Equity funds deliver in November

Debt plans positive after long hiatus.

The impressive performance of equity schemes has been underscored by Crisil FundServices' monthly risk-adjusted return ranking of mutual funds for November 2004.

Krishnan Sitaraman, head of financial sector ratings, Crisil FundServices, said "Investor sentiment remained buoyant throughout the month on the back of good economic fundamentals and a correction in the global crude oil prices."

Foreign institutional investors have significantly supported the recent bullishness in the equity markets.

They have so far pumped in around $7 billion during this calendar year, the highest ever inflow in the history of the Indian stock market.

The Bombay Stock Exchange's index of bank stocks, the Bankex, was the clear outperformer among sectoral indices, registering a 18.65 per cent growth during the month.

The CNX Midcap 200, generated monthly returns of 12.55 per cent on the back of the rally in the mid-cap segment, whereas the Sensex and the National Stock Exchange's S&P CNX Nifty registered returns of 9.62 per cent and 9.27 per cent, respectively.

The debt market saw returns moving northwards towards the month-end.

Although the performance of the debt market has been sluggish for the last few months, investors can derive comfort that global crude oil prices dipped during the month, pulling down inflation numbers.

Crisil FundServices ranked 188 schemes in November 2004, covering over 71 per cent of the industry assets under management (AUM).

The Crisil ranking measures the schemes' performance on the basis of their returns in the period of analysis and the risks taken to obtain these returns.

Diversified equity schemes have sparked off tremendous interest among both foreign and retail investors in the last quarter on the back of their impressive returns during the period.

Schemes that have invested large proportions in the mid-cap segment have reaped rich rewards.

The top performers on the Crisil rankings in the open-ended diversified equity funds category in November 2004 were Sundaram Select Midcap at No.1, which moved up three notches, Franklin India Prima Fund at No. 2, and Reliance Growth Fund at No. 3.

For debt funds, returns move northwards towards the end November.

As yields fell towards the latter half of the month, bond prices rose, and the category ended the month on a positive note.

The top three Income Funds in November 2004 were CanIncome - Growth Plan at the top, HSBC Income Fund - Investment Plan at No. 2 and CanCigo at No. 3.

Gilt-long funds generated marginal negative monthly returns of 0.37 per cent as measured by the Crisil MF Gilt index in November 2004.

The best performing schemes in this category were Chola Gilt Investment - Cumulative at No. 1, DSP Merrill Lynch Govt Sec Fund (Plan A) at No. 2, and Prudential ICICI Gilt - Investment at No. 3.

In the debt short-term category, LIC MF short-term plan continued to top the charts at No. 1, followed by Sundaram Select Debt ST Asset Plan and Tata Short Term Bond Fund at No. 2 and No. 3, respectively.

The performance of balanced funds were enhanced by momentum in equity segment.

The balanced fund category has performed well over the last couple of months, helped by the ongoing momentum in the equity segment.

The best performers in this category were DSP Merrill Lynch Balanced Fund at No. 1 followed by FT India Balanced Fund and UTI Unit Scheme 1995 (US-95) at No. 2 and No. 3, respectively.

In the floating rate fund category, 14 schemes were eligible for the ranking, an increase of two over the previous month. The top performers were HDFC Floating Rate Income Fund - Short Term Plan in the top slot, Grindlays Floating Rate Fund at No. 2, and Prudential ICICI Floating Rate Plan - Option B at No. 3.