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D.Muthukrishnan (Muthu), Certified Financial Planner- Personal Financial Advisor

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Beating the Sensex

Posted by Muthu on May 13, 2015

Last one year, Sensex has given a return of 10.5%.

The following 9 equity funds, chosen based on their AUM (Assets Under Management); (i.e.) these are the 9 largest equity funds in the industry and have provided the following returns in the last one year.

HDFC Equity – 24.57%

HDFC Top 200 – 20.42%

Reliance Equity Opportunities – 39.97%

HDFC Midcap Opportunities- 49.41%

ICICI Prudential Value Discovery- 49.55%

Birla Sun Life Frontline- 28.85%

ICICI Prudential Focused Bluechip- 23.99%

IDFC Premier Equity- 51.42%

Franklin India Bluechip- 26.79%

Don’t worry as to why the return varies. Each fund has a different mandate (i.e.) investing in large cap, midcap, value stocks etc and accordingly performance would vary year on year. The key take away from the above data is active fund management works very well in India. Even as per CRISL study last year, equity funds have given an annualised return of around 23 % as against 13% by Nifty between April 1997 and September 2014.

For purpose of providing illustration regarding power of equity, we keep sharing Sensex data. Many good equity funds in India have outperformed index by a significant margin thereby creating alpha. Please note that these returns are provided after accounting for expenses. 10% alpha after expenses over two decades is phenomenal.

The data provided above is obtained from the below tweet:

https://twitter.com/NagpalManoj/status/598321481001533442

Invest in equity funds regularly. Ignore volatility. Patiently stay the course.

2 Responses to “Beating the Sensex”

  1. ajay said

    Please do look at “http://www.safalniveshak.com/do-not-invest-in-index-funds/” for more information why you should invest in active funds. Also see the comments section for the actual comparison of returns between index and active funds.

  2. Nitingoyal said

    Nitingoyal: Sensex up 10.5%, CNX500 21.9%, NIFTY 15.86% Midcap 38.8%. Most funds you cited are not benchmarked to SENSEX & what about dividends?

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