Case Study On Mutual Fund

However the scenario is changing to some extent now. People are gaining literacy of financial concepts and basic risk-return analysis which is a positive sign. They are also looking to have a more balanced portfolio like mutual funds and invest in a more disciplined way like Systematic Investment Plans (SIPs). Thus we have more and more financial products coming in India which helps in diversifying their portfolios.

Mutual funds are an easy, convenient way to invest, without having to worry about choosing individual stocks. A mutual fund can be defined as a single portfolio of stocks, bonds, and/or cash managed by an investment company on behalf of many investors. The investment company manages the fund, and sells shares in the fund to individual investors. When one invests in a mutual fund, they become a part-owner of a large investment portfolio, along with all the other shareholders of the fund. The fund manager invests the contributions when shares are purchased, along with money from the other shareholders. Every day, the fund manager counts up the value of all the fund's holdings, figures out how many shares have been purchased by

Establishing and maintaining an internal mutual fund for Urban Growth Management Company, with smart investments will allow the company to become a stable flourishing corporation. Listed below is the recommended investments to establish a mutual fund for Urban Growth Management Company. An explanation and breakdown of your investments are written out below the breakdown of funds allocated. The fund allocations through various corporations and companies will shift and foster into new opportunities. Not all opportunities are created equal, and there will always be risk involved. Continuous management and evaluation of distributed funds should be considered on an annual basis.

JENSEN, M. C. 1968. The performance of mutual funds in the period 1945–1964. The Journal of finance, 23, 389-416.

3.1INTRODUCTION: A Mutual Fund is a kind of trust that pools money which shares common financial goals from a group of investors and invest the money. The Fund is mainly a corporation where sole business is to collect and invest money or fund. You combine the pool by buying shares in the fund. Then the money is invested by a team of professionals who research bond, stock and other assets and then place the money as good they can earn the returns. There are several kinds of mutual fund. Funds can also be open ended and close ended funds. Open ended schemes sell their shares to those who are willing to buy.

Mutual funds are investment plans that let you to pool your money together with additional investors to purchase a collection of securities that might be difficult to recreate on your own. This is often referred to like a portfolio. The price of the mutual fund, also recognized as its net asset value is determined by the total value of the securities in the portfolio, divided by the number of the fund’s unsettled shares. This price varies based on the value of the securities held by the portfolio at the end of every business day. Note that mutual fund investors do not really own the securities in which the fund invests; they only own shares in the fund itself.

It appoints professionally qualified and experienced staff that manages each of these functions on a full time basis. The large pool of money collected in the fund allows it to hire such staff at a very low cost to each investor. In effect, the mutual fund vehicle exploits economies of scale in all three areas - research, investments and transaction processing. While the concept of individuals coming together to invest money collectively is not new, the mutual fund in its present form is a 20th century phenomenon. In fact, mutual fund gained popularity only after the Second World War. Globally, there are thousands of firms offering tens of thousands of mutual funds with different investment objectives. Today, mutual funds collectively manage almost as much as or more money as compared to

Abstract The stock market is witnessing heightened activities and is increasingly gaining importance. In the current context of globalization and the subsequent integration of the global markets this paper captures the trends, similarities and patterns in the activities and movements of the Indian Stock Market in comparison to its international counterparts. This study covers New York Stock Exchange (NYSE), Hong Kong Stock exchange (HSE), Tokyo Stock exchange (TSE), Russian Stock exchange (RSE), Korean Stock exchange (KSE) from various sociopolitico-economic backgrounds. Both the Bombay Stock exchange

A __mutual fund__ is a collection of stocks and/ or bonds held by investors that have pool their money together into one professionally managed investment. Mutual funds can invest in stocks, bonds, cash and/or other assets. The collection of investments held by the mutual funds is called its __portfolio__. It is important to understand that when investing in a mutual fund, you do not actually own shares of the stocks or bonds, rather you own shares of the mutual fund itself.

When an investor considers to investment money, the first challenge that almost every investor face is numerous options to choose from stocks, bonds, mutual funds & so on. “Equity is one the key asset class which beats inflation in the long run.” (The Times of India, 5th Feb 2015). “Equity mutual funds help investors generate better inflation-adjusted returns, without spending a lot of time and energy on it. While most people consider letting their savings 'grow ' in a bank, they don 't consider that inflation may be nibbling away its value.” (The Hindu, 14th March 2016). Purpose of this study is to analyze the past performance of three global equity mutual funds of State Street Global Advisors (SSGA) & Northern Trust (NT) on the basis of equivalent investment style, asset manager, historical returns & application of statistical tools. This will help in understanding performance of mutual funds in terms of risk & return, asset manager’s investment strategies & asset manager’s performance.

A mutual fund is a collection of diversified investments combined into one fund chosen by the investment company. The mutual fund is classified by what type of funds are included within the fund. When an investor choses to invest in a mutual fund, he or she is adding their money to a pool of other investors money. This money is used to invest in a number of different securities based on specific investment goals. Investment companies choose to include many different stocks, as well as bonds or money market instruments in order to reduce risk and completely diversify the fund (Tyson, 2007). The investor owns shares of the funds rather than owning the underlying investments (Morris & Morris, 2005).

Two funds were chosen in order to determine the performance of each investment by observing the risk and significance of fund management fees. In order to achieve the highest level of accuracy possible, the two funds were chosen in the same sector of the market and of equal size and investment strategy. One fund chosen was an open-ended actively managed mutual fund, and the other a close-ended passively managed exchange traded fund.

Based on these results we could argue that the mutual funds do not follow the market closely, but both Managers over-perform the index. Furthermore, in order to test whether or not we have viable explanatory coefficients, a t-testing procedure was followed(Table 2). Using a 5% significance level, all coefficients except the market beta of Mutual Fund 1 are statistically significant. The low R2 in both mutual funds implies that their returns are less well explained by the Benchmark’s movements. However, Titman and Tiu(2011) suggest that low R-squares likely indicate more active management; either departing from a Benchmark or focusing on stocks with larger fractions of variance attributed to firm-specific information.

Mutual Fund have emerged as strong financial intermediaries and have helped in increasing the growth of Indian economy. Mutual Fund have provided financial stability and rationalised the resource allocation process. The Mutual Fund industry has grown from a monopoly market to a competitive market through the following phases:-

The stock market is witnessing keen activities and is gradually more gaining Importance. Post the1997 East Asian disaster which had caused significant reduction in asset prices and stock markets in quite a small number of Asian countries, these economies bang back. These economies maintained high interest rates thereby creation them attractive to foreign investors. As a result these economies customary a large inflow of funds and experienced a theatrical run-up in asset prices. As a part of market amalgamation, the capital market of India is no longer cut off from international economic measures and their stock index travels. This paper finds the correlation of Indian Stock market with four other major Asian economies: Japan, Singapore, Hong Kong and Korea. A weak correlation concludes that the Indian stock markets propose diversification benefits to institutional and international investors. The paper finds non routine feature in the stock return allotment of the five economies of Asia including India. The Indian markets showed facial exterior of platykurtic distribution, the volatility of