Abstract:
Mutual fund is a financial instrument which is made by the
collection of funds from different potential investors. Then
these mutual funds are invested in investment securities such as
stocks, bond, money market instruments and fixed bank deposits.
In Pakistan mutual funds industry is developing but mutual funds
hold huge investments in the global world. In Pakistan mostly
people are risk averse and they are not aware of the investment
world, so mutual funds can play a massive role in Pakistan
economy where inflation is increasing day by day, per capita
income is very low and investments are also very less.
The basic reason of thesis work is to analyze the performance of
portfolios offered by Pakistani mutual funds and the stress on
the execution of mutual funds relation to the hidden risk. This
research work endeavor to assess the evaluation of Pakistani
mutual funds using three models named as Sharpe model, Jensen
Alpha and Treynor model. With a specific end goal to evaluate
the performance of mutual funds, the two most important
variables are return and risk. The sample of 15 mutual funds is
taken for the analysis of Pakistani mutual funds portfolio
during the period of 2010 - 2015. This study is based on the
various quantitative analyses of Pakistani mutual funds and will
provide the guidelines to the mutual funds manager. This study
also benefits the potential small investor by figuring out some
key variables for influencing the Pakistani investors of mutual
funds.
