A

Project report

On

“A STUDY OF RISK AND RETURNS ANALYSIS ON KOTAK EQUITY

MUTUAL FUND WITH REFERENCE TO NJ INDIA INVEST PVT. LTD.
KOLHAPUR”,

Submitted to

SHIVAJI UNIVERSITY, KOLHAPUR.

In partial fulfillment of the award of the degree of

MASTER OF BUSINESS ADMINISTRATION (MBA)

Submitted by

MAYURI BALASO DESAI

Under the guidance of

Mr. P. A. PETARE

Through

The Director

Sou. Sushila Danchand Ghodawat Charitable Trust’s

SANJAY GHODAWAT GROUP OF INSTITUTIONS
FACULTY OF MANAGEMENT, ATIGRE.
(2017 -18)
 Date:-
COLLEGE CERTIFICATE
To,
The Registrar,
Shivaji University,
Kolhapur.
Subject: MBA Project Report

Respected Sir,
I am recommending the project report entitled “A STUDY OF RISK AND RETURNS

ANALYSIS ON KOTAK EQUITY MUTUAL FUND WITH REFERENCE TO NJ INDIA

INVEST PVT. LTD. KOLHAPUR”, prepared by MISS. MAYURI BALASO DESAI as

partial fulfillment of University requirements for award of Master of Business

Administration (MBA) degree of Shivaji University, Kolhapur. The matter

presented in the project report has not been submitted earlier for award of any

Degree and Diploma of Shivaji University or any other University.

Place: - Atigre

Date: - Dr. V. V. KULKARNI

Director
 Date:-
GUIDE CERTIFICATE

This is to certify that MISS. MAYURI BALASO DESAI has worked under my
guidance and satisfactorily completed the project report in partial fulfillment of
MBA course. This work is based on original observations and efforts being
submitted under the title of “A STUDY OF RISK AND RETURNS ANALYSIS ON
KOTAK EQUITY MUTUAL FUND WITH REFERENCE TO NJ INDIA INVEST PVT.
LTD. KOLHAPUR”, His/Her conclusions and recommendations are based on the
information collected by him during his project work. This has not formed a basis
for the award of any Degree of Diploma by this University or any other university.

Place: Atigre

Date:

PROF. P PETARE

Project Guide
 DECLARATION

I, MAYURI BALASO DESAI hereby declare that the Project Report, entitled “A
STUDY OF RISK AND RETURNS ANALYSIS ON KOTAK EQUITY MUTUAL FUND
WITH REFERENCE TO NJ INDIA INVEST PVT. LTD. KOLHAPUR”, submitted to
the Shivaji University, Kolhapur in partial fulfillment of the requirements for
the award of the Degree of Master of Business Administration is a record of
original work undergone by me under the supervision and guidance of Mr. P.
A. PETARE (Ass. Professor), Sou. Sushila D. Ghodawat Charitable Trust’s
Sanjay Ghodawat Group of Institutions ( Faculty of Management), Atigre and
it has not formed the basis for the award of any Degree/Fellowship or other
similar title to any candidate of any University.

Place: Atigre
Date:

MISS. MAYURI BALASO DESAI

ACKNOWLEGDEMENT

I have taken efforts in this project. However, it would not have been possible
without the kind support and help of many individuals and organizations. I would
like to extend my sincere thanks to all of them.

I am highly indebted to Mr. Ajinkya Gurav (UM) their guidance and constant
supervision as well as for providing necessary information regarding the project &
also for their support in completing the project and my heartfelt thanks to Mr. P.
A. PETARE for providing his/her valuable suggestions and kind cooperation in
understanding the research work.

I would like to express my special gratitude and thanks to Dr. V. V. KULKARNI

(Director, SGI), Dr. SANDEEP RAKSHIT (Dean, Faculty of Management) who has been

a constant source of inspiration and encouragement for me.

I would like to express my gratitude towards my parents & member of for their
kind co-operation and encouragement which help me in completion of this project.

My thanks and appreciations also go to my colleague in developing the project and

people who have willingly helped me out with their abilities.

MISS. MAYURI BALASO DESAI

Chapter Page
Title
No. No.

1 INTRODUCTION TO THE STUDY

&METHODOLOGY
1.1 Introduction
1.2 Objectives & Importance of The study
1.3 Scope & limitations of The study
1.4 Research methodology

2 THEORETICAL BACKGROUND

3 COMPANY PROFILE
3.1 Name of the unit
3.2 Location or address of the unit
3.3 Brief history of the unit and present position
3.4 Financial position
3.5 Organization chart

4 ANALYSIS OR INTERPRETATION OF DATA

5 FINDINGS, SUGGESTIONS AND CONCLUSION

6 BIBLIOGRAPHY
 Chapter 1
INTRODUCTION
TO THE
STUDY & METHODOLOGY
INTRODUCTION:-
Mutual funds is one of the most popular product in the investment activity as they assure a
reasonable and regular return on investment done by large or small investor. But, there are some
exemptions to this phenomenon. Mutual funds, being an firm or investment agency, are favored
as appropriate vehicle in particular from small investors, who usually feel risky to invest in
capital market and are unable to predict its conditions through different schemes.

NJ India Invest Pvt ltd. Is the company, which focus on the financial services provide to the
customers and also providing the investment services. The present study focuses on the risk and
returns analysis on equity mutual fund which is important for an investor to decide on a balance
between the desire lowest possible risk and earn possible return.

OBJECTIVES:-
 To study concept of Mutual Fund.

 To understand the various volatility measures and their significance.

 To study the effect of volatility on performance of funds.

 To evaluate performance of Equity Mutual Fund Schemes.

 To find out risk and return relationship and comparison between these schemes.

 To find out if Fund Managers are taking unnecessary risk in portfolio.

 To know if the funds are giving expected returns on these schemes.

SCOPE OF THE STUDY:-

 This study is based on equity schemes of mutual fund.

 This study is limited with NJ India Invest Pvt. Ltd. Kolhapur only.
LIMITATIONS OF THE STUDY:-

 The study is restricted to limit duration (2 months).

 Risk management is the wide topic and it’s difficult to analyze thoroughly with in the
short period.
 Analysis is based on Equity Schemes only.

RESEARCH METHODOLOGY:-
Business Research is an organized, data based, systematic, critical, objective, scientific
inquiry or investigation in to a specific problem undertaken, with the purpose of finding answers
or solutions to it. The information provided could be the result of a careful analysis of data
gathered first hand or of the data that are already available.
RESEARCH DESIGN

Descriptive research design:

The descriptive research includes surveys and fact-finding enquires of different kinds.
The major purpose of descriptive research is description of the state of affairs, as it exists at
present. The major characteristic of this method is researchers has no control over the variables,
he can only report what has happened or what is happening. The descriptive study is under taken
in order to ascertain and be able to describe the characteristics of the variables of interest in a
situation.

