Stock selection and market timing are critical skills for fund managers aiming to generate superior risk-adjusted returns over the long term. The mutual fund industry in India comprises public sector funds, private sector funds, and foreign funds. This study examines these three sectors to compare fund performance selectivity and recency based on fund sponsorship. Growth, income, balanced, and tax-saving schemes were selected for analysis, covering a five-year period from April 1, 2017, to March 31, 2022. Market timing involves analyzing market trends to anticipate bullish or bearish movements, enabling mutual fund portfolios to be adjusted accordingly.Stock selection relies on the expertise of fund managers to make informed predictions about the direction of market prices. These tools allow managers to evaluate their own performance relative to market movements.The purpose of this study is to empirically assess the market timing abilities of selected mutual fund managers in India. Using Jensen’s Alpha, Fama’s Return Decomposition, and the Henriksson-Merton (unconditional) methodology, funds were evaluated based on the managers’ performance in market analysis over the five-year period. The findings indicate that fund managers exhibit persistence in their stock selection skills; however, the selected funds do not demonstrate consistent market timing abilities within the Indian context.
Y. Maheswari (Wed,) studied this question.