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ANALYSIS OF MUTUAL FUNDS (2008)
THE CHOICE IS YOURS
INTRODUCTION
This report is an attempt to understand about mutual funds in general and the analysis of the data given on the 838 mutual funds from the investor perspective. The report is divided broadly in to two sections. First section is about the general aspects of mutual funds, which should give an idea and understanding to a lay man investor, about mutual funds and its associated terms. The objective in the first part is to summarize the already accumulated knowledge from books websites etc.
The second section is the data analysis and its interpretation of the 838 mutual funds focusing on equipping the investor to make an informed decision about his investment. While there are cases in every day life where predictions, possibilities and probabilities can be made on various subjects, this report is not an attempt to do that. The main reason behind, is that the mutual funds which follow the stock market trajectory of highs and lows are extremely unpredictable and without an abstract understanding of the world economic situation cannot be predicted in short or long term. This is especially the case now due to the poor health of all stock markets around the world. Also the data given, while is extensive in the number of funds, is quite insufficient for a prediction of its future. Instead of attempting to be specific on identifying such and such mutual fund to invest, this report is going to analyze the historical data by grouping them in different permutations and combinations.
Any investor will be much interested in knowing how much money he is going to make out of an investment which, here, are the returns. Also an investor will have certain characteristics like risk aversion or risk taking, time orientation (short and long terms of investment). Based on these human characteristics the investors are grouped into categories and then the data grouped accordingly in to various combinations, making them smaller entities from which average returns, standard deviations etc are calculated, tabulated, plotted in graphs which make easy reading and understanding. From this tables and graphs group patterns are identified and filtered so that a conclusion of the performance of subgroups can be made and certain recommendations for the future investor attempted.
MUTUAL FUNDS EXPLAINED.
The Definition
A mutual fund is nothing more than a number of stocks or bonds which have been put together. It is a company that brings together a number of people to invest in a collection of shares or stocks from different companies. Each person holds his own piece of share in that holding.
An investor can make money from a mutual fund in three different ways. 1) Income earned from dividends or Interest on bonds, 2) Money from capital gain, in which the share sells for a higher price and 3) Increase in holding price, in which case the company distribute the profit to the investor in the form of dividends
Types of Funds
There are many numbers of mutual funds which will suit each one’s requirements and capacity. It is also important to understand that each mutual fund has different risk and rewards. The higher the potential return is the higher the risk of loss. Basically there are three types of funds available. They are:
All the mutual funds are derived from any of these three types.
Funds that invest in stocks are the largest category of mutual funds. The basic objectives of such investments are long term capital gain and some interest from the investment. Equity funds can again be divided according to its size such as large, medium and size, and type such as growth, blend, and value.
Their objective is to provide current income on a steady basis. These fund holdings may appreciate in value, their primary objective is to provide a stable cash flow to the investors. Therefore the customers of these funds are generally conservative investors and retirees.
III. Money Market Funds
The money market consists of short term – low risk investments. They generally include Treasury bills etc. They will not have great returns since they are short term, but the risks involved in such investments are very less. A typical return in these funds is twice the amount one could earn over a normal savings account
Balanced funds provide a balanced mixture of safety, income and capital growth. The strategy behind these funds is to invest in mixture of both fixed income and equities. They are balanced accordingly by 40% of fixed income and 60% of equity funds.
One way of describing the variety of equity funds is a style box based on the size of the companies invested in and the investment style of the manager.
http://www.investopedia.com/university/mutualfunds/mutualfunds1.asp
There are three sizes of companies invested in:
Large cap – Market capitalization $5 billion or more,
Mid Caps – Market capitalization – $1 billion to $5 billion,
Small Caps – Market capitalization $250 million to $1 billion.
Value mutual funds invest in mature companies that have reached their zenith of growth and use their earnings to pay dividends.
Growth mutual funds focus on companies which are experiencing significant earnings or revenue growth.
Advantages of Mutual Funds:
It is an essential requirement to have an experienced or skilled professional manager to take care of our valuable money which is invested in mutual funds, even under the best, stable market conditions. Professional expertise is important since they maintain a portfolio of all the securities and they have the skill and expertise to decide when to buy and sell one particular security based on the market study. They also monitor the investor’s securities time to time.
In mutual funds, the concept of diversification can effectively be used. The risk of investing in one particular security is reduced by investing in a number of small securities of different organizations. Since investments are diversified, the risk of loosing money is minimized.
