Statistical Assessment of Inception Return and Systematic Risk on the Reward–Risk Performance of Artificial intelligence-based Quant Mutual Funds in India

Abstract

This study explores the influence of Inception Return and Systematic Risk on the Sharpe Ratio of equity-based quant mutual fund schemes in India. These schemes employ predictive analytics, Artificial Intelligence (AI), Big Data, and algorithmic trading to optimize portfolio strategies. Seven equity-oriented quant mutual fund schemes managed by Quant Money Managers Ltd. were selected based on their portfolio turnover ratios. Using regression analysis, the study evaluates the extent to which inception return and systematic risk affect risk-adjusted returns. Findings suggest a statistically significant relationship between these factors and Sharpe Ratio performance, providing valuable insights for fund managers and retail investors.