List of worst equity mutual funds (Jan 2013 to Apr 2022)

Published: April 30, 2022 at 6:00 am

This is a list of the worst-performing equity mutual funds over every possible five, four, and three periods between 1st Jan 2013 (introduction date of direct plans) to April 8th 2022.

Some caveats before we begin:  (1) The definition of a “worst mutual fund” is as arbitrary as the definition of a “best mutual fund”. We hope that it is a reasonable definition, considering the high fees demanded by the MF industry.  This is one of the highest in the world, according to a Morningstar study. (2) We choose a representative category benchmark and compare the fund’s returns with the benchmark over the above-mentioned periods. The choice of the benchmark is also arbitrary but reasonably representative. (3) SEBI mutual fund categorization rules were fully in place by May-June 2018. Some funds (particularly those from smaller AMCs) may have changed significantly changed in style after that. An exhaustive filtration taking these changes into account is beyond the capabilities of this study.

(4) A fund labelled as “worst” means a careful, deeper investigation of its past performance is necessary, particularly if you invest in it or consider future investments in it. (5) Sectoral funds/ thematic funds are compared with Nifty 100 TRI. As a data analyst, this choice is incorrect. However, as an investor, it makes sense, and that is more important! We are not trying to submit a thesis here! If a thematic fund fails against a large cap index, it is an avoidable fund for most investors.

How a worst mutual fund is defined

Say there are 800 five year return periods possible; 1025 four year return periods; 1300 three year return periods; 1500 two year return periods. We shall define a fund as “worst” if it has beaten the benchmark for less than 50% of the 5Y and 4Y and 3Y return periods.

Let us take, for example, Principal Focused Multicap Fund- Direct Plan. We compare it with Nifty Largemidcap 250 TRI.


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  • No of rolling return entries (3 Years) 1472
  • No of times the fund has outperformed the index (3 years) 552
  • rolling return outperformance Consistency Score (3 years) 38%
  • No of rolling return entries (4 Years) 1228
  • No of times the fund has outperformed the index (4 years) 506
  • rolling return outperformance Consistency Score (4 years) 41%
  • No of rolling return entries (5 Years) 981
  • No of times the fund has outperformed the index (5 years) 337
  • rolling return outperformance Consistency Score (5 years) 34%

Using the April 2022 Equity Mutual Fund Screener, we filer out all funds with a rolling return outperformance consistency of less than 50% over five years and four years and three years. This will be our definition of a “worst fund”. We make no claim of superiority over this definition. We just feel this is reasonable while appreciating that not all readers will agree with the methodology used.

NOTE: Investors holding these funds need not exit them in a hurry. Please use this as a sign to dig deeper and re-evaluate these funds. A fund absent from this list does not mean it is a “good fund” or an outperformer!

The filtration process

A total of 378 equity mutual funds were studied from these categories and against these benchmarks.

CategoryBenchmark
Aggressive Hybrid FundCrisil6535
Dividend Yield FundNifty 100 TRI
ELSSN200TRI
Focussed FundNifty Largemidcap 250 TRI
Large & Mid Cap FundNifty Largemidcap 250 TRI
Large Cap FundNifty 100 TRI
Mid Cap FundNiftyMidcap150TRI
Multi Cap FundNifty Largemidcap 250 TRI
Sectoral/ ThematicNifty 100 TRI
Sectoral/ Thematic (international)Nifty 100 TRI
Small Cap FundNiftyMidcap150TRI
Value FundNifty 100 TRI

We are left with 140 funds after applying the above filter.

Aggressive Hybrid Funds

Nippon India Equity Hybrid Fund  – Direct Plan Growth Plan
Franklin India Equity Hybrid Fund – Direct – Growth
BARODA HYBRID EQUITY FUND – Plan B (Direct) – Growth Option
Aditya Birla Sun Life Equity Hybrid’95 Fund – Direct Plan-Growth
L&T Hybrid Equity Fund – Direct Plan-Growth
UTI – Hybrid Equity Fund -Direct Plan – Growth
Edelweiss Aggressive Hybrid Fund(G)-Direct Plan
Tata Hybrid Equity Fund -Direct Plan- Growth
JM Equity Hybrid Fund (Direct) – Growth Option

Dividend Yield Funds

Aditya Birla Sun Life Dividend Yield Fund – Growth – Direct Plan
UTI-Dividend Yield Fund.-Growth-Direct

ELSS Funds

Edelweiss Long Term Equity Fund (Tax Savings) – Direct Plan-Growth Option
HSBC Tax Saver Equity Fund – Growth Direct
Sundaram Diversified Equity – A Long-term Tax Saver Fund – Direct Plan – Growth Option
SBI MAGNUM TAXGAIN SCHEME 1993 – DIRECT PLAN -GROWTH
IDBI Equity Advantage Fund – Growth Direct
Franklin India TAXSHIELD – Direct – Growth
Nippon India Tax Saver Fund – Direct Plan Growth Plan – Growth Option
HDFC TaxSaver -Direct Plan – Growth Option
Union Tax Saver Scheme – Direct Plan – Growth Option
Principal Personal Tax Saver Fund – Direct Plan

Focussed Funds

Nippon India Focused Equity Fund – Direct Plan Growth Plan – Growth Option
Motilal Oswal Focused 25 Fund (MOF25)- Direct Plan Growth Option
Principal Focused Multicap Fund- Direct Plan – Growth Option
IDFC Focused Equity Fund-Direct Plan-Growth
Sundaram Select Focus – Direct Plan – Growth Option
DSP  Focus Fund – Direct Plan – Growth
Aditya Birla Sun Life Focused Equity Fund – Growth – Direct Plan
ICICI Prudential Focused Equity Fund – Direct Plan – Growth