III. Variety
The investor has the freedom to choose from a wide variety of categories like stock, bonds etc.
Since mutual funds contain a number of securities such as bonds and stocks, the fee, an investor pay for this services may vary according to the number of securities one hold in his account. The actual fee can vary since the fund industry is very competent and dynamic.
This is one of the major advantages of Mutual funds. The money invested in mutual funds can be sold on any business day. The price per share investor can redeem is known as the Net Asset Value (NAV)
We can buy or sell shares directly from a firm, broker, bank, fund. It is even possible to purchase them online. It is even possible to make the funds be automatically re invested and the dividends and capital gains are periodically being distributed. Many funds offer quarterly account statements, tax information and 24 hour customer service etc.
Risk and Reward Potential for Types of Funds
http://www.investopedia.com/university/mutualfunds/
Though the risk involved in Mutual funds are different, we can see that some of them are as risky as stocks. Therefore investing in mutual funds requires identifying the type of funds investing in, the potential growth rate, return rate and the time span of the funds. Many of the short term funds are said to be risk free, though the long term funds give more returns. Investing in mutual fund in a highly fluctuating market involves more risks, but the more risk involved in a fund the more potential return it provides. Therefore it is no wonder that the new era of investment will see rapid growth in mutual funds.
http://www.iloveindia.com/finance/mutualfunds/growthfunds.html
Disadvantages of mutual funds.
http://www.investopedia.com/university/mutualfunds/mutualfunds.asp .
Costs.
Returns from investing in mutual funds are affected by fees that can be divided into two categories.
http://www.investopedia.com/university/mutualfunds/mutualfunds2.asp
Net Asset Value.
Net Asset Value is the value of mutual funds, calculated by total assets minus liabilities. Net Asset Value per share is the value per share in the mutual fund and the actual price of the mutual fund which fluctuates everyday.
Reading a mutual fund table.
http://www.investopedia.com/university/mutualfunds/mutualfunds4.asp
Column 1&2 52 W high and low these columns represent the highest and the lowest price over the last 52 weeks
– Column 3 Fund name this column lists the names of mutual funds
Column 4 – Fund specifics –this column gives details about mutual funds i.e. N no load, F front load
Column 5 Price change this column represent the change in prices of mutual funds from the previous day‘s trading
– Column 6 % change – this column represent the change in prices in %
Column 7 Week high this column represents the highest price at the previous week
Column 8 Week low this column represents the lowest price at the previous week
Column 9Close this column represents the last price at which a mutual fund was traded
Column 10 Week price changethis represents the price change in money from the previous week
http://www.investopedia.com/university/mutualfunds/mutualfunds4.asp
GROUPING THE INVESTOR.
An investor will have certain characteristics like risk aversion or risk taking, time orientation (short and long terms of investment) etc. It is also understood that the investor will be looking for returns on the investments made by him.
To advise the investor effectively the risk perception of the individual person is to identified first as,
From the time orientation perspective there will be people investing for
Hence this report is a guide for investor in the following brackets
Long term High Risk  Long term Low Risk 
Medium term High Risk  Medium term Low Risk 
Short term High Risk  Short term Low Risk 
GROUPING THE FUNDS
The data given in the spread sheet is grouped in to sub categories for ease of analysis. Before grouping the data the following assumptions are made.
As the returns values given for 12 months, 36 months and 60 months are not comparable values, two more sets of data values the average for 20012 and 20034 are calculated from the average return figures from the table. The sample calculation is given below.
Let
Year  Yearly Average % return  
2001  = A  
2002  = B  
2003  = C  
2004  = D  
2005  = E  
5Year Return  =(A+B+C+D+E)/5


3Year Return 
=(C+D+E)/3


2005 Return 
=E  
Let  
5Year Return  3.7  =(A+B+C+D+E)/5  
3Year Return 
10.2  =(C+D+E)/3  
2005 Return 
2.7  =E  
=3.7 x 5  =(A+B+C+D+E)  
=10.2 x 3  =(C+D+E)  
18.5  =(A+B+C+D+E)  
30.6  =(C+D+E)  
Substituting E = 2.7  
30.6  =(C+D+2.7)  
=30.62.7  =(C+D)  
27.9  =(C+D)  
=27.9/2  =(C+D)/2  
13.95  =(C+D)/2  Average of 2003 & 2004  
Similarly (A+B)/2 =  24.55  Average of 2001 & 2002  
The above two values are found for all funds by using formula in Excel and is used in the analysis.
