Abstract:
This study examines the quantitative dimensions of the mutual funds with the scheme
of KSE-100 Index due to volatility in their prices caused fluctuation and performance
which is important for the practitioners and academic researchers. This paper analyzes
the performance of open ended mutual funds comprising sample of 54 mutual funds
listed on the Karachi Stock Exchange and Mutual Fund Association of Pakistan
(MUAFP) during the period from 2008 to 2014. Importantly, all the open ended
mutual funds were selected, which commenced before January 2008. The various
performance measures were used like Sharpe, Treynor, and Jensen Alpha and found
that only 37 percent of the open ended mutual funds are outperformed the market with
using Sharpe ratio, 38 percent of the open ended mutual funds are performing better
than the market with using Treynor ratio and all the Jensen alpha ratios are showing
negative abnormal returns. Thus, all the Sharpe ratios are showing negative results,
but in Treynor ratio some funds are showing positive results i.e. out of 21
outperformed while only four funds are showing negative abnormal returns and the
rest are showing positive abnormal returns. In this case, the Treynor method is
showing good results than Sharpe method without any similarity these two models. In
addition, average returns in case of income fund are higher which is evident from the
descriptive results where market is getting more returns relative to open ended mutual
funds.