DATA COLLECTION:-

The data collection is the data constitute the foundation on which the super structure of
statistical analysis is built. The results obtained from the analysis are properly interpreted and
policy decisions are taken. Hence if the data inaccurate and inadequate, the whole analysis may
be faulty and the decisions will be misleading.

Data for the project is collected both through Primary and Secondary data.
PRIMARY DATA

Primary data are those, which is fresh and personally collected by researchers.

In this study, the primary data is collected from the discussion and interaction with company
guide.

SECONDARY DATA

The secondary data relating to RISK AND RETURNS ANALYSIS ON EQUITY MUTUAL
FUND were collected from the web site, Factsheets, Mutual fund handbook, News Paper etc.
 Chapter 2
THEORETICAL BACKGROUND
INTRODUCTION

WHAT IS MUTUAL FUND:-

SEBI Mutual Fund Regulation act, 1996, defines a Mutual Fund as ‘A fund established in
the form of a trust by a sponsor to raise money by the Trustees through the sale of units to the
public under one or more schemes for investing in securities in accordance with these
regulations.’

A Mutual Fund is common pool of money into which Investor place their contributions
that are to be invested in accordance with a stated objective. The ownership of the Fund is thus
joint or “mutual”; the fund belongings to all investors.

A single investor’s ownership of the fund is in the same proportion as the amount of the
contribution made by him or her bears to the total amount of the fund.

MUTUAL FUND OPERATION FLOW CHART:-

Investor Fund
• Pool Their Manager
money
with • Invest in

Returns Securities
• Passed
• Generates
back to
 Investing or riding is no science. It's an art. Yet all too often, we make the mistake of
assuming that because so much surrounding our fund is numeric, the buy-and-sell decisions are
mathematical. Nothing could be further from the truth -- especially when considering one of the
most difficult-to-understand (and measure) aspects of a mutual fund: its riskiness.

CONCEPT OF MUTUAL FUND

Concept of Mutual Fund

Many Investor With Common Financial Objective Pool Their Money

Investors, On A Proportionate Basis, Get Mutual Fund Units For The Sum Contributed
To The Pool

The Money collected From Investor Is invested into Shares, Debentures & Other
Securities By The Fund Manager

The fund manager Realize Gains Or Losses, & Collects Dividend Or Interest Income

Any Capital Gain Or Losses From Such Investments Are Passed On To The Investors
In Proportion of The Number of Units Held By Them

When an investor subscribes for the units of a mutual fund, he becomes part owner of the
assets of the fund in the same proportion as his contribution amount put up with the corpus (the
total amount of the fund). Mutual Fund investor is also known as a mutual fund shareholder or a
unit holder.

Any change in the value of the investments made into capital market instruments (such as
shares, debentures etc.) is reflected in the Net Asset Value (NAV) of the scheme. NAV is
defined as the market value of the Mutual Fund scheme's assets net of its liabilities. NAV of a
scheme is calculated by dividing the market value of scheme's assets by the total number of units
issued to the investors.

THE MUTUAL FUND INDUSTRY PROFILE IN INDIA:-

The mutual fund industry in India started in 1963 with the formation of Unit Trust of India, at
the initiative of the Government of India and Reserve Bank of India. Though the growth was
slow, but it accelerated from the year 1987 when non- UTI players entered the industry.
In the past decade, Indian mutual fund industry had seen dramatic improvements, both
quality wise as well as quantity wise. Before, the monopoly of the market had seen an ending
phase; the Asset under Management (AUM) was Rs. 6,700 cr. The private sector entry to the
fund family raised the AUM to Rs. 4,700 cr in March 1993 and till March 2014; it reached the
height of Rs. 3, 25,000 cr.
Putting the AUM of the Indian Mutual Funds Industry into comparison, the total of its less
than the deposits of SBI alone, constitute less than 11% of the total deposits held by the Indian
banking industry.
The main reason of its poor growth is that the mutual fund industry in India is new in the
country. Large sections of Indian investors are yet to be in telling actuated with the concept.
Hence, it is the prime responsibility of all mutual fund companies, to market the product
correctly abreast to the development of the sector. Each phase is briefly described as:

 FIRST PHASE – 1964-87:

Unit Trust of India was established on 1963 by an Act of Parliament. It was set up by
the Reserve Bank of India and functioned under the Regulatory and administrative control of the
Reserve Bank of India. In 1978 UTI was de-linked from the RBI and the Industrial
Development Bank of India took over the regulatory and administrative control in place of RBI.
The first scheme launched by UTI was Unit Scheme 1964. At the end of 1988 UTI had
Rs.6,700crores of assets under management.

 SECOND PHASE – 1987-1993 (ENTRY OF PUBLIC SECTOR FUNDS):

1987 marked the entry of non- UTI, public sector mutual funds set up by public sector banks and
Life Insurance Corporation of India and General Insurance Corporation of India. SBI Mutual
Fund was the first non- UTI Mutual Fund established in June 1987 followed by Can bank Mutual
Fund (Dec 87), Punjab National Bank Mutual Fund (Aug 89), Indian Bank Mutual Fund (Nov
89), Bank of India (Jun 90), Bank of Baroda Mutual Fund (Oct 92).
LIC established its mutual fund in June 1989 while GIC had set up its mutual fund in December
1990.At the end of 1993, the mutual fund industry had assets under management of Rs.47, 004
crores.

 THIRD PHASE – 1993-2003 (ENTRY OF PRIVATE SECTOR FUNDS):

With the entry of private sector funds in 1993, a new era started in the Indian mutual fund
industry, giving the Indian investors a wider choice of fund families. Also, 1993 was the year in
which the first Mutual Fund Regulations came into being, under which all mutual funds, except
UTI were to be registered and governed. The erstwhile Kothari Pioneer was the first private
sector mutual fund registered in July 1993.
The 1993 SEBI Regulations were substituted by a more comprehensive and revised
Mutual Fund Regulations in 1996. The industry now functions under the SEBI Regulations
1996.The number of mutual fund houses went on increasing, with many foreign mutual funds
setting up funds in India and also the industry has witnessed several mergers and acquisitions. As
at the end of January 2003, there were 33 mutual funds with total assets of Rs. 1, 21,805 crores.
The Unit Trust of India with Rs.44, 541 crores of assets under management was way ahead of
other mutual funds.