If the returns over the various periods is fluctuating too much from the mean value i.e. if the standard deviation is too much it is high risk and vice versa.
For eg
The table and the graph next give the grouping of the mutual funds.
ANALYSIS
Analysis of the data for finding the above is given in the below tables.
Table 1.1. Average returns over periods
2005 Average  3 Year Average  5 Year Average  20012 Average  20034 Average 
7.3  17.8  3.4  18.3  23.0 
Table 1.2. Standard deviations over the periods
2005 Standard Deviation  3 Year Standard Deviation  5 Year Standard Deviation  20012 Standard Deviation  20034 Standard Deviation 
4.5  4.9  7.0  14.2  6.8 
Table 1.3. Maximum returns over the periods
2005 Maximum Return  3 Year Maximum Return  5 Year Maximum Return  20012 Maximum Return  20034 Maximum Return 
25.3  42.3  26.5  22.7  58.6 
Table 1.4. Minimum returns over the periods
2005 Minimum Return  3 Year Minimum Return  5 Year Minimum Return  20012 Minimum Return  20034 Minimum Return 
5.1  6.7  26.5  113.2  9.8 
Table 1.5. Percentage of funds with above 10 % returns
%age of MFs with more than 10% return in 2005  %age of MFs with more than 10% return in 3 Years  %age of MFs with more than 10% return in 5 Years  %age of MFs with more than 10% return in 20012  %age of MFs with more than 10% return in 20034 
26.85  96.66  18.38  1.91  99.88 
Table 1.6. Percentage of funds with above 20 % returns.
%age of MFs with more than 20% return in 2005  %age of MFs with more than 20% return in 3 Years  %age of MFs with more than 20% return in 5 Years  %age of MFs with more than 20% return in 20012  %age of MFs with more than 20% return in 20034 
0.84  32.58  1.43  0.48  59.90 
From the above tables it is clear that the mutual funds have not been giving a steady return over the years. High standard deviation in 20012 suggests that there is a high proportion of funds with varying returns. On average funds performed badly in 20012 and in the next 2 years improved performance. This could be due to market conditions in at the times, as most of the stock markets across the world were down in 2001 due to the “IT Bubble Burst”. Hence mutual funds are not the safest option to invest money in adverse market conditions since they follow the stock market fluctuations.
For analyzing the risk aspect the standard deviation of the data is examined. A high standard deviation indicates that there are a high proportion of funds with varying returns in the positive and negative side of the average.
The data is split into risk groups and analyzed in Minitab software for the generating the graph and summary as shown below.
Graph 2.1. Five years performance – low risk
Graph 2.2. Five years performance average risk
Graph 2.3. Five year performance – high risk
Table 2.1. Summary –average return and standard deviation
5 year  
Average Risk  Avg Risk MF Mean Return  3.64 
Standard Deviation for Avg Risk  5.44  
High Risk  High Risk MF Mean Return  0.89 
Standard Deviation for High Risk  5.79  
Low Risk  Low Risk MF Mean Return  9.08 
Standard Deviation for Low Risk  5.53 
Graph 2.4. Risk factor – average returns
Graph 2.5 Risk factor standard deviations
For calculation of the risk associated with the returns the returns under the 5 year period is taken as it is the average of longer term. Below is the analysis.
Table 3.1. Averages comparison fee and no fee
No of Funds  Mutual Fund  2005 Average  3 Year Average  5 Year Average 
317  Yes  7.3  17.2  2.3 
521  No  7.4  18.2  4.0 
From the analysis of the averages it can be seen that the mutual funds with no fees performed slightly better.
Table 3.2. Standard deviation comparison fee and no fee
Mutual Fund  2005 Standard Deviation  3 Year Standard Deviation  5 Year Standard Deviation 
Yes  4.6  4.7  6.3 
No  4.5  5.0  7.3 
The analysis on standard deviation indicates that the risk associated with mutual funds divided into Fees and no fees categories are similar. There is a slightly higher risk associated with the mutual funds with no fees for the 5 year period. This is also evident from the below analysis of the maximum and minimum return values below.
