-sized enterprise (MSME) customers.
Furthermore, Bajaj Finance has plans to introduce new auto loans, microfinance, and tractor
financing in the coming quarters. These strategic initiatives aim to drive further growth and
expansion for the company.

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 REVIEW OF LITRATURE

As of July 29, 2023, there are some relevant sources that provide information about the
performance analysis of mutual funds. Here's a comprehensive review based on the provided
information:
1. Moneycontrol - Mutual Fund Category Performance: The provided information from
Moneycontrol presents the performance data of various mutual fund categories over
different time periods (1 year, 2 years, 3 years, and 5 years). The mutual fund
categories listed include Equity, Hybrid, and Debt funds. The data includes annual
returns for different types of funds within each category, such as Large Cap Funds,
Mid Cap Funds, Small Cap Funds, ELSS (Equity Linked Savings Scheme),
Sectoral/Thematic Funds, Value Funds, Focused Funds, and others. The returns range
from around 4% to 30% depending on the category and the time period considered.
2. ET Money - Best Mutual Funds to Invest in India 2023: The information from ET
Money highlights the importance of considering an investor's risk profile and time
horizon while selecting mutual funds. It emphasizes that there is no single best mutual
fund for everyone, as the choice should align with the individual's investment
objectives and risk tolerance. The article mentions different types of mutual funds
based on asset classes like Equity, Debt, and Hybrid funds, and suggests that investors
should match their goals with the specific investment objectives of the mutual fund
schemes. It also provides a list of top-performing mutual funds in different categories
(Equity, Debt, and Hybrid).
3. Economic Times - How Your Mutual Funds Performed After Budget 2023: The
Economic Times article discusses the performance of mutual funds on the budget day
of 2023. It mentions that most equity mutual fund categories were in the red on that
day, except for the technology fund category, which saw a gain of 0.67%. Debt mutual
funds, on the other hand, fared better and gained around 0.02-0.51% on the budget
day. The article points out that the stock market was likely to be under pressure due to

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 factors like the Adani saga and global economic concerns, while debt mutual funds
were expected to reward investors in 2023, partly because of the budget indicating a
check on the deficit and lower government borrowing plans.
The information from the provided sources gives a glimpse of the performance analysis of
mutual funds in different categories over various time periods. However, for a
comprehensive literature review, it is essential to explore academic and research databases as
well as financial journals to gather more in-depth and rigorous analyses of mutual fund
performance over time. It would be prudent to include academic studies, expert opinions, and
analyses from reputable financial institutions to gain a comprehensive understanding of the
subject.

Emerging Trends in Mutual Funds: In addition to performance analysis, there have been
discussions on emerging trends within the mutual fund industry. These trends reflect the
changing dynamics and evolving landscape of the industry. Here are some potential
emerging trends identified in a paper titled "Emerging Mutual Fund Trends for 2021":
1. Asset class shift: Investors may shift their focus and allocate funds to different asset
classes based on market conditions and preferences. This trend highlights the
importance of understanding changing investment preferences and the impact on fund
flows.
2. Digital investing: The rise of digital technologies has transformed the way investors
access and manage their investments. The adoption of digital platforms and tools for
investing is expected to continue, providing investors with enhanced convenience and
access to a broader range of investment options.
3. Focus on fund management fees and costs: There is an increasing emphasis on cost
efficiency and transparency in the mutual fund industry. Investors are becoming more
aware of fees and costs associated with fund management and are seeking funds with
competitive fee structures.
4. ESG and passive funds: Environmental, Social, and Governance (ESG) factors have
gained prominence in investment decision-making. The integration of ESG
considerations into fund management practices, as well as the growing popularity of
passive funds, are emerging trends within the mutual fund industry.
5. Increased inter-regulatory coordination and industry consolidation: Regulatory bodies
and industry participants are working towards greater coordination to ensure the
stability and integrity of the mutual fund sector. Additionally, industry consolidation
through mergers and acquisitions is expected to shape the future landscape of the
mutual fund industry.

xxix
6. Allowing new entrants: There is a trend towards facilitating the entry of new
participants into the mutual fund industry. This could promote innovation,
competition, and diversity, ultimately benefiting investors with a broader range of
investment options.

Emerging factors effecting Indian market.

