Pravesh Project

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CHAPTER: 1
Introductory Issues.
1.1 Introduction.
The performance evaluation of mutual fund is a vital matter of

concern to the fund managers, investors, and researchers
alike. The core competence of the company is to meet
objectives and the needs of the investors and to provide
optimum return for their risk. This study tries to find out the
risk and return allied with the mutual funds.
This project paper is segmented into three sections to explore
the link between conventional subjective and statistical
approach of Mutual Fund analysis. To start with, the first
section deals with the introductory part of the paper by giving
an overview of the Mutual fund industry and company profile.
This section also talks about the theory of portfolio analysis
and the different measures of risk and return used for the
comparison. The second section details on the need, objective,
and the limitations of the study. It also discusses about the
sources and the period for the data collection. It also deals
with the data interpretation and analysis part wherein all the
key measures related to risk and return are done with the
interpretation of the results.
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In the third section, an attempt is made to analyses and

compare the performance of the equity mutual fund. For this
purpose β-value, standard deviation, and risk adjusted
performance measures such as Sharpe ratio, Treynor
measure, Jenson Alpha, and Fema measure have been used.
The portfolio analysis of the selected fund has been done by
the measure return for the holding period. At the end, it
illustrates the suggestions and findings based on the analysis
done in the previous sections and finally it deals with
conclusion part.
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1.2 Focus of the Study:
A Mutual Fund is a trust that pools the savings of a number

of investors
who share a common financial goal. The money thus collected
is then
invested in capital market instruments such as shares,
debentures and
other securities. The income earned through these
investments and the
capital appreciation realized is shared by its unit holders in
proportion to
the number of units owned by them. Thus a Mutual Fund is the
most
suitable investment for the common man as it offers an
opportunity to
invest in a diversified, professionally managed basket of
securities at a
relatively low cost.
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· Portfolio Managers evaluate their portfolio performance

and identify the
sources of strength and weakness. The evaluation of the
portfolio provides
a feed back about the performance to evolve a better
management
strategy. Even through evaluation of portfolio performance is
considered to
be the last stage of investment process, the managed
portfolios are
commonly known as mutual funds. Various managed portfolios
are prevalent in the capital market. Their relative merits of
return and risk criteria have to be evaluated.
Risk & Return:
Risk refers to the chance that some unfavorable event will

occur. Investment risk is related to the probability of actually
earning less than the expected return; thus, the greater the
chance of low or negative returns, the riskier the investment.
The standard deviation (σ) is a measure of dispersion of the
probability distribution, is commonly used to measure risk.
The smaller the standard deviation, the tighter the probability
distribution and, thus, the lower the risk of the investment.
Rate of return is income you collect on an investment
expressed as a percentage of the investment's purchase price.
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With a common stock, the rate of return is dividend yield, or

your annual dividend divided by the price you paid for the
stock.
In securities, the amount of revenue an investment generates
as a percentage of the amount of capital invested over a given
period of time.
The rate of return shows the amount of time it will take to
recover one's investment. For example, if one invests $1,000
and receives $150 in the first year of the investment, the rate
of return is 15%, and the investor will recover his/her initial
$1,000 in six years and eight months.
· Sharpe’s performance index gives a single value to be

used for the
performance ranking of various funds or portfolios. Sharpe
index measures
the risk premium of the portfolio relative to the total amount
of risk in the
portfolio. This risk premium is the difference between the
portfolio’s
average rate of return and risk less rate of return. The
standard deviation
of the portfolio indicates the risk. The index assigns the
highest values to
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assets that have best risk-adjusted average rate of return. The

Sharpe ratio
provides me with a return for unit of the risk measure
Relative Performance Index (RPI) :--
Relative Performance Index is defined as the ratio of the

unadjusted percentage NAV growth and the percentage
change in Bombay Stock Exchange Sensex. The RPI
calculations are applied to 269 sample schemes. Expected
return from a scheme can be expressed as RPI x market
return. Hence a scheme with RPI equal to 5, is expected to
give an annual return of 8.4% (1.68 multiplied by 5) which is
the risk free rate, with the mean monthly market return during
the study period at 0.14% (1.68% annualized). We restricted
further analysis to schemes with RPI greater than 5 as the
investor expects at least risk-free returns.
RISK & RETURN
PERFORMANCE
OF MUTUAL FUND
SHARPE RPI
RATIO
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1.3 Limitation of the Study:-
  The study is limited only to the analysis of different

schemes and its suitability to different investors
according to their risk-taking ability.
 The study is based on secondary data available from

monthly fact sheets, websites and other books, as
primary data was not accessible.
  The study is limited by the detailed study of three

schemes of HDFC.
  Many investors are all price takers.
  The assumption that all investors have the same

information and beliefs about the distribution of returns.
  Banks are free to accept deposits at any interest rate

within the ceilings fixed by the Reserve Bank of India and
interest rate can vary from client to client. Hence, there
can be inaccuracy in the risk free rates.
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 The study excludes the entry and the exit loads of the
mutual funds.
CHAPTER: 2
Theoretical overview.
2.1 Securities. A security can be defined as a negotiable

instrument which can be bought and sold in the capital
market.
Security Analysis:
It is the process of examining the risk – return characteristics

of the
individual securities or groups of securities with an aim to

know which
one is worthwhile to invest.

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The Securities Market consists of two segments, viz. Primary

market and Secondary market. Primary market is the place
where issuers create and issue equity, debt or hybrid
instruments for subscription by the public; the Secondary
market enables the holders of securities to trade them.
Secondary market essentially comprises of stock exchanges,

which provide platform for purchase and sale of securities by
investors. In India, apart from the Regional Stock
Exchanges established in different centers, there are

exchanges like the National Stock Exchange (NSE) and the
Over the Counter Exchange of India (OTCEI), who provide
nationwide trading facilities with terminals all over the
country. The trading platform of stock exchanges is
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accessible only through brokers and trading of securities is

confined only to stock exchanges.
Thus, the securities market has two independent, inseparable

segments, the new issues (primary) market and the stock
(secondary) market. The primary market provides channel for
sale of new securities while the secondary market deals in
securities previously issued. The issuer of securities sells the
securities to the primary market to raise funds for investment
and/or to discharge some obligations. The secondary market
enables them who hold securities to adjust their holdings in
response to change in their assessment of risk and return.
They also sell securities for cash to meet their liquidity needs.
The corporate securities market dates back to the 18™

century when the securities of the East India Company were
traded in Mumbai and Kolkata. The brokers used to gather
under a banyan tree in Mumbai and under a neem tree in
Kolkata for the purpose. However, the real
beginning came in the 1850s with the introduction of the joint

stock companies with limited liability. The 1860s witnessed
beverish dealings in securities and securities speculation. This
brought brokers to Bombay together in July 1875 to boom the
first organized stock exchange in the country, viz. The Stock
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Exchange, Mumbai, Ahmedabad Stock Exchange in 1894 and

22 others followed with 20™ century.
The Stock Exchanges are the exclusive centers for trading in

equities and the trading platform of an exchange is accessible
only to brokers. The regulatory framework heavily favors the
recognized stock exchanges by almost banning trading
activity outside the stock exchanges. The securities are
divided into two parts viz. Corporate securities and
Government Securities.
• Corporate Securities:
The no of stock exchanges increased from 11 in 1990 to

23 now. All the exchanges are fully computerized and offer
100% on-line trading. 9644 companies were available for
trading on stock exchanges at the end of March 2002. The
trading platform of the stock exchanges was accessible to
9687 members from over 400 cities on the same date.
The sectoral distribution of turnover has undergone

significant change over last few Years. The share of
manufacturing companies in turnover of top '50' companies,
which was nearly 80% in 1995-96, declined sharply to about
6% in 201-02. During the same period the share of IT
companies in turnover increased sharply from nil in 1995-96 to
67% in 2001-02.
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• Government Securities:
The aggregate turnover in central and state government

dated securities, including treasury bills, through SGL
transactions increased 31 times between 1994-95 and 2001-02.
During 2001-02 it reached a level of Rs. 1,573,893 core, higher
than combined trading volumes in equity segments of all the
exchanges in the country, reflecting deepening of the market.
The share of outright transactions in government securities
increased from 23.2% in 1995-96 to 77% in 2001-02. The share
of repo transactions declined correspondingly from 76.8% in
1995-96 to 23% in 2001-02. The Share of dated securities in
turnover of government securities increased from 69% in 1996-
97 to 94% in 2001-02. The T-bills accounted for remaining SGL
turnover.
2.2 Risk
Risk refers to the chance that some unfavorable event

will occur. Investment risk is related to the probability of
actually earning less than the expected return; thus, the
greater the chance of low or negative returns, the riskier the
investment.
Risk is an important concept in financial analysis,
especially in terms of how it affects security prices and
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rates of return. Investment risk is associated with the

probability of low or negative future returns.
Types of Risk:-
Systematic Risk or Market Risk
Unsystematic Risk - Stock or company specific risk
Credit or Default Risk - can they pay the interest on the

load or the dividend on that stock.
Country Risk - Measure of political and economic stability

Foreign Exchange Risk - will your money depreciate
when you buy an asset in another country?
Interest Rate Risk - will the central bank raise interest

rates
Political Risk - Political stability of a country
Execution risk - the time between when you see your price
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and when the trade actually goes to the market.
Measuring Risk The Standard Deviation
The standard deviation (σ) is a measure of dispersion of the

probability distribution, is commonly used to measure risk.
The smaller the standard deviation, the tighter the probability
distribution and, thus, the lower the risk of the investment.
Mathematically,
Standard deviation: Measure of Total Risk
Financial analysts and statisticians prefer to use a quantitative
risk surrogate called the variance of returns, denoted by
Var ( r ) = (1/n) Σnt=1 [ri – r am ]2
Where ri = return on individual mutual fund unit. r am = mean
rate of return
The square root of the variance is called the standard
deviation σ = (Var (r))(1/2)
The standard deviation and the variance are equally
acceptable and equivalent quantitative measures of an asset’s
total risk. The variance and standard deviation are computed
from logarithmic monthly returns.
2.3 The Sharpe Ratio: Measuring Risk

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Developed by Nobel laureate economist William Sharpe, this ratio measures

risk adjusted performance. It is calculated by subtracting the risk-free rate of
return (U.S. Treasury Bond) from the rate of return for an investment and
dividing the result by the investment's standard deviation of its return.
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 riskadjusted performance.
Mathematically,
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2.4 Rate of Return
Rate of return is income you collect on an investment

expressed as a percentage of the investment's purchase price.
With a common stock, the rate of return is dividend yield, or
your annual dividend divided by the price you paid for the
stock.
In securities, the amount of revenue an investment generates
as a percentage of the amount of capital invested over a given
period of time.
The rate of return shows the amount of time it will take to
recover one's investment. For example, if one invests $1,000
and receives $150 in the first year of the investment, the rate
of return is 15%, and the investor will recover his/her initial
$1,000 in six years and eight months.
Different investors have different required rates of return at

different levels of risk. With a bond, rate of return is the
current yield, or your annual interest income divided by the
price you paid for the bond. For example, if you paid $900 for
a bond with a par value of $1,000 that pays 6% interest, your
rate of return is $60 divided by $900, or 6.67%.
- Simple rate of return/Accounting rate of return is the
measure of profitability obtained by dividing the expected
future annual net income by the required investment; also
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called Accounting Rate of Return or unadjusted rate of return.

Sometimes the average investment rather than the original
initial investment is used as the required investment, which is
called average rate of return.
Its formula:
Simple rate of return = Incremental revenues − Incremental
expenses,
including depreciation = Incremental net operating income /
Initial investment*
Simple Return Calculation ={( Pt+1 − P t) / Pt } or

{( Pt+1 / Pt )-1}
Where Pt+1 : the amount received
P t : the amount invested
The riskiness of an asset can be considered in two ways: (1) on

a stand-alone basis, where the asset’s cash flows are analyzed
all by themselves, or (2) in a portfolio context, where the cash
flows from a number of assets are combined and then the
consolidated cash flows are analyzed.
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In a portfolio context, an asset’s risk can be divided into two

components: (1) a diversifiable risk component, which can be
diversified away and hence is of little concern to diversified
investors, and (2) a market risk component, which reflects the
risk of a general stock market cannot be eliminated by
diversification, hence does concern investors. Only market risk
is relevant; diversifiable risk is irrelevant to most investors
because it can be eliminated.
An attempt has been made to quantify market risk with a
measure called beta. Beta is a measurement of how a
particular firm’s stock returns move relative to overall
movements of stock market returns. The Capital Asset Pricing
Model (CAPM), using the concept of beta and investors’
aversion to risk, specifies the relationship between market risk
and the required rate of return. This relationship can be
visualized graphically with the Security Market Line (SML). The
slope of the SML can change, or the line can shift upward or
downward, in response to changes in risk or required rates of
return market decline and which cannot be eliminated by
diversification, hence does concern investors. Only market risk
is relevant; diversifiable risk is irrelevant to most investors
because it can be eliminated.
An attempt has been made to quantify market risk with a
measure
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called beta. Beta is a measurement of how a particular firm’s

stock returns
move relative to overall movements of stock market returns.
The Capital Asset Pricing Model (CAPM), using the concept of
beta and investors’ aversion to risk, specifies the relationship
between market risk and the required rate of return. This
relationship can be visualized graphically with the Security
Market Line (SML). The slope of the SML can change, or the
line can shift upward or downward, in response to changes in
risk or required rates of return.
Risk Vs. Return :--

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2.5 Risk & Return with SML curve
Security Market Line (SML)

The security market line shows how expected rate of return
depends on beta. According to the capital asset pricing model,
expected rates of return for all securities and all portfolios lie
on this line.
The SML essentially graphs the results from + risk premium

r = rf + β (rm – rf)
Where r = the expected (or required) return on security j
rf = the risk-free security (such as a T-bill)
rm = the expected return on the market portfolio
β = beta, an index of non-diversifiable (non-controllable,
systematic) risk
β (rm – rf) = risk premium
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2.6 BSE (BOMBAY STOCK EXCHANGE)
The Stock Exchange, Mumbai, popularly known as "BSE" was

established in 1875 as "The Native Share and Stock Brokers
Association". It is the oldest one in Asia, even older than the
Tokyo Stock Exchange, which was established in 1878. It is a
voluntary non-profit making Association of Persons (AOP) and
is currently engaged in the process of converting itself into
demutualise and corporate entity. It has evolved over the
22
years into its present status as the premier Stock Exchange in

the country. It is the first Stock Exchange in the Country to
have obtained permanent recognition in 1956 from the Govt.
of India under the Securities Contracts (Regulation) Act, 1956.
The Exchange, while providing an efficient and transparent

market for trading in securities, debt and derivatives upholds
the interests of the investors and ensures redresses of their
grievances whether against the companies or its own
member-brokers. It also strives to educate and enlighten the
investors by conducting investor education program and
making available to them necessary informative inputs.
A Governing Board having 20 directors is the apex body,

which decides the policies and regulates the affairs of the
Exchange. The Governing Board consists of 9 elected
directors, who are from the broking community (one third of
them retire ever year by rotation), three SEBI nominees, six
public representatives and an Executive Director & Chief
Executive Officer and a Chief Operating Officer.
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2.7 NSE (NATIONAL STOCK EXCHANGE)
NSE was incorporated in 1992 and was given

recognition as a stock exchange in April 1993. It
started operations in June 1994, with trading on the
Wholesale Debt Market Segment. Subsequently it
launched the Capital Market Segment in November
1994 as a trading platform for equities and the Futures
and Options Segment in June 2000 for various
derivative instruments.
NSE has been able to take the stock market to the doorsteps
of the investors. The technology has been harnessed to deliver
the services to the investors across the country at the
cheapest possible cost. It provides a nation-wide, screen-
based, automated trading system, with a high degree of
transparency and equal access to investors irrespective of
geographical location. The high level of information
dissemination through on-line system has helped in
integrating retail investors on a nation-wide basis. The
standards set by the exchange in terms of market practices,
Products , technology and service standards have become
industry benchmarks and are being replicated by other market
participants. Within a very short span of time, NSE has been
able to achieve all the objectives for which it was set up. It has
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been playing a leading role as a change agent in transforming

the Indian Capital Markets to its present form. The Indian
Capital Markets are a far cry from what they used to be a
decade ago in terms of market practices, infrastructure,
technology, risk management, clearing and settlement and
investor service.
2.8 MUTUAL FUND IN INDIA: AN OVERVIEW
Concept & Definition of Mutual Fund :
Mutual Fund is a investment company that pools

money from shareholders and invests in a variety of
securities, such as stocks, bonds and money market
instruments. Most open-end mutual funds stand ready
to buy back (redeem) its shares at their current net
asset value, which depends on the total market value
of the fund's investment portfolio at the time of
redemption. Most open-end mutual funds continuously offer
new shares to investors.
Also known as an open-end investment company, to

differentiate it from a closed-end investment company. Mutual
funds invest pooled cash of many investors to meet the fund's
stated investment objective. Mutual funds stand ready to sell
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and redeem their shares at any time at the fund's current net
asset value: total fund assets divided by shares outstanding.
In Simple Words, Mutual fund is a mechanism for pooling the

resources by issuing units to the investors and investing funds
in securities in accordance with objectives as disclosed in offer
document.
Investments in securities are spread across a wide cross-

section of industries and sectors and thus the risk is reduced.
Diversification reduces the risk because all stocks may not
move in the same direction in the same proportion at the
same time. Mutual fund issues units to the investors in
accordance with quantum of money invested by them.
Investors of mutual funds are known as unit holders.
The profits or losses are shared by the investors in proportion

to their investments. The mutual funds normally come out
with a number of schemes with different investment
objectives which are launched from time to time. In India , A
mutual fund is required to be registered with Securities and
Exchange Board of India (SEBI) which regulates securities
markets before it can collect funds from the public.
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In Short, a mutual fund is a common pool of money in to

which investors with common investment objective
place their contributions that are to be invested in
accordance with the stated investment objective of the
scheme. The investment manager would invest the
money collected from the investor in to assets that are
defined/ permitted by the stated objective of the
scheme. For example, an equity fund would invest equity
and equity related instruments and a debt fund would
invest in bonds, debentures, gilts etc . Mutual Fund is a
suitable investment for the common man as it offers an
opportunity to invest in a diversified, professionally
managed basket of securities at a relatively low cost.
2.9 Mutual Fund History in India
UTI pioneered the mutual fund industry in India ( 1963) with

slow & staidly growth , but it accelerated from the year 1987
when non-UTI players entered the industry.
In the past decade, Indian mutual fund industry had seen a
dramatic improvement, both qualities wise as well as quantity
wise. Before, the monopoly of the market had seen an ending
phase; the Assets Under Management (AUM) was Rs.67 bn.
The private sector entry to the fund family raised the AUM to
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Rs. 470 bn in March 1993 and till April 2004; it reached the
height of Rs. 1,540 billion.
Putting the AUM of the Indian Mutual Funds Industry into
comparison, the total of it is 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 intellectualed with the concept. Hence,
it is the prime responsibility of all mutual fund companies, to
market the product correctly abreast of selling. The mutual
fund industry can be broadly put into four phases according to
the development of the sector. Each phase is briefly described
as under.
First Phase - 1964-87
Unit Trust of India (UTI) 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 (IDBI) 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.6,700 crores of assets under management.
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Second Phase - 1987-1993 (Entry of Public

