Top 50 and Bottom 50 Mutual Funds based on 1M and 1Y Returns as on April 27, 2024

 

Commentary:

1. There has been a significant recovery through the last week for the top 50 funds when compared to a week before. However, the commodity funds suffered a severe correction through the last week. As a result, many of the commodity funds have disappeared from the Top 50 based on 1M return, and the monthly average return of Top 50 across all funds has come down from 12.18 to 11.02.

2. In general, the equity funds have recovered through this week. As a result, the annual return average of top 50 based on 1M return has been further enhanced to 60.88.

3. Since there is fresh fear of inflation at the US and there is central effort to control it, there is a tug of war between commodity prices and the equities lead by technologies. We can anticipate volatility for next few weeks in this regard, with some impact to Indian MF too. So, while there is recovery on Indian equity, need to see the impact of short term correction through next 2-3 weeks through the result season. Inflation fears could weigh on all types of equities short term, but after that, the election completion is likely to confirm bull time for Indian equities in general.  

4. Based on the criteria of funds having above average returns from 1M through 1Y, the following have made to the investment grade in the monthly top 50 as on this week.

- HDFC Defence Fund

- Quant Commodities Fund

- Mirae Asset Nifty Smallcap 250 Momentum Quality 100 ETF

- Mirae Asset NYSE FANG+ETF FoF (In spite of weekly correction, further corrections due?)

- Quant Value Fund

- JM MidCap Fund

- SBI PSU Fund.

5. Looking at the bottom 50 funds based on 1M Return, the IT based funds are still in the bottom 50, though the intensity of correction is waning.

6. Due to inflation fear based corrections globally, many global equity based funds rule the bottom 50 based on 1M Return.

7. One can look at Top 50 funds based on 1Y Return, for assessing the consistent above average return providers (marked in green) across 1M thru 1Y timeframe. These funds areinvestment worthy inspite of potential corrections in the near future. The return of more PSU Funds to the top 50 indicates the enthusiasm of the market on post election bull run for PSU funds. 

- CPSE ETF

- ABSL Equity PSU Fund

- SBI PSU Fund

- Mirae Asset NYSE FANG+ETF FOF (Watch out for further correction beyond this week though)

- Motilal Oswal S&P BSE Enhanced Value ETF

- Motilal Oswal S&P BSE Enhanced Value Index Fund

- Invesco India PSU Equity Fund

- ICICI Prudential PSU Equity Fund

- Quant Infrastructure Fund

- Quant Value Fund

- Bandhan Infrastrucutre Fund

8. Looking at the Bottom 50 based on 1Y Return helps to assess the damage done by certain thematic funds through the last one year, if these funds are in your portfolio.

9. When we look at the equity only funds top 50 based on 1M Return, the following funds make the investment grade by having above average return from 1M through 1Y timelines.

- HDFC Defence Fund

- Quant Commodities Fund

- Mirae Asset NYSE FANG+ETF FoF (Watch out for further correction beyond this week though)

- Quant Value Fund

- SBI PSU Fund

- LIC MF Infrastructure Fund

- DSP TIGER Fund

10. Looking at the Equity Only Top 50 based on 1Y Return, the following additional funds make the cut for investment worthiness:

 - CPSE ETF

- ABSL PSU Equity Fund

- Invesco India PSU Equity Fund

- ICICI Prudential PSU Equity Fund

Funds that make in top 50 both in 1M and 1Y timeline basis give one more confidence for fresh investments ahead.

11. Looking at hybrid funds top 50 based on 1M Return, the following make it to fresh investment considerations:

- Quant Multi Asset Fund

- Quant Dynamic Asset Allocation Fund

- JM Aggressive Hybrid Fund

- Bank of India Mid & Small Cap Equity & Debt Fund

- ICICI Prudential Retirement Fund - Hybrid Aggressive Plan

- ABSL Multi Index FOF

- HSBC Aggressive Hybrid Fund

- Quant Absolute Fund

- ICICI Prudential Child Care Fund - Gift Plan

- Nippon India Asset Allocator FoF

- Shriram Multi Asset Allocation Fund

12. Looking at Hybrid Top 50 based on 1Y Return, a subset of the funds from Top 50 based on 1M Return make it to the fresh investment considerations. (See marked in green). No new fund outside this list here. Funds that repeat both in 1M and 1Y Top 50 can be more favorites for fresh investments.