Two research papers have been examined to gain insights into the association
between selected macroeconomic variables and the stock market in India.
1. "The Impact of Macroeconomic Factors on the Nifty Auto Index": This paper
explores the relationship between various macroeconomic variables and the
Nifty Auto Index of the National Stock Exchange (NSE) during a period when
the Indian automotive sector experienced a significant decline in sales. The
study adopts the Autoregressive Distributed Lag (ARDL) co-integration
approach and conducts suitable diagnostic tests. The findings suggest that the
exchange rate has a significant negative relationship with the Nifty Auto Index
in the long run. Additionally, crude price, index of industrial production, and
repo rates are statistically significant determinants of the Nifty Auto Index.
Furthermore, the first lag of crude price is found to be a potential predictor of
the index in the short run. The study provides valuable implications for
researchers, corporations, portfolio managers, investors, and the government. It
is worth noting that there has been a lack of research exploring the association
between macroeconomic factors and Indian auto indices, making this study a
significant contribution to the literature.
2. "(PDF) Macroeconomic Factors and the Indian Stock Market: Exploring Long
and Short Run Relationships": This paper investigates the long and short run
relationships between selected macroeconomic indicators and stock market
returns in India. The study uses monthly data from July 2001 to July 2015, a
period that saw significant stock market reforms in the country. By employing
co-integration and error correction model (ECM), the research identifies a long-
run relationship between the BSE Sensex (a broader market index) and several
macroeconomic indicators, including Exchange Rate, Wholesale Price Index, T-
bill rates, and M3 (money supply). The presence of these long-run relationships
xxx
 suggests that macroeconomic indicators have an enduring influence on stock
market returns in India.
Overall, these two research papers highlight the importance of macroeconomic factors
in shaping the Indian market. The exchange rate, crude oil price, index of industrial
production, repo rates, wholesale price index, T-bill rates, and money supply are
among the critical macroeconomic variables influencing various aspects of the Indian
stock market. Additionally, it emphasizes the need for further research to understand
the dynamic relationship between macroeconomic factors and specific sectors of the
Indian economy, such as the automotive industry.

RESEARCH AND METHODELOGY

The purpose of the research methodology is to describe the research procedure. This includes
the overall design, the sampling procedure, the data collection method, and the analysis
procedures. This section is important because it is hard to discuss methodology without using
technical terms. This study was based on primary and secondary data. Distributing the
questionnaire to the respondents collected the data and using the Web, journals, articles,
blogs etc.
Research Design:
The research aims to conduct a comprehensive study of the performance analysis of mutual
funds and explore the impact of emerging trends in the mutual fund industry. The research
design will be a combination of quantitative and qualitative methods to gather data and
insights. The study will involve data analysis, literature review, and surveys or interviews
with industry professionals, fund managers, investors, and financial advisors.

Data Collection:
Historical Performance Data: Obtain historical returns, expense ratios, and other performance
metrics of a sample of mutual funds over different time periods from reliable sources such as
mutual fund databases and financial publications.

Benchmark Data:
Collect benchmark index data that aligns with the respective mutual funds to enable
comparison and benchmark analysis.

Literature Review:
Conduct an extensive review of academic research, industry reports, and relevant
publications to understand the existing body of knowledge on mutual fund performance
analysis and emerging trends in the industry.

Surveys and Interviews:

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Design and administer surveys to investors, fund managers, and financial advisors to gather
insights on their perspectives, preferences, and experiences related to mutual fund
performance and emerging trends. Conduct interviews with industry experts and
professionals to gain qualitative insights and opinions.

Data Analysis:
Performance Analysis: Use statistical tools and methods to analyse the historical
performance data of mutual funds. Calculate various performance metrics, including
annualized returns, standard deviation, Sharpe ratio, Treynor ratio, alpha, and beta.

Benchmark Comparison:
Compare the performance of mutual funds with their respective benchmark indexes to assess
relative performance.

Regression Analysis: Conduct regression analysis to explore the relationship between fund
performance and various factors, such as expense ratios, fund size, turnover, and manager
tenure.

Content Analysis: Perform content analysis on qualitative data from interviews and surveys
to identify recurring themes and insights.

Emerging Trends Analysis:

Identification of Emerging Trends: Identify and analyse emerging trends in the mutual
fund industry, such as passive investing, AI and big data analytics, sustainable investing,
robo-advisory services, and digital platforms.

Trend Impact Assessment: Evaluate the impact of these emerging trends on mutual fund
performance, investor behaviour, fund management practices, and overall industry dynamics.

Limitations and Delimitations:

Acknowledge and address any potential limitations of the research, such as sample size
constraints, data availability, and potential biases in survey responses. Delimit the scope of
the research to specific regions or types of mutual funds if necessary.