Sector Funds)
During this period Banks entered into mutual fund market.
Pioneered by SBI Mutual Fund (June87) followed by Can bank
Mutual Fund (Dec 87), PNB Mutual Fund (Aug 89), Indian Bank
Mutual Fund (Nov 89), Bank of India (Jun 90), Bank of Baroda
Mutual Fund (Oct 92). LIC in 1989 and GIC in 1990. By the end
of 1993 AUM was Rs.47,004 crores .
Third Phase - 1993-2003 (Entry of Private Sector

Funds)
The third phase saw the entry of private sector funds . There
was change in Regulation of Mutual fund. It was now governed
by SEBI (MF) Regulation Act, which was further revised in
1996.
The erstwhile Kothari Pioneer (now merged with Franklin
Templeton) was the first private sector mutual fund registered
in July 1993. The total AUM was 1.21 lakh crores invested by
the end of Jan. 2003.
Fourth Phase - since February 2003 (Entry of Foreign Firms)
It was the period for the entry of foreign firms who created
Boom in the in Indian Capital market. As at the end of April
2007, there were 32 funds managing firms with more than
756 schemes having AUM worth Rs. 3.50 lakh crores.
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GROWTH IN ASSETS UNDER MANAGEMENT :-
2.10 Types of Mutual Funds

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Schemes according to Maturity Period:
A mutual fund scheme can be classified into open-

ended scheme or close-ended scheme depending on its
maturity period.
Open-ended Fund
An open-ended Mutual fund is one that is available for

subscription and repurchase on a continuous basis.
These Funds do not have a fixed maturity period.
Investors can conveniently buy and sell units at Net
Asset Value (NAV) related prices which are declared on
a daily basis. The key feature of open-end schemes is
liquidity.
Close-ended Fund
A close-ended Mutual fund has a stipulated maturity period

e.g. 5-7 years. The fund is open for subscription only during a
specified period at the time of launch of the scheme. Investors
can invest in the scheme at the time of the initial public issue
and thereafter they can buy or sell the units of the scheme on
the stock exchanges where the units are listed. In order to
provide an exit route to the investors, some close-ended funds
give an option of selling back the units to the mutual fund
through periodic repurchase at NAV related prices. SEBI
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Regulations stipulate that at least one of the two exit routes is

provided to the investor i.e. either repurchase facility or
through listing on stock exchanges. These mutual funds
schemes disclose NAV generally on weekly basis.
Fund according to Investment Objective:
A scheme can also be classified as growth fund, income fund,

or balanced fund considering its investment objective. Such
schemes may be open-ended or close-ended schemes as
described earlier. Such schemes may be classified mainly as
follows:
Growth / Equity Oriented Scheme
The aim of growth funds is to provide capital appreciation over

the medium to long- term. Such schemes normally invest a
major part of their corpus in equities. Such funds have
comparatively high risks. These schemes provide different
options to the investors like dividend option, capital
appreciation, etc. and the investors may choose an option
depending on their preferences. The investors must indicate
the option in the application form. The mutual funds also allow
the investors to change the options at a later date. Growth
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schemes are good for investors having a long-term outlook

seeking appreciation over a period of time.
Income / Debt Oriented Scheme
The aim of income funds is to provide regular and steady

income to investors. Such schemes generally invest in fixed
income securities such as bonds, corporate debentures,
Government securities and money market instruments. Such
funds are less risky compared to equity schemes. These funds
are not affected because of fluctuations in equity markets.
However, opportunities of capital appreciation are also limited
in such funds. The NAVs of such funds are affected because of
change in interest rates in the country. If the interest rates
fall, NAVs of such funds are likely to increase in the short run
and vice versa. However, long term investors may not bother
about these fluctuations.
Balanced Fund
The aim of balanced funds is to provide both growth and

regular income as such schemes invest both in equities and
fixed income securities in the proportion indicated in their
offer documents. These are appropriate for investors looking
for moderate growth. They generally invest 40-60% in equity
and debt instruments. These funds are also affected because
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of fluctuations in share prices in the stock markets. However,

NAVs of such funds are likely to be less volatile compared to
pure equity funds.
Money Market or Liquid Fund
These funds are also income funds and their aim is to provide
easy liquidity, preservation of capital and moderate income.
These schemes invest exclusively in safer short-term
instruments such as treasury bills, certificates of deposit,
commercial paper and inter-bank call money, government
securities, etc. Returns on these schemes fluctuate much less
compared to other funds. These funds are appropriate for
corporate and individual investors as a means to park their
surplus funds for short periods.
Gilt Fund
These funds invest exclusively in government securities.

Government securities have no default risk. NAVs of these
schemes also fluctuate due to change in interest rates and
other economic factors as is the case with income or debt
oriented schemes.
Index Funds
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Index Funds replicate the portfolio of a particular index such

as the BSE Sensitive index, S&P NSE 50 index (Nifty), etc
These schemes invest in the securities in the same weight age
comprising of an index. NAVs of such schemes would rise or
fall in accordance with the rise or fall in the index, though not
exactly by the same percentage due to some factors known as
"tracking error" in technical terms. Necessary disclosures in
this regard are made in the offer document of the mutual fund
scheme. There are also exchange traded index funds launched
by the mutual funds which are traded on the stock exchanges.
2.11 Mutual Funds – Organization:--
There are many entities involved and the diagram below

illustrates the organizational set up of a mutual fund:
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2.12 Significant of mutual Fund
Advantages Of Mutual Fund
 Portfolio Diversification
 Professional Management
 Reduction / Diversification of Risk
 Liquidity
 Flexibility & Convenience
 Reduction in Transaction Cost
 Safety Of Regulated Environment
 Choice of Schemes.
Disadvantages Of Mutual Fund:--

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 No Control over cost in the Hands of an investor

 No tailor-made portfolios
 Managing a portfolio funds
 Difficulty in selecting a suitable fund scheme
2.13 NET ASSET VALUE
The Term Net Asset Value (NAV) is used by investment

companies to measure net assets. It is calculated by
subtracting liabilities from the value of a fund's securities and
other items of value and dividing this by the number of
outstanding shares. Net asset value is popularly used in
newspaper mutual fund tables to designate the price per
share for the fund.
The value of a collective investment fund based on the market

price of securities held in its portfolio. Units in open ended
funds are valued using this measure. Closed ended
investment trusts have a net asset value but have a separate
market value. NAV per share is calculated by dividing this
figure by the number of ordinary shares. Investments trusts
can trade at net asset value or their price can be at a premium
or discount to NAV.
Value or purchase price of a share of stock in a mutual fund.

NAV is calculated each day by taking the closing market value
37
of all securities owned plus all other assets such as cash,

subtracting all liabilities, then dividing the result (total net assets) by
the total number of shares outstanding.
Calculating NAV’s - Calculating mutual fund net asset values is easy.

Simply take the current market value of the fund's net assets (securities held by
the fund minus any liabilities) and divide by the number of shares outstanding.
So if a fund had net assets of Rs.50 lakh and there are one lakh shares of the
fund, then the price per share (or NAV) is Rs.50.00.
2.14 Background of HDFC Mutual Fund:
HDFC Mutual Fund is one of the largest mutual funds and well-
established fund house in the country with consistent and
above average fund performance across categories since its
incorporation on December 10, 1999. While our past
experience does make us a veteran, but when it comes to
investments, we have never believed that the experience is
enough.
Our Investment Philosophy
The single most important factor that drives HDFC Mutual
Fund is its belief to give the investor the chance to profitably
invest in the financial market, without constantly worrying
about the market swings. To realize this belief, HDFC Mutual
Fund has set up the infrastructure required to conduct all the
38
fundamental research and back it up with effective analysis.

Our strong emphasis on managing and controlling portfolio
risk avoids chasing the latest “fads” and trends.
We Offer
We believe, that, by giving the investor long-term benefits, we have to

constantly review the markets for new trends, to identify new
growth sectors and share this knowledge with our investors in
the form of product offerings. We have come up with various
products across asset and risk categories to enable investors
to invest in line with their investment objectives and risk
taking capacity. Besides, we also offer Portfolio Management
Services.
Our Achievements
HDFC Asset Management Company Limited was awarded
NDTV Profit Business Leadership Award 2009 in the Mutual
Funds Category for the period April 1, 2008 to March 31, 2009
from amongst six nominees in the category. NDTV Profit
Business Leadership Awards have been instituted to honor
organization excellence and promise to acknowledge the best,
the brightest and the most dynamic of Indian organizations
39
that have emerged as leaders in their respective verticals and

are taking India to economic superpower status. The objective
of the Awards is to salute men and women who fuel India’s
journey to the forefront of the World Economy. Grand
Thornton India are the Business Process Advisors to the
Awards instituted by NDTV Profit.
HDFC Top 200 Fund :-
Scope Of Investment
To generate long term capital appreciation from a portfolio of equity and

equity-linked instruments primarily drawn from the companies in BSE 200
index.
Basic Scheme Information:-
Nature of Scheme Open Ended Growth Scheme

Inception Date October 11, 1996
Option/Plan Dividend Option, Growth Option.
The Dividend Option offers
Dividend Payout and
Reinvestment Facility.
Entry Load NIL
(purchase / additional (With effect from August 1,
purchase / switch-in) 2009)
40
Exit Load • In respect of each

(as a % of the Applicable purchase / switching of
NAV) units, an Exit Load of
1.00% is payable if Units
are redeemed / switched-
out within 1 year from the
date of allotment
• No Exit Load is payable if

Units are redeemed /
switched-out after 1 year
from the date of allotment.
Minimum Application For new investors :Rs.5000 and
Amount any amount thereafter.
For existing investors: Rs. 1000

and any amount thereafter.
Lock-In-Period Nil
Net Asset Value Periodicity Every Business Day
Redemption Proceeds Normally dispatched within 3
Business days
Current Expense Ratio On the first 100 crores average
weekly net assets 2.50%
(Effective Date 22nd May
On the next 300 crores average
2009)
weekly net assets 2.25%
41
On the next 300 crores average

weekly net assets 2.00% On the
Any change in the expense
balance of the assets 1.75%
ratio will be updated within two
working days.
Investment Pattern :-
The asset allocation under the Scheme will be as follows :
Sr.No Asset Type (% of Portfolio) Risk Profile

1 Equities and Up to 100% Medium to
Equity Related (including use High
Instruments of derivatives
for hedging
and other uses
as permitted
by prevailing
SEBI
Regulations)
2 Debt & Money Balance in Low to Medium
Market Debt & Money
Instruments Market
Instruments
42
* Investment in Securitized debt, if undertaken, would not

exceed 20% of the net assets of the scheme.
The Scheme may also invest up to 25% of net assets of the

Scheme in derivatives such as Futures & Options and such
other derivative instruments as may be introduced from time
to time for the purpose of hedging and portfolio balancing and
other uses as may be permitted under the regulations and
guidelines.
The Scheme may also invest a part of its corpus, not

exceeding 40% of its net assets, in overseas markets in Global
Depository Receipts (GDRs), ADRs, overseas equity, bonds
and mutual funds and such other instruments as may be
allowed under the Regulations from time to time.
Subject to the Regulations and the applicable guidelines, the

Scheme may, engage in Stock Lending activities. Also refer to
Section on Stock Lending by the Fund
If the investment in equities and related instruments falls
below 65% of the portfolio of the Scheme at any point in time,
it would be endeavored to review Andre balance the
composition.
Notwithstanding anything stated above, subject to the
43
regulations, the asset allocation pattern indicated above may

change from time to time, keeping in view market conditions,
market opportunities, applicable regulations and political and
economic factors. It may be clearly understood that the
percentages stated above are only indicative and are not
absolute and that they can vary substantially depending upon
the perception of the AMC, the intention being at all times to
seek to protect the NAV of the scheme. Such changes will be
for short term and defensive considerations.
The Trustee may from time to time at their absolute discretion
review and modify the strategy, provided such modification is
in accordance with the Regulations or in the event of a
discontinuation of or change in the compilation or the
constituents of the BSE 200 Index.
Provided further and subject to the above, any change in the
asset allocation affecting the investment profile of the Scheme
and amounting to a change in the Fundamental Attributes of
the Scheme shall be effected in accordance with sub-
regulation (15A) of regulation 18 of SEBI regulations.
Investment Strategy:-
The investment strategy of primarily restricting the equity

portfolio to the BSE 200 Index scripts is intended to reduce
risks while maintaining steady growth. Stock specific risk will
be minimized by investing only in those companies / industries
44
that have been thoroughly researched by the investment

manager's research team. Risk will also be reduced through a
diversification of the portfolio
Type & Investment Objective:-
It is an open-ended equity fund. The objective is to generate

long-term capital appreciation from a portfolio of equity and
equity-linked instruments primarily drawn from companies in
BSE 200 index.
Composition: -
Asset Allocation Market

Capitalization
Equity 96.30
Large Cap 87.33
Debt 0.00
Mid Cap 6.86
45
Cash 3.70
Small Cap 2.11
Fund Commentary:-
 The fund maintains a diversified portfolio of

predominantly large cap stocks. It invests in
fundamentally strong companies for longer horizon. It
does not take high cash exposure.
 The fund manager expects the market to remain range

bound with an upward bias over the mid to long term.
 He expects the market to start discounting FY12 earnings

over the next 4-5 months and this should lead to the
market to rally further.
 He views the Q1 FY11 results as good for most

companies barring a few.
 The fund manager is bullish on the Banking sector and

views it as a quasi play on infrastructure due to pickup in
credit growth.
46
 The fund is overweight on Banking & Finance and Oil &

Gas and continues to bullish on large cap IT stocks.
 The fund has been a consistent out performer against the

benchmark BSE 200 index and the fund is recommended
for moderate and conservative investors with a horizon
of 2-3 yrs.
Portfolio Characteristics
Risk Analysis
47
Portfolio P/E Ratio 24.61

Beta 0.76
Portfolio P/B Ratio 5.41

Sharpe Standard 0.42
Dividend Yield 1.24

Deviation Expense 3.95
Avg. Market Cap (Cr.) 85886

Ratio 1.80
As of July 30 , 2010
Scheme Features
 Options: Growth & Dividend
 Minimum Investment: Rs. 5,000
 Load Structure: Exit Load: 1% if redeemed before 1
Year Benchmark Index: BSE 200
 NAV: 52 Week High / Low: 200.11/148.64
 Corpus: Rs. 8306.75 Cr.
HDFC Balance Fund:-

48
Investment Objective:-
The primary objective of the Scheme is to generate

capital appreciation along with current income from a
combined portfolio of equity and equity related and debt
and money market instruments.
Basic Scheme Information:-
Nature of Scheme Open Ended Balanced

