Commentary:
1. Since equities are on rebound after significant correction, it is time to invest into mutual funds as post correction investments tend to return more. The weekly top 50 report deals with performance leaders within 1 year timelines. Since Value research presents mutual funds data as short term and long term returns, where it means long term as timeline above 3 years, and the timelines associated are 3Y, 5Y, 10Y, 15Y and 20Y. There are very handful funds for 15Y and 20Y as the mutual fund industry was just taking off by then.
2. Those who want to go for fresh mutual funds investments could consider long term return performance along with the short term returns shared as weekly Top 50 MF analysis recently, dated Nov 29, 2024.
3. Theoretically it is possible to combine both the short term return and long term return into one excel file and present, which is lot of work for me, and have not done so. My personal investment style is not to worry beyond 1 year performance, as I tend to sell the underperformers within one year timeline, as I am new to the mutual funds investments and have limited resources to invest, and I attempt best possible returns by riding on top performers. So, this entire report is bit academic to me personally. In a year, I would churn out at least 30% of my investments for being underperforming for the last three months or so. The ones I hold will remain held as long as they do not fall into the underperforming trap for the last three months.
4. Looking at the long term performance summary above, one can align with two types of benchmarks.
4.1. Average equity fund performance:
Short term: per the recent weekly top 50 MF report:
1W return : 2.20%
1M return : 0.52%
3M return : -2.83%
6M return : 10.17%
12M return : 30.22%
Long term: per this report:
3 Yr return : 18.19%
5 Yr return : 20.97%
10 Yr return : 14.34%
15 Yr return : 11.64%
20 Yr return : 15.35%
So, one should anticipate at least 20% annual return from the mutual fund portfolio, especially when being advised. Else, the associated advisor may deserve being replaced by a better one.
4.2. Top 50 equity fund performance:
Short term: per the recent weekly top 50 MF report:
1W return : 5.51%
1M return : 6.84%
3M return : 5.11%
6M return : 25.26%
12M return : 50.48%
Long term: per this report:
3 Yr return : 31.03%
5 Yr return : 32.02%
10 Yr return : 19.02%
15 Yr return : NA
20 Yr return : NA
So, it is my openion that by riding on short term top 50 performers, one can enhance their annual return from mutual funds by 50% when compared to the overall average performance of all equity funds, hence these weekly and special reports. One needs to stay active, dynamic and shifting funds from underperforming ones to the emerging performers with consistent performance record short term.
Six months back, the Indian mutual fund market average annual return itself was 40%, which now may be considered around 30% (take average of 3M, 6M and 1Yr returns recently) given short term corrections. Given the underperformance of the mutual funds in the last three months, one may need to be happy to hit 20% annual return this year when the financial year ends by March 2025.
5. I am asked quite often as to a silver bullet solution, which ensures the best returns for the one to invest and forget for the next 10 years. This long term performance report is quite convincing that such silver bullet solutions are not there and should not be attempted. This is because the equity market is quite dynamic and changes its favor for particular type of funds weekly, monthly, quarterly, six monthly, annually and beyond.
6. Long Term Equity Top 50 Reports:
Please note the coloring scheme here. The funds which are having not a single below average return across all the timelines are marked green, the funds missing above average return for just one timeline are marked as amber.
6.1. 3 Yr Top 50:
6.2. 5 Yr Top 50:
6.3. 10 Yr. Top 50
7. 15Yr and 20 Yr Performance Summary:
Since there are not too many funds with 15 Yr and 20Yr return data, no need for top 50 and bottom 50 analysis. Incidently, the performance rankings across 15 Yr and 20 Yr are aligned, so one report given below is enough.
8. Long Term Bottom 50 reports
Key lesson: These bottom 50 lists reconfirm that one should not simply assume that good days will return for the underperforming funds, as these are the underperforming funds over longer term, those holding them since long term are unfortunate.
Coloring scheme: Here the funds with below average returns on all timelines are marked with darkest red, middle red if one timeline has above average return while the rest are below average and light red if two timelines have above average while the rest is below average. 15Yr and 20 Yr performance columns are ignored for the color scheme assignment.
8.1. 3 Yr. return bottom 50:
8.2. 5 Yr return bottom 50:
8.3. 10 Yr return bottom 50:
9. Whether it is a weekly Top 50 MF report or special MF report, these are availble in the blog indicated below. Blogs are also rendered as videos (on Youtube and Instagram) for those not prefering to read.
Blog: NatsFunCorner! on Blogger
https://natsfuncorner.blogspot.com/
Other relevant Social Network Platform links:
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Disclaimer:
- This is not a solicitation for mutual fund investment nor an advice. It is only an insight to help investment decisions based on the free MF performance data downloaded from Value Research. Investment decisions are only yours to make.
- Mutual fund investments are subjected to market risk. Read the propsectus of a mutual fund for all the risk information associated prior to investment.
- The author can not be responsible for the ommissions or errors in the data from Value Research or the data processing errors if any by the author.
- All your investment decisions need to be based on your decision finally, with no blame to anyone else later.
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