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Absolute returns
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Absolute returns - October 18th, 2010

Absolute returns measure how much a fund has gained over a certain period. So you look at the NAV on one day and look at it, say, six months or one year or two years later. The percentage difference will tell you the return over this time frame. This measure looks at the appreciation or depreciation (expressed as a percentage) that an asset - a mutual fund achieves over a given period of time.
NAV= (Market Value of Equity investments) + (NAV of Equity Mutual Funds) + (Debt & Fixed Income Securities on face value + accrued interest) + (NAV of Debt Mutual Funds) + (Cash) + (Balances with Broker) + (Dividend/Interest/any other receivables) – (Liabilities) – (Accrued Expenses i.e. taxation (NRI)/portfolio management fees, and other statutory liabilities}
1 High Watermarking is arrived at after deducting performance-based fees from the closing NAV.
2 Opening NAV (for purpose of calculating performance based fee) would be highest of all previous year closing NAV (adjusted for Infusions and Withdrawals).
3 Absolute return is calculated as a difference between Closing NAV and the High Watermark as at the end of the previous year.
4 Return% is computed as a percentage of Absolute returns on the Opening NAV
Scheme LIC MF Index - Sensex Plan (G) Reliance Index-Sensex Plan (G) UTI Master Index Fund (G)
1 Year 39.3% 37.8% 41.3%

We clearly know the importance of absolute returns in judging the attractiveness of a fund. The above table states that UTI Master Fund is the best fund amongst the three when absolute returns are considered. Thus when an investor tries to evaluate the performance of a fund UTI would be the best fund to invest in.

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