Article Details
  • Published Online:
    September  2025
  • Product Name:
    The IUP Journal of Financial Risk Management
  • Product Type:
    Article
  • Product Code:
    IJFRM020925
  • DOI:
    10.71329/IUPJFRM/2025.22.3.24-35
  • Author Name:
    Sourav Das and Kiranjit Sett
  • Availability:
    YES
  • Subject/Domain:
    Finance
  • Download Format:
    PDF
  • Pages:
    24-35
Volume 22, Issue 3, July-September 2025
Evaluating Stock Selection and Market Timing Abilities of Mutual Fund Managers
Abstract

The performance of selected large-cap and small-cap mutual fund schemes in India has been evaluated in this paper in terms of stock selection and market timing during the period January 2017 to December 2024, using the models of Treynor-Mazuy (1966) and Henriksson-Merton (1981). HDFC, Edelweiss and Nippon India in the large-cap category and Axis and HDFC in the smallcap category have been found to have generated positive and significant alpha values intermittently. While a few funds showed positive and significant market timing ability, several funds generated significantly negative gamma values in 2023, indicating wrong timing decisions.

Introduction

Mutual funds in India have experienced significant growth in recent years, indicating growing faith of investors in these investment vehicles. The total amount of assets under management (AUM) of mutual funds increased from 17.54 lakh cr in March 2017 to 65.74 lakh cr by March 2024, marking a growth of nearly 3.75 times.