Scheme
Inception Date September 11, 2000
Option/Plan Dividend Option, Growth
Option. The Dividend Option
offers Dividend Payout and
Reinvestment Facility.
Entry Load NIL
(purchase / additional (With effect from August 1,
purchase / switch-in) 2009)
Exit Load (as a % of the • In respect of each
Applicable NAV)
49
purchase / switching of
units, an Exit Load of
1.00% is payable if Units
are redeemed /
switched-out within 1
year from the date of
allotment..
• No Exit Load is payable
if Units are redeemed /
switched-out after 1
year from the date of
allotment.
Minimum Application For new investors: Rs.5000
Amount and any amount thereafter.
For existing investors: Rs.
1000 and any amount
thereafter.
Lock-In-Period Nil
Net Asset Value Every Business Day.
Periodicity
Redemption Proceeds Normally dispatched within 3
Business days
Current Expense Ratio On the first 100 crores
(#) (Effective Date 22nd average weekly net assets
May 2009) 2.25%
On the next 300 crores
50
(#) Any change in the average weekly net assets

expense ratio will be updated 2.00%
within two working days. On the next 300 crores
average weekly net assets
1.75%
On the balance of the assets
1.50%
Investment Pattern:-
The Scheme will be invested in equity and equity related

instruments as well as in debt and in money market
instruments in normal circumstances. The following table
provides the asset allocation of the Scheme's portfolio.
The asset allocation under the Scheme will be as
follows :
Sr. No. Type of Normal Normal Risk

Instruments Allocation Deviation Profile of
(% of Net (% of the
Assets) Normal Instrument
Allocation)
51
1 Equity and 60 20 Medium to

Equity High
Related
Instruments
2 Debt 40 30 Low to
Securities Medium
(including
securitized
debt) and
Money
Market
instruments
Pending deployment of funds of the Scheme in securities in

terms of the investment objective of the Scheme, the AMC
may invest the funds of the Scheme in short term deposits of
scheduled commercial banks.
Investment Strategy:
The balanced product is positioned as a lower risk alternative

to a pure equities scheme, while retaining some of the upside
potential from equities exposure. The Scheme provides the
Investment Manager with the flexibility to shift allocations in
the event of a change in view regarding an asset class.
Asset allocation between equities and debt is a critical

52
function in a balanced fund. It is proposed to continuously

monitor the potential for both debt and equities to arrive at a
dynamic allocation between the asset classes.
The equity and debt portfolios of the Scheme would be

managed as per the respective investment strategies detailed
here in.
Equity Investments:
The investment approach would be based on the concept of

economic earning power and cash return on investments.
Five basic principles serve as the foundation for this

investment approach. They are as follows:
• Focus on the long term
• View our investments as conferring a proportionate

ownership of the business.
• Maintain a margin of safety (i.e. the price of purchase

represents a discount to the intrinsic value of that
business).
• Maintain a balanced outlook on the market by regularly

monitoring economic trends and investor sentiment.
53
• The decision to sell a holding would be based on one of

three reasons
 The anticipated price appreciation has been achieved

or is no longer probable.
 Alternative investments offer superior total return

prospects, or
 A fundamental change has occurred in the company or

the market in which it competes
In summary, the assessment of investment value is a

function of extensive research and based on data and
reasoning, rather than current fashion and emotion. The
idea is to develop a model that allows us to identify
"businesses with superior growth prospects and
good management, at a reasonable price".
In order to implement the investment approach
effectively, it would be important to periodically meet the
management face to face. This would provide an
understanding of their broad vision and commitment to
the long-term business objectives. These meetings would
also be useful in assessing key determinants of
management quality such as orientation to minority
shareholders, ability to cope with adversity and approach
to allocating surplus cash flows. Discussions with
54
management would also enable benchmarking actual

performance against stated commitments.
Debt Investments:
Debt securities (in the form of non-convertible debentures,

bonds, secured premium notes, zero interest bonds, deep
discount bonds, floating rate bond / notes, securitized debt,
pass through certificates, asset backed securities, mortgage
backed securities and any other domestic fixed income
securities including structured obligations etc.) include, but
are not limited to:
• Debt obligations of / Securities issued by the Government

of India, State and local Governments, Government
Agencies and statutory bodies (which may or may not
carry a state / central government guarantee).
• Securities that have been guaranteed by Government of

India and State Governments.
• Securities issued by Corporate Entities (Public / Private

sector undertakings).
55
• Securities issued by Public / Private sector banks and

development financial institutions.
Money Market Instruments Include:
• Commercial papers
• Commercial bills
• Treasury bills
• Government securities having an unexpired maturity up

to one year
• Call or notice money
• Certificate of deposit
• Stance bills
• Permitted securities under a repo / reverse repo

agreement
• Any other like instruments as may be permitted by RBI /

SEBI from time to time
Investments will be made through secondary market

purchases, initial public offers, other public offers, placements
and right offers (including renunciation). The securities could
be listed, unlisted, privately placed, secured / unsecured,
56
rated / unrated of any maturity.
The AMC retains the flexibility to invest across all the

securities / instruments in debt and money market.
Investment in debt securities will usually be in instruments
which have been assessed as "high investment grade" by at
least one credit rating agency authorized to carry out such
activity under the applicable regulations. Pursuant to SEBI
Circular No. MFD/ CIR/9/120/2000 dated November 24, 2000;
the AMC may constitute committee(s) to approve proposals for
investments in unrated debt instruments. The AMC Board and
the Trustee shall approve the detailed parameters for such
investments. The details of such investments would be
communicated by the AMC to the Trustee in their periodical
reports. It would also be clearly mentioned in the reports, how
the parameters have been complied with. However, in case
any unrated debt security does not fall under the parameters,
the prior approval of Board of AMC and Trustee shall be
sought. Investment in debt instruments shall generally have a
low risk profile and those in money market instruments shall
have an even lower risk profile. The maturity profile of debt
instruments will be selected in accordance with the Fund
Managers view regarding current market conditions, interest
rate outlook and the stability of ratings.
57
Risk Control:
The overall portfolio structure would aim to maintain risk at a

moderate level. The Fund Manager would avoid adopting
either a very defensive or aggressive posture at any point in
time. Risk will also be controlled through portfolio
diversification and a conscious focus on maintaining adequate
levels of liquidity at all points in time. Macro-economic risk will
be addressed through a constant review of the business and
economic environment. The AMC may from time to time,
review and modify the Schemes? Investment strategy if such
changes are considered to be in the best interest of Unit
holders and appropriate to the existing market situation.
Investments in securities and instruments not specifically
mentioned earlier may also be made, provided they are
permitted by SEBI Regulations.
Portfolio - Holdings (as on July 30, 2010):
Company / Issuer Industry+ / Rating % to NAV

EQUITY & EQUITY
RELATED
58
Coromandel Fertilizers 4.33

International Ltd
Tata Consultancy Software 3.84
Services Ltd.
Balkrishna Industries Auto Ancillaries 3.67
Ltd.
Motherson Sumi Auto Ancillaries 3.26
Systems Ltd.
Ipca Laboratories Pharmaceuticals 3.20
Ltd.
Infosys Technologies Software 3.19
Ltd.
Sun Pharmaceutical Pharmaceuticals 3.03
Industries Ltd.
Bank of Baroda Banks 3.01
The Federal Bank Banks 2.97
Ltd.
Biocon Ltd. Pharmaceuticals 2.83
Total of Top Ten 33.33
Equity Holdings
Total Equity & Equity 68.58
Related Holdings
Total Credit 27.40
Exposures
59
(aggregated
holdings in a single
issuer)
Cash margin 0.02
Other Cash, Cash 4.01
Equivalents and Net
Current Assets
Grand Total 100.00
Net Assets (Rs. In 17502.36
Lakhs)
Returns:
HDFC Balanced Fund
(NAV as at
evaluation date
30-July-2010, Rs.
52.065 Per unit)
Date Period NAV Per Benchmark
Unit (Rs.) Returns (%) Returns
60
^ (%) #
March 30, Last 1218 29.183 18.94** 10.9**
2007 days
January 29, Last 182 45.015 15.66* 7.44*
2010 days
July 30, Last 1 Year 37.949 37.2* 13.15*
2009 (365 days)
July 30, Last 3 33.100 16.28** 8.03**
2007 Years (1096
days)
July 29, Last 5 21.953 18.83** 14.44**
2005 Years (1827
days)
July 28, Last 10 N.A N.A N.A
2000 Years (3654
days)
September Since 10.000 18.16** N.A
11, 2000 Inception
(3609 days)
Inception Date of HDFC Balanced Fund is September 11, 2000
HDFC INCOME FUND

61
Summary Info
Fund Name : HDFC Mutual Fund

Scheme Name : HDFC Income Fund (D)
AMC : HDFC Asset Management
Company Ltd
Type : Open
Category : Income Funds
Launch Date : 20-Jul-00
Fund Manager : Shobhit Mehrotra
Net Assets:(Rs. cr) 404.72
NAV Details :
NAV Date : 31-Aug-10

NAV [Rs.]: 10.9
Buy/Resale Price [Rs.] : 10.82
Sell/Repurchase Price [Rs.] 10.93
Entry Load % : Nil
Exit Load % : Nil
Performance Of Mutual Fund :
Performance (%) * returns above 1 yr. are

annualized
1w 1m 3m 6m 1y 3y 5y Since
INC
Scheme 0.2 0.5 0.8 3.8 6.1 8.6 6.4 7.5
62
Returns
Categor [25.3 [9.6] [12. 10.2 7.7 6.9 5.0 6.3

y Avg. ] 3]
Categor 57.2 35.5 12.9 44.5 27.7 12.6 9.9 16.4
y Best
Categor [272. [70. [42. [19. [32. [7.5] [3.4] [3.1]
y Worst 1] 4] 1] 4] 5]
Investment Details:
Tax Benefits : NA
Min. Investment(Rs.) : 5,000.00
Increm.Investment(Rs.) : 100.00
HDFC Income Fund - Growth : 21.97 (NAV as on Sep 2, 2010)
Period 1 3 6 1 year 3 year 5 year Since

mo mo mo Ince
nth nth nth ption
Return 0.63 0.58 3.62 6.02 8.54 6.41 8.21
s
(%)
63
Risk Analysis Of Income Fund :

Risk ratios Percent
Mean 0.33
Standard Deviation 1.2
Sharpe 0.18
Beta 10.62
Treynor 0.02
Sortino 0.35
Correlation 10.46
Fama -1.34
Portfolio Attributes:
Scheme Particulars
P/E NA
P/B NA
Dividend Yield NA
Market Cap (Rs. in crores) NA
Top 5 Holding (%) 93.32 as on Jul - 2010
No. of Stocks 13
Expense Ratio (%) 1.89
Fund Features :
64
Scheme Particulars
Type Open Ended
Nature Debt (Equity: 0%, Debt:
82.94%, Cash: 17.06%)
Option Growth
Inception Date Sep 11, 2000
Face Value 10
Fund Size (Rs.Crore) 404.72 as on Jul 31, 2010
Fund Manager Anand Laddha, Shobhit
Mehrotra.
SIP NA
STP NA
SWP NA
Expense ratio (%) 1.89
Portfolio Turnover Ratio (%) NA
Last Dividend Declared 5479.40
Minimum Investment (Rs) 5000
Purchase Redemptions Daily
NAV Calculation Daily
Entry Load Entry Load is 0%.
Exit Load Exit Load
65
CHAPTER: 3
OBJECTIVES AND METHODOLOGY OF THE STUDY
3.1 Objective of the Study:

66
Present study focused on mutual fund analysis of HDFC in

general and HDFC TOP 200, Income, Balance fund as
particular HDFC is one of the best financial organization in
India.
The main object of the study can be set for as

follows:-
(1) To visualize the performance of mutual fund in India.
(2) To Judge risk return relationship of HDFC mutual fund in

general ,HDFC Top 200,Income,Balance fund
(3) To make a comparative analyses of mutual fund with

respect to HDFC Top 200,Income ,Balance fund.
3.2 Methodology of study.
The research methodology is a prerequisite for carrying out

research. It defines the procedure to be followed during the
course of summer project report; research methodology
provides guidelines for collecting information. In order to make
the study more revealing it also covered some research
articles, textbooks, publications and web sites in respect to
the performance analysis of mutual fund.
67
Research is an organized enquiry designed and carried out to

provide
information for solving a problem. Research methodology is a
way to systematically solve the research problem. It may be
understood as a science of studying how research is done
scientifically.
DATA COLLECTION:-
The task of data collection begins after a research problem

has been
defined. While deciding about the method of data collection to
be used for the study, the researcher should keep in mind two
types of data viz,
primary and secondary.
· Primary data may be described as those data that have
been observed and recorded by the researchers for the first
time to their knowledge.
Primary data can be classified into two types:

· Data classified by their nature.
· Data classified according to function.
Primary data can be collected through several

methods. Some
68
of the important ones are:

i. Observation method
ii. Interview method
iii. Questionnaires
iv. Schedules
v. Other methods
• Secondary data are statistics not gathered for the

immediate
study at hand but for some other purposes.
Secondary data can be classified into two types:
• Internal data which include sales analysis.
• External data which include libraries, literature etc.
The Project work primarily based as the secondary Data

available from the official and non official sources. The Data
will be collected edited, Tabulated and analysis with the help
of the daily NAV of HDFC mutual fund.
Time:-
The Project work primarily based on NAV history during the

period from August 2009 to July 2010 .
Tools & Technique
I have to use the statistical tool and Financial Technique to

find out the risk & return with the help of Excel I tried to
69
represent a trend by putting the previous data. The data

,Tools and Technique that I used to do my project are
collected from the various sources, they are listed below:
 NAV history during the period from August 2009 to July

2010 Search from the web page of HDFC mutual fund.
 The statistical tool that I have been used to do my project
such as Mean Variance.
 The Financial Technique that I have been used to do my
project such as Sharp Ratio, RPI Factor
The Project work will be useful not only to the policy maker,
Administration department and executive but also to various
group of person such as teacher, student who are interested in
expanding their horizon of knowledge.
Return :--
For each mutual fund scheme under study, the monthly

returns are computed as:
ri = { ln(ending NAV - beginning NAV ) / beginning NAV }
The market returns are computed on similar lines with BSE

Sensex (The Bombay Stock Exchange Sensitive Index) as
benchmark. The return on the market portfolio is
computed as:
rm ={ ln(ending sensex-beginning sensex)/ beginning sensex}

70
The logarithmic mean is computed to obtain mean monthly

market return. The returns thusobtained are absolute returns
and are retained throughout the study.
Risk :--
Standard deviation: Measure of Total Risk
Financial analysts and statisticians prefer to use a quantitative

risk surrogate called the variance of returns, denoted by
Var ( r ) = (1/n) Σnt=1 [ri – r am ]2
Where ri = return on individual mutual fund unit. ram = mean
rate of return
The square root of the variance is called the standard
deviation σ = (Var (r) )(1/2)
The standard deviation and the variance are equally
acceptable and equivalent quantitative measures of an asset’s
total risk. The variance and standard deviation are computed
from logarithmic monthly returns.
SHARPE RATIO :-
71
The Sharpe ratio tells investors whether an investment's

returns are due to smart investment decisions or the result of
excess risk.
Most people with a financial background can quickly

comprehend how the Sharpe ratio is calculated and what it
represents. The ratio describes how much excess return you
are receiving for the extra volatility that you endure for
holding a riskier asset. Remember, you always need to be
properly compensated for the additional risk you take for not
holding a risk-free asset.
We will give you a better understanding of how this ratio
works, starting with its formula:
72
Relative Performance Index is defined as the ratio of the

unadjusted percentage NAV growth and the percentage
change in Bombay Stock Exchange Sensex.
RPI = [ { ( Current NAV – FaceValue )/ FaceValue } /

{ (Current BSE Sensex – BSE Sensex at issue time ) / BSE
Sensex at issue time } ] . …… ( 1 )
However RPI calculated as above will result in negative values

for a mutual fund scheme
with positive return against the bear market. Hence we amend
above formula as in (2):
RPI (Adjusted) = [ { ( %Change in SchemeNAV + 2 X Changein

Sensex ) } / { + X % Change in Sensex }] ....(2)
where –X% is the actual change in the sensex.
The RPI calculations are applied to 269 sample schemes.

