Crude concerns have hit equity markets in a big way, and this is more than evident in the 400+ point slide in the BSE Sensex over the past few days. The impact on (equity) growth funds has been depressing to say the least.

Rising crude oil prices in the global market is a concern afflicting all equity markets, and India has been no exception to this. So while ten days ago, domestic markets were inching upwards of 4,700 points, the surge in crude prices has spoilt the party and markets did not take long to forfeit all their gains in a matter of days.

As is the case with all bear and bull runs, software stocks led the charge once again, this time on their way down. And given the heavy exposure to software stocks by diversified growth funds, net asset values (NAVs) of these funds have slumped dramatically.

Open-ended, Growth Schemes	NAV (Rs)	Last week	Last month	Last year	Since inception
BSE - 30	-	0.9%	7.4%	0.2%	-
S&P CNX Nifty	-	0.4%	6.5%	4.9%	-
S&P CNX 500	-	-0.2%	9.1%	7.3%	-
Magnum Multiplier Plus 1993	23.9	4.7%	32.1%	28.6%	14.1%
GIC Growth Plus II	17.2	2.0%	9.0%	26.6%	10.2%
GIC Fortune 1994	7.0	0.9%	9.2%	-11.1%	-5.3%
Primary Equity Fund	16.2	0.5%	6.3%	3.8%	9.4%
GIC D'MAT	8.5	0.0%	6.0%	-23.5%	-25.1%
K MNC	10.3	-1.4%	1.7%	0.0%	10.4%
Reliance Vision Fund	19.5	-1.5%	1.8%	12.7%	14.1%
Templeton Growth Fund	12.9	-1.8%	2.4%	24.3%	9.6%
Mastergain 1992	12.1	-1.9%	8.5%	-9.9%	3.9%
Zurich(I) Capital Builder	13.0	-1.9%	2.4%	-6.3%	5.0%
Mastershare Plus 1991	22.9	-2.2%	4.2%	-10.2%	5.5%
K P Prima Fund (Gr)	23.1	-2.6%	8.9%	5.7%	13.2%
Birla MNC Fund (Gr)	32.0	-2.7%	3.1%	65.4%	21.7%
Pru ICICI Growth (Gr)	24.3	-2.8%	13.2%	29.8%	48.6%
Grandmaster 1993	10.9	-2.9%	11.1%	-17.1%	0.3%
DSP ML Equity Fund	18.7	-3.1%	3.1%	3.0%	29.0%
Boinanza Exclusive Gr	7.5	-3.1%	2.9%	-19.2%	-2.5%
Canbonus	10.5	-3.1%	6.2%	-18.5%	2.9%
Canexpo	19.4	-3.5%	6.0%	21.9%	13.0%
Alliance Equity Fund (Gr)	39.5	-3.6%	10.8%	68.1%	94.4%
Birla Advantage Fund	41.9	-3.7%	8.0%	47.6%	35.8%
K P Bluechip (Gr)	23.7	-3.9%	4.4%	38.5%	30.2%
Franklin India (Gr)	7.4	-3.9%	2.9%	0.0%	-28.1%
Mastergrowth 1993	19.2	-4.0%	5.1%	1.7%	10.1%
K 30	19.4	-4.1%	5.2%	23.3%	43.0%
DSP ML Opportunities (Gr)	9.7	-4.4%	7.1%	0.0%	8.9%
JM Equity Fund (Gr)	11.6	-4.4%	6.6%	-3.8%	3.4%
UGS 10000	11.5	-4.5%	1.1%	-15.5%	8.0%
IDBI Equity Fund (Gr)	11.6	-4.5%	8.1%	-2.2%	4.0%
Canglobal	7.6	-4.6%	6.2%	-22.2%	6.5%
Tata Pure Equity	13.8	-4.7%	6.2%	39.1%	49.5%
Taurus Starshare	9.6	-4.9%	6.0%	4.0%	-1.7%
Zurich(I) Equity (Gr)	20.6	-5.1%	5.5%	19.3%	14.6%
Libra Leap	20.6	-5.2%	4.8%	33.1%	33.7%
Sundaram Growth	14.4	-5.3%	6.8%	13.1%	24.0%
IL&FS Gr & Val (Gr)	14.4	-5.4%	6.4%	0.0%	18.8%
Sun F & C Value (Gr)	22.0	-5.7%	5.5%	5.8%	32.2%
Zurich (I) Top 200	16.0	-5.7%	3.8%	-12.4%	18.3%
K P Prima Plus (Gr)	22.5	-6.0%	0.4%	20.6%	16.6%
ING Growth (Gr)	19.4	-6.1%	11.6%	61.6%	65.9%
Magnum Global Fund	12.3	-7.3%	9.4%	-0.8%	5.8%
Sun F&C Emerg Tech (Gr)	6.8	-7.7%	3.8%	0.0%	-21.1%
Magnum Equity Fund	16.2	-8.4%	17.0%	27.7%	17.0%

Crude concerns are unlikely to vanish into thin air, which implies that the current slide is unlikely to reverse overnight. However, given the level at which some software stocks find themselves, bargain hunters (including fund managers) could lead a buying frenzy in these stocks, unless they see a further diminution in prices, in which case we could be witnessing a rather protracted bearish phase.

Serious investors are better off staying invested rather than exiting at this moment, as there a consensus among fund managers about the solidity of fundamentals as far as software stocks are concerned. Smarter investors could opt for the systematic investment plans (SIPs) and actually ride the market slide.

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