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  1. 1. Summer Training Project Prepared By: Deepak Bansal “ Comparative Study of Various Schemes of HDFC Mutual Fund through Sharpe Ratios and Treynor Index”
  2. 2. INTRODUCTION <ul><li>What is a Mutual Fund???? </li></ul>
  3. 3. History of INDIAN Mutual Fund Industry <ul><li>www.amfiindia.com </li></ul>Phases of INDIAN MUTUAL FUND First Phase (1964-87) Second Phase (1987-93) Third Phase 1993-2003 Fourth Phase (Since 2003)
  4. 4. Categories of Mutual Fund Categories Based on Structure Based on Investment Open-Ended Close-Ended Equity Fund Debt Fund Balanced (Hybrid) Fund
  5. 5. INVESTMENT Strategies <ul><li>Systematic Investment Plan </li></ul><ul><li>Systematic Transfer Plan </li></ul><ul><li>Systematic Withdrawal Plan </li></ul>
  6. 6. About HDFC <ul><li>HDFC was incorporated in 1977 with an objective “To promote home ownership” without any government assistance. </li></ul><ul><li>HDFC is currently operational in India with Five different sectors. </li></ul>www.hdfc.com
  7. 7. HDFC and Associate Companies HDFC Mutual Fund HDFC STANDARD Life Insurance HDFC Securities HDFC ERGO General Insurance HDFC Bank HDFC
  8. 8. About HDFC Mutual Fund <ul><li>HDFC Mutual Fund is one of the largest mutual funds incorporated on December 10, 1999. </li></ul><ul><li>Presently, HDFC Mutual Fund is managing: </li></ul><ul><ul><li>28 Open-Ended Schemes </li></ul></ul><ul><ul><li>8 Close-Ended Schemes </li></ul></ul>www.hdfcfund.com
  9. 9. Sponsors of HDFC Mutual Fund <ul><li>Housing Development Finance Corporation Limited with 60% paid up equity capital </li></ul><ul><li>Standard Life Investments Limited with 40% equity paid up capital </li></ul><ul><ul><ul><ul><ul><li> </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>www.hdfcfund.com </li></ul></ul></ul></ul></ul>
  10. 10. VISION Statement of HDFC Mutual Fund <ul><li>“ To be a dominant player in the Indian Mutual Fund space recognized for its high levels of ethical and professional conduct and a commitment towards enhancing investor interests.” </li></ul>www.hdfcfund.com
  11. 11. SWOT Analysis of HDFC Mutual Fund
  12. 12. STRENGTH <ul><li>Brand Name </li></ul><ul><li>Large Product Portfolio </li></ul><ul><li>Good Return Generating Products </li></ul><ul><li>More Assets </li></ul>
  13. 13. WEAKNESS <ul><li>High Employee Turnover Rate </li></ul>
  14. 14. OPPORTUNITY <ul><li>Awareness about Mutual Fund amongst Investor </li></ul><ul><li>Penetration to Rural Market </li></ul><ul><li>Huge Scope for Expansion </li></ul>
  15. 15. THREAT <ul><li>More Competition </li></ul>
  16. 16. Organization Chart Branch and Cluster Head Relationship Manager Client Services Head Sales Manager Executive Client Representative 1 Client Representative 2 Area Executive 1 Area Executive 2
  17. 17. Title of the Project <ul><li>“ Comparative Study of Various schemes of HDFC Mutual Fund through Sharpe Ratios and Treynor Index” </li></ul>
  18. 18. Objectives of Research <ul><li>Significance of Indices like Sharpe Ratio and Treynor Index for various type of schemes i.e. Equity, Liquid & Hybrid </li></ul><ul><li>Study of Effect of time on the quantitative analysis of Sharpe Ratio and Treynor Index </li></ul>