Expected return from a scheme can be expressed as RPI x
market return. Hence a scheme with RPI equal to 5, is
73
expected to give an annual return of 8.4% (1.68 multiplied by

5) which is the risk free rate, with the mean monthly market
return during the study period at 0.14% (1.68% annualized).
We restricted further analysis to schemes with RPI greater
than 5 as the investor expects at least risk-free returns.
CHAPTER: 4
PROCESS OF THE STUDY:
SENSEX DAILY NAV
ISSUE TIME CURRENT FACE VALUE CURENT NAV

TIME
RPI
SD SPI
74
RISK AVERAGE MONTHLY MONTHLY

MEASUREMENT MONTHLY REVENUE AVERAGE NAV
REVENUE
CHAPTER:5
Data Analysis &

Interpretation
Table No:-1
GROWTH OPTION
HDFC TOP 200 FUND
MONTH ( 09 - AVG. MONTHLY
10) AVG. MONTHLY NAV RETURN(%)
(154.3485714-
AUGUST 146.9690435) 5.021144401
(163.60425-
SEPTEMBER 154.3485714) 5.996607883
(172.4412105-
OCTOBER 163.60425) 5.40142478
NOVEMBER (174.9111-172.4412105) 1.432308143
DECEMBER (178.030381-174.9111) 1.783352229
(179.363895-
JANUARY 178.030381) 0.749037323
(171.7654211-
FEBRUARY 179.363895) -4.23634528
(180.8672857-
MARCH 171.7654211) 5.299008696
75
(185.91915-
APRIL 180.8672857) 2.793133253
MAY (182.72481-185.91915) -1.718133931
(189.1372273-
JUNE 182.72481) 3.509330397
JULY (197.1580455-189.1372273) 4.240740078
Total 30.27160797
1)MEASUREMENT OF AVG.PORTFOLIO
RETURN (RAM) 2.522633998
2)MEASUREMENT OF RISK WITH S.D.& ST

A)VARIENCE(σ2) 9.714
B)STANDARD DEVIATION(S.D.)(σ) 3.1167
Sharpe Ratio
Table No:-1.1
Avg portfolio Avg.Risk free Sharpe

Fund name Return Return Std.Div.(σ) Ratio
HDFC TOP 200 2.522633998 7.5/12 3.1167 0.60886
Table No:2
GROWTH OPTION
HDFC INCOME FUND
MONTH ( 09 - AVG.MONTHLY
10 ) AVG. MONTHLY NAV RETURN(%)
(20.81504-
AUGUST 20.91447727) -0.475447072
(20.85711053-
SEPTEMBER 20.81504) 0.202116
(20.8900842-
OCTOBER 20.85711053) 0.1580932
(21.163115-
NOVEMBER 20.8900842) 1.3069876
76
(21.21288095-
DECEMBER 21.16311) 0.2351542
(21.31074-
JANUARY 21.21288095) 0.461319
FEBRUARY (21.2413211-21.31074) -0.3257461
(21.302455-
MARCH 21.2413211) 0.2878065
(21.52184211-
APRIL 21.302455-21) 1.0298677
(21.79858-
MAY 21.52184211) 1.2858467
JUNE (21.8290091-21.79858) 0.1395921
(21.91949524-
JULY 21.8290091) 0.4145224
Total 4.720112228
1)MEASUREMENT OF AVG.PORTFOLIO RETURN
(RAM) 0.393342686
Sharpe Ratio
Table No:-2.1

HDFC Income Fund 0.3933 7.5/12 0.5646 -0.41037
Table No :-3
GROWTH OPTION
HDFC BALANCE FUND
MONTH ( 09 - AVG.MONTHLY
77
(37.712380295-
AUGUST 36.40559091) 3.589529389
SEPTEMBER (39.70425-37.712380295) 5.2817395
OCTOBER (41.48668421-39.7042) 4.4892781
NOVEMBER (42.3278-41.48668421) 2.0274356
DECEMBER (43.88747619-42.3278) 3.6847561
(45.62721053-
JANUARY 43.8874761) 3.9640793
(44.98442105-
FEBRUARY 45.62721053) -1.4087854
(46.77380952-
MARCH 44.98442105) 3.9777959
APRIL (48.1638-46.7738095) 2.9717282
MAY (47.73504762-48.1638) -0.8901963
JUNE (49.6183-47.73504762) 3.9452194
JULY (51.525-49.6183) 3.8427354
Total 35.47531519
(RAM) 2.956276266
Sharpe Ratio
Table No:-3.1

HDFC Balance fund 2.956 7.5/12 2.072 1.125
78
DIVIDEND OPTION
HDFC TOP 200 FUND
MONTH ( 09 - AVG. MONTHLY
AUGUST (39.9155714285714-38.00643478) 5.023193202
SEPTEMBER (42.30855-39.9155714285714) 5.2817395
OCTOBER (44.5941578947368-42.30855) 4.4892781
NOVEMBER (45.2295-44.594157894736) 2.0274356
DECEMBER (46.0395714285714-45.2295) 3.6847561
JANUARY (46.385-46.0395714285714) 3.9640793
FEBRUARY (44.4207894736842-46.385) -1.4087854
MARCH (44.2677619047619-44.4207894736842) 3.9777959
APRIL (43.9255789473684-44.2677619047619) 2.9717282
MAY (43.2087272727273-43.9255789473684) -0.8901963
JUNE (44.6857272727273-43.2087272727273) 3.9452194
Table No:4Sharpe Ratio
(46.6021363636364-
JULY 44.6857272727273) 3.8427354
Total 36.908979
(RAM) 3.07574825
79
Table No: 4.1

HDFC TOP 200 3.075 7.5/12 2.1516 1.138687
Table No: 5
DIVIDEND OPTION
HDFC INCOME FUND
MONTH ( 09 AVG.MONTHLY
- 10 ) AVG. MONTHLY NAV RETURN(%)
AUGUST (10.90033-10.97620909) -0.69130507
SEPTEMBER (10.9163789473684-10.90033) 0.147233592
(10.8256578947368-
OCTOBER 10.9163789473684) -0.831054446
NOVEMBER (10.96715-10.8256578947368) 1.307006989
DECEMBER (10.9766476190476-10.96715) 0.086600612
JANUARY (10.871925-10.9766476190476) -0.954049202
FEBRUARY (10.8365578947368-10.871925) -0.325306744
MARCH (10.84486-10.8365578947368) 0.076612014
APRIL (10.8648894736842-10.84486) 0.184690938
MAY (11.004575-10.8648894736842) 1.285659892
JUNE (10.9966-11.004575) -0.072469859
JULY (10.8939476190476-10.9966) -0.933491997
Total 0.213618716
1)MEASUREMENT OF AVG.PORTFOLIO
RETURN (RAM) -0.05998944
80
Sharpe Ratio
Table No: 5.1
HDFC Income Fund -0.0599 7.5/12 0.7656 -0.894593
Table No: 6
DIVIDEND OPTION
HDFC BALANCE FUND
MONTH( 09 – AVG.MONTHLY
(16.6768095238095-
AUGUST 16.09743478) 3.599174351
SEPTEMBER (17.5574-16.6768095238095) 5.2803294
OCTOBER (18.3457368421053-17.5574) 4.490054576
NOVEMBER (18.71835-18.3457368421053) 2.031061282
DECEMBER (19.4079523809524-18.7183) 3.684098123
(20.1772105263158-
JANUARY 19.4079523809524) 3.963623417
(19.9162105263158-
FEBRUARY 20.1772105263158) -1.293538567
(18.7269523809524-
MARCH 19.9162105263158) -5.971307362
APRIL (18.95545-18.7269523809524) 1.220153789
MAY (18.805380952381-18.95545) -0.791693405
(19.5276818181818-
JUNE 18.805380952381) 3.840926529
(20.2783636363636-
JULY 19.5276818181818) 3.844193208
Total 20.05288213
(RAM) 1.991422945
81
Sharpe Ratio
Table No: 6.1
HDFC Balance fund 1.9914 7.5/12 3.2445 0.0421143
Table No: 7
Growth Option Dividend option

HDFC TOP HDFC HDFC HDFC TOP HDFC HDFC
200 Income Balance 200 Income Balance
Face
value 10 10 10 10 10 10
Curr.Mark 197.1580 21.919495 46.60213 10.89394 (20.278363
et Price 455 24 51.525 636 76 63
RPI 3.3242 0.211713 0.73756 0.6501 0.015878 0.182564
-
Rate of 0.3933426 2.956276 0.059989 1.9914229
Return 2.52263 8 2 3.075748 4 4
-
Expected 0.0832757 2.180431 1.999543 0.000952 0.3635621
Return 8.385726 59 07 775 5 38
Table No :8
COMPARETIVE ANALYSIS
GROWTH OPTION DIVIDEND OPTION
NAME OF RETURN( RIS SHARPE RETURN( RIS SHARPE
FUNDS RAM) K(σ) RATIO(ST) RAM) K(σ) RATIO(ST)
HDFC TOP 200 2.522 3.1167 0.60886 3.075 2.1516 1.138687
HDFC INCOME 0.3933 0.5646 -0.41037 -0.0599 0.7656 -0.894593

82
HDFC
BALANCE 2.956 2.072 1.125 1.9914 3.2445 0.0421143
INTERPRETATION
 According to table no. 7, the comparative study of
expected return measure with in HDFC Top 200 Fund,
HDFC Income Fund and HDFC Balance Fund with the help
of RPI method, it is observed that the expected rate of
return of HDFC Top 200 is the highest followed by HDFC
Balance and HDFC Income respectively.
 As far as the analysis is concerned in table no. 8, in terms

of the Growth options, we found that among the three
funds HDFC Top 200, HDFC Income & HDFC Balance, the
return of HDFC Balance is greater than HDFC Top 200
and HDFC Income Fund respectively.
 Similarly, if we compare dividend option of the same

above mentioned Funds, the return of HDFC Top 200 is
greater than the other two.
 In the growth option if we consider the risk factor of the
three funds, we will see that the HDFC Income is
more preferable than the other two.
 In the dividend option, the risk of the HDFC Income is
much lower compared to the other two.
 Further if we compared the sharpe ratio of the above
mentioned three funds, we will found out that the sharpe
ratio of the HDFC Balance is much positive and more in
comparison of the other funds.
83
 The comparative study of expected return measure with

in HDFC Top 200 Fund, HDFC Income Fund and HDFC
Balance Fund with the help of RPI method, it is observed
that the expected rate of return of HDFC Top 200 is the
highest followed by HDFC Balance and HDFC Income
respectively.
 Limitations of the Study:

The present study has the following limitations:
 The NAVs used in the study are obtained from
AMFI’s website, which in turn is supplied by the
members. Members in turn have not followed any
uniform rule in its computation due to the
flexibilities offered under SEBI regulations.
 Initially all mutual fund schemes were directly linked

to stock market. In the recent 2 years numerous
schemes which are independent of stock market
(debt & money market funds) are introduced and
such schemes’ returns need not have correlation
with BSE sensex, and the sensex is not adjusted for
dividends.
 Banks are free to accept deposits at any interest
within the ceilings fixed by Reserve Bank of
India and interest rates can vary from client to
84
client. Hene there can be an inaccuracy in the risk-

free rates.
 The analysis is not free from the limitations of non-

identical time periods and unequal sample
observations.
 The study excludes the effect of entry and exit
loads of the mutual funds.
 There are several methods are available to
calculate the risk and return of a mutual fund . But
in my project I am only able to deal with three
methods only .
85
CHAPTER: 6
Findings & Suggestions
FINDINGS:
By the above study, one can have a lot of findings regarding
the
Performance of the funds in his portfolio. The comparison in
performance
of these mutual funds can be done easily.
The following finding can be:
 The mutual funds performance is evaluated easily with

the help of
86
Sharpe Index Model. The fund having low ST(Sharp Index

Ratio)
value performs weakly and form high ST performs
comparatively well.
It also shows effectiveness of Sharpe Index Method.
 With a number of mutual funds scheme existing in the
market, it is
very difficult by an investor to choose the best among them.
This
paper provides a necessary and sufficient result to help to
choose the
best portfolio to get maximum return with minimum risk.
 Standard deviation and mean proves to be very useful

statistical tool in order to reach to some valuable result.
Without help of average and standard deviation one
cannot apply Sharpe Index Method.
 On The basis of Sharp Index Ratio the best performing
and worst-performing funds can be easily identified. The
tables no (1.1, 2.1, 3.1, 4.1, 5.1, & 6.1) are in a good
support of this study. By studying these tables one can
easily interpret it. Like the HDFC Balance Fund & HDFC
Top 200 Fund are the best-performing fund where as
HDFC Income Fund is worst-performing.
Thorough Comparative Analysis between Growth &

Dividend scheme regarding HDFC Top 200 Fund,HDFC
Income Fund & HDFC Balance Fund it is found that-
1) As far as the analysis is concerned, in terms of the

Growth options, we found that among the three
funds HDFC Top 200, HDFC Income & HDFC
87
Balance, the return of HDFC Balance is more than

HDFC Top 200 and followed by HDFC Income,
which reveals its performance is the best during
the period of August 09-July 10.
2) Similarly, if we compare dividend option of the
same above mentioned Funds, the HDFC Top 200
is the best performer in
the same above said period, followed by HDFC
Balance Fund and HDFC Income Fund respectively.
By Analyzing the Performance of each funds in the

given period based on the two options Growth&
Dividend it is found that
1) In HDFC Income fund the growth option more

significant than the Dividend option.
2) Again In HDFC Balance fund the growth option is
more than that of dividend option, which reveals
HDFC Balance is more preferable
Analyzing the Performance based on risk

factor of each funds in the given period based
on the two options GROWTH & DIVIDEND it is
found that :-
88
1) In the growth option if we consider the risk factor

of the three funds, we will see that the HDFC
Income is more preferable than the other two.
2) In the dividend option, again the HDFC Income is
the best preference.
The comparative study of expected return measure

with in HDFC Top 200 Fund, HDFC Income Fund and
HDFC Balance Fund with the help of RPI method it is
found that expected rate of return of HDFC Top 200
is more than other two.
Hence, the portfolio theory teaches us that

investment choices are made on the basis of
expected risk and returns and these expectations
can be satisfied by having right mix of assets.
SUGESSTION
89
This study can be easily understand and help an investor in

many
ways. Some of the suggestions are below
 It is not only fund or company’s goodwill which can be
taken into
consideration while choosing a portfolio, the market factors
like
government policies, economic of sales and the trend in a
particular
sector should also be considered.
 Today investor is having enough funds to invest in a

number of
schemes. He is always in search of such statistical tools
which can
provide him maximum return with lower risk. In this regard,
mutual fund is the best choice.
 Considering the above analysis, it can be noted that the

three growth oriented mutual funds (HDFC Top 200 Fund
and HDFC Balance Fund ) have performed better than
their benchmark indicators. Other fund such as HDFC
Income Fund did not perform well and performed
negatively.
 Though HDFC Top 200 Fund, HDFC Income Fund and

HDFC Balance Fund have performed better than the
90
benchmark of their systematic risk (volatility) but with

respect to total risk the fund have not outperformed the
Market Index.
 Growth oriented mutual funds are expected to offer the
advantages of Diversification, Market timing and
Selectivity. In the sample, HDFC Equity Fund, HDFC
Growth Fund and HDFC Top 200 fund is found to be
diversified fund and because of high diversification, it has
reduced total risk of the portfolio. Whereas, others are
low diversified and because of low diversification their
total risk is found to be very high. Further, the fund
managers of these under performing funds are found to
be poor in terms of their ability of market timing and
selectivity.
 The Fund manager of HDFC Income Fund and HDFC

Balance Fund and can improve the returns to the
investors by increasing the systematic risk of the
portfolio, which in turn can be done by identifying highly
volatile shares.
 Alternatively, these can take advantage by
diversification, which goes to reduce the risk if the same
return is given to the investor at a reduced risk level, the
compensation for risk might seem adequate. The fund
manager of HDFC Income Fund and HDFC Balance Fund
91
can earn better returns by adopting the marketing timing

strategy and selecting the under priced securities.
 The fund manager can divide all securities into several

asset classes and tries to construct an efficient portfolio
based on expected returns, risk, and correlations of
indexes representing these asset classes. The investment
should be done in the bench mark indexes to get an
“efficient” portfolio in such a way that no other
combination of these indexes would result in a portfolio
with a higher return for a given level of risk. It should be
emphasized, however, that this is not a fully efficient
portfolio because information about correlations among
individual securities within an index and across the
indexes is lost in the transition from individual securities
to the benchmarks that represent them.
 These measures are more useful to investors who are
putting their money into one diversified fund and are
able to use leverage or invest in the risk-free asset. When
the investor is investing in the different funds, the fund’s
marginal contribution to the portfolio’s risk and return is
more important than its individual security
characteristics. To construct an efficient portfolio, an
investor must take account of the correlations among the
being considered. It is not advisable to apply just
92
procedure or approach for all situations at least when it

comes to investments though the used measures are
highly reliable in the studies done on similar veins. Even
at this juncture it would still be recommended that
instead of going ahead only on the basis of risk and
return, other indicators like new projects, sector impact,
individual sentiments about companies etc besides
‘common sense and intuition’ may also be looked into.
CHAPTER: 7
CONCLUSIONS:-
Mutual fund has become one of the important sources for

investing. It is quite likely that a more efficient portfolio can be
constructed directly from funds. Thus, the two-step process of
choosing an asset allocation based on the information about
benchmark indexes and then choosing funds in each category
may be one of the best realistically attainable approaches.
93
To use this approach to portfolio selection effectively,

investors would benefit from estimates of future asset returns,
risks and correlations, as well as from fund management’s
disclosure of future asset exposures and appropriate
benchmarks.
It has been a great opportunity for me to get a first experience

of Mutual Funds. My study is to get the feel of how the work is
carried out in relation to fund’s portfolio aspect. I got an
opportunity in relation to the documentation and also the
portfolio analysis that have been carrying out in facilitating
the investor and the fund manager.
Appendices :
Appendix 1: Company profile

94
1.1 Niveshak Mpowered Ltd.
Niveshak is a Company incorporated under the Indian

Companies Act 1956. Niveshak is created solely with a view to
provide a platform for the Investors to enable them to take
informed decision for investing their hard earned money, in
seeking this goal, Niveshak also endeavors to develop a
95
qualified and well-informed cadre of Financial Advisors and

