Performance analysis of Indian Mutual Funds with a special reference to sector funds

Abstract

Mutual Fund industry in India has emerged as the most dynamic segment of the Indian financial system. The industry grew by leaps and bounds during the last few years. With the plethora of schemes available for the investors to choose, it becomes essential for a retail investor to know the performance of the mutual funds in order to make an informed decision. In this paper, we have carried out the performance evaluation of open-ended equity sector mutual funds using five approaches of performance measures viz, Sharpe Ratio, Treynor Ratio, Jensen's Measure, Information Ratio and M-squared measure. The sectors selected for the purpose of the study are banking sector, FMCG sector, infrastructure sector, pharma sector & technology sector. All the schemes are selected from the respective sectors which were existing during the period of the study. The period adopted for the study is from 1st April 2008 to 31st March 2011.