Dynamic funds top one-week returns chart

Asset allocation plans or dynamic funds category emerged as the best among various categories of funds for the week ended February 2. This category, which has schemes with flexibility to alter asset allocation as per the market dynamics, posted 0.89% average return.

The uptrend in equity market benefited the index and diversified equity scheme category, the next best performer.

Barring automobile and fast-moving consumer good funds, all other fund categories registered positive average return. The rally in debt market after the Reserve Bank of India hiked only the repo rate, leaving the reverse repo rate unchanged, helped long-term schemes, with gilt funds notching up the best return in the debt funds category.

Short-term debt schemes such as liquid and floating rate funds maintained consistency in returns.

Index, diversified equity and tax-saving funds with 0.73 per cent, 0.68 per cent, and 0.55 per cent average return, respectively, underperformed the Bombay Stock Exchange's Sensex and National Stock Exchange's Nifty that gained 0.85 per cent and 0.86 per cent, respectively, for the week.

In index funds category, 12 schemes were able to beat the Sensex and Nifty. Birla Index, with 0.99 per cent return, was the top performing index scheme while Banking BeES was the worst-hit with 0.54 per cent negative return.

Banking BeES, an exchange trade scheme from Benchmark Mutual Fund, was the only one to give negative return. The scheme, which invests in banking sector stocks in the same proportion as that of CNX Bank Index, suffered because of the fall in these counters.

Out of 173 diversified funds, 66 gave better returns than the Sensex and Nifty, while 30 schemes posted negative returns.

Among diversified equity schemes, StanChart Premier Equity Fund was first with 4.04 per cent return, followed by Kotak Lifestyle and Birla India GenNext funds that gave 4 per cent and 3.13 per cent returns, respectively.

The worst-hit diversified funds were Franklin India Opportunities Fund (-1.02 per cent return), Taurus Bonanza Exclusive (-1.20 per cent), and ABN Amro Dividend Yield (-1.42 per cent).