Distributors by empowering the practicing Financial
Advisors/Distributors with better/relevant knowledge/skills and
by training the young college and B-School graduates with
adequate knowledge/skills.
A unique Investor Education Program has been devised for

helping the investor understand the intricacies of the savings
and investments. The program also encompasses in it
sufficient provision to draw sufficient learning from the
feedback received from the investors as to what is the
significance of learning and knowledge on the investment
decisions of the common investors. Niveshak Associates would
help the investors in understanding their risk profile so that
they can understand what type of savings/investment options
or securities and mutual funds they should invest within their
overall risk profile. Niveshak is an initiative of SPA Capital
Services Ltd. and Acsys Software (India) Pvt. Ltd.
1.2 Group Company-
SPA Capital Service Ltd

96
SPA Group promoted in 1995, by a team of financial

professionals, provides value added financial services like
corporate finance and wealth management services to
Indian companies and HNIs.
SPA Group has established itself as one of India's

leading financial advisory house, offering various financial
services like securities broking, insurance broking,
corporate finance, merchant banking, financial advisory,
risk management and wealth management.
SPA Capital Services Ltd. is a flagship company of SPA

Group, engaged in advisory and distribution services of
mutual funds & insurance and is ranked amongst the top 5
financial intermediaries of the country.
The company has a distribution network of over

200 sub-brokers across India being serviced by its 58
branches. The company has mobilized over Rs. 5 lac crores
for various mutual funds during the last 10 years and is
currently having AUM over Rs.20,000 cores with hundreds
of satisfied customers.
Acsys Software (India) Pvt. Ltd

97
is a leading Technology and Software Solution Provider in

the niche vertical of the Mutual Fund Industry both in India
and abroad. Its Software products and services covering
many application areas are termed "Best of Brand" services
within the Indian Fund Industry. Acsys designs software
solutions and products to keep pace with today's changing
market place. Its software applications and products,
support all participants in the fund industry, be it the Fund
House, the Distributor and/or Investor.
In addition, Acsys has a large pool of in-house expertise to

continually develop appropriate and advanced technology
requirements to the financial services market in general
and Fund Industry in particular.
98
Profile
Acsys Software (India) Pvt. Ltd., incorporated in 1996, was

originally the software division of Computer Age
Management Services (P) Ltd., (CAMS). It was hived off as a
joint venture in association with Alliance Capital LLP of the
USA. Currently, Acsys Software is fully owned by the original
Indian promoters and is an affiliate Company to CAMS.
CAMS are India's largest Transfer Agency for Open Ended
Funds dominating more than 60% of the market. CAMS offer
Outsourced Transaction Processing, Customer Care, Fund
Accounting and related Transfer Agency Services.
Acsys Software products for Asset Management Companies,

Distributors and related entities come with the following
advantages:
 Substantial knowledge of business and domain of the

Mutual Fund Industry. It understands the needs easily and is
able to harness the software solutions for new products and
services faster.
 Its Software Products and services are put through

extreme process conditions through its stake-holder's
businesses.
99
 It operates in a dynamic environment dictated by

enormous growth in the Indian Mutual Fund Industry in a
very short span.
 Demonstrated capabilities overseas, through offshore

development, which resulted in an entity migrating from a
multiple database and legacy systems environment to a
"state of the art" open architecture software solution - See
Case Study.
 Members of NICSA and ALFI, leading Fund Forums in US

and Europe. Thereby continually tracking trends in the
overseas Investment Industry.
 Multi-currency functionality to include Euro compliancy.
Acsys has a library of core products, which meets the

software requirements of Mutual Fund Asset Management
Companies, Fund Distributors and other intermediaries. All
its products are designed and customized using Client
Server Architecture for Oracle Databases with Power Builder
and other Internet enabled front ends, using JAVA, XML and
other revolutionary tools for 24/7 web delivery.
Acsys Software has production facilities at Chennai, India
and provides client service from Luxembourg for Europe.
100
1.3 Board members of company
Mr. Kamal Somani, FCA,
He is a senior finance professional with over 30 years of

experience in investment banking, securities broking and
corporate finance. His vast experience and vision has enabled
the Group to establish itself as a respected financial services
provider in the country. He looks after the overall group
strategies and leads securities broking, investment advisory
and investment banking activities of the Group
Mr. Sandeep Parwal, B.Com (Hons), FCA,
has over 20 years of experience in various aspects of financial

services. He handles investment advisory, insurance broking
and merchant banking activities of the Group. His expertise in
providing customized innovative solutions with unmatched
101
speed provides a distinctive edge to the Group's capability.
Mr. V. Shankar,
an alumnus of Indian Institute of Management Calcutta and

Indian Institute of Technology Madras, is the Managing
Director of Computer Age Management Services (CAMS), the
largest RTA in India.
Computer Age Management Services Pvt. Ltd. (CAMS), offers a

comprehensive package of Transaction Processing and
Customer Care services to the Mutual Fund industry, and has
been constantly raising the bar in customer service since
1995.
CAMS today has the most appropriate and advanced

technology employed, with the best network for service
delivery through its network of Service Centers in all
major cities in India. Currently CAMS provides this
comprehensive package of services to 18 Indian Mutual Fund
families as services provider. Of every 100 Mutual Fund
102
transactions processed in India, CAMS processes 50 or more.

CAMS is clearly the #1 choice for Mutual Funds in India.
Mr. Shanks is also a Director at Acsys Software., which is a

leading Technology and Software Solution Provider in the
niche vertical of the Mutual Fund Industry both in India and
abroad
1.4 Niveshak Financial Advisory Program
(NFAP)
It is believed that the financial and capital market would

generate the largest number of employment opportunities in
the next 2 decades. Yet the talented people with the skills sets
required to fill most of the positions are glaringly missing in
the country. A successful sales & marketing career in the
financial market requires a thorough grooming at the grass-
root level, and that is where this program commands immense
value.
NML believes that large scale employment

opportunities exist in this field for graduates and fresh MBAs,
if empowered properly. Niveshak, therefore, offers quality &
practical education in field of investment, financial planning,
insurance and tax advisory. As part of this initiative Niveshak
103
has chosen to offer a comprehensive internship program titled

"Niveshak Interaction Program" for a total duration of two
months.
This Internship not only offers a strong opportunity

to learn for a budding student; but also shapes up the
professional in the student as a result of mentoring from an
experienced Mentor. This paves the way for a strong and
rewarding career. The entire program is designed such that
student will also be made to acquire the AMFI & IRDA
licenses. In addition, the internship also enables a student to
earn sizeable money.
Smoothen your way from college to corporation! Learn

how to take your college degree to the business world.
You are serious about your studies, and about your job
and a career in the corporate world. The NML's
Niveshak Interaction Program is designed to help you
stand out in the job market. It is a unique Internship
Program to enable you to pick the ropes of a successful
financial advisory career.
This program is an eight - week intensive introduction

to the principles of Advisory Business and skills you'll
need in the financial world. Whether or not you've
104
studied business, you can benefit from the training

based on the top-ranked learning program.
Niveshak Interaction Program – Objectives
Today the Indian Capital market requires the inclusion of a

wide base of retail investors to counter the volatility caused by
the inflow & outflow of foreign money on which we have
excessive dependence. Indian middle class savers largely
share the capital market (only amount 2% of the salary savers
participate). Only through a process of personalized education
can they be attracted to join the capital market via Mutual
Funds, Insurance etc.
To ensure the delivery of "Investor.Education@home" and

facilitate investments, India needs to grow a new cadre of
financial advisors who are not merely "Salesmen" but rather
"Advisors" - properly trained to educate and assist the saver,
logistically and with knowledge. NML proposes to achieve this
goal through this unique Internship Program in addition to the
soon to be launched regular 6 month diploma program.
This program seeks to develop a vocational skill by providing
knowledge required to obtain licenses to advise investors, and
then provide the environment through an experimental
learning proven to avoid the temptation of merely hard selling
105
financial products but rather to deliver financial education.

This program provides opportunity to sharpen the
communication and presentation skills. The field work helps
student in understanding the nitty-gritty of the financial
advisory.
This program also fulfils the need of the Interns/Students to

complete the internship which their regular degree program
expects them to do.
Niveshak Mpowered Pvt. Ltd has been created to

meet regulatory and corporate requirements for providing the
requisite Course Material & forum for various regulatory
licenses necessary for selling the MF & Insurance products,
Supervision by Expert Mentors for augmenting critical skills
and information Technology Environment.
The entire design is such that it also offers the most
favorable brokerage for the students (only available to
corporate national distributors & not individuals) and sufficient
remuneration for lead generation.
106
1.5 vision
SPA believes in attaining customer satisfaction, on continuing basis, by
providing highest standard of financial services in India. The philosophy at
SPA is to provide services to clients after assessment of their profile,
needs and risk-appetite. The basic work theme at SPA is:
- Dedicated, competent and honest team of professionals

- Customer centric work environment
- Insight of customers’ perspectives
- Strong research base
- Clear understanding of applicable laws
- Consistency and passion to excel
- Technology savvy
1.6 Milestone
Since 1994, with the coming into existence of the SPA Group, we
have diversified into a complete financial solution providing
house, catering varied needs of our clients ranging from
investment advisory services to investment banking, corporate re-
structuring, distribution and broking services, risk management
and insurance advisory.
107
Within a short span of time, the Group has made a place

for itself in the midst of the top financial solutions
provider in the country.
1.7 Types of services provided by groups of SPA-
• Financial Advisory
• Tax Consultancy
• Equity merchant banking
• Corporate advisory
• Corporate finance
• Project finance
• Investment advisory
• Mutual fund distribution
• Security broking
• Equity broking
108
• Insurance broking
• Valuation Services
• Bond broki
Appendix : 2
HDFC AMC COMPANY OVERVIEW
HDFC ASSET MANAGEMENT COMPANY LIMITED (AMC)

AMC was incorporated under the Companies Act, 1956, on
December 10, 1999, and was approved to act as an AMC for
the Mutual Fund by SEBI on July 30, 2000.
The registered office of the AMC is situated at Ramon House,
3rd Floor, H.T. Parekh Marg, 169, Back bay Reclamation,
Church gate, Mumbai - 400 020.
In terms of the Investment Management Agreement, the
Trustee has appointed HDFC Asset Management Company
Limited to manage the Mutual Fund As per the terms of the
Investment Management Agreement, the AMC will conduct the
operations of the Mutual Fund and manage assets of the
schemes, including the schemes launched from time to time.
The present share holding pattern of the AMC is as follows:
109
Particulars % of the paid up capital Housing Development

Finance Corporation Limited 50.10 Standard Life Investments
Limited 49.90 Zurich Insurance Company (ZIC), the Sponsor of
Zurich India Mutual Fund, following a review of its overall
strategy, had decided to divest its Asset Management
business in India.
The AMC had entered into an agreement with ZIC to acquire
the said business, subject to necessary regulatory approvals.
On obtaining the regulatory approvals, the Schemes of Zurich
India Mutual Fund has now migrated to HDFC Mutual Fund on
June 19, 2003.
The AMC is also providing portfolio management / advisory
services and such activities are not in conflict with the
activities of the Mutual Fund. The AMC has renewed its
registration from SEBI vide Registration No. - PM /
INP000000506 dated December 22, 2000 to act as a Portfolio
Manager under the SEBI (Portfolio Managers) Regulations,
1993. The Certificate of Registration is valid from January 1,
2004 to December 31, 2006.
Board of Directors
The Board of Directors of the HDFC Asset Management
Company Limited (AMC) consists of the following eminent
persons.
Table: 1.6
Mr. Deepak S. Parekh Chairman of the board
110
Mr. N. Keith Skeoch CEO of Standard Life Investments Ltd.

Mr. Keki M. Mistry Associate director
Mr. James Aird Investment director
Mr. P. M. Thampi Independent director
Mr. Humayun Dhanrajgir Independent director
Dr. Deepak B. Phatak Independent director
Mr. Hoshang S. Billimoria Independent director
Mr. Rajeshwar Raj Bajaaj Independent director
Mr. Vijay Merchant Independent director
Ms. Renu S. Karnad Joint managing director
Mr. Milind Barve Managing director
Mr. Deepak Parekh, the Chairman of the Board, is
associated with HDFC Ltd. in his capacity as its Executive
Chairman.
Mr. Parekh joined HDFC Ltd. in a senior management position
in 1978. He was inducted as Wholetime Director of HDFC Ltd.
in 1985 and was appointed as the Executive Chairman in
1993.
Mr. N. Keith Skeoch is associated with Standard Life
Investments Limited as its Chief Executive and is responsible
for all company business and investment operations within
Standard Life Investments Limited.
Mr. Keki M. Mistry is an associate director on the Board. He
is the Vice-Chairman & Managing Director of Housing
Development Finance Corporation Limited (HDFC Ltd.) He is
111
with HDFC Ltd. since 1981 and was appointed as the

Executive Director of HDFC Ltd. In 1993. He was appointed as
the Deputy Managing Director in 1999, Managing Director in
2000 and Vice Chairman & Managing Director in 2007.
SPONSORS HOUSING DEVELOPMENT FINANCE

CORPORATION LIMITED (HDFC):
HDFC was incorporated in 1977 as the first specialized

housing finance institution in India. HDFC provides financial
assistance to individuals, corporate and developers for the
purchase or construction of residential housing. It also
provides property related services (e.g. property
Identification, sales services and valuation), training and
consultancy. Of these activities, housing finance remains the
dominant activity.
HDFC currently has a client base of over 8, 00,000 borrowers,
12, 00,000 depositors, 92,000 shareholders and 50,000
deposit agents. HDFC raises funds from international agencies
such as the World Bank, IFC (Washington), USAID, CDC, ADB
and KFW, domestic term loans from banks and insurance
companies, bonds and deposits. HDFC has received the
highest rating for its bonds and deposits program for the ninth
year in succession. HDFC Standard Life Insurance Company
Limited, promoted by HDFC was the first life insurance
112
company in the private sector to be granted a Certificate of

Registration (on October 23, 2000) by the Insurance
Regulatory and Development Authority to transact life
insurance business in India. HDFC is India's premier housing
finance company and enjoys an impeccable track record in
India as well as in international markets. Since its inception in
1977, the Corporation has
Maintained a consistent and healthy growth in its operations
to remain the market leader in mortgages. Its outstanding
loan portfolio covers well over a million dwelling units. HDFC
has developed significant expertise in retail mortgage loans to
different market segments and also has a large corporate
client base for its housing related credit facilities. With its
experience in the financial markets, a strong market
reputation, large shareholder base and
Unique consumer franchise, HDFC was ideally positioned to
promote a bank in the Indian environment.
STANDARD LIFE INVESTMENTS LIMITED
The Standard Life Assurance Company was established in
1825 and has considerable experience in global financial
markets. In 1998, Standard Life Investments Limited became
the dedicated investment management company of the
Standard Life Group and is owned 100% by The Standard Life
Assurance Company.
113
With global assets under management of approximately

US$186.45 billion as at March 31, 2005, Standard Life
Investments Limited is one of the world's major investment
companies and is responsible for investing money on behalf of
five million retail and institutional clients worldwide. With its
headquarters in Edinburgh, Standard Life Investments Limited
has an extensive and developing global presence with
operations in the United Kingdom, Ireland, Canada, USA,
China, Korea and Hong Kong. In order to meet the different
needs and risk profiles of its clients, Standard Life Investments
Limited manages a diverse portfolio covering all of the major
markets world-wide, which includes a range of private and
public equities, government and company bonds, property
investments and various derivative instruments. The
company's current holdings in UK equities account for
approximately 2% of the market capitalization of the London
Stock Exchange.
HDFC MUTUAL FUND PRODUCTS
Equity Funds
HDFC Growth Fund
HDFC Long Term Advantage Fund
HDFC Index Fund
HDFC Equity Fund
HDFC Capital Builder Fund
HDFC Tax saver
114
HDFC Top 200 Fund

HDFC Core & Satellite Fund
HDFC Premier Multi-Cap Fund
HDFC Long Term Equity Fund
HDFC Mid-Cap Opportunity Fund
Balanced Funds
HDFC Children's Gift Fund Investment Plan
HDFC Children's Gift Fund Savings Plan
HDFC Balanced Fund
HDFC Prudence Fund
Debt Funds
HDFC Income Fund
HDFC Liquid Fund
HDFC Gilt Fund Short Term Plan
HDFC Gilt Fund Long Term Plan
HDFC Short Term Plan
HDFC Floating Rate Income Fund Short Term Plan
HDFC Floating Rate Income Fund Long Term Plan
HDFC Liquid Fund - PREMIUM PLAN
HDFC Liquid Fund - PREMIUM PLUS PLAN
HDFC Short Term Plan - PREMIUM PLAN
HDFC Short Term Plan - PREMIUM PLUS PLAN
HDFC Income Fund Premium Plan
HDFC Income Fund Premium plus Plan
HDFC High Interest Fund
115
HDFC High Interest Fund - Short Term Plan

HDFC Sovereign Gilt Fund - Savings Plan
HDFC Sovereign Gilt Fund - Investment Plan
HDFC Sovereign Gilt Fund - Provident Plan
HDFC Cash Management Fund - Savings Plan
HDFC Cash Management Fund - Call Plan
HDFCMF Monthly Income Plan - Short Term Plan
HDFCMF Monthly Income Plan - Long Term Plan
HDFC Cash Management Fund - Savings Plus Plan
HDFC Multiple Yield Fund
HDFC Multiple Yield Fund Plan 2005
ACHIEVEMENT AND AWARDS
CNBC - TV 18 - CRISIL Mutual Fund of the Year Awards