Ethical Considerations:
Ensure that the research adheres to ethical guidelines, including obtaining informed consent
from participants, maintaining confidentiality of data, and presenting findings in an unbiased
and transparent manner.

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 DATA ANALYSIS AND INTERPRETATION
Data Analysis for Performance Analysis of Mutual Funds:
Historical Returns: Analyse the historical returns of selected mutual funds over different
time periods, calculate annualized returns, and compare them with benchmark indexes.

Top Equity Funds AUM Annualised Returns (%) SIP Returns (%)
Launch Date
(Based on 5-year returns) (in ₹ Cr) 1 Yr. 3 Yrs. 5 Yrs. 5 Yr. 3 Yrs. 1 Yrs.
Multicap (Direct Plan-Growth Option)

Quant Active Fund 07-Jan-13 4851 23.83 38.33 23 27.59 21.56 15.64

NipponIndia Multi Cap

01-Jan-13 17665 32.8 36.94 17.55 23.88 28.59 31.57
Fund

Mahindra Manulife Multi

11-May-17 1869 25.78 30.99 19.1 23.08 20.9 25.04
Cap Fund

BarodaBNP Paribas Multi

02-Jan-13 1815 24.58 28.92 15.52 20.07 18.62 22.69
Cap Fund
Flexicap (Direct Plan-Growth Option)
HDFC Large and Mid Cap
01-Jan-13 9983 27.21 31.69 16.45 21.85 22.72 27.56
Fund
ICICI Prudential Large
01-Jan-13 8685 24.02 31.3 16.63 21.58 22.29 21.46
&Mid Cap Fund
Mahindra Manulife Large
30-Dec-19 1270 22.85 29.83 -- -- 19.55 23.34
& Mid Cap Fund
SBI Large & Midcap Fund 01-Jan-13 12822 26.12 29.72 16.83 20.68 20.4 20.51

Table-1.1- Historical annualised return & SIP return of different year of Mutual
Funds.

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Risk-Adjusted Returns: Evaluate the risk-adjusted performance of mutual funds using
Flexicap (Growth
option) Risk Measures
(For the month July)
Std.Dev Beta Sharpe Jenson
Kotak Flexicap Fund 14.87 (Slope)
0.98 0.09 -0.16
HDFC Flexi Cap Fund 15.92 0.97 0.12 0.49
UTI Flexi Cap Fund 16.87 1.05 0.08 -0.28
SBI Flexicap Fund 14.09 0.93 0.1 0
Aditya Birla Sun Life 14.54 0.95 0.1 -0.03
Flexi Cap Fund
ICICIPrudential Flexicap 13.71 0.84 0.04 0.29
Fund
Axis Flexi Cap Fund 14.95 0.95 0.07 -0.35
Franklin India Flexi Cap 15.82 1 0.11 0.19
Fund
Canara Robeco Flexi 13.92 0.91 0.1 -0.02
Cap Fund
Motilal Oswal Flexi 15.52 0.97 0.06 -0.58
Cap Fund
metrics such as Sharpe ratio and Treynor ratio to assess how well funds have performed
relative to the risks taken.
• Sharpe Ratio - It is calculated as the excess return of the fund.
• Std. Deviation- Measure of a fund's historical volatility or how much its returns
deviate from the average return.
• Jensen Ratio- A fund's excess return relative to its expected return based on its
beta.
• Beta (Slope)-indicates how much the fund's returns are likely to move
concerning the overall market.

Table- 1.2 Ratio for comparison

EXPENSE RATIOS:
Analyses the expense ratio of a mutual fund, as it directly impacts investors' returns. Lower
expense ratios are generally favorable for investors.
COMPARE EXPENSE RATIOS
 When analysing an expense ratio, compare it with similar funds or industry averages.
 Lower expense ratios are generally more favourable for investors.

xxxiv
  Actively-managed funds typically have higher expense ratios than passively-managed
index funds.
 Comparing expense ratios helps assess cost efficiency and identify funds aligned with
investment goals.

