A STUDY ON SPECIAL REFERENCE TO NSE AND BSE BASED ON RETURN AND RISK EVALUATION OF INDEX FUND PORTFOLIO

Authors:

Dr. P. Shalini¹, Mr. Nandha Kumar M²

¹Dr. P. Shalini, Professor, Master Of Business Administration & Panimalar Engineering College, Chennai -600123

²Mr. Nandha Kumar M, Student, Master Of Business Administration & Panimalar Engineering College, Chennai -600123

Abstract - This study focuses on the evaluation of return and risk of index fund portfolios with special reference to NSE and BSE in association with Ricchie Rich Investments. The research aims to analyze the performance of selected Nifty 50 index funds using various financial measures such as standard deviation, beta, Sharpe ratio, Treynor ratio, Sortino ratio, alpha, and tracking error. The study is based on secondary data collected over a specific period and emphasizes understanding the relationship between risk and return. The findings reveal that most index funds exhibit similar risk and return characteristics due to their passive nature. The analysis shows that standard deviation and beta values are nearly identical across funds, indicating uniform market behavior. Risk-adjusted performance measures such as Sharpe, Treynor, and Sortino ratios also show minimal variation among the funds. The study highlights that only a few funds generate positive alpha, while most underperform the benchmark slightly. Tracking error analysis indicates that most funds closely replicate the benchmark index with minor deviations. The research further emphasizes the importance of cost efficiency and consistency in fund selection. It concludes that index funds are suitable for long-term investors seeking stable and predictable returns. The study also supports the effectiveness of passive investment strategies in modern financial markets. Overall, the research provides valuable insights for investors and financial analysts in making informed investment decisions.

Key Words:  National Stock Exchange (NSE), Bombay Stock Exchange (BSE), Nifty 50, Index Funds.