Large & Midcap Funds

IDFC Core Equity Fund-Direct Plan-Growth
Franklin India Equity Advantage Fund – Direct – Growth
L&T Large and Midcap Fund-Direct Plan-Growth

Largecap funds

Essel Large Cap Equity Fund-Direct Plan-Growth Option
IDBI India Top 100 Equity Fund Growth Direct
HDFC Top 100 Fund -Direct Plan – Growth Option
Tata Large Cap Fund -Direct Plan Growth
HSBC Large Cap Equity Fund – Growth Direct
Aditya Birla Sun Life Frontline Equity Fund – Growth – Direct Plan
Franklin India Bluechip Fund- Direct – Growth
JM Large Cap Fund (Direct) – Growth Option
L&T India Large Cap Fund – Direct Plan – Growth
Baroda Large cap Fund – Plan B (Direct) – Growth Option
IDFC Large Cap Fund-Direct Plan-Growth

Midcap funds

Tata Mid Cap Growth Fund – Direct Plan Growth
DSP  Midcap Fund – Direct Plan – Growth
SBI Magnum MIDCAP FUND – DIRECT PLAN – GROWTH
L&T Mid Cap Fund-Direct Plan-Growth
UTI Mid Cap Fund-Growth Option- Direct
HDFC Mid Cap Opportunities Fund -Direct Plan – Growth Option
Sundaram Mid Cap Fund- Direct Plan – Growth Option
Franklin India Prima Fund – Direct – Growth
DHFL Pramerica Midcap Opportunities Fund – Direct Plan – Growth Option
PGIM India Midcap Opportunities Fund Direct Plan
Quant Mid Cap Fund-Growth Option-Direct Plan
Motilal Oswal Midcap 30 Fund (MOF30)-Direct Plan-Growth Option
Nippon India Growth Fund – Direct Plan Growth Plan – Growth Option
BOI AXA MID & SMALL CAP EQUITY & DEBT FUND – DIRECT PLAN GROWTH
Baroda Mid-cap Fund- Plan B (Direct) – Growth Option

Multicap funds

IDBI DIVERSIFIED EQUITY FUND Growth Direct
Union Multi Cap Fund – Direct Plan – Growth Option
ICICI Prudential Multicap Fund – Direct Plan –  Growth
Franklin India Equity Fund – Direct – Growth
IDFC Multi Cap Fund-Direct Plan-Growth
HSBC Multi Cap Equity Fund – Growth Direct
HDFC Equity Fund -Direct Plan – Growth Option
BARODA MULTI CAP FUND – Plan B (Direct) – Growth Option

Sectoral or Thematic funds

Tata Infrastructure Fund -Direct Plan Growth
Baroda Banking and Financial Services Fund – Plan B (Direct) – Growth Option
Canara Robeco Infrastructure-Direct Plan – Growth
SBI INFRASTRUCTURE FUND –  DIRECT PLAN – GROWTH
Franklin India Opportunities Fund – Direct – Growth
ICICI Prudential Exports & Services Fund – Direct Plan – Growth
Nippon India Banking Fund – Direct Plan Growth Plan – Growth Option
IDFC  Infrastructure Fund-Direct Plan-Growth
Aditya Birla Sun Life Infrastructure Fund – Growth – Direct Plan
Invesco India PSU Equity Fund – Direct Plan – Growth
UTI-Transpotation and Logistics  Fund-Growth Option- Direct
Nippon India Power & Infra Fund – Direct Plan Growth Plan – Growth Option
HSBC Infrastructure Equity Fund – Growth Direct
ICICI Prudential Infrastructure Fund – Direct Plan –  Growth
Sundaram Infrastructure Advantage Fund (Erstwhile Sundaram Capex Opportunities) Direct Plan Growth
HDFC Infrastructure Fund -Direct Plan – Growth Option
UTI Infrastructure Fund-Growth Option- Direct
Aditya Birla Sun Life Manufacturing Equity Fund – Direct Plan – Growth
UTI India Consumer Fund – Direct Plan – Growth Option

Sectoral/ Thematic (international)

Franklin Asian Equity Fund – Direct – Growth
Aditya Birla Sun Life International Equity Fund – Plan A – Growth – Direct Plan
Nippon India Japan Equity Fund- Direct Plan- Growth Plan- Growth Option

Small Cap Funds

DSP  Small Cap Fund – Direct Plan – Growth
Kotak-Small Cap Fund – Growth – Direct
HSBC Small Cap Equity Fund – Growth Direct
Aditya Birla Sun Life Small Cap Fund – Growth – Direct Plan
Sundaram Small Cap Fund – Direct Plan – Growth Option
Franklin India Smaller Companies Fund – Direct – Growth
Quant Small Cap Fund-Growth Option-Direct Plan
Union Small Cap Fund – Direct Plan – Growth Option
ICICI Prudential Smallcap Fund – Direct Plan – Growth

Value funds

Templeton India Value Fund – Direct – Growth
ICICI Prudential Value Discovery Fund – Direct Plan – Growth
Aditya Birla Sun Life Pure Value Fund – Growth – Direct Plan
UTI Value Opportunities Fund- Direct Plan – Growth Option

 

To reiterate: Investors holding these funds need not exit them in a hurry. Please use this as a sign to dig deeper and re-evaluate these funds. A fund absent from this list does not mean it is a “good fund” or an outperformer!

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