2008 :
HDFC Prudence Fund was the only scheme that won the
CNBC - TV 18 - CRISIL Mutual
Fund of the Year Award 2008 in the Most Consistent
Balanced Fund under CRISIL ~
CPR for the calendar year 2007 (from amongst 3
schemes).HDFC Cash Management Fund - Savings Plan
was the only scheme that won the CNBC -TV 18 - CRISIL
Mutual Fund of the Year Award 2008 in the Most Consistent
Liquid Fund
116
Under CRISIL ~ CPR for the calendar year 2007 (from

amongst 5 schemes).
HDFC Cash Management Fund - Savings Plan was the
only scheme that won the CNBC -TV 18 - CRISIL Mutual Fund
of the Year Award 2008 in the Liquid Scheme – Retail
Category for the calendar year 2007 (from amongst 19
schemes).
Lipper Fund Awards 2008: HDFC Equity Fund - Growth
has been awarded the 'Best Fund over Ten Years' in the
'Equity India Category' at the Lipper Fund Awards 2008
(form amongst 23 schemes). It was awarded the Best Fund
over ten years in 2006 and 2007 as well. 2008 makes it three
ina row. Lipper Fund Awards 2009:
HDFC Equity Fund - Growth has been awarded the 'Best Fund
over Ten Years' in the 'Equity India Category' (form amongst
34 schemes) and HDFC Prudence Fund – Growth Plan in
the ‘Mixed Asset INR Aggressive Category’ (from amongst
6 schemes), have been awarded the ‘Best Fund over 10
Years’ by Lipper Fund Awards India 2009.
ICRA Mutual Fund Awards – 2008:
HDFC MF Monthly Income Plan - Long Term Plan -
Ranked a Seven Star Fund and has been awarded the Gold
Award for "Best Performance" in the category of "Open
Ended Marginal Equity" for the three year period ending
December 31, 2007 (from amongst 27 schemes)
117
HDFC High Interest Fund - Short Term Plan - Ranked a

Five Star Fund indicating performance among the top 10%
in the category of "Open Ended Debt - Short Term" for one
year period ending December 31, 2007 (from amongst 20
schemes).
HDFC Prudence Fund - Ranked a Five Star Fund
indicating performance among the top 10% in the category of
"Open Ended Balanced" for the three year period ending
December 31, 2007 (from amongst 16 schemes).
Appendix :3
History Of Net Asset Value

Growth Option Top 200 Fund 118
DATE Daily NAV DATE Daily NAV DATE Daily NAV

145.27
1 140.372 1 6 3 158.221
145.98
2 141.067 2 4 4 157.016
148.08
3 142.388 3 1 5 157.505
141.01
4 144.379 6 9 6 154.304
142.61
5 145.086 7 1 7 151.393
139.00
8 140.258 8 1 10 149.572
9 144.332 9 139.06 11 150.259
136.85
10 147.638 10 3 12 149.981
135.88
11 146.408 13 5 13 154.695
12 143.994 14 140.36 14 154.286
144.06
15 142.332 15 6 17 148.634
144.12
16 144.373 16 1 18 151.129
148.44
17 140.587 17 7 19 149.592
151.81
18 138.975 20 2 20 151.561
150.81
19 141.064 21 3 21 153.724
149.38
22 140.516 22 5 24 156.975
152.44
AUGUST-09
23 140.213 23 7 25 157.374
JUNE-09
JULY -09
153.75
24 142.593 24 1 26 158.428
153.96
25 142.511 27 2 27 158.516
153.87
26 145.723 28 3 28 159.733
152.66
29 146.529 29 5 31 158.422
154.20
30 143.761 30 9 TOTAL 3241.32
3001.33 156.60 AVERA 154.348
TOTAL 8 31 7 GE 57
AVERA 142.959 3380.2
GE 05 TOTAL 88
AVERA 146.96
GE 9
119
Growth Option Top 200 Fund

SEPTEMBER-09
OCTOBER-09
NOVEMBER-09
171.85
1 157.155 1 2 3 162.803
170.09
2 156.543 5 5 4 167.053
171.43
3 156.238 6 9 5 168.751
171.59
4 158.32 7 1 6 170.515
172.45
7 161.392 8 3 9 174.441
171.10
8 161.402 9 3 10 173.862
174.63
9 161.209 12 8 11 177.419
177.36
10 161.054 14 9 12 175.369
177.11
11 161.335 15 7 13 176.811
178.33
14 161.169 16 3 16 178.634
177.62
15 163.993 20 6 17 178.816
175.04
16 166.018 21 1 18 178.118
172.41
17 166.591 22 3 19 175.811
173.65
18 167.186 23 2 20 177.465
22 168.391 26 172.22 23 178.521
168.49
23 167.064 27 2 24 178.334
168.08
24 167.718 28 7 25 179.07
25 167.979 29 166.74 26 176.214
3
120
166.11
29 169.563 30 9 27 174.054
3276.3
30 171.765 TOTAL 83 30 176.161
3272.08 AVERA 172.44 3498.22
TOTAL 5 GE 12 TOTAL 2
AVERA 163.604 AVERA 174.911
GE 25 GE 1

DECEMB
FEBRUAR
JANUARY-

181.42
1 178.983 4 8 1 173.925
182.76
2 178.891 5 6 2 171.666
183.14
3 179.562 6 9 3 174.537
4 178.938 7 182.18 4 172.214
181.75
7 178.18 8 5 5 168.437
182.44
8 179.732 11 7 8 169.975
181.34
9 178.451 12 5 9 170.849
10 178.982 13 181.75 10 169.663
2
121
182.97
11 177.93 14 8 11 171.287
182.32
14 177.823 15 5 15 170.344
183.26
15 175.308 18 3 16 171.888
181.67
16 175.494 19 3 17 173.397
17 176.405 20 181.51 18 173.343
177.63
18 174.954 21 6 19 171.913
175.48
21 174.316 22 3 22 171.788
174.43
22 175.313 25 9 23 171.779
169.34
23 179.05 27 2 24 171.346
ER-09
10
Y-10
170.58
24 180.094 28 8 25 171.586
171.85
29 180.09 29 5 26 173.606
3407.9 3263.54
30 179.686 TOTAL 14 TOTAL 3
AVERA 179.36 AVERA 171.765
31 180.456 GE 39 GE 42
3738.63
TOTAL 8
AVERA 178.030
GE 38

122
MARCH-10
APRIL-10
MAY-10
184.92
2 176.554 1 3 3 186.819
187.46
3 178.388 5 8 4 184.513
187.32
4 178.536 6 2 5 184.563
187.07
5 178.697 7 4 6 184.288
185.56
8 180.107 8 7 7 180.964
187.07
9 179.49 9 4 10 185.197
185.96
10 179.164 12 6 11 183.281
185.83
11 180.108 13 4 12 184.511
184.44
12 179.905 15 4 13 185.869
184.31
15 179.008 16 3 14 183.755
182.90
16 180.363 19 5 17 183.004
184.16
17 181.589 20 6 18 183.988
184.88
18 181.869 21 6 19 179.3
185.84
19 182.353 22 7 20 181.608
186.77
22 181.242 23 5 21 180.5
187.18
23 181.955 26 4 24 180.023
187.19
25 182.649 27 7 25 175.866
185.23
26 183.98 28 3 26 178.518
186.31
29 184.746 29 1 27 181.953
30 183.787 30 187.89 28 183.844
123
4
3718.3
31 183.723 TOTAL 83 31 184.857
3798.21 AVERA 185.91 3837.22
TOTAL 3 GE 92 TOTAL 1
AVERA 180.867 AVERA 182.724
GE 29 GE 81

JULY-10
JUNE-10
DATE Daily NAV DATE Daily NAV

1 181.953 1 192.971
2 183.665 2 192.5
3 186.795 5 192.457
4 187.59 6 194.11
7 184.504 7 192.98
8 183.109 8 195.343
9 184.353 9 196.85
10 186.893 12 197.203
11 187.277 13 197.86
14 189.477 14 197.501
15 189.573 15 197.349
16 190.07 16 198.394
17 190.753 19 198.382
18 190.307 20 197.538
21 192.811 21 198.468
22 191.778 22 199.985
23 192.55 23 200.109
24 192.825 26 199.108
124
25 192.234 27 199.488
28 194.664 28 199.569
29 193.234 29 200.034
30 194.604 30 199.278
TOTAL 4161.019 TOTAL 4337.477
AVERAGE 189.13723 AVERAGE 197.158
Growth Option Income Fund

JUNE-
JUL
AUGUST-
Daily
DATE Daily NAV DATE Daily NAV DATE NAV
1 20.6474 2 21.0351 3 20.9065
2 20.6582 3 20.0581 4 20.8985
3 20.7761 6 20.8853 5 20.8771
4 20.8158 7 20.8513 6 20.8255
5 20.8096 8 20.9029 7 20.8411
8 20.7877 9 20.8971 10 20.8169
9 20.7696 10 20.8901 11 20.8443
10 20.7259 13 20.9347 12 20.8594
11 20.6638 14 20.9393 13 20.8677
12 20.6587 15 20.9406 14 20.8324
15 20.7236 16 20.9797 17 20.842
16 20.7337 17 21.0044 18 20.8338
17 20.7398 20 20.9612 20 20.802
18 20.794 21 20.9538 21 20.7609
19 20.8296 22 20.9749 24 20.6992
22 20.811 23 21.006 25 20.7439
23 20.8255 24 21.0089 26 20.815
24 20.8283 27 21.005 27 20.7634
25 20.8102 28 21.0137 28 20.7478
26 20.8478 29 21.002 31 20.7234
29 20.8829 30 20.9527 TOTAL 416.300
8
125
AVERAG 20.8150
30 20.9118 31 20.9217 E 4
TOTAL 457.051 TOTAL 460.1185
AVERAG 20.775045 AVERAG 20.914477
Y-09
09
09
E 5 E 3

SEPTE
NOVE
OCTO
Daily
DATE Daily NAV DATE Daily NAV DATE NAV
1 20.7216 1 20.9078 3 20.9825
2 20.7234 5 20.9805 4 20.9881
3 20.7314 6 20.938 5 21.0142
4 20.7015 7 20.9115 6 21.0219
7 20.8297 8 20.9141 9 21.0428
8 20.7833 9 20.86 10 21.0749
9 20.8086 12 20.8312 11 21.0827
10 20.7604 14 20.8294 12 21.0812
11 20.7756 15 20.8358 13 21.0915
14 20.8778 16 20.8167 16 21.1169
15 20.9271 20 20.8335 17 21.1767
16 20.9641 21 20.8929 18 21.1862
17 20.9219 22 20.8562 19 21.2369
18 20.9986 23 20.8558 20 21.298
22 20.9653 26 20.8713 23 21.2675
23 20.986 27 20.9088 24 21.2971
24 20.9802 28 20.9344 25 21.3302
126
25 20.9191 29 20.9881 26 21.3524

29 20.9095 30 20.9456 27 21.3316
TOTAL 396.2851 TOTAL 396.9116 30 21.289
AVERAG 20.857110 AVERAG 20.890084
E 5 E 2 TOTAL 423.2623
AVERAG 21.16311
MBER-09
BER-09
MBER-09
E 5

JANU
DEC
FEBR
Daily Daily
DATE NAV DATE NAV DATE Daily NAV
1 21.23 1 21.2708 1 21.3643
2 21.2274 4 21.2591 2 21.3145
3 21.2126 5 21.2899 3 21.2922
4 21.1744 6 21.2672 4 21.2666
7 21.1744 7 21.2486 5 21.3003
8 21.2156 8 21.2816 8 21.3067
9 21.2079 11 21.2773 9 21.282
10 21.1907 12 21.254 10 21.2455
11 21.1971 13 21.2591 11 21.2036
14 21.2272 14 21.296 15 21.1841
15 21.2127 15 21.2833 16 21.1857
16 21.1826 18 21.3108 17 21.1684
17 21.2288 19 21.3014 18 21.1663
18 21.1911 20 21.3185 19 21.1814
21 21.2073 21 21.3589 22 21.2668
22 21.206 22 21.3704 23 21.2459
23 21.223 25 21.39 24 21.2157
24 21.2349 27 21.4135 25 21.2092
127
29 21.2236 28 21.3914 26 21.1859

30 21.2503 29 21.373 TOTAL 403.5851
426.214 AVERAG 21.241321
31 21.2529 TOTAL 8 E 1
AVERAG 21.3107
TOTAL 445.4705 E 4
EMBER-09
ARY-10
UARY-10
AVERAG 21.21288
E 1

MARC
M
APR
Daily Daily
DATE NAV DATE Daily NAV DATE NAV
2 21.2031 5 21.4875 3 21.6456
3 21.2178 6 21.4928 4 21.677
4 21.2015 7 21.5107 5 21.7522
5 21.2334 8 21.4973 6 21.6837
8 21.1844 9 21.4711 7 21.7124
9 21.2203 12 21.4611 10 21.6966
10 21.2132 13 21.4421 11 21.7268
11 21.2068 15 21.4849 12 21.7623
12 21.1991 16 21.439 13 21.7798
15 21.2609 19 21.4465 14 21.8222
17 21.2977 20 21.5046 17 21.8491
18 21.3354 21 21.5278 18 21.8673
19 21.375 22 21.5706 19 21.895
22 21.3688 23 21.5753 20 21.8938
23 21.379 26 21.5791 21 21.8994
25 21.3841 27 21.599 24 21.9609
26 21.4023 28 21.6197 25 21.9214
29 21.4501 29 21.6116 26 21.8042
30 21.4567 30 21.5943 28 21.8058
31 21.4595 TOTAL 408.915 31 21.8161
TOTAL 426.0491 AVERAG 21.521842 TOTAL 435.9716
E 1
128
AVERAG 21.30245 AVERAG

E 5 E 21.79858
H-10
IL-10
AY-10

1 21.8295 2 21.9075
JULY-10
2 21.8438 5 21.8835
JUNE-10
3 21.7861 6 21.8909
4 21.8291 7 21.9218
7 21.8538 8 21.9144
8 21.8495 9 21.8829
9 21.843 12 21.9043
10 21.8405 13 21.8996
11 21.7875 14 21.8952
14 21.7418 15 21.8928
15 21.7589 16 21.9756
16 21.8028 19 21.9383
17 21.7978 20 21.9196
18 21.8329 21 21.9066
21 21.8487 22 22.0194
22 21.8558 23 21.9291
23 21.8653 26 21.9442
24 21.8638 27 21.9084
25 21.7993 28 22.0078
28 21.8419 29 21.9026
29 21.872 30 21.8649
30 21.8944 TOTAL 438.4445
TOTAL 480.2382 AVERAGE 21.9194952
AVERAGE 21.8290091
129
Growth Option Balance Fund

1 35.692 1 36.305 3 38.4
2 36.058 2 36.255 4 38.26
3 36.509 3 36.57 5 38.296
4 36.759 6 35.338 6 37.78
5 36.518 7 35.791 7 37.374
8 35.784 8 35.135 10 37.043
9 36.472 9 35.11 11 37.114
10 36.943 10 34.745 12 37.182
11 36.673 13 34.341 13 37.695
12 36.168 14 35.017 14 37.606
AUGUST 2009
15 35.697 15 35.72 17 36.809

JULY 2009
JUNE 2009
16 36.161 16 35.807 18 37.046

17 35.4 20 37.171 19 36.762
18 35.105 21 36.881 20 37.03
19 35.63 22 36.612 21 37.393
22 35.323 23 37.336 24 37.91
23 35.173 24 37.581 25 38.088
24 35.779 27 37.732 26 38.441
25 35.709 28 37.791 27 38.568
26 36.002 29 37.606 28 38.71
29 36.395 30 37.949 31 38.453
30 36.003 31 38.13 TOTAL 791.96
AVERAG 37.7123809
TOTAL 791.953 TOTAL 800.923 E 5
AVERAG 35.997863 AVERAG 36.4055909
E 6 E 1
130
Daily
DATE NAV DATE Daily NAV DATE Daily NAV
1 38.343 1 41.487 3 40.356
2 38.255 5 41.096 4 40.774
3 38.336 6 41.022 5 41.085
4 38.745 7 41.09 6 41.336
7 39.395 8 41.008 9 41.781
8 39.403 9 40.811 10 41.97
9 39.231 12 41.305 11 42.338
10 39.322 14 41.858 12 42.177
NOVEMBER 2009
SEPTEMBER 2009
11 39.32 15 41.74 13 42.559

14 39.326 16 42.153 16 42.939
OCTOBER 2009
15 39.711 20 42.197 17 42.992

16 39.959 21 42.005 18 42.863
17 40.053 22 41.647 19 42.673
18 40.201 23 41.912 20 42.856
22 40.446 26 41.792 23 43.019
23 40.33 27 41.239 24 43.152
24 40.346 28 41.414 25 43.385
25 40.791 29 41.28 26 42.95
29 41.132 30 41.191 27 42.511
30 41.44 TOTAL 788.247 30 42.84
TOTAL 794.085 AVERAGE 41.48668421 TOTAL 846.556
131

