Thesis (M.Sc.) - Cairo University - Faculty of Commerce - Department of Business Administration

Islamic compliant financial instruments are one of the globally growing financial service sectors. Financial services based on Islamic finance are virtually an interest for many global market participants. The objective of this research is to investigate the performance of Islamic and conventional mutual funds in the context of Egyptian financial market. Risk and return assessment of Islamic and conventional mutual funds is conducted using various financial performance measures and risk measures. The analysis is based on a sample of 6 Islamic mutual funds and 15 conventional mutual funds and on the time period from May 2008 to April 2015. The Egyptian index (EGX30) is used as the benchmark for the Egyptian market index. Additionally, the Morgan Stanley Capital International index for Egyptian Islamic funds (MIEG) and the Morgan stanley capital international index for Egyptian conventional funds (MXEG) are used as benchmarks for Islamic and conventional mutual funds, respectively. The results shows that Islamic mutual funds underperformed both conventional mutual funds and the Egyptian market index. Furthermore, conventional mutual funds underperformed both the EGX30 and the MXEG. As for risk measures, Islamic funds had the lowest total and systematic risk whether compared to conventional mutual funds, EGX30 or MIEG. Moreover, conventional mutual funds had lower total and systematic risk than the EGX30 and the MXEG

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