 FOURTH PHASE – SINCE FEBRUARY 2003:

In February 2003, following the repeal of the Unit Trust of India Act 1963 UTI was
bifurcated into two separate entities. One is the Specified Undertaking of the Unit Trust of
India with assets under management of Rs.29, 835 crores as at the end of January 2003,
representing broadly, the assets of US 64 scheme, assured return and certain other schemes.
The Specified Undertaking of Unit Trust of India, functioning under an administrator and
under the rules framed by Government of India and does not come under the purview of the
Mutual Fund Regulations.
The second is the UTI Mutual Fund Ltd, sponsored by SBI, PNB, BOB and LIC. It is
registered with SEBI and functions under the Mutual Fund Regulations. With the bifurcation of
the erstwhile UTI which had in March 2000 more than Rs.76, 000 crores of assets under
management and with the setting up of a UTI Mutual Fund, conforming to the SEBI Mutual
Fund Regulations, and with recent mergers taking place among different private sector funds,
the mutual fund industry has entered its current phase of consolidation and growth. As at the end
of September, 2004, there were 29 funds, which manage assets of Rs.153108 crores under 421
schemes.

ROLE OF MUTUAL FUNDS

Mutual Funds perform different roles for different constituencies. Their primary role is to assists
investors in earning an income or building their wealth, by participating in the opportunities
available in various securities and markets. It is possible for mutual fund to structure a scheme
for any kind of investment objective. Thus, the mutual fund structure , through its various
schemes, makes it possible to tap a large corpus of money from diverse investors. As a large
investor, the mutual funds can keep a check on the operations of the investee company, and their
corporate governance and ethical standards. The mutual fund industry itself, offers livelihood to
a large number of employees of mutual funds, distributors, registrars and various other service
providers. Higher employment, income and output in the economy boost the revenue collection
of the government through taxes and other means. When these are spent prudently, it promotes
further economic development and nation building. Mutual funds can also act as a market
stabilizer, in countering large inflows or outflows from foreign investors. Mutual funds are
therefore viewed as a key participant in the capital market of any economy.
Why To Select Mutual Fund?

The risk return trade-off indicates that if investor is willing to take higher risk. Then
correspondingly he can expect higher returns and vise versa if he pertains to lower Risk
instruments, which would be satisfied by lower returns. For example, if an investors opt
For bank FD, which provide moderate return with minimal risk. But as he moves ahead to
Invest in capital protected funds and the profit-bonds that give out more return which is
Slightly higher as compared to the bank deposits but the risk involved also increases in the
Same proportion.
Thus investors choose mutual funds as their primary means of investing, as Mutual
funds provide professional management, diversification, convenience and liquidity. That
doesn’t mean mutual fund investments risk free. This is because the money that is pooled in are
not invested only in debts funds which are less riskier but are also invested in the stock markets
which involves a higher risk but can expect higher returns. Hedge fund involves a very high risk
since it is mostly traded in the derivatives market which is considered very volatile.

ADVANTAGES OF MUTUAL FUNDS

The advantages of investing in a mutual fund are:

 Professional management
 Diversification
 Return potential
 Low costs
 Liquidity
 Transparency
 Flexibility
 Choice of schemes
 Tax benefits
 Reduction in risk
Disadvantages of mutual funds

 No control over cost

 Customized portfolio are not possible
 Fund selection can be difficult

TYPES OF MUTUAL FUNDS

 Open – Ended funds

An open-end fund is one that is available for subscription all through the year. These do
not have a fixed maturity. Investors can conveniently buy and sell units at Net Asset Value
("NAV") related prices. The key feature of open-end schemes is liquidity.

 Close-Ended funds
A close ended fund makes a one-time sale of a fixed number of units. It has a fixed
maturity. It does not allow investors to buy or redeem units directly from the funds. However,
to provide liquidity to investors many closed-end funds get themselves listed on stock exchange.
Funds do offer “buy-back of funds/units” thus offering another avenue for liquidity to closed-end
fund investor.

 Interval funds
Interval funds are that funds, which combines the features of open-ended and close ended
funds. The units may be traded on the stock exchange or may be open for sale or
redemption during pre-determined intervals at NAV related prices.

 Load or no-load fund

A load fund is one that charges a percentage of NAV for entry or exit. That is, each time
one buys or sells units in the fund, a charge will be payable. This charge is used by the mutual
fund for marketing and distribution expenses. However the investor should also consider the
performance track record and service standard of the mutual fund, which are more important.
Efficient funds may give higher returns in spite of load.
  Load fund
It is one that does charge for entry or exit. It mean the investors can enter the
fund/scheme at NAV and additional charges are payable on purchase or sale of unit.
 No-load fund
It is one that does not charge for entry or exit. It mean the investors can enter the
fund/scheme at NAV and no additional charges are payable on purchase or sale of unit.

 Tax exempt Vs Non-tax exempt

Generally, when a fund invests in tax-exempt securities, it is called a tax-exempt fund. In
India after the 1999 Union Government Budget, all of the dividend income received from any of
the mutual funds is tax-free in the hands of the investors. However, funds other than Equity
Funds have to pay a distribution tax, before distributing income to investors. In other words,
equity mutual fund schemes are tax-exempt investment avenues, while other funds are taxable
for distributable income.