Name of company- Aditya Birla Sun Life Nippon India Growth Fund
Year- Apr-22 Apr-23 Apr-22 Apr-23
Name of funds Regular Direct Regular Direct Regular Direct Regular Direct
Equity Savings 2.14% 1.25% 2.35% 1.47% 1.96 1.04 1.73 1.05
Balanced Advantage 1.67% 1.17% 1.79% 0.46% - - - -
Large Cap Fund 1.57% 1.00% 1.73% 1.07% 1.7 0.23 1.78 1.02
Focused Fund 1.78% 1.06% 2.14% 1.18% 1.83 0.61 1.9 1.29
Flexi Cap Fund 1.56% 1.03% 1.68% 0.93% 1.96 0.07 1.91 0.78
Large & Mid Cap Fund 1.72% 1.14% 1.82% 1.16% 1.91 0.74 2.08 1.56
Sectoral/Thematic 1.88% 1.36% 1.93% 1.41% 1.04 0.2 0.98 0.7
NameMidofCap
AMC-
Fund 1.82% 1.02% Aditya
1.89%Birla1.32%
Sun Life 1.76
Mutual Funds
0.41 1.69 0.7
Small cap Fund 1.73% 0.98% 1.96% 1.19% 1.69 0.28 1.62 0.92
Year- Apr-23 Apr-22 Apr-21 Jul-20
Name of funds Regular Direct Regular Direct Regular Direct Regular Direct
Equity Savings 2.35% 1.47% 2.14% 1.25% 2.75% 1.40% 2.53% 1.61%
Balanced
1.79% 0.46% 1.67% 1.17%
Advantage 2.08% 0.81% 2.09% 0.99%
Large Cap Fund 1.73% 1.07% 1.57% 1.00% 1.72% 1.12% 1.85% 1.10%
Focused Fund 2.14% 1.18% 1.78% 1.06% 1.83% 1.10% 2.10% 1.11%
Flexi Cap Fund 1.68% 0.93% 1.56% 1.03% 1.71% 1.17% - -
Large & Mid Cap
1.82% 1.16% 1.72% 1.14%
Fund 2.16% 1.04% 2.07% 1.08%
Sectoral/Themati
1.93% 1.41% 1.88% 1.36%
c 2.13% 1.73% 2.07% 1.16%
Mid Cap Fund 1.89% 1.32% 1.82% 1.02% 2.01% 1.15% 2.29% 1.28%
Small cap Fund 1.96% 1.19% 1.73% 0.98% 2.33% 1.10% 2.38% 1.08%

Table-3 Expense Ratio for different company of different year.

EVALUATE HISTORICAL TRENDS

 Historical trend: The fund's expense ratio has been observed over the past
several years.
 Declining trend: Generally, the expense ratios have been decreasing over time.
 Insights into cost management: Monitoring the trend provides insights into how
the fund manages its costs.
 Commitment to value: The declining expense ratios reflect the fund's
commitment to delivering value to investors.
 Significance: Monitoring expense ratios helps assess the fund's cost efficiency
and potential impact on investment returns.
Table-4 Expense Ratio company of 4 years.
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Comparing to Benchmark Indices

Data Analysis for Emerging Trends in the Mutual Fund Industry:

Content Analysis: Analyse qualitative data from interviews and surveys to identify
emerging trends in the mutual fund industry, such as passive investing, AI, sustainable
investing, robo-advisory services, and digital platforms.
Adoption Rates: Determine the adoption rates of new trends in the industry and identify
which trends are gaining traction.
Impact on Performance: Examine how emerging trends have affected mutual fund
performance and investor preferences.
Industry Growth: Analyse data to understand the growth rate and market share of funds
related to emerging trends.
Customer Behaviour: Investigate how emerging trends influence customer behaviour, such
as changing investment preferences and increased use of digital platforms.

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FINDINGS SUGESSTIONS

xxxvii
CONCLUSION

xxxviii
REFERENCES

xxxix
APPENDICES

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QUESTIONNAIRE

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 DAILY WORK LOG

SR. NO. DATE Day DESCRIPTION OF WORK DONE

Introduction about company, introduced to
1 02-May-23 Tuesday
other interns
2 03-May-23 Wednesday Introduction to team Mutual Funds,
3 04-May-23 Thursday
4 05-May-23 Friday
5 06-May-23 Saturday
6 07-May-23 Sunday Holiday
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33 03-Jun-23 Saturday
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39 09-Jun-23 Friday
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74 14-Jul-23 Friday
75 15-Jul-23 Saturday Holiday
76 16-Jul-23 Sunday Holiday
77 17-Jul-23 Monday
78 18-Jul-23 Tuesday
79 19-Jul-23 Wednesday
80 20-Jul-23 Thursday

xliii
81 21-Jul-23 Friday
82 22-Jul-23 Saturday
83 23-Jul-23 Sunday Holiday
84 24-Jul-23 Monday
85 25-Jul-23 Tuesday
86 26-Jul-23 Wednesday
87 27-Jul-23 Thursday
88 28-Jul-23 Friday
89 29-Jul-23 Saturday

WEEKLY PROGRESS REPORT

xliv
xlv