Most equity-based MFs underperform in last 1 year: S&P Dow Jones

In terms of returns to investors, most of the equity focused mutual funds in the country have underperformed their respective benchmark S&P BSE indices, for one year ended December 2016, says a report.

The analysis is part of S&P Dow Jones Indices' scorecard SPIVA which tracks the performance of actively managed Indian mutual funds against their benchmarks over the one-year, 3-year, 5-year and 10-year periods, as on December 31, 2016.

Over the one year period, the latest SPIVA India (S&P Indices Versus Active Funds) scorecard showed that 66.29 per cent of largecap equity funds, 64.29 per cent of ELSS (equity linked savings scheme) and 71.11 per cent of mid/small cap equity funds have underperformed their respective benchmark indices.


"Studies reveal that over the one, 3 and 5-year periods ending December 2016, only Indian ELSS funds maintained 100 per cent style consistency," Asia Index Associate Director (Global Research & Design) Akash Jain said in a statement.

"Over the 10-year period, only 30.63 per cent of Indian equity large-cap funds and 28.57 per cent of Indian equity mid-/small-cap funds preserved their style," Jain added.

The SPIVA scorecard also revealed that the majority of the composite bond funds underperformed S&P BSE India bond index over one year, 3-year, 5-year, and 10-year periods.

Besides, most of the government bond funds underperformed S&P BSE India Government Bond Index over three, five and ten year periods.

Asia Index is a 50-50 partnership between S&P Dow Jones Indices and domestic bourse BSE.