UTI ASSET MANAGEMENT

COMPANY LIMITED
“We care for you”
“PERFORMANCE EVALUATION OF MUTUAL
FUNDS IN INDIA”

BY
Satish Vishwakarma
Sinhgad Institute
Pune
 INDUSTRY OVERVIEW
The origin of mutual fund industry in India is with the introduction of
the concept of mutual fund by UTI in the year 1963 under the
regulations of SEBI.

The mutuals fund is structured around a fairly simple concept, the

mitigation of risk through the spreading of investments across
multiple entities.
 ABOUT UTI…

• UTI MUTUAL FUND is sponsored by SBI, PNB, BOB, LIC & T rowe
price.

• The oldest asset management company in India

• Actively manages assets of over Rs. 58922 crores as on 31st march

2012.

• Over 12 million investor accounts

• Around 263 schemes

• A nationwide presence with 150 branch offices.

• A network of over 25000 agents.

 ACTIVITIES OF UTI AMC LTD.

Fund Management Research

UTI AMC

Schemes of
UTI Mutual Fund UTI International Ltd
( Rs 58922.15 Cr +) manager to offshore funds
(Rs 1500 Cr.+)
Portfolio Management
(450 clients and Rs 3200 Cr.+)
 WHAT IS MUTUAL FUND

As per SEBI definition,”A fund established in the form of a trust by a

sponsor,to raise money by the trustees thru the sale of units to the
public,under one or more schemes ,for investing in securities in
accordance with the SEBI regulations.”

In simple words,”a mutual fund collects the savings from the small
investors,invest them in Govt or corporate securities & earn income
thru interest or dividend ,besides capital gain”
WORKING….
TYPES OF MUTUAL FUNDS
 PERFORMANCE OF MUTUAL FUNDS

OBJECTIVE OF THE STUDY

• To make an in-depth study of the Mutual Funds

• To evaluate performance of selected mutual funds in terms of risk

and returns.

• To make comparative analysis of the returns of different kind of

funds on the basis of their schemes.

• To advise investors and help them to invest in Mutual Funds.

 RESEARCH METHODOLOGY
DESCRIPTIVE-
SOURCES: - Financial services- By M.Y.Khan
- Understanding the Mutual fund, UTI

ANALYTICAL-
SOURCES: Fact sheets of HDFC, ICICI PRUDENTIAL, BIRLA
SUN LIFE, KOTAK AND UTI
• www.valueresearchonline.com
• www.moneycontrol.com
• www.investopedia.com
• www.crisil.com
• www.mutualfundsindia.com
Performance of a fund depends upon the type of the fund and its

investment objective.

It is measured on 2 most important parameters-

I. RISK

II. RETURN
 RETURN

An investor in a mutual fund makes an investment in anticipation of

return. The return to the investor is in the form of dividend and
capital appreciation.

the change in NAV method is most commonly used to calculate

the returns between 2 dates. The formula to calculate return is:

(NAV at the end) – (NAV at the start) * 100

NAV at the start
 RISK

Risk in a mutual fund is associated with the changes and shifts in the
return from the fund. Return is not constant and and fixed, but
changes over time and is volatile.

It is measured by using following tools-

• STANDARD DEVIATION

• BETA

• SHARPE RATIO

• TREYNOR RATIO
•

• BETA = COV. XY

• SHARPE RATIO = RISK PREMIUM

SD

• TREYNOR RATIO = RISK PREMIUM

BETA
 DATA ANALYSIS
HDFC BIRLA ICICI PRU UTI KOTAK
SUN LIFE

MEAN 15.97 11.96 13.63 13.85 10.38

SD 8.085 6.294 8.52 7.14 3.82

BETA 0.032 -0.0006 0.012 -0.012 0.022

SHARPE 1.115 13.098 10.36 5.06 23.88

TREYNOR 281.87 -137400 7354.16 -3011.67 4146.8

 FINDING

According to the performance the fund houses are ranked as-

1……….HDFC MUTUAL FUND

2……….ICICI MUTUAL FUND

3……….BIRLA SUN LIFE MUTUAL FUND

4……….UTI MUTUAL FUND

5……….KOTAK MUTUAL FUND

 INTERPRETATION

• Out of the above, though all the fund house perform well. Kotak has
a least S.D but at the same time this also says that its returns is too
less and in equity funds returns should be maximum.

• Birla sun life and UTI with negative beta keep them in a better
position but with negative treynor ratio is not a good symptom.

• Thus from the above table HDFC and ICICI seems to be top
performing fund family in mutual fund industry. And this also
recognized by CRISIL and other rating agencies.
 CONCLUSION

• In my study I was suppose to do performance evaluation of mutual

fund and I had found that people consider HDFC and ICICI the most
amongst. But UTI have also respondents.

• we can say mutual fund is a best investment vehicle for old &
widow, as well as to those who want regular returns on their
investment.
• Mutual fund is also better and preferable for those who want their
capital appreciation.

• The companies are doing considerable achievements in mutual fund

industry.

• There are also so many factors involved those have affects on

companies.
 LEARNING

• Complete knowledge on mutual fund industry

• Performance measurement of funds

• How to choose best funds

• How to convince investors

• Upto some extend I realize life as an employee.

• How to recommend suitable fund to investors.

 LIMITATIONS

• The study is confined to only 5 top asset management companies.

• The ranks are assigned on the basis of only 4 measures.

• Findings of this study may change due to time constraint.

• Other factors affecting performance remains constant.

 SUGGESTIONS

• The AMC (Asset Management Company) should create a huge

awareness among the individuals about the benefits of Mutual
Funds & the returns from the Mutual Fund market. This can be done
by arranging at the household level or by conducing external
program at a public place to educate people about the nature,
benefits & importance of Mutual Funds.

• In case of UTI Equity fund, since the AMC has made short term
borrowings from money market and hence it might have affect its
performance. Hence it is recommended that AMC should attract
more investors rather than borrowings from market.
Thank you….