Last Updated on October 1, 2023 at 4:49 pm
SBI Magnum Multicap Fund is an open-ended Equity Scheme investing across large cap, mid cap, small cap stocks with some exposure to debt and money market instruments. In this review, we compare its performance with Nifty 500 TRI and category peers.
Launched in Sep 2005, the fund currently has an AUM of Rs. 8758.28 Cr as on 31 Jan 2020. Just three years ago, in Dec 2016, the AUM was only Rs 1,429.64 Crores! The SEBI categorization rules did not affect the fund significantly other the removal of individual market cap limits.
Prior to May 2018, the fund invested 50% of its equity portfolio in largecap (max 90%), min 10% in midcap ( max 40%) and a max 10% smallcap exposure. These self-imposed restrictions were lifted as SEBI did not require it!
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This is the asset allocation history of SBI Magnum Multicap Fund since July 2017 The fund has maintained a large cap heavy portfolio. Aside from its meagre small cap exposure, it has so far been a large and mid cap fund.
Let us now evaluate the fund’s performance with Nifty 500. We consider 2333 five-year returns between Oct 2005 and Feb 2020. Notice that the fund (regular plan) has fared reasonably well after Dec 2014.
We only have 1082 ten-year return data points for the above-mentioned period. While most funds have struggled to beat the benchmark in the recent past with a much better history, the opposite seems to be true for SBI Magnum Multicap! It has managed to keep its nose above the benchmark since mid-2017 and has outperformed in the last year or so. The direct plan should have done a touch better.
SBI Multicap vs HDFC Equity vs Kotak Multicap
Next, we look at how the SBI fund has fared against HDFC Equity and Kotak Multicap. Over five years, Kotak Multicap (highest AUM among active funds) and SBI Multicap have performed almost identically! The outperformance of HDFC Equity wrt Nifty 500 has gone down dramatically over 5 years (see below)
Over ten years too, the SBI fund has fared better since mid-2017. Kotak does not have much of a history. HDFC Equity has managed to outperform the NIfty 500 over the entire investment window considered.
SBI Multicap vs Kotak Multicap vs HDFC Equity rolling returns over ten yearsUnlike most other funds we have reviewed recently, where the outperformance has dropped in recent years, SBI Magnum Multicap has managed to overcome its unremarkable past and do well in the last few years. Existing investors can continue to hold. New investors who prefer a multicap mutual fund can also consider it.
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