  19. 19. <ul><li>Research Design </li></ul><ul><ul><ul><li>Descriptive Design </li></ul></ul></ul><ul><li>Data Collection </li></ul><ul><ul><ul><li>Primary Data- Interview </li></ul></ul></ul><ul><ul><ul><li>Secondary Data- Company Website </li></ul></ul></ul><ul><ul><ul><ul><ul><li> - Annual Reports </li></ul></ul></ul></ul></ul><ul><li>Sampling Technique </li></ul><ul><ul><ul><li>Convenience </li></ul></ul></ul>Research Methodology
  20. 20. Contd…. <ul><li>Universe </li></ul><ul><ul><li>All funds of HDFC Mutual Fund </li></ul></ul><ul><li>Population </li></ul><ul><ul><li>All growth funds of HDFC Mutual Fund </li></ul></ul><ul><li>Sample Unit </li></ul><ul><ul><li>One Single growth fund of HDFC Mutual Fund </li></ul></ul><ul><li>Sample Size </li></ul><ul><ul><li>13 Growth funds of HDFC Mutual Fund </li></ul></ul>
  21. 21. Introduction to Project
  22. 22. Sharpe Ratios <ul><li>A ratio developed by Nobel laureate  William F. Sharpe to measure risk-adjusted performance. The Sharpe ratio or Sharpe index or Sharpe measure or reward-to-variability ratio is a measure of the excess return (or Risk Premium) per unit of risk in an investment asset </li></ul>
  23. 23. Comparative Analysis through Sharpe Ratios
  24. 24. HDFC Top 200 Fund
  25. 25. HDFC Equity Fund
  26. 26. HDFC Capital Builder Fund
  27. 27. HDFC Core & Satelite Fund
  28. 28. HDFC Premier Multi-Cap Fund
  29. 29. HDFC Prudence Fund
  30. 30. HDFC Tax Saver Fund
  31. 31. HDFC MIP-LTP Fund
  32. 32. HDFC MIP-STP Fund
  33. 33. HDFC High Interest Fund
  34. 34. HDFC High Interest-STP Fund
  35. 35. HDFC Cash Management-Retail Fund
  36. 36. HDFC Cash Management-Wholesale Fund
  37. 37. Treynor Index <ul><li>Treynor Index is a measure used to calculate the portfolio's excess return per unit of risk . This is a similar ratio to the Sharpe ratio, except that the portfolio's beta is considered the measure of risk as opposed to the variance of portfolio returns. </li></ul>
  38. 38. Comparative Analysis through Treynor Index
  39. 39. HDFC Top 200 Fund
  40. 40. HDFC Equity Fund
  41. 41. HDFC Capital Builder Fund
  42. 42. HDFC Core & Satelite Fund
  43. 43. HDFC Premier Multi-Cap Fund
  44. 44. HDFC Prudence Fund
  45. 45. HDFC Tax Saver Fund
  46. 46. HDFC MIP-LTP Fund
  47. 47. HDFC MIP-STP Fund
  48. 48. HDFC High Interest Fund
  49. 49. HDFC High Interest-STP Fund
  50. 50. HDFC Cash Management-Retail Fund
  51. 51. HDFC Cash Management-Wholesale Fund
  52. 52. Facts and Findings <ul><li>Schemes with more volatility ratio i.e. high standard deviation are the true top performers in the market </li></ul><ul><li>Equity diversified funds are more volatile as compared to Debt funds and Hybrid Funds </li></ul><ul><li>Volatility and Returns have a direct relationship </li></ul><ul><li>Returns in case of equity fund is very high for long term period </li></ul>
  53. 53. Contd… <ul><li>Debt funds are having no correlation with the market i.e. SENSEX </li></ul><ul><li>Annualized return for Balanced Fund is the highest for HDFC Prudence Fund amongst all Balanced fund of all mutual fund Companies (www.amfiindia.com) </li></ul>
  54. 54. Conclusion <ul><li>Returns are only reward of risk and funds performing well in the markets are those who has more variations in their returns. </li></ul><ul><li>With the time period returns as well as their effect on Sharpe Ratio and Treynor Index is changing because portfolio of a scheme differs from fund to fund. </li></ul>