 Types of Mutual Funds on the basis of Risk Vs Returns-

A) Broad fund type by nature of Investments-
Mutual funds may invest in equities, bonds or other fixed income securities, or short-term
money market securities. So we have Equity, Bonds and Money Market Funds. All of them
invest in financial assets. But there are funds that invest in physical assets. For example, we may
have Gold or other precious metal funds, or Real estate funds.
B) Broad Fund Types by Investment objective
Investment and hence the mutual funds pursue different objectives while investing. Thus,
Growth Funds- invest for medium to long term capital appreciation.
Income Funds- invest to generate regular income, and less for capital appreciation.
Value Funds- invest in equities that are considered under –valued today, whose value will be
unlocked in the future.
C) Broad Fund Types by Risk Profile
The nature of funds portfolio and its investment objective imply different levels of risk
undertaken. Funds are therefore often grouped in order of risk. Thus, equity funds have a greater
risk of capital loss than a Debt fund that seeks to protect the capital while looking for income.
Kotak Mutual Fund uses following Measures of Volatility
A)BETA:
One measure of the relative volatility of a particular stock to the market is its beta. A
beta approximates the overall volatility of a security's returns against the returns of a relevant
benchmark (usually the S&P 500 is used). For example, a stock with a beta value of 1.1 has
historically moved 110% for every 100% move in the benchmark, based on price level.
Conversely, a stock with a beta of .9 has historically moved 90% for every 100% move in
the underlying index. It is common knowledge that mutual funds are benchmarked against
particular market indices. In general, diversified funds are benchmarked against Sensex or Nifty,
while sectorial funds are benchmarked against their particular sector index. It is fair to then
assume that the ups and downs of any index will affect the funds that are benchmarked against it.
In other words, if the Sensex falls, you can expect a diversified fund to fall as well.
But while some funds might be affected more by an index's volatility, others might not. So, to
get an idea of how volatile a fund is with respect to its index Beta is the measure of a fund's (or
stock's) volatility relative to the market or benchmark.
For example, if a fund is benchmarked against the Sensex, a beta of more than 1 would imply
that the fund is more volatile than the index. And of course, a beta of less than 1 would imply
lesser volatility.
Allow me to explain further. Let's say there are two funds, one with a beta of 2.5 and the other
with 0.4, both benchmarked against the same index. Now, if the market rises by 1 per cent, the
first fund will rise by approximately 2.5 per cent, while the latter will rise by 0.4 per cent. A
similar relationship will take place in a falling market. In simpler words, beta is a quantitative
measure of a fund (or stock) relative to the market.
In effect, beta expresses the fundamental trade-off between minimizing risk and
maximising return. This means that while an investor can expect high returns from a fund that
has a beta of 2, he can also expect the fund to be more risky and drop much more when the
market falls. A fund with a beta of 1 would flourish or diminish in the same vein as the market.
So, how effective is beta in judging a fund's volatility? Well, that depends on the index used to
calculate it. If the beta of a large-cap fund is calculated against a mid-cap index, the resulting
value would have no meaning. This is because the large-cap fund would not be invested in the
stocks making up the small-cap index.
Beta is fairly straightforward and offers a lucid, quantifiable and convenient measure of a fund's
volatility. However, beta does have its limitations. Beta is essentially a historic tool and does not
incorporate new information. For example, a company may venture into a new business and
assume a high debt level, but this new risk will not be captured by beta. Beta relies on past
movements and does not take new happenings into account. Hence, beta cannot be calculated for
new funds or stocks that have insufficient history.
In conclusion, investors should remember that beta is just an indication of a fund's
(or stock's) volatility. It gives a fair idea of the same and can be used as a reference, but should
not be relied upon completely since beta depends on past movements, which are not fool proof
predictors of future behaviour.

B)STANDARD DEVIATION:
It is one of the most popular risk measures -- one with a distinct advantage over beta.
While beta compares a fund's returns with a benchmark, standard deviation measures how far a
fund's recent numbers stray from its long-term average. For example, if Fund X has a 10%
average rate of return and a standard deviation of 5%, most of the time, its return will range from
5% to 15%. A large standard deviation supposedly shows a more risky fund than a smaller one.
But here, again, what's problematic is your reference point. The number alone doesn't tell you
much. You have to compare one standard deviation with the others among a fund's peers. But a
more glaring problem is that the standard deviation system rewards consistency above all else. A
fund is considered stable based on the uniformity of its own monthly returns. So if it loses money
but does so very consistently it can have a very low standard deviation -- down 3% each and
every month wins a standard deviation of zero. That doesn't signal a risk-free investment, and
likewise, a fund that gains 10% one month and 15% the next would be penalized by a high
standard deviation a reminder that volatility, although perhaps a cousin to risk, itself isn't
necessarily a bad thing.

C)R-squared:

A statistical measure that represents the percentage of a fund or security’s movements

that can be explained by movements in a benchmark index. For fixed-income securities, the
benchmark is the T-bill. For equities, the benchmark is the S&P 500. R-squared values range
from 0 to 100. An R-squared of 100 means that all movements of a security are completely
explained by movements in the index. A high R-squared (between 85 and 100) indicates the
fund's performance patterns have been in line with the index. A fund with low R-squared (70 or
less) doesn’t act much like index. A higher R-squared value will indicate a more useful beta
figure. For example, if a fund has an R-squared value of close to 100 but has a beta below 1, it is
most likely offering higher risk-adjusted returns. A low R-squared means you should ignore the
beta.

D)Sharpe Ratio:

This formula, worked by Nobel Laureate Bill Sharpe, tries to quantify how a fund
performs relative to the risk it takes. Take a fund's returns in excess of a guaranteed investment
(a 90-day T-bill) and divide by the standard deviation of those returns. The bigger the Sharpe
ratio, the better a fund performed considering its riskiness. Here, again, you have the problem of
relativity -- the ratio itself doesn't tell you anything, you have to compare it with the Sharpe of
other funds. But this ratio has an advantage over alpha because it uses standard deviation instead
of beta as the volatility variable, and therefore you don't have to worry that a fund doesn't relate
well to the chosen index.

The Sharpe ratio tells investors whether an investment's returns are due to smart
investment decisions or the result of excess risk. This measurement is very useful because
although one portfolio or security can reap higher returns than its peers, it is only a good
investment if those higher returns do not come with too much additional risk. The greater an
investment's Sharpe ratio, the better its risk-adjusted performance.

Sharpe Ratio Dynamics: The Sharpe ratio, developed by Nobel Laureate William Sharpe,
is designed to measure how many excess units of returns an investor can achieve over the risk
free rate for each unit of risk taken. Thus, the Shape Ratio measures the risk/reward value of
investors' assets class choices beyond the U S Treasury. Let's take a look at the efficient frontier
chart below to better illustrate the concept of risk, return and the Sharpe ratio.
Efficient Frontier - if you plot all the investment choices that you have at your disposal - stocks,
bonds and portfolios of stocks and bonds, etc. on the chart above, the resulting chart will be
bounded by an upward sloping curve known as the efficient frontier.

E)Return Dynamics:

Without taking on risk, you can achieve a level of return as indicated on the chart by the
risk-free portfolio, the U.S. Treasury.

To achieve an additional X per cent of return, you will need to take Z level of risk.
Portfolio A represents your risk and return payoff. The Sharpe ratio of Portfolio A can simply be
defined as X divided by Z. Portfolios B and C will deliver a higher level of returns should you
choose to take additional risk beyond Z. Unlike portfolio B and C, portfolios A' and A'' will
deliver a higher level of returns for the same level of risk Z. Thus, A'' is preferable to A' and A' is
preferable to A. The Sharpe ratio of A is defined as X+Y divided by Z.

Therefore, the Sharpe ratio of A' is higher than that of A. Given the same level of risk Z, it can
be concluded that any portfolio providing X plus additional returns should be considered
superior. The additional achievable returns will be limited by the efficient frontier. Applying this
same methodology, we can also presume that Portfolios B and C are superior if their Sharpe
ratios are shown to be higher to that of A.
 Chapter 3
INTRODUCTION
TO
COMPANY
NJ Wealth – Financial Products Distributors Network Kolhapur Branch

NJ Wealth - Financial Products Distributors Network, one of India's leading and most successful
network of distributors in the financial services industry.

Started in 2003, NJ Wealth seeks to reach out to the common man and extend the opportunity to
create wealth through an empowered network of financial products distributors – the NJ Wealth
Partners. To its Partners, NJ Wealth provides a full service, comprehensive business platform
with end-to-end solutions critical for success in financial products distribution practice. With its
compelling set of offerings covering every area of distribution practice, NJ Wealth has managed
to successfully transform the lives of many small and big distributors.

