Abstract   Title: High-Risk Funds vs. Mutual- Index Funds A study of macro -variables influence on different funds choice   Level: Final assignment for Bachelor Degree in Business Administration   Author: Moses Yokie & Bo Lemar   Supervisor: Ogi Chun & Cheick Wagué   Date: 2011-05-25   Aim: The purpose with this thesis is to compare two different types of mutual-index fond and a high-risk fund in relation to the macro variables. The purpose also includes an investigation about if an investor will receives a higher return on high-risk fund than on mutual-index fund in a 10 years period. Method: A quantitative method has been use in this study, where the information has been received from Morningstar. Microsoft Excel has been used to process the collected data in order to calculate the expected return and the risk measures. The result is presented in graphs and tables on the empirical capital, in order to analyse and compare it with the theories and the selected macro- variables to see if there will be any correlation.   Conclusion: This research shows that there is no possibility that the macro-variable factors can benefit an investment on high-risk fund or on mutual-index fund in the short run. On the other hand there is a correlation between the high-risk fund and mutual-index fund with the macro-variables factors in the long run.   Suggestion for future research: Base on the results on this thesis. It would be interesting to do a quantitative investigation on more fund category with other macro-variable factors that are not included in this study to compare if there will be any correlation between them.   Key words: High-risk fund, BNP, Mutual-index, Arbitrage, Macro-variable, Inflation. / Syfte: Syftet med denna uppsats är att jämföra två olika aktieindex och högriskfonder med avseende på makrovariabler. Syftet innefattar också att undersöka om en investerare kan få bättre avkastning på högriskfonder än aktieindexfonder på 10 år period. Metod: En kvantitativ metod har använts i uppsatsen, där data inhämtats från Morningstar. Det insamlade material har sedan bearbetats i Microsoft Excel för att beräkna fonderna avkastning och Sharpekvoten. Resultatet har redovisats i grafer och tabeller i empirikapitlet, för att sedan analyseras och jämföras med de teorierna som används. Resultatet har jämförts med de valda makrovariablerna för att hitta korrelationer. Slutsats: Det har inte gått att påvisa några möjligheter att utnyttja makrovariabler för att skapa kortsiktiga vinster i högriskfonder eller aktieindexfonder. Däremot finns det långsiktiga samband mellan de valda investeringarna och de valda makrovariablerna Förslag till fortsatta studier: Det kan vara intressant att gör en kvantitativ undersökning på fler former av fondkategorier för att få ytterligare information om tillämpbarhet. Dessutom att undersöka samband med andra makrovariabler som inte innefattas i denna undersökning.

M. Comm. / Although there has been several work done on monetary policy and inflation in South Africa, this dissertation is intended to add and expand on the existing literature on the subject with data dating back to 1970. The dissertation was inspired by recent international research that has indentified that a large Bayesian VAR model normally performs better than the normal SVAR model. Given that there has already been differing conclusions in literature on whether interest rates are effective as a tool to control inflation, there is therefore an opportunity to assess monetary policy using a different and more robust modelling framework. The choice of a sample is informed by the fact that prior to inflation targeting and within the period under consideration; interest rates remained a core factor in monetary policy management. Some of the literature will be discussed in detail in chapter 2. This dissertation will introduce the large BVAR model with 14 variables in the South African economy. In comparison, the SVAR model suffers from the curse of dimensionality that is eliminated by using more variables with the Large Bayesian VAR with the response functions of all 14 variables. The objective is therefore to determine whether interest rate changes in South Africa have a meaningful and desired effect on inflation. A substantial amount of recent literature was done within the environment of inflation targeting; however, our study intends to measure more the responsiveness of interest rates and other macro variables to monetary policy. The period of inflation targeting in South Africa provides more useful data and evidence on the responsiveness of the macro variables given the direct policy approach it represents versus the previous regime and hence it is covered in more detail in the dissertation. We also assess, in the process, the main drivers behind inflation in South Africa, in an effort to establish whether the country suffers from cost- push or demandpush. The type of inflation should also assist in providing recommendations on the appropriate response to inflation.