After three straight months of gains, Nifty showed signs of fatigue in January, especially in the second half of the month as investors turned cautious ahead of the Union Budget. A steep correction ensued and benchmarks dropped all of its monthly gains to end the month with a 2.48 percent loss. Broader markets were able to ride the storm much better than the frontliners as BSE Smallcap ended with marginal losses of 0.3 percent, while BSE Midcap ended with gains of 0.6 percent.
The sharp underperformance of the equity markets was also visible in the returns of Portfolio Management Schemes (PMSes) as about 68 percent of the schemes generated negative returns during the month. Of the 193 schemes PMSBazaar.com looked at, 131 fell into the red, while two funds ended flat.
Basant Maheshwari Wealth Advisers' Equity Fund was the biggest loser in January, dropping 8.09 percent on a month-on-month basis. The multicap fund, which is managed by ace investor Basant Maheshwari, was among the top performers in December (11.51 percent) and November 2020 (22.04 percent).
At -7.7 percent, Varanium Capital Advisors' Largecap focused fund was the second-biggest loser of January 2021. The largecap strategy, managed by TS Anantakrishnan, focuses heavily on financials, as they constituted about 28 percent of its entire portfolio (as on December 31, 2020). Pharmaceuticals (16 percent), oil & gas (12 percent), technology (12 percent) and consumer staples (11 percent) are the other major sectors the Rs 104.41-crore fund has exposure in.
Composite Investment's Lighthouse (7.4 percent), Asit C Mehta Investment Intermediates' Ace 50 (7.1 percent), Marcellus' Consistent Compounders (6.8 percent) were among the other major losers in January 2021.
Six out of the 10 worst performing funds were from the multicap space, while three were largecap-focused funds and one was from the large & mid-cap category.
On the other hand, 60 funds managed to generate positive returns in January 2021, while 132 funds generated returns greater than Nifty.
Valentis Advisors' Rising Star Opportunity was the top gainer in January, rising 9.08 percent on a month-on-month basis. The small & mid-cap focused fund is managed by Jyotivardhan Jaipuria and was among the top gainer from this space in December as well, logging 9.29 percent gains.
Invesco's Caterpillar (7.51 percent), Negen Capital's Smallcap Emerging (4.66 percent), Phillip Capital's Emerging India Portfolio (4.43 percent), Sageone's Small & Microcap (4.4 percent) were the other top performers in January 2021.
Eight of the best performing schemes were from the small and midcap category.
Of the 12 smallcap schemes PMSBazaar.com looked at, 10 strategies outperformed benchmark BSE Smallcap 100, while two generated negative returns in January. Negen Capital's Smallcap Emerging fund was the best performing PMS from this space, delivering a 4.66 percent return. It was also the best performing smallcap scheme in December at 12.83 percent. Sageone's Small & Microcap (4.4 percent), Right Horizons' Minerva India Under-served (3.86 percent), Roha Asset Managers' Emerging Champions (2.97 percent) were some other top-performing smallcap schemes.
In comparison, nine out of the 19 midcap funds beat the BSE Midcap index. These include Invesco's Caterpillar (7.51 percent), Phillip Capital's Emerging India Portfolio (4.43 percent), Nafa Asset Manager's Emerging Bluechip (2.97 percent). Meanwhile, the 14-member small & mid-cap category was lead by Valentis Advisors' Rising Star Opportunity which delivered a 9.08 percent return in January 2021.
From the largecap space, only one out of 18 funds managed to generate a positive return in January. Meanwhile, seven funds outperformed Nifty50. ICICI Prudential's Largecap Portfolio (0.13 percent), Wize Market Analytics' Capital Mind- Market Fund (-0.54 percent), Motilal Oswal's Value (-1.32 percent) were some of the better performing schemes.
Buoyant Capital's Opportunities (2.8 percent), Credent Asset Management's Growth Portfolio (2.71 percent), Bonanza's Value (2.48 percent), Quest Investment Advisors' Focus (2.11 percent) were some of the best performing PMS from the multicap space.
Among others, LIC Mutal Fund's Value Equity+ (-1.29 percent) was the top performer in the large & mid-cap category, while Right Horizons' Alphabots India Prime at 3.15 percent and Kotak's Fintech at -0.4 percent led the charge in thematic and sector fund category.
Portfolio Management Services cater to wealthy investors and the professional fee charged by them is higher than regular mutual funds (MFs).
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