Annual Report

Serbian Journal of Management 8 (1) (2013) 79 - 93

www.sjm06.com

Serbian Journal of Management

RATIO ANALYSIS OF ACTUAL BUSINESS PERFORMANCE OF OPEN INVESTMENT FUNDS IN SERBIA

Lidija Barjaktarovića*, Dejan Ječmenicab and Maja Paunovićc aUniversity Singidunum, Faculty of economics, finance and administration, Bulevar Vojvode Misica 43, 11 000 Belgrade, Serbia bWiener Städtische, Human Resources Department, Vienna Insurance Group, Tresnjinog cveta 1, Belgrade, Serbia cUnion Nikola Tesla University, Faculty for management, Njegoseva 1a, 21 000 Sremski Karlovci, Serbia (Received 10 January 2013; accepeted 10 April 2013)

Abstract The subject of this paper is to analyze the performance of open investment funds in Serbia in the period of 2007 to 2013. By applying Jensen's alpha, Sharper and Sortino ratio it was found that the performances of domestic investment funds are unsatisfactory. Review of investment funds operations is based on the returns they bring and the risks they accept in the business. In Serbia, the equity funds, as the most risky funds, started to operate in 2007, while cash funds (as the least risky funds) were introduced in later phase after 3 years. At the moment there are 16 open investment funds (on 02/28/13), where value growth and value maintenance funds dominate. A total net asset of open investment funds is 2,324 million Dinars i.e. 20 million Euros (at the end of 2012). Keywords: investment funds, interest rate, risk, Jensen's alpha, Sharper ratio, Sortino ratio

1. INTRODUCTION Investment funds are collective investment institutions which raise individual investors' funds and invest them in a wide range of financial assets. Investment

* Corresponding author: lbarjaktarovic@singidunum.ac.rs

funds offer their members a range of benefits and professional investment management, and for their service charge fee. The basic concept of investment funds is the pooling of individual investors funds, in order for them to achieve the...