13. Due to significant correction through last one week, there is some churn out as to the funds that made investment grade based on 1M Return. There will be further volatility short term, though there is overall higher confidence for the commodity funds to do well medium term due to inflation fears ahead in the US which will overflow globally. The funds making the investment grade through this week are:

- UTI Gold ETF FoF

- Invesco India Gold ETF FoF

- SBI Gold Fund

- Quantum Gold Savings Fund

- Kotak Gold Fund

- Axis Gold Fund

- Quantum Gold Fund

- HDFC Gold Fund

- LIC MF Gold ETF FoF

14. The significant correction through this week gives more impetus to make fresh investments to some of the leading Commodity Funds. I had made investments in SBI Gold Fund and Axis Gold Fund before and may add more through the week ahead.

 

15. There is nothing much to talk about Debt funds Top 50 based on 1M Return. Debt funds remain boring.

Best Regards

- Nataraja Upadhya

Top 50 Funds based on 1M and 1Y Return as on April 20, 2024

 

Commentary:

1. The above table gives different averages, across all fund types and specific fund types.

2. When we compare to the report from last week, we see significant correction on 1 week basis. But the returns of the top 50 for 1M thru 1Y are not much impacted though. Since some commodity funds performances are impacted, the 1Y return of Top 50 based on 1M return has improved thru this week.

3. Slight reduction in the Top 50 Commodity funds 1 M Return through this week reconfirms a bit of correction in the coomodity funds through this week.

4. Looking at Top 50 Funds based on 1M Return, it is the same two funds like last week, that made the investment criteria (marked in light greem) which is to have above average return (shown as bold) in all time frames from 1M through 1Y.  

5. Most of the funds that made to the Top 50 are the commodity funds like last time.

6. It is interesting to note that two small cap index funds have made to the top 50 list after 4-6 weeks. IT is too early to reconfirm this as the revival of small cap funds. We need confirmation from next few weeks.

7. We look at the Top 50 Funds based on 1Y Return for further insight as to fresh investment eligibility. Nine funds marked in light green have made it to the investment eligibility which is to have above average returns on all time frames from 1M thru 1Y.

One can appreciate the Top 50 List based on 1Y Return as a complement to Top 50 List based on 1M Return here.For example, the fund on the top row here, CPSE ETF, did not make it to the Top 50 based on 1M Return, but still has a decent 1M return inspite of profi erosion of -0.92% through last one week. One may have temporary losses on fresh investment on such funds in near future, if the correction continues, but these funds are likely to be the winners for the future overall, as they have given above average performance for all the timelines from 1M through 1Y. So the bet is that they are likely to recover and march ahead once the temporary correction is over

One can simply wait for another one or two weeks, reconfirm these funds appearance in the list as investment worthy, before fresh investments or take a chance and invest right away.

 8. Reintroducing the Bottom 50 based on 1M Return (this was missed on last week report), to appreciate the impact and depth of correction on these funds. You should be concerned as to hold on to these funds, as you might have lost significantly by holding them so far. Most of these loser funds are IT funds. One clarity that emerges from the Bottom 50 funds, is that one needs to be careful in investing on thematic funds. They give good return when the going is good, but then one should abandon them when the theme behind such funds becomes less attractice. IT funds have been sub par since Jan end this year. So one had ample time to get out of them. Recovery of these funds may take longer, and the holder of these funds will further suffer on gains.

9. When the correction of best performing funds started in March, the Bottom 50 showed average 1Y Return at the level of 70 plus percentage. Now, it has come down to 26.60% only, which means lot of correction based gain loss has happened to such funds through last one month.

10. So, the Bottom 50 list is useful as a warning signal for those holding such funds.Be happy if none of these bottom 50 are in your portfolio.

11. As one can see, the Bottom 50 funds based on 1M Return have bled significantly through last one week, causing an average weekly loss of 4%, almost comparable to residual monthly loss % of 4.59%.

