FACTORS CONTRIBUTING TOWARDS CREATING A PROFITABLE INVESTMENT PORTFOLIO

Abstract

Purpose:The aim of this research study is to understand the mutual fund market in Pakistan and understand the factor that are directly or indirectly contributing toward creating a profitable investment portfolio in mutual fund industry in Pakistan. This study deal separately open ended and close ended fund to understand which are most attractive to the investors The performance of companies is also focused to understand sendees provided to the investors in earning higher returns by managing the funds and portfolio efficiently and effectively in Pakistan Methodology/sample: In this research study out of 22 assets management companies 8 companies are selected to collected the data on open and close ended mutual funds for last 10 years. The tools which are used during this research study are as follow:Sharpe Model, Treynor Model and Hypothesis Testing Findings: The analysis suggests that the NAFA trust is performing the best among the five open end funds selected. The investors can take their investment decisions on the basis ofthe expected returns and the systematic and unsystematic risk involved. The performance evaluation of the open ended and close ended mutual funds suggests that the mutual fund industry is growing and developing on a continuous basis. Practical Implications:In future, the investors will have more options as the industry is expected to grow commendably.The results ofthe study added that products of mutual fund market still need to be formulated in order to effect lesser by return fluctuation which needs serious role of government in the development of industrial and business sector of the economy that will ultimately result in the development ofthe mutual fund industry within the country.