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HOME | MONEY | MUTUAL FUNDS | PERFORMANCE REVIEW |
April 10, 2000
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Best and worst funds of 1999-2000Financial year 1999-2000 has been a good year for the mutual fund industry with most funds providing positive returns. This rediff.com-Value Research study of one-year fund performance finds out that diversified equity funds have provided an average return of 78.19 per cent. There are no losers in this category. Except for one scheme in balanced funds, there are no losers in most of the other categories. Since most of the sectoral, tax planning and gilt funds are less than a year old, we look at three-month performance of these funds to get a bigger sample. In sectoral funds, there are some losers. The best funds are Alliance Equity in diversified equity, SBI's Magnum Balanced in balanced funds, Sundaram Bond Saver in medium-term debt funds and Dundee Liquidity in short-term debt funds. A closer look. Equity - Diversified Equity markets have yielded astronomical returns in the last year, thanks to the bull run on the bourses and there have been no losers in this category. The recent volatility is a part of the inherent risk associated with equity investments. Diversified equity funds have, on an average, returned 78.19 per cent in the last year. While all the top 10 funds have convincingly outperformed the sector average, Alliance Equity has topped with a whopping return of 212 per cent in the last one year!
Equity - Balanced With most of the balanced equity funds tilting in favour of the equity markets, they have also posted impressive returns - 59 per cent in the last year. Magnum Balanced ranked first posting a return of 188.33 in the last year. This sector's sole loser, Dhanasahayog, posted a negative return of 4.37 last year.
Debt - Medium-term With interest rates going down, debt funds invested towards the long-end of the market have posted smart gains. This has been particularly pronounced in the fourth quarter of the last financial year. While on an average, debt funds have returned 13.08 per cent, Sundaram Bond Saver has outperformed its peers posting 15.08 per cent return.
Debt - Short-term Short-term debt funds have on an average, yielded a return of 9.56 per cent. Dundee Liquidity and JM High Liquidity have been the star performers in this category, posting a return of 13.10 and 12.63 per cent, respectively. These exceptional returns are attributed to these funds' strategy to invest a larger part of the corpus in the long-end of the debt market.
Equity - Sectoral Sectoral equity funds have given an average return of 7.89 per cent over the last three months. Two of Unit Trust of India's sector-specific funds belong to the toppers' league, with UTI Service Sector generating the highest return of 82.7 per cent. Three of SBI Mutual Fund's sector funds belong in the top losers' category with Magnum Contra losing as much as 26.79 per cent in the last three months.
Equity - Tax Planning In the three-month horizon, tax-planning schemes have gained the maximum - yielding 15.58 per cent on an average. However, there has been a wide variance in the performance of this group with Alliance Tax Relief '96 yielding the highest return of 44.51 per cent and BOB ELSS '96 - the only loser in this category - posting a negative return of 4.91 per cent.
Gilt Funds Returns from gilts have been boosted because of a consistent decline in interest rates leading to capital appreciation of the underlying portfolio. The returns have been further boosted with the cut in credit reserve ratio, or CRR, and bank rate on April 1. Gilt funds, on an average, yielded 3.52 per cent in the last three months which implies a simple annual return of 14.08 per cent. Both the options of Templeton G-Sec Fund are in the topper's list while Tata GSF (A) has outperformed its peers with a return of 6 per cent in the last three months.
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