Discuss the following:
Case-An Analysis of Mutual Fund Managers
There are thousands of mutual funds available (see page 175 for a 6nelintroduction to mutual funds). There is no shortage of sources of info:maim about them. Newspapers regularly report the value of each and, mutual hind companies and broken advertise extensively, and there are books on the subject. Many of the advertisements imply that individuals should invest in the advertiser's mutual fund because it has performed well in the past. Unfortunately there is little evidence to infer that past performance is a predictor of the future. However, it any be possible to acquire useful information by examining the managers of mutual funds. Several researchers have studied the issue. One project gathered data zoncen ing. the performance of 2,029 funds.
The performance of each hind was measured by its nsk-adjusted excess NOM, which is the difference between the return on investment of the hind and a return that is considered a standard. The standard is based on a variety of vanables including the nsk-free rate
Mere are for variables that descnbe the hind manager. They are age. tenure (how many year. the manager has been in charge). whether the manager had an MBA (1 = yes. 0 = no). and a measure of the aualny of the manager's education [the average Scholastic Achievement
Test (SAT) score of students at he university where the manager received his or her undergraduate degree).
The data are:
Column I Return Performance of the fund
Column 2 SAT Measure of the manager's education (average SAT score of students at the university where the manager received hisiber undergraduate degree) Column 3 Code (MBA) 0 - manager has no MBA
1 - manager has MBA
Column 4 Age Age of Manager
Column 5 Tenure How many years manager has been in charge
Required: An analysis of the data
1. Use the appropriate graphical techniques to compare the Performance of funds managed by those who have an MBA to those who do not have an MBA. Comment on the distributions (limit your comments to 1 to 2 sentences.)
2. Use appropriate descriptive statistics
a) to describe the Performance of funds managed by managers who have an MBA to those who do not have an MBA.
Compare the performance of funds based on the years a manner has been in chaste. more
Attachment:- book data.rar