Mutual fund investment: Around 80% of equities mutual funds have surpassed their benchmarks. The Assets Under Management (AUM) of stock mutual funds decreased by 4.03% sequentially, from Rs 26,43,291 crore in September 2024 to Rs 25,36,803 crore in October 2024, excluding Sectoral/Thematic Funds, a recent performance review conducted by PL Wealth Management stated. The analysis, which focused on 240 open-ended equity diversified funds, revealed that 80% of these funds outperformed their benchmarks in the previous month, leading up to October 31st, 2024. Out of the total 240 funds, 192 managed to outperform their benchmarks by the end of October 31, 2024.
Based on the analysis, the top-performing funds were Value, Contra, and Dividend Yield Funds, with 96% of these funds outperforming their benchmarks. Flexi Cap Funds and Large & Mid Cap Funds also demonstrated strong performance, with 86% and 85% of their funds surpassing their benchmarks, respectively. On the other hand, small-cap funds had the lowest performance, with only 60% of funds outperforming their benchmarks.
As of October 31, 2024, approximately 58% of the 240 open-ended equity diversified funds managed to exceed their benchmarks in the past year. This is a slight increase from the previous year, where 55% of the funds were successful in outperforming their benchmarks.
The report suggests that investors adhere to their long-term objectives and continue with their systematic investment plans (SIPs). SIPs have delivered an average annual return of over 15% for top-quartile equities funds over the past three years.
“Investors are advised to stick to their SIP investments and keep a long-term focus. SIPs over the past 3-years have yielded a return in excess of 15% p.a. on an average for the top quartile equity funds,” said Pankaj Shrestha Head – Investment Services at PL Wealth.
Performance at a glance
Large Cap Funds: Eighty-four percent of funds performed better than the S&P BSE 100 TRI benchmark.
Large & Mid Cap Funds: Eighty-five percent of schemes surpassed the NIFTY LargeMidcap 250 TRI index.
Multi Cap Funds: Seventy-seven percent of funds outperformed the Nifty500 Multicap 50:25:25 TRI.
Flexi Cap Funds: Eighty-six percent of funds exceeded the NIFTY 500 TRI.
Mid Cap Funds: Eighty-one percent of funds performed better than the Nifty Midcap 150 TRI.
Small Cap Funds: Only 60% of funds outperformed the Nifty Smallcap 250 TRI.
Focused Funds: Sixty-five percent of schemes performed better than the NIFTY 500 TRI.
Equity Linked Savings Schemes (ELSS): Eighty-one percent of ELSS outperformed the NIFTY 500 TRI.
The favourable trajectory in sectors such as Value, Contra, and Dividend Yield Funds reflects effective stock selection and market tactics that contributed to their strong performance. Additionally, Flexi Cap and Large & Mid Cap Funds demonstrated resilience in the market due to their diversified holdings across various industries.
Data from the Association of Mutual Funds in India (AMFI), released on November 11, revealed that equity mutual funds experienced a historic inflow of Rs 41,887 crore in October. This marked a significant increase of 21.7% compared to the previous month, driven by robust investments in thematic funds despite heightened volatility in the stock market.