12. When we look at the Equity Only Top 50 based on 1M Return, six funds make investment consideration (marked in green) by having above average return in all time frames from 1M thru 1Y. Two funds are included in spite of not having relevant returns in some time frames by being relatively new. They are HDFC Defence Fund and Quant Commodities Fund.

13. This way, this analysis does help to pick up the consistent winners from relatively new funds too. Performance history of minimum 3M is mandated for such considerations.

14. Unlike last week, the equity only Top 50 based on 1Y Return list has more fresh investment worthiness than that of all fund types discussed above. This is because, some funds like CPSE ETF have to wrestle with lower 1M Return average of Top 50 than that was in all fund types.

15. It is only fair to say that the day of superior returns of hybrid funds when compared to equity only funds has not arrived at. When you compare the averages of Top 50 based on both 1M and 1Y across Equity and Hybrid funds, this point becomes clear.

16. Theoretically, one anticipates such time where top hybtid funds are likely to give better return than top equity funds. Hence looking at hybrid funds top 50 list becomes relevant, both from 1M and 1Y list.

17. Far more hybrid funds become fresh investment worthy (marked in green) than the equity funds, as the benchmark average for these funds is lower within the universe of hybrid funds only.

18. I am still curious as when will I get to see performance of top hybrid funds being superior enough to beat the top equity funds. I am also curious to see such hybrid funds in the Top 50 across all fund types. Since such a phenomenon has not occured through the recent corrections, I do have a doubt as to whether top Indian hybrid funds will ever give better return than the top equity funds. I will remain doubtful till I am proved wrong by these hybrid funds. Personally I am investing in some hybrid funds, as their returns are still good, if not as good as top equity funds. While I continue to doubt, I hang on to the faith that one day they will come handy by being better than equity funds.

19. The list of fresh investment worthy hybrid funds based on 1Y return are slightly different when compared to Top 50 of 1M Return. Definitely, those funds which appear in the both the list as investment wortthy are better darlings for fresh investments.A few of such examples are Quant Multi Asset Fund and Quant Dynamic Asset Allocation Fund.

 

 20. Unlike last week, many commodity funds met the fresh investment criteria (Marked in light green). Last week there was a churn out across past performers and recent performers. This time, some funds came to the top with better performance in all time lines from 1M through 1Y.

21. If a commodity fund continues to return more than 20% return annually, it is way too attractive when compared to fixed deposits. So, one needs to look at this list seriously, but if these funds correct significantly within the next one year, that will be sub par performance than fixed deposits. I am hoping that fresh investments will return at least at par with fixed deposits. It is just the hope based judgement than any insight based on reality projection. It is very hard to project reality for next one year. But, I will ride on the hope and make some more investments into commodity funds as a replacement to fixed deposits.

22. Debt funds top 50 is given only to reconfirm that there is no anamoly requiring discussion. This list remains boring.

Top 50 Funds based on 1M Return and 1Y Return as on April 13 2024

 

Commentary:

1. There is a divergence from last week report, when we look at top 50 across all fund types based on 1M Return.  Though the top 50 is dominated by commodity funds, based on the investment criteria which is to look for above average returns in 1M thru 1Y timeline within top 50, no commodity funds make it. This is because of two reasons: a. Top returning commodity funds have given below average 1M return this time b. The superior return of foreign equity based funds have elevated the average for some commodity funds to miss the criteria.

We can anticipate further divergence in fund behavior through next three to four weeks due to national and global dynamics across the quarterly results.

2. Based on 1M top 50, the following made the cut with above average returns for all timelines from 1M thru 1Y:

 - Mirae Asset S&P500 Top 50 ETF FoF

- Mirae Asset NYSE FANG+ETF FoF

3. Based on 1Y Top 50, the following made the cut with above average returns for all timelines from 1M thru 1Y.

-  Mirae Asset NYSE FANG+ETF FoF

- SBI PSU Fund

- Quant Infrastructure Fund

- Quant Value Fund

- Bandhan Infrastructure Fund

   

 4. When we look at Equity only Top 50 based on 1M Return, the following made the cut for investment based on above average return in all timelines from 1M thru 1Y:

-  Mirae Asset S&P500 Top 50 ETF FoF

- Mirae Asset NYSE FANG+ETF FoF

- Bandhan Infrastructure Fund

Bandhan Infrastructure Fund misses out in Top 50 across all fund types due to lower 1M return than top 50 average, though the 1M return is healthy 8.65% 

5. The funds that made the investment worthiness in equity only Top 50 based on 1Y return are the same as those in Top 50 across all fund types, because when it comes to superior 1Y return, equity rules almost all top 50 positions.