To the common man, NJ Wealth offers a comprehensive wealth management platform with a
wide choice of financial and non-financial products. Backed by high levels of excellence in
operational and service standards, NJ Wealth offers customers of its Partners, with solutions that
truly make a difference.

Driven by the strong vision of 'Creating Wealth and Transforming Lives', NJ Wealth's constant
endeavour is to build on the ideas that are meaningful & effective in scaling business challenges,
seizing available opportunities and serving the interests of the customer.

The NJ Wealth family has grown steadily and today it has over 24,800+ NJ Wealth Partners,
spread across 97 branches in 23 states in India with over 12,00,000+ investors, and over INR
32,500+ crores of mutual fund assets under advice. Irrespective of the numbers though, it is trust
in us which fuels the passion for creating solutions with excellence that touch many lives, day
after day.

We warmly welcome all, to NJ Wealth to experience this passion to excel and to serve.

Product basket
 Domestic mutual funds (all AMCs)
 Capital Markets - direct equity and ETFs
 Fixed Deposits of companies
  PMS products (Third party & NJ)
 Residential & commercial properties

Partner Services
 Dedicated Relationship Manager
 Marketing & Sales support
 Research support
 Training & Education support
 Dedicated Customer Care / Query management support
 Technological support, including online business / 'Partners Desk' with CRM &
Employee Management modules

Customer Services
Online family "Client Desk" enabling single portfolio view of 'entire' wealth portfolio Trading
& Demat Account with online transacting & call-&-trade service in mutual funds, direct equity
& Exchange Traded Funds (ETF)

Asset Management
NJ has ventured in asset management business with NJ Advisory Services Pvt. Ltd., a
group company, launching its discretionary PMS products.
At the heart of NJ Advisory Services is the idea to provide customers with solutions that give
them the freedom from active management of investments while having an assurance that we
would be doing so in the best possible manner. Our conviction, matched by our passion and
expertise, is all about ensuring the peace of mind of the investor.
The PMS products currently offered are aimed at meeting investor's need for successful long-
term wealth creation by following strategies that control risk and optimize returns in a mutual
fund portfolio.
NJ Advisory Services leverages upon with its rich experience in portfolio management
with in-depth knowledge & expertise in mutual funds. The decisions on the mutual fund
portfolio also combine results of time tested proprietary research models, extensive due-diligence
of fund houses, interactions with fund managers & internal risk controls.
The defined processes and smart use of technology further ensures that the investors are offered
with quality portfolio management and administrative services, ensuring a complete peace of
mind.

Products
 Freedom Portfolio:
Objective To stay invested in equity mutual fund schemes at all times, deliver superior
portfolio returns by selecting better performing schemes and encashing on opportunities
offered by markets.
 Dynamic Asset Allocation Portfolio:
Objective: To give better risk adjusted returns by deciding right proportion of Equity and Debt
asset classes from time to time, and selecting consistently better performing mutual fund
schemes.

Key customer services:

Online Client PMS Desk with daily update reports
Reporting on monthly, quarterly & annual basis through email and hard copies
The existing customers of NJ Wealth Partners can approach them for more details.

Real Estate
The NJ Realty venture offers an integrated service model offering end-to-end services to
various stake-holders in realty program management & execution. The idea is to associate with
stakeholders and engage actively in various stages of program management, viz. market survey,
legal due diligence, land acquisition, planning & execution of projects and managing sales &
distribution through NJ Wealth – Financial Products Distributors Network.
Managing realty programs is a lengthy process replete with many challenges right from
program identification to marketing. As a developer, investor or land owner, one may be keen to
execute realty projects, but may not be equipped with the right skill-sets, contacts, experience
and/or know-how for the undertaking. This is where NJ Realty can associate and help in shaping
up the realty programs. NJ Realty has acquired considerable experience in program management
and is also currently engaged in multiple programs playing diverse roles.
At the heart of NJ Realty is the philosophy of sustainability and preservation of environment.
Going beyond words, NJ Realty seeks to keep environment as one of the focal points in it's real
estate business.
The NJ Realty venture offers an integrated service model offering end-to-end services to
various stake-holders in realty program management & execution. The idea is to associate with
stakeholders and engage actively in various stages of program management, viz. market survey,
legal due diligence, land acquisition, planning & execution of projects and managing sales &
distribution through NJ Wealth – Financial Products Distributors Network.
Managing realty programs is a lengthy process replete with many challenges right from
program identification to marketing. As a developer, investor or land owner, one may be keen to
execute realty projects, but may not be equipped with the right skill-sets, contacts, experience
and/or know-how for the undertaking.
This is where NJ Realty can associate and help in shaping up the realty programs. NJ
Realty has acquired considerable experience in program management and is also currently
engaged in multiple programs playing diverse roles. At the heart of NJ Realty is the philosophy
of sustainability and preservation of environment. Going beyond words, NJ Realty seeks to keep
environment as one of the focal points in it's real estate business.

Insurance Broking
NJ Insurance Brokers Pvt. Ltd., a licensed insurance broker by IRDA, seeks to provide
customers with comprehensive solutions catering to their insurance needs.
At the heart of NJ Insurance is the strong vision for continued financial well-being for
customers - individuals and families, regardless of any circumstances. The key is to offer 'right'
advice which is unbiased and customer centric and encompasses the right risk to insure, the right
coverage, the right product and at the right time. The idea to offer clients with comprehensive
solutions extends further to cover quality claim settlement and other services.
NJ Insurance leverages from the rich experience of NJ group in financial planning and
investment management for customers. NJ Insurance Brokers has appointed Certified Insurance
Advisors (CIAs) who work with customers in identifying, fulfilling & managing their insurance
needs.
NJ offers a comprehensive basket of products both in life & non-life insurance space and
makes exhaustive use of technology to deliver great value to customers.

Product basket
 Life insurance products from leading life insurers.
 General insurance products, especially Health, Motor & Personal Accident, from
leading general insurers
Global Wealth Advisory
NJ Global Invest (Ltd.) is a new venture wherein NJ seeks to offer a Global Wealth Advisory
platform to advisors for offshore funds across the globe.
The vision at Global Wealth Advisory platform is to offer a single window for investment
opportunities across the globe to customers. The idea is to bring to customers a wide range of
offshore fund schemes (domiciled in Mauritius, Luxembourg, Dublin and other jurisdictions),
through advisors on the Global Wealth Advisory platform. NJ Global Invest seeks to provide a
offshore fund distribution platform & offshore Portfolio Advisory services under a B2B
distribution model. NJ Global Invest also desires to offer comprehensive order routing and trade
settlement facility with support services of client reporting & fees settlement.
NJ Global Invest is a venture that leverages from rich experience & success of financial
products distribution business in India. Incorporated in Mauritius, NJ Global Invest is set up an
offshore fund distribution company and is a licensed 'Investment Dealer (Full Service Dealer,
excluding underwriting)" by FSC, Mauritius.

