Only 42 out of 260 equity mutual funds consistently outperformed the Nifty 50!

Published: October 5, 2022 at 6:00 am

A reader asked, “If we compare the performance of actively managed mutual funds across categories, how many of them have outperformed the Nifty 50 consistently?”

Readers may be aware that we publish a monthly equity mutual funds performance consistency screener where each category has its own relevant benchmark. Let us now determine how many funds qualify if we compare them with Nifty 50.  We shall consider 406 equity mutual funds (including aggressive hybrid funds) across 13 categories.

Disclaimer: Fund performance reports present return and risk analysis of a fund with representative benchmarks and not investment recommendations. It must be expressly understood that the data below reflect only past performance and is in no way an indication of future performance. Our investment recommendations are here: Handpicked List of Mutual Funds (PlumbLine).

We shall use the Rolling return outperformance consistency. the fund returns are compared with category benchmark returns over every possible  3Y,4Y, and 5Y period. Higher the outperformance consistency, the better. Suppose 876 fund returns were compared with 876 benchmark returns, and the fund has beaten the benchmark 675 times. The consistency score will be 675/876 ~ 77%. We shall set 500 rolling return data points as the minimum eligibility criterion. The results are as of 9th Sep 2022.

Five years:


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  • No of funds with > 500 rolling return data points: 260
  • No of funds with 70% or more rolling return outperformance consistency: 86

Four years:

  • No of funds with > 500 rolling return data points: 273
  • No of funds with 70% or more rolling return outperformance consistency: 60

Three years:

  • No of funds with > 500 rolling return data points: 283
  • No of funds with 70% or more rolling return outperformance consistency: 53

List of funds that qualify over 5Y AND 4Y AND 3Y (70% or more rolling return outperformance consistency)

Only 42 out of 260 equity mutual funds consistently outperformed the Nifty 50! They are listed below.

Note: We have only used Nifty 50 TRI as the lone benchmark for all categories.  Please investigate these funds’ performance with more relevant benchmarks using our monthly screener linked above.

CategoryFund
Aggressive Hybrid FundCANARA ROBECO EQUITY HYBRID FUND – DIRECT PLAN – GROWTH OPTION
Contra FundKotak India EQ Contra Fund – Growth – Direct
Contra FundInvesco India Contra Fund – Direct Plan – Growth
ELSSDSP Tax Saver Fund – Direct Plan – Growth
ELSSBOI AXA Tax Advantage Fund-Direct Plan- Growth
ELSSquant Tax Plan – Growth Option – Direct Plan
ELSSCANARA ROBECO EQUITY TAX SAVER FUND – DIRECT PLAN – GROWTH OPTION
ELSSKotak Tax Saver-Scheme-Growth – Direct
ELSSJM Tax Gain Fund (Direct) – Growth Option
ELSSInvesco India Tax Plan – Direct Plan – Growth
ELSSAxis Long Term Equity Fund – Direct Plan – Growth Option
Focussed FundSBI FOCUSED EQUITY FUND – DIRECT PLAN -GROWTH
Focussed FundIIFL Focused Equity Fund-Direct Plan-Growth
Focussed FundAxis Focused 25 Fund – Direct Plan – Growth Option
Large & Mid Cap FundMirae Asset Emerging Bluechip Fund – Direct Plan – Growth
Large & Mid Cap FundCANARA ROBECO EMERGING EQUITIES – DIRECT PLAN – GROWTH OPTION
Large & Mid Cap FundKotak Equity Opportunities Fund – Growth – Direct
Large & Mid Cap FundInvesco India Growth Opportunities Fund – Direct Plan – Growth
Large & Mid Cap FundSundaram Large and Midcap Fund Direct Plan – Growth
Large Cap FundAxis Bluechip Fund – Direct Plan – Growth
Large Cap FundCANARA ROBECO BLUE CHIP EQUITY FUND – DIRECT PLAN – GROWTH OPTION
Large Cap FundMirae Asset Large Cap Fund – Direct Plan – Growth
Mid Cap FundAxis Midcap Fund – Direct Plan – Growth
Mid Cap FundInvesco India Midcap Fund – Direct Plan – Growth Option
Mid Cap FundKotak Emerging Equity Scheme – Growth – Direct
Multi Cap FundCANARA ROBECO FLEXICAP FUND – DIRECT PLAN – GROWTH OPTION
Multi Cap FundParag Parikh Flexi Cap Fund – Direct Plan – Growth
Multi Cap Fundquant Active Fund-GROWTH OPTION-Direct Plan
Multi Cap FundUTI – Flexi Cap Fund-Growth Option – Direct
Multi Cap FundDSP Flexi Cap Fund – Direct Plan – Growth
Multi Cap FundJM Flexicap Fund (Direct) – Growth Option
Sectoral/ ThematicCANARA ROBECO CONSUMER TRENDS FUND – DIRECT PLAN – GROWTH OPTION
Sectoral/ ThematicMirae Asset Great Consumer Fund – Direct Plan – Growth
Sectoral/ ThematicAditya Birla Sun Life India Gennext Fund – Growth – Direct Plan
Sectoral/ ThematicAditya Birla Sun Life Digital India Fund – Growth – Direct Plan
Sectoral/ ThematicICICI Prudential Technology Fund – Direct Plan -Growth
Sectoral/ Thematicquant Flexi Cap Fund – Growth Option-Direct Plan
Sectoral/ Thematic (international)Nippon India US Equity Opportunites Fund- Direct Plan- Growth Plan- Growth Option
Sectoral/ Thematic (international)ICICI Prudential US Bluechip Equity Fund – Direct Plan -Growth
Small Cap FundSBI Small Cap Fund – Direct Plan – Growth
Small Cap FundAxis Small Cap Fund – Direct Plan – Growth
Small Cap FundNippon India Small Cap Fund – Direct Plan Growth Plan – Growth Option

These results again indicate the difficulty of actively managed funds beating a flagship index. We urge young earners to invest in index mutual funds and not repeat the mistakes of older investors like me. See Fourteen Years of Mutual Fund Investing: My Journey and lessons learned.

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Pattabiraman editor freefincalDr M. Pattabiraman(PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. He has over nine years of experience publishing news analysis, research and financial product development. Connect with him via Twitter or Linkedin or YouTube. Pattabiraman has co-authored three print books: (1) You can be rich too with goal-based investing (CNBC TV18) for DIY investors. (2) Gamechanger for young earners. (3) Chinchu Gets a Superpower! for kids. He has also written seven other free e-books on various money management topics. He is a patron and co-founder of “Fee-only India,” an organisation for promoting unbiased, commission-free investment advice.
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