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7/30/2019 Arsalan Fyp Ppt
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Muhammad Arsalan
Affect of Fund Size on Mutual Fund Performance
FINAL YEAR PROJECT
Topic
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Objective Importance
Introduction
Population, Sampling Technique, and Size
Data and Methodology
Hypothesis
Results
Conclusion
Recommendation
Contents
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My objective in this study was
To find out the affect of mutual fund size on mutual fund
performance To determine the relation between mutual fund size and its NAV
return
Objective
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This study will be a helpful guideline for the investors who
want to invest in mutual funds
Especially small investors who seek for safer opportunities
investment with handsome returns.
Importance
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Mutual fund refers to a pool of securities
A number of investors make investment in it with a common objective of getting
profit, and it is managed by professional fund managers
It is diversified in nature, therefore, it is considered safe and less risky
investment
There are two basic structural types of mutual funds
Open end funds: continue to sell and repurchase shares after their initial public offerings
Close end funds: operates like a public limited company, and its stock trades on the
regular secondary market
In Pakistan, Mutual Funds Association of Pakistan (MUFAP) is the tradebody for Pakistan's multi billion rupees asset management industry.
Introduction
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Population I have worked on open end type of mutual funds. There are 126 open
mutual funds working in Pakistan
Sampling Technique In this study I have exercised convenience sampling and I have picked
up the samples which I got conveniently from these 126 open endmutual funds
Sample Size I have used last five years quarterly data of the nine open end funds out
of the total number of population
Population, Sampling Technique & Size
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I used,
Last five years quarterly data, mutual funds NAV returns as
dependent variable, and
Total size or volume of the fund as the independent variable
I used regression and correlation to analyze the relation
between mutual funds size and NAV return
Data and Methodology
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Ho:Mutualfund size does not affect NAV returns
HA:Mutualfund size affects NAV returns
Hypothesis
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According to the regression result
As my P value is 0.0786, which is less than 0.1
Therefore,
My null hypothesis, mutual fund size does not affect NAV returns, has been rejected
According to the results, I have found an inverse relation between mutual fund sizeand NAV returns.
Because,
The value of coefficient is -0.275229 and it is showing the inverse relation between thevariables I have used.
The value of R square is 0.0702
The value of correlation is -0.16295
Results
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-1
-0.8
-0.6
-0.4
-0.2
0
0.2
0.4
NAV Returns
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In the graph it can be seen that initially, in 2007, there were bothnegative and positive results on and off
But moving ahead it is showing disastrous negative returns thatdestroyed the major investment in the mutual funds
It was the time when recession was on its peak and there was amassive liquidity crisis in the world, this business also affected verymuch.
Later on it is indicating the recovery but it is not well enough which canovershadow the past destructions.
Because of these devastating returns asset management companies arestill striving to cater the effects of these circumstances.
Conclusion
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Government must ensure the proper law and order situation in thecountry
It is also very important to implement such policies which can be
effective to keep the inflation rate as low as possible. It will consequently
give the confidence to the investors.
Government should create investor friendly environment and implement
flexible tax policies i.e. do not impose taxes with different names
AMCs should maintain a contingency fund in order to cope with thesituations which they have faced in the couple of two years back, like
liquidity crisis and economic recession.
Recommendation
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Thank You