6. When we look at the Top 50 hybrid funds based on 1M return, more funds have made the cut for investment criteria: They are:

- Quant Multi Asset Fund

- Quant Dynamic Asset Allocation Fund

- Bank of India Mid and Small Cap Equity & Debt Fund

- Axis Retirement Savings Fund - Dynamic Plan

- Nippon India Asset Allocator FoF

- Axis Retirement Savings Fund - Aggressive Plan

- ICICI Prudential Retirement Fund - Hybrid Aggressive Plan

- ICICI Prudential Multi Asset Fund

- Kotak Multi Asset Allocation Fund

 

6. When we look at the Top 50 hybrid funds based on 1Y return, more funds have made the cut for investment criteria: They are:

- JM Aggressive Hybrid Fund

- Quant Multi Asset Fund

- ICICI Prudential Retirement Fund - Hybrid Aggressive Plan

- Bank of India Mid and Small Cap Equity & Debt Fund

- ICICI Prudential Child Care Fund - Gift Plan

- UTI Multi Asset Allocation Fund

- Axis Retirement Savings Fund - Dynamic Plan

- ICICI Prudential Multi Asset Fund

- Baroda BNP Paribas Aggressive Hybrid Fund

7. When we look at Commodity only Top 50 Funds based on 1M Return, none make the cut on investment criteria. This is because there is a churn out of leaders across shorter term and medium term within 1Y, and effectively no fund makes cut with above average retrun across all timelines from 1M thru 1Y.  We need to take a pause therefore and wait for better pattern emergence through upcoming weeks.

 

8. Debt funds top 50 based on 1M Return is given above, but no story to tell here.

Top Funds based on top 1M (for all fund types) and 1Y Return (for equity and hybrid types) as on April 6 2024

 

Top Funds Analysis as on April 6, 2024:

Commentary:

1.  From this week onwards, top funds analysis is done based on 1Y and 1M basis both for all funds together, equity only, and hybrid only. This is to assist more funds selection for investments through the volatile market conditions now and ahead.

2. As usual, in the top 50 analysis, the values above the average are highlighted. The funds with all above average values across 1M thru 1Y timelines are marked green, meaning they are more favorable for new investment given consistency of above average performance in all timelines from 1M thru 1Y.

From this perspective, the following from the all fund types top 50 from 1M performance, have emerged favorable:

    - Mirae Asset S&P 500 Top 50 ETF FoF (Foregin equity).

Though there is some recovery of equity through this week, we can see that domestic equity funds are yet to appear on top 1M 50 with above average performance.

3. But, when we look at the top 50 based on 1Y performance, some more are popping up with consistent performance:

    - Quant Infrastructure Fund

    - Quant Value Fund

    - Mirae Asset NYSE FANG+ETF FoF (Foreign equity)

    - Bandhan Infrastructure Fund 

4. Bottom 50 funds analysis for 1M reconfirm that many of the top performing equity funds for the last one year are still in the bottom 50, meaning they are yet to catch up with all the corrections that have gone in, though there is some rebound. 

5. Bottom 50 for 1Y basis, do warn us that we should not get into underperforming funds, while the overall annual performance average of all funds across all fund types still looks attractive for investments.

6. When we do the top 50 funds analysis within equity funds only, both for 1M and 1Y, the same funds appear as investment worthy as in the all fund types top 50 analysis. This is just a reconfirmation and there is no boundary condition popping up by considering equity funds only.

7. Since the interest rates are likely to fall ahead (may be 4-6 months later), hybrid funds could become more attractive along with equity funds. Hence, top 50 funds analysis is done for hybrid funds both on one 1M and 1Y basis.

