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13) Fund Management Efficiency Ratio = Total Assets/Total Equity Capital a) explain the ratios and what...

13) Fund Management Efficiency Ratio = Total Assets/Total Equity Capital

a) explain the ratios and what happened from 2017 to 2019

2019

RM’000

2018

RM’000

2017

RM’000

Total Asset

42,429,819

49,130,609

48,972,650

Total Equity

8,412,097

7,920,944

7,504,447

Fund Management Efficiency Ratio

42,429,8198,412,097x 100%

= 504.39%

49,130,6097,920,944x 100%

= 620.26%

48,972,6507,504,447x 100%

= 652.58%

Solutions

Expert Solution

Fund management efficiency ratio which is measured by Total assets / Total equity explains the extent that how efficiently the funds have been employed to generate assets under management. In other words, high fund management efficiency ratio in case of mutual fundsdenotes the the equity has been employed efficently in the long run to generate assets.

In the year 2019 fund management effciency ratio is 504.39% which means an equity fund of RM 100 has been able to generate 504.39 assets; In the year 2018 fund management effciency ratio is 620.26% which means an equity fund of RM 100 was able to generate 620.26 assets;In the year 2017 fund management effciency ratio is 652.58% which means an equity fund of RM 100 was able to generate 652.58 assets.

From the year 2017 to 2019 fund management efficiency ratio has decreased which means the effeiciency of the fund has decreased over time. In other words Net Asset Value (NAV) of assets held has decreased over time.

jeff jeffy answered 2 years ago
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