Information Technology
NJ Technologies is a latest venture by NJ wherein we aim to provide quality technology
solutions to businesses in a wide range of domains.
NJ started its journey in technology with the start of Finlogic Technologies (India) Pvt.
Ltd., a group company, in year 2000. The idea then was to develop software applications to
support the growing (financial services) distribution business and manage the IT infrastructure.
Over the years, the captive IT team, gained strong domain expertise and skills in diverse areas
and technology domains. Today, Finlogic team boasts of over 300 employees with skills & rich
experience in product development, software testing, infrastructure management, R&D, project
management & information security. The entire NJ Group's internal systems and infrastructure is
managed by Finlogic which also has developed many state-of-the arts, proprietary applications
that power NJ's businesses.
NJ Technologies now seeks to leverage these in-house skills & expertise to help other
businesses find solutions for their business challenges. At NJ Technologies, we are keen to adopt
the latest and the best practices from the industry in delivering solutions that really work for
businesses.
Solutions for businesses:
 Infrastructure Set-up and Management
 Database Management
 Customized Application Development
 Software Quality Assurance
 Information Security

Training & Development

The NJ Gurukul is a venture aimed at providing valuable training & education support to the
young, emerging talent pool in India. Started in year 2008, NJ Gurukul today offers a very wide
range of training programs across India in all major cities.
NJ Gurukul is about a vision that aspires to nurture the young talent in India and to
transform them into individuals with knowledge & skills for employment and enterprise. With
special focus on the financial advisors community, NJ Gurukul today, is a leading provider of
training programs in the financial services industry. NJ Gurukul offers a wide range of training
programs by way of part / full time classroom sessions being conducted at multiple locations
across India. NJ Gurukul has an institutionalised, process driven approach to training with focus
on delivering uniformity in quality & content.
The NJ Gurukul has a Board of Trainers with over 35 well qualified, professional trainers
empanelled across India for delivering training programs. Within a short time, NJ Gurukul has
trained over 35,000 participants in over 80 locations across India. NJ Gurukul is an authorised
Education Provider (EP) with FPSB India to deliver training for the prestigious Certified
Financial Planner - CFPCM Certification. NJ Gurukul is also amongst the largest trainers of
Mutual Fund Distributors in India.

Organizational Structure:-
 Chapter 4
DATA
PRESENTATION,
INTERPRETATION
&
ANALYSIS
MEASURING RISK

Since assuming risk is inherent to the investment process, mutual fund investors must be
adequately and consistently rewarded for the risks they assume. Prudent research means
searching for fund managers who consistently produce returns justifying the risks they have
taken.

Modern portfolio theory research developed a number of statistics that make it possible to
more precisely quantify the relationship between risk and return. These measurements help
determine

 Funds volatility (Standard Deviation).

 How closely a fund mirrors a particular market index (R²)

 How volatile a fund is compared with that market index (Beta)

 How much of funds risk-adjusted return is created by a talented manager (Sharpe)

TO STUDY THE CALCULATION OF VOLATILITY MEASURES:-

A. Kotak 50- Dividend

Duration Rp Rm Rf X2 XY
X=Rm-Rf Y=Rp-Rf
1 year
15.28 16.56 6.25 10.31 9.03 106.3 93.1 3.13 9.8
2 year
-0.94 -0.96 6.25 -7.21 -7.19 51.98 51.84 -14.39 207.07
3 year
21.56 9.95 6.25 3.7 15.31 13.69 56.65 -3.48 12.11
4 year
30.62 30.28 6.25 24.03 24.37 577.44 585.61 16.85 283.92
5 year
12.18 10.67 6.25 4.42 5.93 19.54 26.21 -2.76 7.62
Since
inception
19.85 14.06 6.25 7.81 13.6 61 106.22 0.63 0.4
Total
43.06 61.05 829.95 919.63 -0.02 520.92

Where,
Rp= Portfolio Return – Kotak Fund
Rm= Market Return – Fund`s Benchmark
Rf= Risk Free Rate of Return

CALCULATION OF ARITHMATIC MEAN (𝑋̅ )

∑𝑿
= 𝑵

10.31+(−7.21)+3.7+24.03+4.42+7.81
= 6

43.06
= 6

= 7.18

CALCULATION OF STANDARD DEVIATION (𝜎)

∑ (𝑋−𝑋̅ )2
=√ 𝑁
 520.92
=√ 6

= √86.82

= 9.32

CALCULATION OF BETA CO-EFFICIENT

𝑵(∑𝑿𝒀)−∑𝑿∑𝒀
= 𝑵(∑𝑿𝟐 )−(∑𝑿)𝟐

6(919.63)−(43.06)(61.05)
= (829.95)−(43.06 )2

5517.78+ 2628.813
= 829.95 −1854.16

2888.97
= −1024.21

= -2.82

CALCULATION OF SHARPE’S RATIO

𝑅𝑝−𝑅𝑓
= 𝜎

61.05
= 9..32

= 6.55
 B. Kotak classic equity fund- Growth

Duration Rp Rm Rf X2 XY
X=Rm-Rf Y=Rp-Rf
1 year
20.04 17.76 6.25 11.51 13.79 132.48 158.72 3.16 9.98
2 year
-0.23 -0.29 6.25 -6.54 -6.48 42.77 42.38 -14.89 221.71
3 year
13.74 11.71 6.25 5.46 7.49 29.81 40.59 -2.89 8.35
4 year
37.38 36.87 6.25 30.62 31.13 937.58 953.2 22.27 495.95
5 year
10.12 8.16 6.25 1.91 3.87 3.65 7.39 -6.44 41.47
Since
inception
13.32 13.38 6.25 7.13 7.07 50.84 50.41 -1.22 1.49
Total
50.09 56.87 1197.13 1252.69 -0.01 778.95

Where,
Rp= Portfolio Return – Kotak Fund
Rm= Market Return – Fund`s Benchmark
Rf= Risk Free Rate of Return

CALCULATION OF ARITHMATIC MEAN (𝑋̅ )

∑𝑿
= 𝑵

𝟏𝟏.𝟓𝟏+(−𝟔.𝟓𝟒)+𝟓.𝟒𝟔+𝟑𝟎.𝟔𝟐+𝟏.𝟗𝟏+𝟕.𝟏𝟑
= 𝟔

𝟓𝟎.𝟎𝟗
= 𝟔

= 8.35

CALCULATION OF STANDARD DEVIATION (𝜎)

