India's best performing mutual funds for October 2022

1 Nov 2022 , 09:36 AM

The month of October 2022 was a genuine bounce as the markets factored in broader stories like the outsourcing potential of India and the effective inflation being much lower due to the free food effect. After the Nifty fell -2.56% in September, the month of October 2022 saw Nifty gain a full 5.37% as it rallied nearly 1,000 points in the month. The markets chose to ignore the high frequency pressures of inflation and interest rates and focus on the long term potential of the India story. A revival in IPOs also helped markets. The buying was across the board as even the Mid-Cap index gained 2.49% while the Small Cap Index gained 2.59% in October 2022. FPI flows were neutral, but what mattered to the markets was that FPIs got interested in IPOs once again while domestic investors stood their ground.

The short term returns across all the equity and even debt mutual funds were positively impacted, although the positive impact was more visible in the equity fund categories. The positive impact was a lot more pronounced in the high beta funds. Bond yields remained flat to positive and did not move much as markets await signals on the peak RBI repo rates. The RBI MPC meet on 03rd November could offer important cues. The month of October 2022 was a welcome bullish shift from the volatility of September 2022 . Here is a quick look at the top mutual fund performers across categories.

1.      Equity Large-Cap Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Canara Robeco Blue-Chip (G)	1.655%	18.583%	15.357%
Axis Blue-Chip Fund (G)	-4.614%	13.543%	14.090%
Edelweiss Large Cap Fund (G)	3.580%	16.551%	13.242%
Category Average	1.393%	14.993%	11.194%
BSE 100 (TR) Index	4.174%	16.844%	12.763%
Data Source: Morningstar

2.      Equity Multi-Cap Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Active Fund (G)	12.422%	33.902%	22.740%
Mahindra Manulife Multi (G)	3.044%	24.788%	16.367%
Nippon India Multi Cap (G)	16.341%	20.978%	13.688%
Category Average	4.458%	20.552%	13.772%
BSE 500 (TR) Index	3.914%	18.402%	12.564%
Data Source: Morningstar

3.      Equity Mid-Cap Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Mid-Cap Fund (G)	19.304%	35.947%	21.235%
PGIM India Mid-Cap Fund (G)	6.152%	38.449%	19.998%
Axis Mid-Cap Fund (G)	-0.706%	21.644%	17.787%
Category Average	4.369%	23.759%	12.934%
BSE Midcap (TR) Index	1.598%	20.870%	10.040%
Data Source: Morningstar

4.      Equity Small-Cap Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Small Cap Fund (G)	6.818%	51.716%	22.803%
Axis Small Cap Fund (G)	9.784%	28.202%	20.114%
SBI Small Cap Fund (G)	12.290%	30.327%	18.160%
Category Average	6.202%	30.693%	13.782%
BSE Midcap (TR) Index	3.872%	29.745%	11.363%
Data Source: Morningstar

5.      Equity Linked Savings Schemes (Tax Saving)

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Tax Plan (G)	18.060%	39.244%	23.675%
Canara Robeco Tax Saver (G)	2.563%	22.216%	16.826%
Mirae Asset Tax Saver (G)	0.187%	20.501%	15.580%
Category Average	2.470%	16.958%	11.240%
BSE 200 (TR) Index	4.244%	17.865%	13.005%
Data Source: Morningstar

6.      Balanced Funds (Aggressive Allocation)

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Absolute Fund (G)	17.268%	30.234	20.322%
ICICI Pru Equity & Debt (G)	11.215%	21.442%	14.318%
Baroda BNP Paribas AEH (G)	3.435%	15.793%	13.743%
Category Average	2.671%	14.847%	10.415%
CRISIL MIF Blended Index PR	1.968%	7.850%	7.669%
Data Source: Morningstar

7.      Balanced Funds (Conservative Allocation)

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Kotak Debt Hybrid (G)	5.040%	12.054%	9.623%
Canara Robeco Hybrid (G)	3.677%	10.111%	8.936%
ICICI Pru Regular Savings (G)	5.440%	9.808%	8.885%
Category Average	4.556%	8.362%	6.471%
CRISIL MIP Blended Index PR	1.968%	7.490%	7.669%
Data Source: Morningstar

8.      Arbitrage Funds (Cash-Futures)

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Nippon Equity Arbitrage (G)	4.434%	4.675%	5.719%
Edelweiss Arbitrage Fund (G)	4.584%	4.828%	5.705%
Axis Arbitrage Fund (G)	4.640%	4.666%	5.601%
Category Average	3.726%	3.932%	4.880%
Benchmark Comparison	N.A.	N.A.	N.A.
Data Source: Morningstar

9.      Government Securities Funds (Gilt Funds)

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Edelweiss G-Sec Fund (G)	2.095%	6.771%	7.821%
DSP G-Sec Fund (G)	2.367%	6.498%	7.638%
ICICI Prudential Gilt Fund (G)	3.490%	7.293%	7.490%
Category Average	1.813%	5.360%	6.332%
I-SEC MIBEX Index TR	1.271%	5.671%	6.805%
Data Source: Morningstar

10.  Corporate Bond Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
ABSL Corporate Debt (G)	3.614%	6.699%	7.238%
Axis Corporate Bond (G)	3.818%	6.891%	7.237%
ICICI Pru Corporate Bond (G)	4.293%	6.672%	7.201%
Category Average	2.609%	5.771%	6.356%
CRISIL ST Bond Fund Index PR	2.879%	5.853%	6.642%
Data Source: Morningstar

11.  Credit Risk Funds

Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
ICICI Pru Credit Risk Fund (G)	5.405%	7.892%	8.000%
Baroda Credit Risk Fund (G)	4.939%	8.980%	7.422%
HDFC Credit Risk Fund (G)	4.010%	7.735%	7.404%
Category Average	12.975%	5.866%	4.331%
CRISIL ST Bond Fund Index PR	2.879%	5.853%	6.642%
Data Source: Morningstar

12.  Liquid Funds
Top performing Direct Plans (Growth Option) on 5-year returns (as on 31st Oct-22):

Name of Fund	1-Year Return	3-Year Return	5-Year Return
Quant Liquid Plan (G)	4.648%	4.873%	5.880%
IDBI Liquid Fund (G)	4.413%	4.232%	5.430%
Mahindra Manulife Liquid (G)	4.486%	4.195%	5.419%
Category Average	3.817%	3.600%	4.839%
CRISIL Liquid Fund Index PR	4.578%	4.368%	5.524%
Data Source: Morningstar

Since September 2022, we made some modifications to our presentation on mutual fund returns. We have included category averages and index benchmarks. This not only gives an absolute picture of returns but also a relative picture of the extent of outperformance that the top performers are able to sustain above the index benchmarks. The overall ranking of top performers are almost similar to previous months, barring some minor shifts here and there. Most of the benchmarks considered are in terms of the TR (Total Returns) index so that the benchmark is a lot more reflective of the capital gains and the dividend returns.

Now for the actual good news. Both equity and debt funds outperformed the last month show, but it was less about the numbers and more about the consistency. For instance, equity and debt fund return leaders have continued to maintain consistency in performance across categories. This makes these rankings a reliable barometer and from a financial planning perspective, an important decision point for investors. October 2022 was a whiff of fresh air after the disappointment of September. It needs to be seen if this can be sustained.