Table 3.3. Maximum/ Minimum returns fee and no fee
Mutual Fund  2005 Maximum Return  2005 Minimum Return  3 Year Maximum Return  3 Year Minimum Return  5 Year Maximum Return  5 Year Minimum Return 
Yes  20.9  3.6  40.5  6.7  24.1  11.9 
No  25.3  5.1  42.3  6.7  26.5  26.5 
Table 3.4. Comparison of above 10% fee and no fee
Mutual Fund  Percentage of above 10 % return in 2005  Percentage of above 10 % return in 3 Years  Percentage of above 10 % return in 5 Years  Percentage of above 10 % return in 20012  Percentage of above 10 % return in 20034 
Yes  26.5  96.2  13.6  0.6  99.7 
No  27.1  96.9  21.3  2.7  100.0 
Table 3.5. Comparison of above 20% fee and no fee
Mutual Fund  Percentage of above 20 % return in 2005  Percentage of above 20 % return in 3 Years  Percentage of above 20 % return in 5 Years  Percentage of above 20 % return in 20012  Percentage of above 20 % return in 20034 
Yes  0.6  28.4  0.9  0.3  54.3 
No  1.0  35.1  1.7  0.6  63.3 
The above are the percentages of the mutual funds which gave above 10% and 20% return over the different periods. The analysis indicates better performance of the funds with no fees.
Table 4.1. Comparison of expense ratios and returns
Mutual Fund  Expense ratio range %  No of mutual funds  Average return 2005 %  Average 3 Yr return %  Average 5 Yr return %  Average 20012 return %  Average 20034 return % 
Large Cap  Exp ratio Less than 1.2%  257.0  6.74  14.85  1.11  19.5  18.90 
Exp ratio above 1.2%  186.0  6.7  14.9  0.4  23.2  19.0  
Small Cap  Exp ratio Less than 1.2%  72.0  7.61  22.66  11.20  6.0  30.18 
Exp ratio above 1.2%  157.0  6.4  21.4  7.6  13.0  28.9  
Mid Cap  Exp ratio Less than 1.2%  70.0  10.30  20.13  4.12  19.9  25.05 
Exp ratio above 1.2%  95.0  9.4  20.2  3.5  21.7  25.6 
Graph 4.1. Comparison of expense ratios and returns
Relationship between asset size and returns.
Table 5.1. Comparison of asset sizes and returns
No of Mutual funds  Average 2005 Return  Standard Deviation  Average 3 Yr Return  Standard Deviation  Average 5 Yr Return  Standard Deviation  
Asset range  
>=0  125.0  6.33  4.97  16.97  5.39  2.05  6.35  
<100  >=100  135.0  7.00  4.49  17.81  4.84  1.50  6.30 
<175  >=175  131.0  8.04  4.78  18.32  5.18  3.13  7.50 
<350  >=350  134.0  7.44  4.52  18.63  4.99  5.35  7.60 
<600  >=600  132.0  7.21  4.44  17.15  4.44  2.97  6.65 
<1300  >=1300  124.0  7.87  4.01  18.18  5.03  5.21  7.24 
<5000  >=5000  57.0  7.70  3.94  17.13  4.12  3.59  5.05 
Graph 5.1. Comparison of asset sizes and returns
The above table gives the average returns for each period classified on different asset ranges. From the table and graph above it can be seen that there is no direct correlation between the asset size and the rate of return. In other words it can be said that there are mutual funds with low asset sizes which give similar returns with those ones with high assets. Hence it may be safely concluded that the assert size should also be of secondary importance when considering investment factors.
Table 6.1. Comparison of growth and value
No of Growth Mutual Funds – 480  Average 20012  Average 20034  Average 5 Yr  Average 3 Yr  Average 2005  
Growth  26.4  22.0  0.2  17.2  7.6  
Value  7.4  24.4  8.2  18.6  6.9  
Standard Deviation 20012  Standard Deviation 20034  Standard Deviation 5 Year  Standard Deviation 3 Year  Standard Deviation 2005  
No of Value Mutual Funds – 358  Growth  11.7  6.6  5.6  4.8  4.8  
Value  9.2  6.8  5.6  5.1  4.2  
Lowest Return  Highest Return  Lowest Return  Highest Return  Lowest Return  Highest Return  Lowest Return  Highest Return  Lowest Return  Highest Return  
Growth  113.2  20.5  9.8  48.5  26.5  26.5  6.7  34.0  5.1  22.2  
Value  41.6  22.7  10.1  58.6  4.7  25.0  7.6  42.3  5.0  25.3 
Table 6.2. Comparison of above 10% return – growth and value
Mutual Fund  No of Funds  Percentage of above 10 % return in 2005  Percentage of above 10 % return in 3 Years  Percentage of above 10 % return in 5 Years 
Growth  480.0  30.2  95.6  4.2 
Value  358.0  22.3  98.0  37.4 
Graph 6.1. Comparison of returns growth and value
Graph 6.2. Comparison of standard deviations – growth and value
The funds are divided into two groups of growth and value and they were analyzed for the rate of returns by taking the averages and the risk factors by taking the standard deviation. The analysis of the average returns suggests that the value funds performed better over the different periods and especially in the long term. From the analysis of standard deviation it can be seen that the risk associated with investing is comparable for value and growth funds.
