These 11 equity mutual funds had portfolio turnover ratio of over 200% in February
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What is a high portfolio turnover ratio?
A higher portfolio turnover ratio indicates continuous buying and selling of stocks by the fund managers. The continuous churning of the portfolio by the fund manager increases the costs and drags down the return of the scheme. Here are 11 equity mutual funds with a portfolio turnover ratio of over 200%, according to data by ACE MF.
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Categories In Focus
These 11 equity mutual funds were from large cap, mid cap, large & mid cap, ELSS, flexi, value, multicap, and focused fund categories.
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Quant Large Cap Fund
This largecap fund had the highest portfolio turnover ratio in February. The scheme had a portfolio turnover ratio of 557%. The scheme gave a 4.49% return in February.
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Shriram Flexi Cap Fund
This flexi-cap scheme had a portfolio turnover ratio of 537.40% in February. The scheme offered 1.38% in February.
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Two schemes from Quant Mutual Fund
Quant Focused Fund and Quant Large & Mid Cap Fund had a portfolio turnover of 456% and 405%. Quant Focused Fund and Quant Large & Mid Cap Fund offered 4.42% and 4.08% respectively in February.
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Shriram ELSS Tax Saver Fund
This ELSS fund had a portfolio turnover ratio of 396.30% as of February 29, 2024. The scheme offered 1.04% in February.
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The other four from Quant
The next four schemes - Quant Flexi Cap Fund, Quant Mid Cap Fund, Quant Value Fund, and Quant Active Fund - had a PTR of 392%, 365%, 335%, and 285% respectively. These four schemes gave 2.63%, 2.99%, 5.49%, and 1.28% respectively.
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WhiteOak Capital Mid Cap Fund
This midcap scheme had a portfolio turnover ratio of 256% in February. The scheme offered a 1.62% return in February.
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JM Large Cap Fund
This largecap fund had a portfolio turnover ratio of 213% in February. This scheme offered a 3.35% return in February.
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Why such a high portfolio turnover ratio?
“There are a few reasons why the portfolio turnover ratio could be even higher. First is the real portfolio turnover. Second, the amount of inflows coming into the fund and getting out of the fund. So in these cases the amount of funds coming in may be higher,” says Chokkalingam Palaniappan, Director of Prakala Wealth, a Chennai-based advisory firm.
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Should you worry?
When people are holding four or five fund houses with a higher turnover ratio in that way it should not be a problem. However, people who have all their investments in a single fund house having a high turnover ratio then they should be a little more cautious and careful,” adds Chokkalingam.