∑ (𝑋−𝑋̅ )2
=√ 𝑁

778.95
=√ 6
 = √129.83

= 11.39

CALCULATION OF BETA CO-EFFICIENT

𝑵(∑𝑿𝒀)−∑𝑿∑𝒀
= 𝑵(∑𝑿𝟐 )−(∑𝑿)𝟐

6(1252.69)−(50.09)(56.87)
= (1197.13)−( 50.09)2

7516.14−2848.62
= 1197.13−2509.00

4667.52
= −1311.87

= -3.55

CALCULATION OF SHARPE’S RATIO

𝑅𝑝−𝑅𝑓
=
𝜎

56.87
= 11.39

= 4.99
 C. Kotak opportunities- Growth

Duration Rp Rm Rf X2 XY
X=Rm-Rf Y=Rp-Rf
1 year
24.02 19.84 6.25 13.59 17.95 184.69 243.94 4.32 18.66
2 year
3.03 1.21 6.25 -5.04 -3.22 25.4 16.23 -14.31 204.78
3 year
26.33 11.71 6.25 5.46 20.08 29.81 109.64 -3.81 14.52
4 year
36.69 36.87 6.25 30.62 30.44 937.58 932.07 21.35 455.82
5 year
10.1 8.16 6.25 1.91 3.85 3.65 7.35 -7.36 54.17
Since
inception
20.65 15.32 6.25 9.07 14.4 82.26 130.61 -0.2 0.04
Total
55.61 83.5 1263.39 1439.84 -0.01 747.99

Where,
Rp= Portfolio Return – Kotak Fund
Rm= Market Return – Fund`s Benchmark
Rf= Risk Free Rate of Return

CALCULATION OF ARITHMATIC MEAN (𝑋̅ )

∑𝑿
= 𝑵

13.59+(−5.04)+5.46+30.62+1.91+9.07
= 6

55.61
= 6

= 9.27

CALCULATION OF STANDARD DEVIATION (𝜎)

∑ (𝑋−𝑋̅ )2
=√ 𝑁

747.99
=√ 6
 = √124.665

= 11.17

CALCULATION OF BETA CO-EFFICIENT

𝑵(∑𝑿𝒀)−∑𝑿∑𝒀
= 𝑵(∑𝑿𝟐 )−(∑𝑿)𝟐

6(1439.84)−(55.61)(83.5)
= (1263.39)−( 55.61)2

8639.04−4643.44
= 1263.39−3092.47

3995.6
= −1829.28

= -2.18

CALCULATION OF SHARPE’S RATIO

𝑅𝑝−𝑅𝑓
=
𝜎

83.5
= 11.17

= 7.47
 D. Kotak select focus fund- Growth

Duration Rp Rm Rf X2 XY
X=Rm-Rf Y=Rp-Rf
1 year
23.74 18.8 6.25 12.55 17.49 157.5 243.94 4.75 22.56
2 year
6.63 0.04 6.25 -6.21 0.38 38.56 16.23 -14.01 196.28
3 year
26.4 11.57 6.25 5.32 20.15 28.3 109.64 -2.48 6.15
4 year
43.12 34.02 6.25 27.77 36.87 771.17 932.07 19.97 398.8
5 year
11.41 9.51 6.25 3.26 5.16 10.62 7.35 -4.54 20.61
Since
inception
15.83 10.36 6.25 4.11 9.58 16.89 130.61 -3.69 13.62
Total
46.8 89.63 1023.04 2103.47 0 658.02

Where,
Rp= Portfolio Return – Kotak Fund
Rm= Market Return – Fund`s Benchmark
Rf= Risk Free Rate of Return

CALCULATION OF ARITHMATIC MEAN (𝑋̅ )

∑𝑿
= 𝑵

𝟏𝟐.𝟓𝟓+(−𝟔.𝟓𝟏)+𝟓.𝟑𝟐+𝟐𝟕.𝟕𝟕+𝟑.𝟐𝟔+𝟒.𝟏𝟏
= 𝟔

𝟒𝟔.𝟖
= 𝟔

= 7.8

CALCULATION OF STANDARD DEVIATION (𝜎)

∑ (𝑋−𝑋̅ )2
=√ 𝑁
 658.02
=√ 6

= √109.67

= 10.47

CALCULATION OF BETA CO-EFFICIENT

𝑵(∑𝑿𝒀)−∑𝑿∑𝒀
= 𝑵(∑𝑿𝟐 )−(∑𝑿)𝟐

6(2103.47)−(46.8)(89.63)
= (1023.04)−( 46.8)2

12620.82−4194.684
= 1023.04−2190.24

8426.14
= −1167.2

= -7.22

CALCULATION OF SHARPE’S RATIO

𝑅𝑝−𝑅𝑓
= 𝜎

89.63
= 10.47

= 8.56
 E. Kotak Tax saver fund- Growth

Duration Rp Rm Rf X2 XY
X=Rm-Rf Y=Rp-Rf
1 year
22.3 19.84 6.25 13.59 16.05 184.69 218.11 4.82 23.23
2 year
0.35 1.21 6.25 -5.04 -5.9 25.4 29.74 -13.81 190.72
3 year
30.25 11.71 6.25 5.46 24 29.81 131.04 -3.31 10.96
4 year
33.44 36.87 6.25 30.62 27.19 937.58 832.56 21.85 477.42
5 year
2.66 8.16 6.25 1.91 -3.59 3.65 -6.86 -6.86 47.06
Since
inception
12.75 12.34 6.25 6.09 6.5 37.09 39.59 -2.68 7.18
Total
52.63 64.25 1218.22 1244.19 5.55 756.57

Where,
Rp= Portfolio Return – Kotak Fund
Rm= Market Return – Fund`s Benchmark
Rf= Risk Free Rate of Return

CALCULATION OF ARITHMATIC MEAN (𝑋̅ )

∑𝑿
= 𝑵

𝟏𝟑.𝟓𝟗+(−𝟓.𝟎𝟒)+𝟓.𝟒𝟔+𝟑𝟎.𝟔𝟐+𝟏.𝟗𝟏+𝟔.𝟎𝟗
= 𝟔

52.63
= 6

= 8.22

CALCULATION OF STANDARD DEVIATION (𝜎)

