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Guide to buying Equity Funds

Myth::
In a volatile market as we have seen in the last calendar, it is expected that the best performers would be the ones who have managed volatility the best. Fact:: The best returns generators have been the worst volatility managers

Guide to buying Equity Funds


The best volatility Managers
Scheme Volatility

The worst returns providers

Scheme JM Small & Midcap JM Emerging Leaders JM Agri & Infra JM HIFI JM Basic

Returns 162 163 163 163 164

JM Small & Midcap


JM Emerging Leaders JM Agri & Infra

14
48 1

JM HIFI
JM Basic

17
106

Guide to buying Equity Funds


Top Returns Generators..
Scheme Birla Sun Life MNC Plan B Return 26 Scheme
Volatility

Birla Sun Life MNC Plan B


Franklin India Bluechip HDFC Growth Fund ICICI Prudential Growth

159
170 141 148

Franklin India Bluechip


HDFC Growth Fund ICICI Prudential Growth HDFC Equity Fund

26
28 30 30

HDFC Equity Fund

167

Guide to buying Equity Funds


Scheme Vol. 16 75 9 Ret 7 8 9

Small schemes show much better returns deviation parity than the larger schemes.

HSBC Emerging Markets Quantum Long Term Equity Franklin Asian Equity

Reliance Quant Plus


ICICI Prudential Indo Asia Equity Shinsei Industry Leaders

49
13 25

10
11 12

Guide to buying Equity Funds


Larger funds can prosper even with higher Volatility
Franklin India Bluechip
HDFC Growth Fund HDFC Equity Fund DSP BlackRock Top 100 HDFC Top 200 Fund

170
141 167 140 166

Guide to buying Equity Funds


Bigger the size, higher the cushion to manage volatility Better inflow into established, larger funds has allowed flexibility in management Sudden redemption pressures are dealt with better for larger funds

Guide to buying Equity Funds

Volatility parameters remain the best indicators of competence in generating returns.

Scheme Franklin Asian Equity

Volatility

Return 9 11 15 32 26

9 13 53 30 7

ICICI Prudential Indo Asia Equity


ICICI Prudential Focused Bluechip Equity Fidelity India Growth Religare AGILE

Guide to buying Equity Funds


Small asset sizes constrain managers ability to
Take risks on fund management Tinker with allocation to cash Small inflows/outflows can jeopardise portfolio construct

In the last year, largely defensive strategy has been used by these small funds

Guide to buying Equity Funds


Reliance Regular Savings Equity DSPBR Small and Midcap Kotak Midcap

Balance between volatility and returns indicate better design and portfolio construct and ensure better future prospects. The schemes are

Birla Sunlife Frontline Equity

Guide to buying Equity Funds


Calendar 2011 is likely to behave similarly as the year gone by. Strategies to maximise returns for the year would be better if based on the learning from last calendar. Many surprise funds are emerging to challenge current pack of leaders

Guide to buying Equity Funds


Methodology
All data and calculations have been sourced from myplexus.com Volatility has been measured by Standard Deviation of NAV and the funds stated Benchmark over 3 months, 6 months and one year. Returns are absolute returns over 3 months, 6 months and one year. Volatility and standard deviation has been ranked over the three time periods and averaged. Thus the number sequence might not be from 1. Further the averaged ranks have been rounded off. All calculations can be sourced from the website, after logging in.

Guide to buying Equity Funds

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