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Mutual Fund performance measurement with Beta
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Beta is a popular measure.
We already heard of *high-beta shares* in equity investments.
Beta is a measure of an investment’s volatility vis-à-vis the market (or benchmark).
If Beta is less than 1 means that the security will be less volatile than the market.
A beta of greater than 1 implies that the security’s price will be more volatile than the market.
Beta of DSPBR Eq Fund is 1.16
That means within a given period, for every 1 point move of the benchmark (Nifty 500), the scheme value (NAV) moves to 1.16
It can happen on both upside and downside.
So we can say, it is more volatile than the benchmark index.
Got it ?
s vix index somethin similar? Yes. VIX itself is an index that measures volatility of the Nifty We get beta values of shares from TopStockResearch Ii Stocks like JPAsscociates, HFCL etc. have high beta
that means they move up and or down faster than the index to which they belong to
fast moving shares
Simiarly, MF schemes have beta
This concludes our session for today!
What beta is preferable High beta = more unpredictability. Low beta = more predictability So it depends on the risk u want to take if u want to go for high risk, go for high beta scheme Yes....thanks sir...nice info For instance, for DSP BR Equity Beta is 1.13 For DSP BR Microcap Beta is 0.99 So DSP BR Microcap, for the sake of this measure alone, is less volatile and more predictable compared to Equity Fund Of course, this single measure cannot be a sufficint for decision making
All these three measures are those who are meticulous
Most people stop looking at the basic fact sheet data.
To determine if an MF is performing better or not, compare with similar funds from the same category over 1-year, 3-year and 5-year periods. Websites such as ValueResearchOnline and MorningStar.in provide easy comparision interface.
- Understanding Mutual Fund Factsheet
- Evaluating of Mutual Fund Schemes
- Comparing Mutual Fund Schemes
- Mutual Fund performance measurement with CAGR
- Mutual Fund performance measurement with Standard Deviation
- Mutual Fund performance measurement with Sharpe Ratio
- Mutual Fund performance measurement with Beta
- Mutual Fund performance measurement with XIRR