∑ (𝑋−𝑋̅ )2
=√ 𝑁

756.57
=√ 6
 = √126.09

= 11.23

CALCULATION OF BETA CO-EFFICIENT

𝑵(∑𝑿𝒀)−∑𝑿∑𝒀
= 𝑵(∑𝑿𝟐 )−(∑𝑿)𝟐

6(1244.19)−(52.63)(64.25)
= (1218.22)−( 52.63)2

7465.14−3381.48
= 1218.22−2769.92

84083.66
= −1551.70

= -2.63

CALCULATION OF SHARPE’S RATIO

𝑅𝑝−𝑅𝑓
=
𝜎

64.25
= 11.23

= 5.72
STUDY OF PERFORMANCE OF SELECTED KOTAK MUTUAL FUNDS

a) Kotak 50- Dividend

Duration 1 year 2 year 3 year 4 year 5 year Since
inception
Kotak 50- Dividend 15.28 -0.94 21.56 30.62 12.18 19.85
Benchmark 16.56 -0.96 9.95 30.28 10.67 14.06

35

30

25

20

15

10

0
1 2 3 4 5 6
-5

Kotak 50- Dividend Benchmark

 b) Kotak classic equity fund- Growth

Duration 1 year 2 year 3 year 4 year 5 year Since

inception
Kotak classic equity 20.04 -0.23 13.74 37.38 10.12 13.32
fund- Growth
Benchmark 17.76 -0.29 11.71 36.87 8.16 13.38

40
35
30
25
20
15
10
5
0
1 2 3 4 5 6
-5

Kotak classic equity fund- Growth Benchmark

 c) Kotak opportunities- Growth

Duration 1 year 2 year 3 year 4 year 5 year Since

inception
Kotak Opportunities- 24.02 3.03 26.33 36.69 10.1 20.65
Growth
Benchmark 19.84 1.21 11.71 36.87 8.16 15.32

40
35
30
25
20
15
10
5
0
1 2 3 4 5 6

Kotak Opportunities- Growth Benchmark

 d) Kotak select focus fund- Growth

Duration 1 year 2 year 3 year 4 year 5 year Since

inception
Kotak select focus 23.74 6.63 26.4 43.12 11.41 15.83
fund- Growth
Benchmark 18.8 0.04 11.57 34.02 9.51 10.36

50
45
40
35
30
25
20
15
10
5
0
1 2 3 4 5 6

Kotak select focus fund- Growth Benchmark

 e) Kotak Tax saver fund- Growth

Duration 1 year 2 year 3 year 4 year 5 year Since

inception
Kotak Tax saver fund- 22.3 0.35 30.25 33.44 2.66 12.75
Growth
Benchmark 19.84 1.21 11.71 36.87 8.16 12.34

40
35
30
25
20
15
10
5
0
1 2 3 4 5 6

Kotak Tax saver fund- Growth Benchmark

COMPARISON OF PERFORMANCE OF SELECTED KOTAK EQUITY FUND
A) Comparison On The Basis of BETA

Fund name Beta

Kotak 50- Dividend 0.98
Kotak classic equity fund- Growth 0.98
Kotak Opportunities- Growth 1.02
Kotak select focus fund- Growth 1.01
Kotak Tax saver fund- Growth 1.07

1.08
1.06
1.04
1.02
Beta

1
0.98
0.96
0.94
0.92
Kotak 50- Kotak classic Kotak Kotak select Kotak Tax saver
Dividend equity fund- Opportunities- focus fund- fund- Growth
Growth Growth Growth
Fund name
B) Comparison On The Basis of Standard Deviation

Fund name Standard Deviation

Kotak 50- Dividend 13.55%
Kotak classic equity fund- Growth 13.30%
Kotak Opportunities- Growth 14.07%
Kotak select focus fund- Growth 14.14%
Kotak Tax saver fund- Growth 15.12%

15.50%
15.00%
Standard deviation

14.50%
14.00%
13.50%
13.00%
12.50%
12.00%
Kotak 50- Kotak classic Kotak Kotak select Kotak Tax
Dividend equity fund- Opportunities- focus fund- saver fund-
Growth Growth Growth Growth
Funds name
C) Comparison On The Basis of Sharpe Ratio

Fund name Sharpe ratio

Kotak 50- Dividend 0.61
Kotak classic equity fund- Growth 0.53
Kotak Opportunities- Growth 0.90
Kotak select focus fund- Growth 0.96
Kotak Tax saver fund- Growth 0.83

1.2

0.8
Sharpe ratio

0.6

0.4

0.2

0
Kotak 50- Kotak classic Kotak Kotak select Kotak Tax
Dividend equity fund- Opportunities- focus fund- saver fund-
Growth Growth Growth Growth
Funds name
D) Comparison On The Basis of Equity Funds

Fund name Equity funds

Kotak 50- Dividend 12.18
Kotak classic equity fund- Growth 10.12
Kotak Opportunities- Growth 10.1
Kotak select focus fund- Growth 11.41
Kotak Tax saver fund- Growth 2.66

14
12
10
Equity funds

8
6
4
2
0
Kotak 50- Kotak classic Kotak Kotak select Kotak Tax
Dividend equity fund- Opportunities- focus fund- saver fund-
Growth Growth Growth Growth
Fund name
 Chapter 5
FINDINGS,
SUGGESTIONS & CONCLUSION
 FINDINGS
 During the study, observed that as compare to low market risk, the KOTAK SELECT
FOCUS FUND gives more returns in recent five years.
 As compare to market risk found that, the KOTAK TAX SAVER FUND gives less returns in
recent five years.

 SUGGESTIONS
 It can be suggested that the investor who can bear high risk can invest into these two
fund.
- Kotak tax saver fund
- Kotak 50 - dividend

 In the year 2014, 2015 and 2016, kotak select focus fund and kotak opportunity fund
doing well. But also includes high risk. Investor can invest in this fund who wants to
take more risk and getting more returns.
 CONCLUSIONS
Many investors tend to focus exclusively on investment return, with little concern for
investment risk. The five risk measures we have just discussed can provide some balance to the
risk-return equation. The good news for investors is that these indicators are calculated for
them and are available on several financial websites, as well as being incorporated into many
investment research reports. As useful as these measurements are, keep in mind that when
considering a stock, bond, or mutual fund investment, volatility risk is just one of the factors
you should be considering that can affect the quality of an investment.

When looking to invest, you need to look at both risk and return. While return can be
easily quantified, risk cannot. Today, standard deviation is the most commonly referenced risk
measure, while the Sharpe ratio is the most commonly used risk/return measure. The Sharpe
ratio has been around since 1966, but its life has not passed without controversy. Even its
founder, William Sharpe, admits the ratio is not without its problems.

The Sharpe ratio is a good measure of risk for large, diversified, liquid investments, but
for others, such as hedge funds, it can only be used as one of a number of risk/return measures.
 BIBLIOGRAPHY

BIBLIOGRAPHY

Book Reference
 National Institute of Securities Market (www.nism.ac.in)

Magazine
 Nj FUND WATCH
 Nj Wealth
 Factsheet of kotak mutual fund

Website
 www.amfiindian.com
 www.njindiainvest.com
 www.mutualfundindia.com