NEW DELHI, JUNE 11 : Take all diversified equity mutual fund schemes. Find out how they fared over various time periods. Crunch the numbers. Put them against the market benchmark, the BSE Sensex. What do you get? A rather uninspiring look at fund managers, experts who we pay about 2.5 per cent of our investment to outperform markets.
Take a look:
• During the past month, when the Sensex crashed by 25.4 per cent, the average fall in 158 diversified equity funds was 28.9 per cent—an underperformance of 3.4 percentage points. Only one out of 10 funds managed to beat the Sensex in this period.
• In the past two weeks, when the Sensex fell by 12.8 per cent, the funds on an average, fell by 16.6 per cent, an underperformance of 3.8 percentage points, with just 16 of 161 funds being able to beat the Sensex. In other words, just 9.9 per cent of funds were able to deliver returns better than the Sensex.
• A study of 161 diversified mutual funds over the past week, two weeks, one month, three months, six months, 12 months and 36 months shows that on an average the funds have been lagging the Sensex in all but the 36-month period.
Story in The Indian Express, June 12, 2006