It's David vs Goliath
Fund managers, particularly those of mid-cap funds, try to identify tomorrow’s Infosys and Reliance today.
By Bakul Chugan, TNN |
Fund managers, particularly those of mid-cap funds, try to identify tomorrow’s Infosys and Reliance today. While all fund managers strive to achieve this goal, some end up being better than others. Standard Chartered Premier Equity has been a surprise package this quarter — it has delivered nearly 80% returns over a one-year period. It has outperformed its benchmark index and so have ICICI Prudential Emerging Star and SBI Magnum Midcap.
In contrast, the oldest available mid-cap fund, Franklin India Prima, has underperformed its benchmark, albeit by a small margin, in the past one year. However, it managed to outperform its benchmark over three-year and five-year periods.
Investments in mid-cap funds last year could have turned out to be a better strategy since mid-cap indices generated higher returns than large-cap indices.
In the past one year, returns of the BSE Midcap, CNX Midcap and CNX Nifty Junior (all mid-cap indices) were in the range of 50%-65% — higher than the returns generated by large-cap indices like the Sensex and the Nifty. Most funds invested 85% or more into mid-cap stocks, but Reliance Growth was an exception.
SBI Magnum Midcap, ICICI Prudential Emerging Star and Birla Midcap have generated handsome returns of more than 55% over a one-year period. But leading this list over a two-year period is SBI Magnum Global with CAGR returns of 56.2%, followed by Sundaram BNP Paribas Select Midcap at 55.6% and ICICI Prudential Emerging Star at 55.2%.
Sundaram BNP Paribas Select Midcap took a back seat in terms of one-year returns, at 34.3%. But it managed to maintain its standing over a two-year time frame. UTI Midcap is among the laggards in this category, posting disappointing returns over one-year, as well as two-year time periods. It delivered CAGR returns of only 21.8% over one year, while it was 26% over a two-year period. Other funds which disappointed include Tata Midcap and JM Emerging Leaders over one-year periods, and Franklin India Prima and DBS Chola Midcap over two-year periods. Not many funds have a track record of three years. Hence, they could not be rated in the study.
In contrast, the oldest available mid-cap fund, Franklin India Prima, has underperformed its benchmark, albeit by a small margin, in the past one year. However, it managed to outperform its benchmark over three-year and five-year periods.
Investments in mid-cap funds last year could have turned out to be a better strategy since mid-cap indices generated higher returns than large-cap indices.
In the past one year, returns of the BSE Midcap, CNX Midcap and CNX Nifty Junior (all mid-cap indices) were in the range of 50%-65% — higher than the returns generated by large-cap indices like the Sensex and the Nifty. Most funds invested 85% or more into mid-cap stocks, but Reliance Growth was an exception.
SBI Magnum Midcap, ICICI Prudential Emerging Star and Birla Midcap have generated handsome returns of more than 55% over a one-year period. But leading this list over a two-year period is SBI Magnum Global with CAGR returns of 56.2%, followed by Sundaram BNP Paribas Select Midcap at 55.6% and ICICI Prudential Emerging Star at 55.2%.
Sundaram BNP Paribas Select Midcap took a back seat in terms of one-year returns, at 34.3%. But it managed to maintain its standing over a two-year time frame. UTI Midcap is among the laggards in this category, posting disappointing returns over one-year, as well as two-year time periods. It delivered CAGR returns of only 21.8% over one year, while it was 26% over a two-year period. Other funds which disappointed include Tata Midcap and JM Emerging Leaders over one-year periods, and Franklin India Prima and DBS Chola Midcap over two-year periods. Not many funds have a track record of three years. Hence, they could not be rated in the study.
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