Journal of Finance and Investment Analysis

Effect of Portfolio Management Strategies on the Returns of Mutual Funds in Kenya

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• Abstract

  The study explored the effect of portfolio management strategies on portfolio returns of mutual funds in Kenya. The population of the study was all the mutual funds licensed by CMA as at 2018. The study concluded that portfolio management strategies have an impact on portfolio returns. In Kenya, the most preferred strategy was active portfolio strategy. Mutual funds that employed active and growth portfolio management strategy generated negative returns, although active strategy is the most preferred strategy, the costs that the strategy attracts leads to negative returns. Those that employed value and passive portfolio management strategies generated positive returns. The study recommends that mutual funds should use value and passive strategies as they produce positive returns, and this is because of the low cost incurred when using these strategies.

  Keywords: Portfolio Management Strategies, Returns, Mutual funds, Kenya.