How large-cap funds fared

Large-cap funds managed to restrict their net asset value slide to 2.5 per cent, better than even the Sensex.



If you had held large-cap focussed equity funds during the last one year, you would have managed the volatile markets better than the Sensex. These funds, on an average, managed to restrict their NAV slide to 2.5 per cent, better than Sensex (-6 per cent) as well as the broader index BSE 500 (-5 per cent). What's more, as many as four in five funds outperformed the benchmark during the year.

That said, this wasn't the best-performing fund category during the year. Sector funds such as FMCG and Pharma and multi-cap funds that invested across market capitalisation categories fared better.

DIVERGENT PATTERNS

And not surprisingly, there was a divergence in the performance of funds. While the top three funds — Canara Robeco Large Cap+, BNP Paribas Equity, and Franklin India Prima Plus delivered 2.4-4 per cent during the year, the bottom three — Baroda Pioneer Growth, Pramerica Equity and Morgan Stanley Growth shed between 8-9 per cent each.

The divergence in performance is significant if we consider a three-year period. While the top three funds averaged a return of 39 per cent, the bottom three delivered an average of 19 per cent. The Sensex registered a compounded return of approximately 27 per cent during the three-year period. While the average returns of the funds matched that of the Sensex during this period, only one in two funds managed to outpace the index.

CONSISTENT PERFORMERS

Funds such as Franklin India Blue Chip, Tata Pure Equity, ICICI Pru Top 100, Quantum Long-term Equity and DSP BR Top 100, to name a few, have consistently stayed ahead of the Sensex during one-, two- and three-year periods.

Funds such as Franklin India Prima Plus and UTI Top 100, which also feature in the list of consistent performers, could have got a leg up from consolidation of existing schemes into itself too. While Franklin India FMCG and Pharma funds were merged into Prima Plus in August 2011, UTI Top 100 merged with the erstwhile Index Select Fund and Master Growth Fund in May 2009.

For some funds, it was also a year of recovery. Sahara Growth, SBI Bluechip, Principal Growth, IDFC Imperial Equity and UTI Leadership Equity outperformed the Sensex during the year. These funds, though, lagged the index during two- and three-year periods.

There were funds that consistently underperformed too. Funds such as JM Equity, IDFC Classic Equity, Taurus Bonanza and DWS Alpha Equity underperformed the Sensex in each of the three timeframes.

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