# Mutual funds cut-off

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The quarterly returns for a group of 54 mutual funds with a mean of 4.1% and a standard deviation of 5.3% can be modeled by a Normal model. Based on the model N(0.041, 0.053), what are the cutoff values for the highest 30% of these funds?

* It notes that the z value is between 0-1, and says using technology to determine the actual z-value, rounding to two decimal places z=0.52.

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##### Solution Summary

From a group of mutual fund, cut-off value for highest 30% of the funds is estimated.

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For given data,

mean, X = 0.041

standard deviation, s = 0.053

number of funds, n = 54

cut-off value, x = ?

highest 30% funds == 0.30

The problem can be formulated as follows:

probability,

p = P((x-X) > ...

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- BEng, Allahabad University, India
- MSc , Pune University, India
- PhD (IP), Pune University, India

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