    On 1M basis, the following funds have shown better than average performance for all timelines from 1M thru 1Y:

    - Axis Retirement Savings Fund - Dynamic Plan

    - Quant Multi Asset Fund

    - Axis Retirement Savings Fund - Aggressive Plan

    - UTI Multi Asset Allocation Fund

    - Bank of India Mid and Small Cap Equity & Debt Fund

    - ICICI Prudential Multi Asset Fund

    - Baroda BNP Paribas Multi Asset Fund 

8. On 1Y basis, the following hybrid funds have shown above average performance in all timelines from 1M thru 1Y:

    - ICICI Prudential Retirement Fund - Hybrid Aggressive Plan

    - Bank of India Mid & Smal Cap Equity & Debt Fund

    - Quant Multi Asset Fund

    - UTI Multi Asset Allocation Fund

    - Quant Absolute Fund

    - Axis Retirement Savings Fund - Dynamic Plan

    - Baroda BNP Paribas Aggressive Hybrid Fund

Please remember that hybrid funds will underperform pure equity funds during bullish phase and can do better through the correction. However, please note that recent correction through March did not put hybrid funds ahead of equity funds though, this is because the aggressive equity portion in these hybrid funds corrected equally badly.

9. Since Commodity funds are attractive now a days as a replacement for the fixed deposits, top 50 analysis on 1M basis is relevant.  The following funds showed better than average perforamnce for all timelines from 1M thru 1Y:

    - Aditya Birla Sun Life Gold Fund

    - Kotak Gold ETF

    - HDFC Gold Fund

10. Debt funds top 50 analysis can be skipped as the time of debt funds has not yet arrived, ahead of commodity funds.

Top Funds with best 1Y return through the financial year 2024

 

Commentary:

1. Value Research considers timeline till 1Y as short term, and the rest beyond as Long Term. I personally consider 1Y timeline as a medium term timeline in between short term and long term.

Therefore, for me 1Y performance benchmark are very important as a bridge between short term game and long term game. I am new to mutual fund investments (just 9 months since I started) and I am not yet ready to give more weightage to the performances beyond 1Y, as my portfolio being small, I like to limit the time horizon to last 1Y performance max for now.

2.  Incidentally, the Top 50 performers across all fund types are equity only, hence there seems to be a sense of repetion across all types top 50 and equity only top 50. This trend will continue till the bull market remains strong for the equities. The recent correction has failed to erode the 1Y performance benchmarks of equity funds in favor of hybrid funds. Since such a trend did not pop up through the current short term correction, I am not counting on such a phenomenon to happen short term through the rest of the calendar year, unless there can be a significant correction of equity in parallel with significant interest rate cuts.

3. When it comes to the equity funds investments, I will be waiting for the revival of them in the monthly top 50, and when that happens, this annual leaders list also becomes useful on my fresh investment decisions. Also, rationalizing the absence of some top annual leaders in the monthly leaders ahead will indicate the nature of churn and recovery of equity market. For example, we do not see much of pure large cap funds in the top annual 50 now, but they might start appearing as favorable as the large caps have been doing well through the recent broader market correction phase.

4. If the gap between the pure equity and hybrid funds start narrowing, then hybrid funds investments will also become attractive, the 1Y top 50 given here, will become handy along with the monthly performance leaders as they appear in the top 50.

5. For me personally, it is either debt fund or commodity fund as a replacement to the bank FD. I found out that some of the leading bond funds are not available for the individual investment, for example DSP Credit Risk Fund which is in the top 50. I will continue to invest in leading commodity funds for now till the trend of debt funds beat them due to interest rate cuts ahead.

6. Please read this blog along with the previous blog, which is 1M performance leaders related blog coinciding this cut off date of March 29, 2024 which is a weekend, month end and financial year end simultaneously.  Some insights shared in the commentary of the previous blog is not repeated here, but relevant to assess the 1Y performance of mutual funds in general.

Top and Bottom 50 funds based on last 1M performance as on March 29, 2024

 

Commentary:

1. This report is primarily useful to evaluate the monthly trend on a weekly basis. As this weekend also coincides with the financial year end 2024, the averages for both 1M and 1Y are given in all the report segments. Also, the top 50 are given for each of the fund types based on 1M Return.

