Around 67 per cent of these funds have beaten debt funds and gold over 10 years
Equity funds have outshined others in the long run. According to market data, almost 75 per cent equity funds in existence for 10 years ago and more have outperformed benchmark and sectoral indices as well as the broad market. Long-term investments in equity funds have fetched better returns than debt funds and gold.
Analysis say 75 per cent of the funds have outperformed their benchmark indices while 67 per cent have beaten debt funds and gold. In absolute terms, investors in equity funds have earned 1-20 per cent extra than investors in other instruments.
However, for the short duration, say about a year, only 50 per cent funds are outperformers. For example, in the last one year, the benchmark indices have given 80 per cent returns, while only 37 equity funds studied here have managed to outperform their benchmark indices.
Business Standard Research Bureau analysed 71 equity diversified funds that have existed for ten years and compared their long-term performance with benchmark and sectoral indices compiled by the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE). These funds are benchmark against Sensex, Nifty, BSE 100 index, BSE 200 index, BSE FMCG index, BSE Health Care index, BSE IT index and CNX 500 index. On a compound annual growth rate basis, the returns vary between 1 per cent and 35 per cent. On an absolute basis, in the last one year, the returns are between 55 per cent and 137 per cent.
In the long run, the top performing funds are HDFC Tax Saver fund (35.39 per cent), Birla Sun Life Tax Relief 96 fund, (33.29 per cent), Birla Sun Life Equity fund (32.88 per cent), Franklin Templeton Tax Shield (30.77 per cent) and Reliance Growth fund-Retail growth option (30.16 per cent).
| MARATHON WINNERS TOP PERFORMING FUNDS IN LONG RUN, COMPARED TO BENCHMARK INDEX | |||||
| Fund | Benchmark | Returns long term* | Returns one year# | ||
| Fund |
Benchmark | Fund | Benchmark | ||
| HDFC Tax Saver | CNX 500 | 35.39 | 14.74 | 99.07 | 88.57 |
| Birla Sun Life Tax Relief 96-D | BSE 200 | 33.29 | 14.85 | 102.77 | 88.51 |
| Birla Sun Life Equity | BSE 200 | 32.88 | 19.72 | 89.25 | 88.51 |
| Franklin Templeton Taxshield | CNX 500 | 30.77 | 19.46 | 78.81 | 88.57 |
| Reliance Growth-Retail Gr | BSE 100 | 30.16 | 13.31 | 97.40 | 85.04 |
| Sahara Tax Gain | BSE 200 | 29.77 | 16.50 | 90.57 | 88.51 |
| SBI Magnum Umbrella-Contra | BSE 100 | 28.64 | 24.67 | 90.55 | 85.04 |
| UTI Top 100 | BSE 100 | 28.05 | 23.34 | -14.05 | 85.04 |
| ICICI Prudential Tax plan | Nifty | 27.15 | 14.36 | 112.00 | 75.76 |
| Principal Personal Tax Saver | BSE 100 | 26.97 | 14.30 | 86.87 | 85.04 |
| * CAGR returns (%), # Absolute returns(%) Source: Value Research, MutualFunds India | |||||
Top funds during last one year that have given more returns than the benchmarks are DSP BlackRock Technology.com fund (108.04 per cent), ICICI Tax fund (112 per cent), SBI Magnum Global 94 fund (119.56 per cent) UTI Master Value fund (117.35 per cent) and SBI Magnum Sector –Umbrella-FMCG fund (66.37 per cent).
Madhusudan Kela, head, equity investments, Reliance Mutual fund, said, “To meet long-term investment goals, it is important to adopt a proper investment strategy and right investment style and stick to it properly. In the short run, due to market volatility, your fund can give you negative returns, but a correct investment style will definitely give healthy returns.”
