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In debt, short-term categories have returned more: CRISIL

India Infoline News Service | Mumbai |

In the 3 year period, returns from short-term categories were higher by 1.5% to 3.1%, with money market funds delivering the most.

CRISIL’s Mutual Fund Ranking for the quarter ended March 2014 shows short-term debt categories delivering the highest returns (Table 1). Debt funds are represented by four unique indices – the CRISIL – AMFI Short-Term Debt Fund Performance Index, the CRISIL – AMFI Money Market Fund Performance Index, the CRISIL – AMFI Income Fund Performance Index and the CRISIL – AMFI Gilt Fund Performance Index.
 
A much-touted investment maxim says long-term investments yield higher than short-term, but elevated interest rates of the last three years have inverted the thesis. In this period, yields on 10-year government security increased from 7.98% to 8.80%, peaking at 9.23% in December 2013. On the other hand, the 1-year certificate of deposit yielded 9.37% on an average over the same period -- helping short-term debt schemes which typically follow an accrual strategy in times of rising interest rates. Long-term debt funds, on the other hand, were impacted by mark-to-market losses.
 
In the 3 year period, returns from short-term categories were higher by 1.5% to 3.1%, with money market funds delivering the most.
 
For the March quarter, Birla Sun Life Mutual Fund and UTI Mutual Fund led the tally by having seven funds under CRISIL Fund Rank 1, followed by ICICI Prudential Mutual Fund with six and SBI Mutual Fund with five. The quarterly ranking covers 17 categories across equity, debt and hybrid funds in the mutual fund industry. Unlike assessments based on returns or net asset value (NAV), the CRISIL Mutual Fund Ranking uses a combination of NAV and portfolio-based attributes to evaluate. It is, therefore, a one-stop comprehensive analysis that considers key parameters such as risk-adjusted returns, asset concentration, liquidity, asset quality and size. The rankings also include categories that focus specifically on long-term consistency in performance. The ranks are assigned on a scale of 1 to 5, with CRISIL Fund Rank 1 indicating very good performance. In any peer group, the top 10 percentile of funds are ranked as CRISIL Fund Rank 1 and the next 20 percentile as CRISIL Fund Rank 2.
 
Table 1: Category and benchmark returns (%) for the quarter ended March 31, 2014
 
Categories 3 months Absolute 6 months Absolute 9 months Absolute 1 Year Absolute 2 Years Annualised 3 Years Annualised 5 Years Annualised
CRISIL – AMFI Short Term Debt Fund Performance Index 2.40 5.05 5.01 7.87 8.99 9.05 7.77
CRISIL – AMFI Money Market Fund Performance Index 2.18 4.65 6.95 9.35 9.21 9.10 7.62








CRISIL – AMFI Income Fund Performance Index 2.10 3.74 -0.55 3.26 7.10 7.55 6.90
CRISIL – AMFI Gilt Fund Performance Index 2.12 4.08 -2.94 1.67 6.20 5.99 5.15








CRISIL Composite Bond Fund Index 2.52 5.01 0.72 4.32 6.77 7.07 6.33
CRISIL Short Term Bond Fund Index 2.44 5.00 6.11 8.78 8.94 8.72 7.42
CRISIL Liquid Fund Index 2.30 4.73 7.22 9.46 8.84 8.71 7.18
CRISIL Gilt Index 2.46 4.37 -3.13 1.13 6.96 6.36 5.76
 
Table 2 - CRISIL Fund Rank 1 schemes
 
Large Cap-oriented Equity Funds Short Term Income Funds
Birla Sun Life Long Term Advantage Fund HDFC Short Term Opportunities Fund
Birla Sun Life Top 100 Fund Morgan Stanley Short Term Bond Fund
ICICI Prudential Top 100 Fund Tata Short Term Bond Fund
Quantum Long-Term Equity Fund

Credit Opportunities Funds
Diversified Equity Funds Birla Sun Life Short Term Opportunities Fund
ICICI Prudential Dynamic Plan
ICICI Prudential Exports and Other Services Fund Ultra Short Term Debt Funds
Principal Growth Fund Reliance Money Manager Fund
Tata Ethical Fund Religare Invesco Credit Opportunities Fund
UTI MNC Fund UTI Floating Rate Fund – STP

UTI Treasury Advantage Fund
Small and Mid-cap Equity Funds
Franklin India Smaller Companies Fund Liquid Funds
Mirae Asset Emerging Bluechip Fund HDFC Liquid Fund
SBI Magnum Midcap Fund ICICI Prudential Liquid Plan

SBI Magnum InstaCash
Thematic - Infrastructure Funds SBI Premier Liquid Fund
Birla Sun Life Infrastructure Fund

Consistent Performers - Equity Funds
Equity-Linked Savings Scheme (ELSS) Birla Sun Life India GenNext Fund
Axis Long Term Equity Fund Birla Sun Life MNC Fund
BNP Paribas Tax Advantage Plan IDFC Premier Equity Fund

Reliance Equity Opportunities Fund
Index Funds SBI Emerging Businesses Fund
Kotak Nifty ETF Tata Ethical Fund

UTI Equity Fund
Balanced Funds UTI MNC Fund
ICICI Prudential Balanced Fund UTI Opportunities Fund


Monthly Income Plan – Aggressive Consistent Performers - Balanced Funds
Birla Sun Life MIP II - Wealth 25 Plan ICICI Prudential Balanced Fund
UTI MIS Advantage Plan

Consistent Performers - Debt Funds
Long Term Gilt Funds IDFC Dynamic Bond Fund
IDFC G Sec Fund - Investment Plan SBI Magnum Income Fund
L&T Gilt


Long Term Income Funds
BNP Paribas Flexi Debt Fund
Reliance Dynamic Bond Fund
Tata Income Fund

 

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