Mutual Funds Underperform Market Indices
While equity markets gained 32.39 per cent between March 9 and April 9, average return of diversified equity fund in the same period has been 24.3 per cent.
The worst performing fund in the diversified equity fund category has managed to give a paltry of 2.28 per cent return during the period under review. Significantly, of the 221 schemes under the category, 208 failed to outperform the BSE Sensex.
The benchmark index had closed on 10,803.86 points on April 9, registering a rise of 2,643.46 point since March 9, 2009, when it had sunken to its threeyear low of 8,160.40.
However, there are some funds that have managed to outperform the Sensex during the 30-day period under consideration. The best scheme in the diversified equity fund category, Taurus Infrastructure, has managed to given a return of 41.85 per cent in the same period. Other schemes, such as JM Basic, Magnum Emerging Businesses, DBS Chola Opportunities managed to outperform the market barometer.
The story is similar in sector-specific funds. While the Bankex has gone up by 38.86 per cent between March 9 and April 9, none of the schemes catering to the banking sector has been able match the performance of the Bankex. The best return of 32.56 per cent has been given by Sundaram BNP Paribas Financial Services Opportunities. The worst fund in the category, JM Financial Services, has managed only 16.88 per cent. Of the two funds meant for the auto sector, JM Auto Sector outstripped BSE Auto index, providing gains of 29.12 per cent. BSE Auto index rose 26.74 per cent during the period. UTI Transportation and Logistics, the other scheme dedicated to Auto sector, has given a return of 17.71 per cent.
In the past one year, most fund schemes have underperformed the Sensex, marginally though. While, the Sensex gave a return of -31.58 per cent, diversified fund gave a return -34.24 per cent. Similarly, the Bankex fell 32.91 per cent against 34.24 per cent drop of bank funds. Auto specific funds have given an average negative return of 25.16 per cent against Auto index
