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Mutual funds are risky financial instruments, they are governed by the normal risks involved in investments. It is difficult to predict the performance of a mutual fund just on the basis of the return of the fund. The performance can only be evaluated in a correct manner if the risk is considered in evaluating the return. Hence a mutual fund's performance is accurate only if it is risk-adjusted performance. In this study, 21 Open Ended Multi Cap Funds and 17 Open Ended Mid Cap funds are compared using the Sharpe Model by William F. Sharpe, who developed it in 1966. The data of 10 calendar years of pre covid is taken for the period between 1st January 2009 – 31st December, 2019. The S&P BSE SENSEX is taken as the benchmark index under this study. It was found that most of the funds had outperformed the market and given good returns.
Noel Daliwala (Tue,) studied this question.