In the week ended February 23, 2018, the S&P BSE Sensex treaded water and managed to move up marginally higher by 0.38%. The CNX Nifty 50, inched higher by 0.37% over the same period. In comparison, the S&P BSE MidCap Index dropped 0.24%. The S&P BSE SmallCap Index too plunged, dropped by 0.22%.
Given this performance of the stock market, all
equity mutual fund schemes were range bound. A few schemes that were predominantly invested in large-caps were able to stem the losses. Only the IT sector provided a relief to investors. Schemes invested heavily in software stocks would have climbed higher.
Such schemes were among the top performing mutual funds for the week. Those mutual funds that have aggressively invested in Auto and Realty sectors would have suffered the most.
In terms of valuations, the price-to-earnings (P/E) multiple of the S&P BSE Sensex eased to around 23 times. The P/E of the S&P BSE MidCap is stilling hovering near 40x and that of the S&P BSE SmallCap index remains above 100 times.
All the indices are trading over twice their long-term average P/E. Hence, could come under pressure with adverse news.
On shifting the focus on sectoral performances, shares of Software, Metals and Bank sectors held their ground. The Nifty IT, Nifty Metal and Nifty Bank indices, reported gains of 3.48%, 0.93% and 0.55% respectively. Bank stocks recovered after declining in the past couple of weeks. Mutual funds focused on these sectors would have been able to restrict losses during the week.
Among the sectoral indices that declined the most were the Nifty Auto, Nifty Realty and Nifty Pharma index. Shares of these sectors fell 1.69%, 1.42% and 0.93% respectively. Mutual funds investing heavily in these sectors would have suffered.
Going ahead, the pace of earnings will set the tone and direction of the market.
Among equity diversified mutual funds, Aditya Birla SL India Opportunities Fund, Templeton India Equity Income Fund, SBI Magnum Equity Fund, MOSt Focused 25 Fund, and Parag Parikh Long Term Equity Fund topped the list with returns of 1.10%, 0.82%, 0.66%, 0.65% and 0.64% respectively.
Top Mutual Funds of The Week
Data as on February 23, 2018. Returns are absolute
(Source: ACE MF, PersonalFN Research)
*Please note, this table only represents the best performing funds based solely on past returns and is NOT a recommendation. Mutual Fund investments are subject to market risks. Read all scheme related documents carefully. Past performance is not an indicator for future returns. The percentage returns shown are only for indicative purposes.
Category-wise Top Performing Equity Mutual Funds of the week
On taking a look at the category wise performance
SBI Magnum Equity Fund,
MOSt Focused 25 Fund,
Canara Rob F.O.R.C.E. Fund,
Reliance Retirement Fund-Wealth , and
Edelweiss Large Cap Advantage Fund-A were the
top large cap funds with a return of 0.66%, 0.65%, 0.62%, 0.61% and 0.58%.
Axis Midcap Fund, Mahindra Unnati Emerg. Business Yojana, Taurus Discovery Fund, UTI Mid Cap Fund, and MOSt Focused Midcap 30 Fund were the top mid cap funds & small cap funds with a return of 0.58%, 0.51%, 0.47%, 0.34%, and 0.34% respectively.
Among multicap funds, Aditya Birla SL India Opportunities Fund, Templeton India Equity Income Fund, Parag Parikh Long Term Equity Fund, Taurus Ethical Fund, and Axis Multicap Fund were the top multi-cap funds with returns 1.10%, 0.82%, 0.64%, 0.57% and 0.51% respectively.
Top Performing ELSSs of the week
In the ELSS category,
IDBI Equity Advantage Fund,
Taurus Tax Shield Fund,
Canara Rob Equity Tax Saver Fund,
Axis Long Term Equity Fund,
ICICI Prudential Long Term Equity Fund (Tax Saving) were the
top ELSS funds, generating a return of 0.65%, 0.56%, 0.54%, 0.42% and 0.40% respectively.
Top Performing Balanced Funds of the week
Balanced funds were able to deliver decent returns. Some were able to stem the losses better than the others. The
top balanced funds for the week
Shriram Equity & Debt Opp Fund,
SBI Magnum Balanced Fund,
Reliance Regular Savings Fund-Balanced Option,
DHFL Pramerica Balanced Advantage Fund, and
Principal Balanced Fund. These schemes delivered a return 0.39%, 0.34%, 0.30%, 0.30%, and 0.28% respectively.
How to invest in the best mutual fund schemes?
PersonalFN suggests that you must take a closer look at the performance of your mutual funds. Staying invested in funds with a proven track-record of consistent performance may pay off in the long run.
Thus, in the interest of your long-term financial wellbeing, it is best that you wisely structure and review your mutual fund portfolio. If you are unsure where to invest fresh investible surplus currently, to strike the correct risk-return tradeoff we recommend adopt a ‘core and satellite approach’ to investing.
Constructing a portfolio with a stable core of long-term investments and a periphery of more specialist or shorter-term holdings can help to deliver the benefits of asset allocation and offer the potential to outperform the market. The satellite portfolio provides the opportunity to support the core by taking active calls determined by extensive mutual fund research.
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