1 43.299 4 45.367 1 45.57
2 43.425 5 45.69 2 45.356
3 43.523 6 45.716 3 45.64
4 43.614 7 45.608 4 45.247
7 43.346 8 45.593 5 44.771
8 43.76 11 45.793 8 45.051
9 43.823 12 45.772 9 45.089
JANUARY 2010
10 43.851 13 45.983 10 44.925

FEBRUARY 2010
DECEMBER 2009
11 43.716 14 46.18 11 44.953

14 43.789 15 46.255 15 44.748
15 43.496 18 46.275 16 44.763
16 43.67 19 46.103 17 45.047
17 43.852 20 46.197 18 44.959
18 43.766 21 45.592 19 43.838
21 43.796 22 45.416 22 44.981
22 43.866 25 45.314 23 44.952
23 44.329 27 44.381 24 44.967
24 44.449 28 44.667 25 44.768
29 44.645 29 45.015 26 45.079
30 44.624 TOTAL 866.917 TOTAL 854.704
AVERAG 45.6272105 AVERAG
31 44.998 E 3 E 44.98442105
TOTAL 921.637
AVERAG 43.887476
E 2
132
Daily
DATE Daily NAV DATE NAV DATE Daily NAV
2 45.645 1 47.549 3 48.324
3 45.861 5 47.901 4 48.053
4 46.255 6 47.991 5 48.084
5 46.251 7 48.012 6 48.028
8 46.503 8 48.006 7 47.321
9 46.443 9 48.269 10 47.843
10 46.414 12 48.356 11 47.515
MARCH 2010
11 46.603 13 48.337 12 47.614

12 46.711 15 48.317 13 48.019
15 46.682 16 48.254 14 47.914
APRIL 2010
MAY 2010
16 46.982 19 47.932 17 47.904
17 46.995 20 48.102 18 47.171
18 47.15 21 48.219 19 47.629
19 47.107 22 48.153 20 47.658
22 46.965 23 48.253 21 47.299
23 47.11 26 48.445 24 47.549
25 47.227 27 48.385 25 46.79
26 47.386 28 48.105 26 47.217
29 47.395 29 48.286 27 47.758
30 47.367 30 48.406 28 48.197
31 47.198 TOTAL 963.278 31 48.549
TOTAL 982.25 AVERAGE 48.1639 TOTAL 1002.436
AVERAGE 46.7738095 AVERAGE 47.73504762
133

1 48.268 1 50.566
2 48.609 2 50.61
3 49.095 5 50.624
4 49.121 6 50.95
7 48.725 7 50.844
8 48.564 8 51.2
9 48.714 9
JUNE 2010
51.408
JULY 2010
10 49.123 12 51.532
11 49.185 13 51.494
14 49.59 14 51.549
15 49.656 15 51.34
16 49.853 16 51.662
17 49.904 19 51.647
18 49.716 20 51.593
21 50.144 21 51.907
22 50.213 22 52.14
23 50.354 23 52.244
24 50.497 26 52.022
25 50.31 27 52.037
28 50.712 28 52.031
29 50.541 29 52.085
30 50.713 30 52.065
TOTAL 1091.61 TOTAL 1133.55
134
Dividend option HDFC Top 200 Fund
Daily
Date NAV Date Daily NAV Date Daily NAV
1-Jun-09 36.298 1-Jul-09 37.566 3-Aug-09 40.917
2-Jun-09 36.819 2-Jul-09 37.749 4-Aug-09 40.605
3-Jun-09 36.477 3-Jul-09 38.291 5-Aug-09 40.731
4-Jun-09 37.334 6-Jul-09 36.465 6-Aug-09 39.904
5-Jun-09 37.517 7-Jul-09 36.877 7-Aug-09 39.151
8-Jun-09 36.268 8-Jul-09 35.946 10-Aug-09 38.68
9-Jun-09 37.321 9-Jul-09 35.962 11-Aug-09 38.858
10-Jun-09 38.176 10-Jul-09 35.391 12-Aug-09 38.786
11-Jun-09 37.858 13-Jul-09 35.141 13-Aug-09 40.005
12-Jun-09 37.234 14-Jul-09 36.298 14-Aug-09 39.899
15-Jun-09 36.804 15-Jul-09 37.256 17-Aug-09 38.44
16-Jun-09 37.332 16-Jul-09 37.271 18-Aug-09 39.083
17-Jun-09 36.354 17-Jul-09 38.389 19-Aug-09 38.686
18-Jun-09 35.937 20-Jul-09 39.259 20-Aug-09 39.195
19-Jun-09 36.477 21-Jul-09 39.001 21-Aug-09 39.754
22-Jun-09 36.335 22-Jul-09 38.631 24-Aug-09 40.595
23-Jun-09 36.257 23-Jul-09 39.429 25-Aug-09 40.698
24-Jun-09 36.872 24-Jul-09 39.761 26-Aug-09 40.97
25-Jun-09 36.851 27-Jul-09 39.815 27-Aug-09 40.993
JULY-09
AUGUST-09
JUNE-09
26-Jun-09 37.682 28-Jul-09 39.792 28-Aug-09 41.308

29-Jun-09 37.89 29-Jul-09 39.48 31-Aug-09 40.969
30-Jun-09 37.174 30-Jul-09 39.879
31-Jul-09 40.499
TOTAL 813.267 TOTAL 874.148 TOTAL 838.227
36.96668 38.006434
Average 2 Average 8 Average 39.9155714
135
Daily Daily
Date NAV Date Daily NAV Date NAV
1-Sep-09 40.641 1-Oct-09 44.441 3-Nov-09 42.102
2-Sep-09 40.483 5-Oct-09 43.987 4-Nov-09 43.201
3-Sep-09 40.404 6-Oct-09 44.334 5-Nov-09 43.641
4-Sep-09 40.942 7-Oct-09 44.374 6-Nov-09 44.097
7-Sep-09 41.736 8-Oct-09 44.597 9-Nov-09 45.112
8-Sep-09 41.739 9-Oct-09 44.248 10-Nov-09 44.962
9-Sep-09 41.689 12-Oct-09 45.162 11-Nov-09 45.882
10-Sep-09 41.649 13-Oct-09 45.868 12-Nov-09 45.352
11-Sep-09 41.722 14-Oct-09 45.803 13-Nov-09 45.725
14-Sep-09 41.679 15-Oct-09 46.118 16-Nov-09 46.243
15-Sep-09 42.409 20-Oct-09 45.935 17-Nov-09 46.062
16-Sep-09 42.933 21-Oct-09 45.266 18-Nov-09 45.466
17-Sep-09 43.081 22-Oct-09 44.587 19-Nov-09 45.894
18-Sep-09 43.235 23-Oct-09 44.908 20-Nov-09 46.167
22-Sep-09 43.546 26-Oct-09 44.538 23-Nov-09 46.118
23-Sep-09 43.203 27-Oct-09 43.573 24-Nov-09 46.118
24-Sep-09 43.372 28-Oct-09 43.469 25-Nov-09 46.309
NOVEMBER-09
25-Sep-09 43.44 29-Oct-09 43.121 26-Nov-09 45.57

OCTOBER-09
SEPTEMBER-09
29-Sep-09 43.849 30-Oct-09 42.96 27-Nov-09 45.012

30-Sep-09 44.419 30-Nov-09 45.557

42.3085 44.594157
Average 5 Average 9 Average 45.2295
136
Date Daily NAV Date Daily NAV Date Daily NAV

1-Dec-09 46.286 4-Jan-10 46.919 1-Feb-10 44.979
2-Dec-09 46.262 5-Jan-10 47.265 2-Feb-10 44.395
3-Dec-09 46.427 6-Jan-10 47.364 3-Feb-10 45.138
4-Dec-09 46.274 7-Jan-10 47.113 4-Feb-10 44.537
7-Dec-09 46.079 8-Jan-10 47.003 5-Feb-10 43.56
8-Dec-09 46.48 11-Jan-10 46.897 8-Feb-10 43.958
9-Dec-09 46.149 12-Jan-10 47.002 9-Feb-10 44.184
10-Dec-09 46.286 13-Jan-10 47.32 10-Feb-10 43.877
11-Dec-09 46.014 14-Jan-10 47.182 11-Feb-10 44.297
14-Dec-09 45.986 15-Jan-10 47.151 15-Feb-10 44.053
15-Dec-09 45.336 18-Jan-10 47.393 16-Feb-10 44.452
16-Dec-09 45.384 19-Jan-10 46.982 17-Feb-10 44.843
17-Dec-09 45.62 20-Jan-10 46.94 18-Feb-10 44.829
18-Dec-09 45.245 21-Jan-10 45.938 19-Feb-10 44.459
DECEMBER-09
21-Dec-09 45.08 22-Jan-10 45.381 22-Feb-10 44.427

FEBRUARY-10
22-Dec-09 45.337 25-Jan-10 45.111 23-Feb-10 44.424

JANUARY-10
23-Dec-09 46.304 27-Jan-10 43.794 24-Feb-10 44.312

24-Dec-09 46.574 28-Jan-10 44.116 25-Feb-10 44.374
29-Dec-09 46.573 29-Jan-10 44.444 26-Feb-10 44.897
30-Dec-09 46.468
31-Dec-09 46.667

Average 46.0396 Average 46.385 Average 44.4208
137

2-Mar-10 45.659 1-Apr-10 43.711 3-May-10 44.413
3-Mar-10 46.133 5-Apr-10 44.312 3-May-10 43.618
4-Mar-10 46.172 6-Apr-10 44.278 4-May-10 43.626
5-Mar-10 46.213 7-Apr-10 44.297 5-May-10 43.56
8-Mar-10 46.578 8-Apr-10 43.863 6-May-10 42.775
9-Mar-10 46.418 9-Apr-10 44.219 7-May-10 43.775
10-Mar-10 46.334 12-Apr-10 43.957 10-May-10 43.323
11-Mar-10 46.578 13-Apr-10 43.926 11-May-10 43.323
12-Mar-10 42.526 15-Apr-10 43.597 12-May-10 43.613
15-Mar-10 42.313 16-Apr-10 43.566 13-May-10 43.934
16-Mar-10 42.633 19-Apr-10 43.233 14-May-10 43.434
17-Mar-10 42.923 20-Apr-10 43.532 17-May-10 43.257
18-Mar-10 42.989 21-Apr-10 43.702 18-May-10 43.49
19-Mar-10 43.103 22-Apr-10 43.929 19-May-10 42.382
22-Mar-10 42.841 23-Apr-10 44.148 20-May-10 42.927
23-Mar-10 43.009 26-Apr-10 44.245 21-May-10 42.665
MAY-10
25-Mar-10 43.173 27-Apr-10 44.248 24-May-10 42.553

APRIL-10
MARCH-10
26-Mar-10 43.488 28-Apr-10 43.784 25-May-10 41.568

29-Mar-10 43.669 29-Apr-10 44.039 26-May-10 42.197
30-Mar-10 43.443 27-May-10 43.009
31-Mar-10 43.428 28-May-10 43.455
31-May-10 43.695

138
Date Daily NAV Date Daily NAV

1-Jun-10 43.008 1-Jul-10 45.613
2-Jun-10 43.413 2-Jul-10 45.501
3-Jun-10 44.153 5-Jul-10 45.491
4-Jun-10 44.341 6-Jul-10 45.882
7-Jun-10 43.611 8-Jul-10 45.615
JULY-10
8-Jun-10 43.282 9-Jul-10 46.173
JUNE-10
9-Jun-10 43.576 12-Jul-10 46.529

10-Jun-10 44.176 7-Jul-10 46.613
11-Jun-10 44.265 13-Jul-10 46.768
14-Jun-10 44.787 14-Jul-10 46.683
15-Jun-10 44.809 15-Jul-10 46.647
16-Jun-10 44.927 16-Jul-10 46.894
17-Jun-10 45.088 19-Jul-10 46.891
18-Jun-10 44.983 20-Jul-10 46.692
21-Jun-10 45.575 21-Jul-10 46.912
22-Jun-10 45.331 30-Jul-10 47.27
23-Jun-10 45.058 23-Jul-10 47.3
24-Jun-10 45.578 26-Jul-10 47.103
25-Jun-10 45.438 27-Jul-10 47.153
28-Jun-10 46.013 28-Jul-10 47.172
29-Jun-10 45.675 29-Jul-10 47.282
30-Jun-10 45.999 22-Jul-10 47.063
TOTAL 983.086 TOTAL 1025.247

Average 44.685727 Average 46.6021364
Dividend option HDFC Income Fund

139

1-Jun-09 10.9821 2-Jul-09 11.0156 3-Aug-09 10.9482
2-Jun-09 10.9879 3-Jul-09 11.0276 4-Aug-09 10.944
3-Jun-09 11.0506 6-Jul-09 10.9371 5-Aug-09 10.9328
4-Jun-09 11.0717 7-Jul-09 10.9193 6-Aug-09 10.9058
5-Jun-09 11.0684 8-Jul-09 10.9463 7-Aug-09 10.914
8-Jun-09 11.0568 9-Jul-09 10.9433 10-Aug-09 10.9013
9-Jun-09 11.0472 10-Jul-09 10.9396 11-Aug-09 10.9157
10-Jun-09 11.0239 13-Jul-09 10.963 12-Aug-09 10.9236
11-Jun-09 10.9909 14-Jul-09 10.9654 13-Aug-09 10.9279
12-Jun-09 10.9881 15-Jul-09 10.9661 14-Aug-09 10.9094
15-Jun-09 11.0227 16-Jul-09 10.9866 17-Aug-09 10.9145
16-Jun-09 11.028 17-Jul-09 10.9995 18-Aug-09 10.9101
17-Jun-09 11.0313 20-Jul-09 10.9769 20-Aug-09 10.8935
18-Jun-09 11.0602 21-Jul-09 10.973 21-Aug-09 10.872
19-Jun-09 11.0791 22-Jul-09 10.9841 24-Aug-09 10.8397
22-Jun-09 11.0692 23-Jul-09 11.0003 25-Aug-09 10.8631
23-Jun-09 11.0769 24-Jul-09 11.0018 26-Aug-09 10.9003
24-Jun-09 11.0784 27-Jul-09 10.9998 27-Aug-09 10.8733
25-Jun-09 11.0688 28-Jul-09 11.0044 28-Aug-09 10.8651
JULY-09
26-Jun-09 10.9175 29-Jul-09 10.9983 31-Aug-09 10.8523

AUGUST-09
JUNE-09
29-Jun-09 10.9359 30-Jul-09 10.9724

30-Jun-09 10.951 31-Jul-09 10.9562


140

1-Sep-09 10.8514 1-Oct-09 10.8349 3-Nov-09 10.8736
2-Sep-09 10.8524 5-Oct-09 10.8725 4-Nov-09 10.8764
3-Sep-09 10.8566 6-Oct-09 10.8505 5-Nov-09 10.89
4-Sep-09 10.8409 7-Oct-09 10.8368 6-Nov-09 10.894
7-Sep-09 10.908 8-Oct-09 10.8381 9-Nov-09 10.9048
8-Sep-09 10.8837 9-Oct-09 10.8101 10-Nov-09 10.9214
9-Sep-09 10.897 12-Oct-09 10.7952 11-Nov-09 10.9255
10-Sep-09 10.8717 14-Oct-09 10.7942 12-Nov-09 10.9247
11-Sep-09 10.8797 15-Oct-09 10.7975 13-Nov-09 10.93
14-Sep-09 10.9332 16-Oct-09 10.7876 16-Nov-09 10.9432
15-Sep-09 10.9591 20-Oct-09 10.7963 17-Nov-09 10.9742
16-Sep-09 10.9784 21-Oct-09 10.8271 18-Nov-09 10.9791
17-Sep-09 10.9563 22-Oct-09 10.8081 19-Nov-09 11.0054
18-Sep-09 10.9965 23-Oct-09 10.8079 20-Nov-09 11.037
22-Sep-09 10.979 26-Oct-09 10.8159 23-Nov-09 11.0212
23-Sep-09 10.9899 27-Oct-09 10.8353 24-Nov-09 11.0366
NOVEMBER-09
24-Sep-09 10.9869 28-Oct-09 10.8486 25-Nov-09 11.0537
OCTOBER-09
25-Sep-09 10.9548 29-Oct-09 10.8765 26-Nov-09 11.0653