Table 7.1. Comparison of returns for categories
Nos  Mutual Fund  2005 Average  3 Year Average  5 Year Average 
443  Large cap  6.7  14.9  0.5 
166  Mid Cap  9.8  20.1  3.7 
229  Small Cap  6.8  21.8  8.7 
Graph 7.1. Comparison of returns for categories
Table 7.2. Comparison of standard deviations for categories
Mutual Fund  2005 Standard Deviation  3 Year Standard Deviation  5 Year Standard Deviation 
Large cap  4.1  3.6  4.9 
Mid Cap  4.7  4.1  6.6 
Small Cap  4.6  4.1  7.4 
Graph 7.2. Comparison of standard deviations for categories
Table 7.3. Minimum and maximum returns for categories
Mutual Fund  2005 Maximum Return  2005 Minimum Return  3 Year Maximum Return  3 Year Minimum Return  5 Year Maximum Return  5 Year Minimum Return 
Large cap  21.6  5.1  31.3  6.7  26.5  26.5 
Mid Cap  25.3  3.6  40.5  11.8  24.1  13.2 
Small Cap  20.5  5.0  42.3  12.1  25.0  11.9 
Graph 7.3. Minimum and maximum returns for categories
Table 7.4. Comparison of above 10 % return for categories
Mutual Fund  %age of above 10 % return in 2005  %age of above 10 % return in 3 Years  %age of above 10 % return in 5 Years  %age of above 10 % return in 20012  %age of above 10 % return in 20034 
Large cap  19.2  93.7  1.4  0.2  99.8 
Mid Cap  51.2  100.0  19.3  0.0  100.0 
Small Cap  24.0  100.0  50.7  6.6  100.0 
Graph 7.4. Comparison of above 10 % return for categories
Table 7.5. Comparison of above 20 % return for categories
Mutual Fund  %age of above 20 % return in 2005  %age of above 20 % return in 3 Years  %age of above 20 % return in 5 Years  %age of above 20 % return in 20012  %age of above 20 % return in 20034 
Large cap  0.5  7.0  0.2  0.2  32.5 
Mid Cap  2.4  51.8  0.6  0.0  84.3 
Small Cap  0.4  68.1  4.4  1.3  95.2 
Graph 7.5. Comparison of above 20 % return for categories
From the above analysis it can be seen that
The table below gives the average 5 year return for various mutual funds divided into groups along with the percentage of such number of funds.
Table 8.1. Comparison of 5 years returns
Mutual Fund Group.  Percentage of total Nos  Average 5 Yr Return 
Large Cap Growth Average Risk  10.74  0.72 
Large Cap Growth High Risk  17.90  3.45 
Large Cap Low Risk  0.84  1.24 
Large Cap Value Average Risk  8.71  2.70 
Large Cap Value High Risk  0.36  1.77 
Large Cap Value Low Risk  14.32  4.91 
Small Cap Growth Average Risk  1.67  9.66 
Small Cap Growth High Risk  11.69  2.05 
Small Cap Growth Low Risk  0.84  14.34 
Small Cap Value Average Risk  3.70  12.98 
Small Cap Value High Risk  0.72  10.22 
Small Cap Value Low Risk  8.71  15.09 
Mid Cap Growth Average Risk  3.34  4.88 
Mid Cap Growth High Risk  10.02  1.40 
Mid Cap Growth Low Risk  0.24  8.80 
Mid Cap Value Average Risk  1.07  9.39 
Mid Cap Value High Risk  0.60  12.12 
Mid Cap Value Low Risk  4.53  11.20 
Graph 8.1. Comparison of 5 years returns
The table below gives the average 3 year return for various mutual funds divided into groups along with the percentage of such number of funds.