2. Anticipate a separate blog for detailed annual performance analysis of all fund types, similar to the 1M performance analysis here.

3. When you look at the 1M Top 50, other than a few foreign equity based funds and one special fund at the end, most of the performance leaders are the commodity funds.

4. When it comes to fresh investment decisions, our benchmark is that the funds need to have better than top 50 average performance across all timelines from 1M thru 1Y. From this perspective, funds making the cut are shown in green. Please note that these funds are commodity funds. So, green signal is not yet there to resume investment into equity or hybrid funds based on superior 1M performance.

5. Also, the returns which are better than the top 50 average are marked in bold.

6. Please note that the 6M and 1Y return averages for Top 50 are worse than that of Bottom 50, and even all funds average, because the top 50 based on 1M performance are driven by commodity funds which tend to give lower returns annually when compared to equity or hybrid. Once the current broad based correction gets over, such an anamoly will disapper as the equity and hybrid funds will start making it to top 50 based on 1M return.

7. Please note that the Top 50 funds based on 1Y performance have given an average return of 74.52% even after the recent correction. This kind of return is phenomenal. Also, note the bottom 50, even after suffering recent correction, have given a whopping 40.16% annual return.  

Therefore, one should assess the end of correction of equity (proven by equity and hybrid funds making it to monthly top 50), and resume the investment into equity funds. It is assumed that those who believe in systemic investment plan will anyway invest into equity even through the correction phase. (I personally prefer to invest into equity funds again at the bottom of correction phase, which I anticipate will be by April end).

8. When one looks at the average annual return of all mutual funds across all types (of course more dominated by equity funds), even after the recent ongoing correction of broader market, it is still a healthy 27.62%.   Also, one can see that all equity funds annual return average is 42.26%. So, it is fair to say that a mutual fund investor should have made a minimum annual return of somewhere in between 27.62% and 42.26%, which is approximately 35% annual return for the financial year 2024. If your mutual fund portfolio did not give that kind of a return, you need to look critically as to scope for improvement in your portfolio management and investment decisioning.

9. One month return of pure equity funds have improved significantly thru this week, thanks to the recovery of equity through this week. The recovery is seen thru foreign equity funds, auto, manufacturing, transportation and logistics  based funds, and some other themes like ELSS, Midcap etc. But the absence of Large Cap and Small Cap can be noted in top equity 50, as the recovery of the same is not much when compared to the correction gone in. 

10. Even the hybrid funds return for the year varied from 22.34% to 34.64%, leading to an average of approx. 28%. This is very impressive return even after the recent corrections of the broader market.

11. As usual, we do not see much variance in debt funds returns, the range is from 7.75 to 9.53, the average of which is slightly better than the bank FD returns. The golder period of debt funds is anticipated, but has not yet arrived, which will happen when interest rates start falling, likely to happen in second half of 2024 calendar year.

12. What is spectacular among commodity funds is the 1M level return. If this kind of return continues in coming months, then the returns on 3M, 6M and 1Y level also will keep improving. I still suggest commodity funds investments as a replacement to the bank FDs as hybrid funds are better bets against risks of equity funds on continued corrections.

13. Looking at the bottom 50 funds across all types based on 1M return, they are lead by IT, Smallcap, Microcap, BFSI, Teck etc. It is sad to see that some flexi cap funds are still in bottom 50.

14. I personally will consider making some more fresh investments into some of the commodity funds marked green, more as a replacement to FD investments.  My pause of investments into equity and hybrid still continues, as my strategy is not to invest thru correction but to invest with vengiance into equity and hybrid post confirmation of correction end, which I am anticipating by April end earliest. If the 4th Q results surprise suprelative to anticipation, this can be earlier than April end. Let us see.

15. This analysis is mainly done for my benefit, no harm in sharing with some additional work if it benefits the reader, but this is never a ploy of investment advice to anyone, this is more of a disclaimer.

 

Equity Top 50 based on 1M Return

Hybrid Top 50 based on 1M Return:

Debt Top 50 Funds based on 1M Return:

Commodity Top 50 based on 1M Return: