EXECUTIVE SUMMARY Investment in mutual funds gives you exposure to equity and debt markets.

These funds are marketed as a safe haven or as smart investment vehicles for novice investors. The middle-class Indian investor who plays hot tips for a quick buck at the bourses is the stuff of legends. The middle-class Indian investor who runs out of luck and loses not only his money but his peace of mind too is somewhat less famous by choice. Mutual funds, on the other hand, sell us middling miracles. Consequently proof enough for a research on Mutual Funds, which has exacting returns.

Every investor requires a healthy return on his/her investments. But since the market is very volatile and due to lack of expertise they may fail to do so. So a study of these mutual funds will help one to equip with unwarranted knowledge about the elements that help trade between risk and return thereby improving effectiveness. A meticulous study on the scalability at which the mutual funds operate along with diagnosis of the market conditions would endure managing the investment portfolio efficiently. Investment is a sensitive concept, any investor whether professional or individual needs to be very careful while investing and getting decent return. Stock markets which gives good returns in the long run does also has huge amount of risk, it is challenging task for professionals to get the expected rate of return from their investments. Individual investors who invest their hard earned money in equities burn their fingers due to lack of conceptual knowledge. Some investors who are risk averse go for Mutual Funds. So, it is very important to check whether Mutual Funds yield the expected returns to the investors, it is obvious as this pint of that a question strikes to our mind as to why only some Mutual Funds give good returns than other Mutual Fund Companies. The point is what makes the successful Mutual Fund Companies to give comparatively. There may be many factors which contribute for yielding returns.

So in the above context the first point seems to be more appropriate answer to the questions to why only some Mutual Fund Companies give higher returns. The Study was conducted to compare the performance of Diversified Equity Funds Return with their Benchmarks, SENSEX and Nifty.

The rise in the level of capital market has manifested the importance Mutual Funds as investment medium. Mutual Funds are now are becoming a preferred investment destination for the investors as fund houses offer not only the expertise in managing funds but also a host of other services.

Total Assets Under Management (AUM) in India as of today is around $100b. Volatile markets and year end accounting considerations have shaved 6% off in March, but much of that money should flow back in April. The next five years will see the Indian Asset Management business grow at least 33% annually says a study by McKinsey.

Investors money inflow to mutual funds has sidelined for the time being but the overall long term fundamental outlook on the economy remains intact. To lower the impact of volatility one can stay invested in diversified equity funds over a longer period of time through the route of Systematic Investment Plan. The following are many factors which may have contributed higher returns. 1. Less fees and expenses. 2. Conservative (less risk fund Manager) 3. Use of hedging techniques 4. Fund managers prediction or forecasting of securities movement ability.