Table 9.1. Comparison of 3 years returns
Mutual Fund Group.  Percentage of total Nos  Average 3 Yr Return 
Large Cap Growth Average Risk  10.74  13.69 
Large Cap Growth High Risk  17.90  14.91 
Large Cap Low Risk  0.84  11.10 
Large Cap Value Average Risk  8.71  15.86 
Large Cap Value High Risk  0.36  15.00 
Large Cap Value Low Risk  14.32  15.28 
Small Cap Growth Average Risk  1.67  21.73 
Small Cap Growth High Risk  11.69  20.49 
Small Cap Growth Low Risk  0.84  23.61 
Small Cap Value Average Risk  3.70  23.12 
Small Cap Value High Risk  0.72  22.70 
Small Cap Value Low Risk  8.71  22.74 
Mid Cap Growth Average Risk  3.34  19.90 
Mid Cap Growth High Risk  10.02  19.65 
Mid Cap Growth Low Risk  0.24  19.65 
Mid Cap Value Average Risk  1.07  21.02 
Mid Cap Value High Risk  0.60  27.24 
Mid Cap Value Low Risk  4.53  20.31 
Graph 9.1. Comparison of 3 years returns
The table below gives the average 3 year return for various mutual funds divided into groups along with the percentage of such number of funds.
Table 10.1. Comparison of 12 months 2005 returns
Mutual Fund Group.  Percentage of total Nos  Average Return in 2005 
Large Cap Growth Average Risk  10.74  7.27 
Large Cap Growth High Risk  17.90  6.82 
Large Cap Low Risk  0.84  5.60 
Large Cap Value Average Risk  8.71  6.63 
Large Cap Value High Risk  0.36  7.07 
Large Cap Value Low Risk  14.32  6.32 
Small Cap Growth Average Risk  1.67  8.07 
Small Cap Growth High Risk  11.69  6.37 
Small Cap Growth Low Risk  0.84  8.06 
Small Cap Value Average Risk  3.70  5.73 
Small Cap Value High Risk  0.72  3.92 
Small Cap Value Low Risk  8.71  7.62 
Mid Cap Growth Average Risk  3.34  11.05 
Mid Cap Growth High Risk  10.02  9.81 
Mid Cap Growth Low Risk  0.24  12.00 
Mid Cap Value Average Risk  1.07  7.29 
Mid Cap Value High Risk  0.60  11.82 
Mid Cap Value Low Risk  4.53  8.94 
Graph 10.1. Comparison of 12 months 2005 returns
Table 11.1. Consistency of returns 5 years period
Mutual Fund  Average 20012 Return  Average 20034 Return  Average 3 Yr Return  Average 5 Yr Return  Average Return 2005 
Large Cap Growth  27.34  18.06  14.36  2.32  6.95 
Large Cap Value  13.13  20.01  15.49  4.04  6.45 
Small Cap Growth  22.05  27.89  20.82  3.67  6.67 
Small Cap Value  1.32  30.82  22.84  14.23  6.89 
Mid Cap Growth  28.76  24.49  19.71  0.32  10.15 
Mid Cap Value  4.20  27.18  21.10  10.98  8.93 
Graph 11.1. Consistency of returns 5 years period
Even though the graph is plotted with incomparable data it can be seen that overall the Small Cap growth funds average returns stands over all the rest over all the periods.
CONCLUSION
In the present climate of market uncertainty where even the bank deposit rates has plummeted to the lowest the mutual funds stands out as an investment option. The returns are not spectacular as an investment in stocks can get. But it does not have the high risk associated with the stock option. But it should also be noted that investing in mutual funds doesn’t assure steady positive returns. Making an investment in mutual funds does not require an investor to have specific knowledge about markets and economic climate. Looking at the 5 year returns for Long Term growth funds the range of returns is in between 26.5% to 26.5 %. So it would recommendable to be familiar with some basic information about mutual funds and their different types. It is also very important to find out about past performance of mutual funds which would be a good guide to make the first investment steps. While an analysis of data will give an insight into the past performance this does not mean that the growth will take the same trajectory taken by the historic values. Hence, even though an attempt is made to project some recommendations this does not mean that it is a guide to the future performance of the fund.
RECOMMENDATIONS
From all the above analysis the following recommendations are made:
REFERENCES
http://www.investopedia.com/university/mutualfunds/mutualfunds1.asp
http://www.investopedia.com/university/mutualfunds/
http://www.investopedia.com/university/mutualfunds/mutualfunds.asp
The rise of mutual funds : an insider’s view By Matthew P. FinkOxford University Press, 2008
The Financial Times guide to using the financial pages By Romesh Vaitilingam