Investment Performance Analysis Of Debt Mutual Funds In India – A Quantitative Approach

Mutual funds are investments which allow the investor to have access to a wide range of securities. Among them the debt funds invest particularly in fixed income securities, which help the investor to balance the risk and return in his portfolio. Analysing any investment brings to light its current and future performance and its suitability to the investor. The study takes into consideration 15 schemes belonging to liquid funds, short term income funds and gilt funds. The performance is evaluated using Absolute Return, Standard deviation, beta, RSquared, Sharpe, Treynor and Jensen’s Alpha. The study concludes that the debt funds are more suitable for short term investments as the liquid and short-term funds are able to provide better risk adjusted returns. Moreover, the gilt funds are more prone to be affected by interest rate risk which will in turn lower the returns of the funds