*Anna University, Coimbatore, Tamilnadu.
**PSG Institute of Management, Coimbatore, Tamilnadu.
The research paper deals with the performance of top three mutual funds in the equity, income and the balanced funds category based on their return. The main focus of this research is to find out the risk and return and study the performance of the funds and to compare it with the market return. This research is limited to 9 open-ended funds 3 each in the equity, income & the balanced funds respectively subject to the availability of NAV Data for three years (2006–2008) The various tools used for analysis are annual return, risk, beta, sharpe, treynor and jense measures, correlation & the regression The analysis reveals the performance of the funds with the market over the three years and whether the fund's managers have good timing abilities and proper stock selection capacities. Also the behaviour of the funds during the up & the down market are analyzed. The findings are most of the funds which performed well in the up market yielded negative returns below the market level during the down period. The conservative income funds alone gave positive returns. The timing abilities and the stock selecting capacities of the fund managers are nil or very poor which might be the reason for the performance of the funds.
