Evaluating the Performance of Mutual Funds in India: A Comparative Analysis of Return and Risk Metrics

Authors: Mr. Thirumala M, Dr. M Lakshmipathi Naidu

Country: India

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Abstract: This study evaluates the performance of mutual funds in India by analyzing the return and risk metrics of various fund categories, including large-cap equity, mid-cap equity, hybrid, and debt funds. The research aimed to compare these mutual funds’ performance over the period from 2019 to 2024, capturing both pre- and post-pandemic market dynamics. Utilizing key risk-adjusted performance measures such as the Sharpe Ratio, beta, and standard deviation, the study offers insights into the risk-return profiles of different funds. The findings revealed that mid-cap equity funds consistently outperformed large-cap equity funds in terms of average returns and risk-adjusted returns, despite their higher volatility and market risk. Large-cap equity funds exhibited lower risk and more stable returns, while hybrid funds provided a balanced approach, making them suitable for moderate risk-tolerant investors. Debt funds, characterized by lower risk and returns, were ideal for conservative investors. The study also highlights the importance of evaluating mutual funds through risk-adjusted metrics to make informed investment decisions. The broader implications suggest that fund managers should continue to diversify offerings to meet the varied risk profiles of investors, especially in the context of economic uncertainty following the pandemic. This research contributes to existing literature by filling a gap in the continuous evaluation of mutual fund performance in a post-pandemic market environment.

Keywords: Mutual funds, risk-adjusted performance, Sharpe Ratio, mid-cap funds, Indian market, risk-return analysis.

Paper Id: 231402

Published On: 2024-10-20

Published In: Volume 12, Issue 5, September-October 2024

Cite This: Evaluating the Performance of Mutual Funds in India: A Comparative Analysis of Return and Risk Metrics - Mr. Thirumala M, Dr. M Lakshmipathi Naidu - IJIRMPS Volume 12, Issue 5, September-October 2024.

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