SEPTEMBER-09
29-Sep-09 10.8357 30-Oct-09 10.8544 27-Nov-09 11.0545

30-Nov-09 11.0324
TOTAL 205.6875 TOTAL 219.343

TOTAL 207.4112 Average 10.82565789 Average 10.96715
Average 10.9163789

DEC
1-Dec-09 11.0018 1-Jan-10 10.8515 1-Feb-10 10.8993

141
2-Dec-09 11.0005 4-Jan-10 10.8456 2-Feb-10 10.8739

3-Dec-09 10.9928 5-Jan-10 10.8613 3-Feb-10 10.8625
4-Dec-09 10.973 6-Jan-10 10.8497 4-Feb-10 10.8495
7-Dec-09 10.973 7-Jan-10 10.8402 5-Feb-10 10.8666
8-Dec-09 10.9943 8-Jan-10 10.857 8-Feb-10 10.8699
9-Dec-09 10.9904 11-Jan-10 10.8548 9-Feb-10 10.8573
10-Dec-09 10.9815 12-Jan-10 10.843 10-Feb-10 10.8387
11-Dec-09 10.9848 13-Jan-10 10.8456 11-Feb-10 10.8173
14-Dec-09 11.0004 14-Jan-10 10.8644 15-Feb-10 10.8073
15-Dec-09 10.9928 15-Jan-10 10.8579 16-Feb-10 10.8082
16-Dec-09 10.9773 18-Jan-10 10.872 17-Feb-10 10.7994
17-Dec-09 11.0012 19-Jan-10 10.8672 18-Feb-10 10.7983
FEBRUARY-10
EMBER-09
JANUARY-10
18-Dec-09 10.9817 20-Jan-10 10.8759 19-Feb-10 10.806
21-Dec-09 10.9901 21-Jan-10 10.8965 22-Feb-10 10.8495
22-Dec-09 10.9894 22-Jan-10 10.9024 23-Feb-10 10.8389
23-Dec-09 10.9982 25-Jan-10 10.9124 24-Feb-10 10.8235
24-Dec-09 11.0044 27-Jan-10 10.9243 25-Feb-10 10.8202
29-Dec-09 10.9985 28-Jan-10 10.9131 26-Feb-10 10.8083
30-Dec-09 10.8411 29-Jan-10 10.9037
31-Dec-09 10.8424


MAR
APRI
2-Mar-10 10.817 5-Apr-10 10.8476 3-May-10 10.9273

142
3-Mar-10 10.8245 6-Apr-10 10.8502 4-May-10 10.9432

4-Mar-10 10.8162 7-Apr-10 10.8593 5-May-10 10.9811
5-Mar-10 10.8325 8-Apr-10 10.8525 6-May-10 10.9466
8-Mar-10 10.8075 9-Apr-10 10.8393 7-May-10 10.9611
9-Mar-10 10.8258 12-Apr-10 10.8342 10-May-10 10.9531
10-Mar-10 10.8222 13-Apr-10 10.8246 11-May-10 10.9684
11-Mar-10 10.8189 15-Apr-10 10.8462 12-May-10 10.9863
12-Mar-10 10.815 16-Apr-10 10.8231 13-May-10 10.9951
15-Mar-10 10.8465 19-Apr-10 10.8269 14-May-10 11.0165
17-Mar-10 10.8653 20-Apr-10 10.8562 17-May-10 11.0301
18-Mar-10 10.8845 21-Apr-10 10.8679 18-May-10 11.0393
19-Mar-10 10.9047 22-Apr-10 10.8895 19-May-10 11.0532
CH-10
L-10
MAY-10
22-Mar-10 10.9016 23-Apr-10 10.8919 20-May-10 11.0526
23-Mar-10 10.9069 26-Apr-10 10.8938 21-May-10 11.0555
25-Mar-10 10.9094 27-Apr-10 10.9038 24-May-10 11.0865
26-Mar-10 10.8046 28-Apr-10 10.9143 25-May-10 11.0666
29-Mar-10 10.8287 29-Apr-10 10.9102 26-May-10 11.0074
30-Mar-10 10.832 30-Apr-10 10.9014 28-May-10 11.0082
31-Mar-10 10.8334 31-May-10 11.0134


143

1-Jun-10 11.0202 2-Jul-10 10.888
2-Jun-10 11.0274 5-Jul-10 10.8761
3-Jun-10 10.9983 6-Jul-10 10.8797
4-Jun-10 11.02 7-Jul-10 10.8951
7-Jun-10 11.0325 8-Jul-10 10.8914
8-Jun-10 11.0303 9-Jul-10 10.8758
9-Jun-10 11.027 12-Jul-10 10.8864
10-Jun-10 11.0258 13-Jul-10 10.8841
11-Jun-10 10.999 14-Jul-10 10.8819
14-Jun-10 10.9759 15-Jul-10 10.8807
15-Jun-10 10.9846 16-Jul-10 10.9218
16-Jun-10 11.0067 19-Jul-10 10.9033
17-Jun-10 11.0042 20-Jul-10 10.894
18-Jun-10 11.0219 21-Jul-10 10.8875
21-Jun-10 11.0299 JULY-10 22-Jul-10 10.9436
22-Jun-10 11.0335 23-Jul-10 10.8987
23-Jun-10 11.0383 26-Jul-10 10.9063
JUNE-10
24-Jun-10 11.0375 27-Jul-10 10.8884

25-Jun-10 11.005 28-Jul-10 10.9378
28-Jun-10 10.8554 29-Jul-10 10.8855
29-Jun-10 10.8703 30-Jul-10 10.8668
30-Jun-10 10.8815
TOTAL 241.9252 TOTAL 228.7729

Average 10.9966 Average 10.89394762
Dividend option HDFC Balance Fund

AUGUST-09
JUNE-09
JULY-09
1-Jun-09 15.783 1-Jul-09 16.054 3-Aug-09 16.981

2-Jun-09 15.945 2-Jul-09 16.032 4-Aug-09 16.919
3-Jun-09 16.144 3-Jul-09 16.171 5-Aug-09 16.935
4-Jun-09 16.255 6-Jul-09 15.627 6-Aug-09 16.707
144
5-Jun-09 16.148 7-Jul-09 15.827 7-Aug-09 16.527

8-Jun-09 15.824 8-Jul-09 15.537 10-Aug-09 16.381
9-Jun-09 16.128 9-Jul-09 15.526 11-Aug-09 16.412
10-Jun-09 16.336 10-Jul-09 15.364 12-Aug-09 16.442
11-Jun-09 16.217 13-Jul-09 15.186 13-Aug-09 16.669
12-Jun-09 15.993 14-Jul-09 15.485 14-Aug-09 16.63
15-Jun-09 15.785 15-Jul-09 15.795 17-Aug-09 16.277
16-Jun-09 15.99 16-Jul-09 15.834 18-Aug-09 16.382
17-Jun-09 15.654 17-Jul-09 16.097 19-Aug-09 16.257
18-Jun-09 15.524 20-Jul-09 16.437 20-Aug-09 16.375
19-Jun-09 15.755 21-Jul-09 16.309 21-Aug-09 16.536
22-Jun-09 15.62 22-Jul-09 16.19 24-Aug-09 16.764
23-Jun-09 15.554 23-Jul-09 16.51 25-Aug-09 16.843
24-Jun-09 15.821 24-Jul-09 16.591 26-Aug-09 16.999
25-Jun-09 15.791 27-Jul-09 16.685 27-Aug-09 17.055
26-Jun-09 15.92 28-Jul-09 16.712 28-Aug-09 17.118
29-Jun-09 16.094 29-Jul-09 16.63 31-Aug-09 17.004
30-Jun-09 15.921 30-Jul-09 16.781
31-Jul-09 16.861

SEPTE
OCTOB
NOVE

1-Sep-09 16.955 1-Oct-09 18.346 3-Nov-09 17.845
2-Sep-09 16.917 5-Oct-09 18.173 4-Nov-09 18.031
3-Sep-09 16.952 6-Oct-09 18.14 5-Nov-09 18.168
4-Sep-09 17.133 7-Oct-09 18.17 6-Nov-09 18.28
7-Sep-09 17.421 8-Oct-09 18.134 9-Nov-09 18.477
8-Sep-09 17.424 9-Oct-09 18.047 10-Nov-09 18.56
145
9-Sep-09 17.348 12-Oct-09 18.265 11-Nov-09 18.723

10-Sep-09 17.388 14-Oct-09 18.51 12-Nov-09 18.652
11-Sep-09 17.388 15-Oct-09 18.458 13-Nov-09 18.821
14-Sep-09 17.39 16-Oct-09 18.64 16-Nov-09 18.989
15-Sep-09 17.561 20-Oct-09 18.66 17-Nov-09 19.012
16-Sep-09 17.67 21-Oct-09 18.575 18-Nov-09 18.955
17-Sep-09 17.712 22-Oct-09 18.417 19-Nov-09 18.871
18-Sep-09 17.777 23-Oct-09 18.534 20-Nov-09 18.952
22-Sep-09 17.885 26-Oct-09 18.481 23-Nov-09 19.024
23-Sep-09 17.834 27-Oct-09 18.236 24-Nov-09 19.083
ER-09
MBER-09
MBER-09
24-Sep-09 17.841 28-Oct-09 18.314 25-Nov-09 19.186

25-Sep-09 18.038 29-Oct-09 18.254 26-Nov-09 18.994
29-Sep-09 18.189 30-Oct-09 18.215 27-Nov-09 18.799
30-Sep-09 18.325 30-Nov-09 18.945


JANUARY
DECEM
FEBRUA

1-Dec-09 19.148 4-Jan-10 20.062 1-Feb-10 20.152
2-Dec-09 19.204 5-Jan-10 20.205 2-Feb-10 20.057
3-Dec-09 19.247 6-Jan-10 20.217 3-Feb-10 20.183
4-Dec-09 19.287 7-Jan-10 20.169 4-Feb-10 20.009
7-Dec-09 19.169 8-Jan-10 20.162 5-Feb-10 19.799
8-Dec-09 19.352 11-Jan-10 20.25 8-Feb-10 19.923
9-Dec-09 19.379 12-Jan-10 20.241 9-Feb-10 19.939
146
10-Dec-09 19.392 13-Jan-10 20.334 10-Feb-10 19.866

11-Dec-09 19.332 14-Jan-10 20.422 11-Feb-10 19.879
14-Dec-09 19.364 15-Jan-10 20.455 15-Feb-10 19.788
15-Dec-09 19.235 18-Jan-10 20.464 16-Feb-10 19.795
16-Dec-09 19.312 19-Jan-10 20.387 17-Feb-10 19.921
17-Dec-09 19.392 20-Jan-10 20.429 18-Feb-10 19.881
18-Dec-09 19.354 21-Jan-10 20.162 19-Feb-10 19.828
21-Dec-09 19.367 22-Jan-10 20.084 22-Feb-10 19.892
22-Dec-09 19.399 25-Jan-10 20.039 23-Feb-10 19.879
RY-10
BER-09
-10
23-Dec-09 19.603 27-Jan-10 19.626 24-Feb-10 19.885
24-Dec-09 19.656 28-Jan-10 19.752 25-Feb-10 19.797
29-Dec-09 19.743 29-Jan-10 19.907 26-Feb-10 19.935
30-Dec-09 19.733
31-Dec-09 19.899


APRIL
MA
MARCH-

2-Mar-10 20.185 1-Apr-10 18.714 3-May-10 19.018
3-Mar-10 20.281 5-Apr-10 18.852 4-May-10 18.912
4-Mar-10 20.455 6-Apr-10 18.888 5-May-10 18.924
5-Mar-10 18.203 7-Apr-10 18.896 6-May-10 18.902
8-Mar-10 18.303 8-Apr-10 18.893 7-May-10 18.624
9-Mar-10 18.279 9-Apr-10 18.997 10-May-10 18.829
10-Mar-10 18.267 12-Apr-10 19.031 11-May-10 18.7
11-Mar-10 18.342 13-Apr-10 19.023 12-May-10 18.739
147
12-Mar-10 18.384 15-Apr-10 19.016 13-May-10 18.898

15-Mar-10 18.373 16-Apr-10 18.991 14-May-10 18.857
16-Mar-10 18.469 19-Apr-10 18.864 17-May-10 18.853
17-Mar-10 18.496 20-Apr-10 18.931 18-May-10 18.958
18-Mar-10 18.557 21-Apr-10 18.977 19-May-10 18.745
19-Mar-10 18.54 22-Apr-10 18.951 20-May-10 18.756
22-Mar-10 18.484 23-Apr-10 18.991 21-May-10 18.615
23-Mar-10 18.541 26-Apr-10 19.066 24-May-10 18.713
25-Mar-10 18.587 27-Apr-10 19.042 25-May-10 18.415
-10
Y-10
10
26-Mar-10 18.649 28-Apr-10 18.932 26-May-10 18.583

29-Mar-10 18.653 29-Apr-10 19.003 27-May-10 18.796
30-Mar-10 18.642 30-Apr-10 19.051 28-May-10 18.969
31-Mar-10 18.576 31-May-10 19.107


JUNE-10
10-Jul

1-Jun-10 18.996 1-Jul-10 19.901
2-Jun-10 19.13 2-Jul-10 19.918
3-Jun-10 19.322 5-Jul-10 19.924
4-Jun-10 19.332 6-Jul-10 20.052
7-Jun-10 19.176 7-Jul-10 20.011
8-Jun-10 19.113 8-Jul-10 20.151
9-Jun-10 19.168 9-Jul-10 20.232
10-Jun-10 19.333 12-Jul-10 20.281
11-Jun-10 19.357 13-Jul-10 20.266
14-Jun-10 19.517 14-Jul-10 20.288
148
15-Jun-10 19.543 15-Jul-10 20.206

16-Jun-10 19.62 16-Jul-10 20.332
17-Jun-10 19.64 19-Jul-10 20.326
18-Jun-10 19.566 20-Jul-10 20.305
21-Jun-10 19.735 21-Jul-10 20.429
22-Jun-10 19.762 22-Jul-10 20.52
23-Jun-10 19.817 23-Jul-10 20.561
24-Jun-10 19.874 26-Jul-10 20.474
25-Jun-10 19.8 27-Jul-10 20.48
28-Jun-10 19.958 28-Jul-10 20.477
29-Jun-10 19.891 29-Jul-10 20.499
30-Jun-10 19.959 30-Jul-10 20.491
TOTAL 429.609 TOTAL 446.124

Average 19.527682 Average 20.2783636
REFERENCES
Books:
1. Security Analysis and Portfolio Management (sixth Edition
1995) by Donald E. Fisher and Ronald J. Jordan. Publication:
Pearson education.
2. The Indian Financial System (second edition) by Bharati V.
Pathak. Published by Dorling Kindersley (India) Pvt. Ltd.,
licensees of Pearson Education in South Asia.
3. Security Analysis and Portfolio Management by Khan and
Jain.
149
4. Security Analysis and Portfolio Management by

Punithavathy Pandian
Magazines:
· Money Outlook (May &June 2010)
· Business world (May & June 2010)
Websites
· www.hdfcfund.com
· www.amfiindia.com
· www.moneycontrol.com
· www.sebi.gov.in
· www.bseindia.com
· www.nseindia.com
· www.mutualfundsindia.com
· www.valueresearch.com
· www.indiainfoline.com
· www.in.finance.yahoo.com
· www.investing.businessweek.com
· www.businessline.com
.www.rbi.org.in

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1

The performance evaluation of mutual fund is a vital matter of

In the third section, an attempt is made to analyses and

1.2 Focus of the Study:

A Mutual Fund is a trust that pools the savings of a number

· Portfolio Managers evaluate their portfolio performance

Risk & Return:

Risk refers to the chance that some unfavorable event will

With a common stock, the rate of return is dividend yield, or

· Sharpe’s performance index gives a single value to be

assets that have best risk-adjusted average rate of return. The

Relative Performance Index (RPI) :--

Relative Performance Index is defined as the ratio of the

RISK & RETURN

1.3 Limitation of the Study:-

  The study is limited only to the analysis of different

 The study is based on secondary data available from

  The study is limited by the detailed study of three

  Many investors are all price takers.

  The assumption that all investors have the same

  Banks are free to accept deposits at any interest rate

2.1 Securities. A security can be defined as a negotiable

It is the process of examining the risk – return characteristics

individual securities or groups of securities with an aim to

one is worthwhile to invest.

The Securities Market consists of two segments, viz. Primary

Secondary market essentially comprises of stock exchanges,

Exchanges established in different centers, there are

accessible only through brokers and trading of securities is

Thus, the securities market has two independent, inseparable

The corporate securities market dates back to the 18™

beginning came in the 1850s with the introduction of the joint

Exchange, Mumbai, Ahmedabad Stock Exchange in 1894 and

The Stock Exchanges are the exclusive centers for trading in

The no of stock exchanges increased from 11 in 1990 to

The sectoral distribution of turnover has undergone

The aggregate turnover in central and state government

Risk refers to the chance that some unfavorable event

rates of return. Investment risk is associated with the

Unsystematic Risk - Stock or company specific risk

Credit or Default Risk - can they pay the interest on the

Country Risk - Measure of political and economic stability

Interest Rate Risk - will the central bank raise interest

Political Risk - Political stability of a country

and when the trade actually goes to the market.

Measuring Risk The Standard Deviation

The standard deviation (σ) is a measure of dispersion of the

2.3 The Sharpe Ratio: Measuring Risk

Developed by Nobel laureate economist William Sharpe, this ratio measures

2.4 Rate of Return

Rate of return is income you collect on an investment

Different investors have different required rates of return at

called Accounting Rate of Return or unadjusted rate of return.

Simple Return Calculation ={( Pt+1 − P t) / Pt } or

The riskiness of an asset can be considered in two ways: (1) on

In a portfolio context, an asset’s risk can be divided into two

called beta. Beta is a measurement of how a particular firm’s

Risk Vs. Return :--

2.5 Risk & Return with SML curve

Security Market Line (SML)

The SML essentially graphs the results from + risk premium

2.6 BSE (BOMBAY STOCK EXCHANGE)