Diversified equity funds have struggled to deliver satisfactory category average returns over the past 12 months. Large-cap funds have yielded a meagre return of 0.6 per cent, mid-cap funds have generated 1.9 per cent, while small-cap funds have fared slightly better with a return of 3.4 per cent.
Perfect storm
This challenging market environment is due to a 'perfect storm' of various problems arising in quick succession. "First, there was the Russia-Ukraine war. Then the interest-rate environment shifted drastically from very low to very high rates. There have been growth-related concerns in several major economies.
And recently there has been the banking crisis in the US and Europe," says Sailesh Raj Bhan, chief investment officer-equity investments, Nippon India Mutual Fund.
The bleak global macroeconomic scenario has played a big part. "In the past one year, the US Federal Reserve (Fed) has raised rates by 475 basis points, the fastest pace of rate hikes ever. Foreign institutional investors (FIIS) have pulled out US $25 billion. The S&P has entered a bear market and the US treasury, the world's safest asset, has also delivered negative returns," says Niket Shah, fund manager, Motilal Oswal Asset Management Company.
Periods of blockbuster returns tend to alternate with poor returns. "What we are witnessing now is a normal process of market consolidation after a period of very strong return from 2020 to 2021," says Chandraprakash Padiyar, senior fund manager, Tata Mutual Fund.
This story is from the March 27, 2023 edition of Business Standard.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the March 27, 2023 edition of Business Standard.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber? Sign In
FY24 credit card spends rose 27%
Increased to ₹18.26 trillion from nearly ₹14 trillion a year ago
DCB Bank Q4 profit rises 9%
Private lender DCB Bank's net profit rose by 9 per cent year-on-year (Y-o-Y) to 156 crore for the quarter ended March (Q4FY24) on the back of a modest rise in net interest income (NII) and a decline in provisions.
Axis Bank back in black with ₹7,129 cr Q4 profit
NII grew 11% to ₹13,089 cr, while fee income grew by 23% to ₹5,637 cr
Growth businesses hold the key for Tata Consumer
Tata Consumer Products reported Q4 results which were more or less in line with analyst consensus but disappointed the market.
Financialisation of savings drives up demat a/cs in Ladakh
Mizoram & Lakshadweep also see spike in demat account registrations
KRAS: Over 73% of KYC records are validated
Know-your-customer (KYC) registration agencies said on Wednesday that 73 per cent of the 108.3 million KYC records were validated as of March 31, 2024, and that the system was in place for the rest of the investors to validate their KYC.
Proxy advisory firms give TaMo DVR conversion plan the thumbs up
Move, they say, will simplify capital structure and eliminate price discount
Call for caution on micro, small, midcap stocks amid sharp run-up
Shares of smallcap companies continued their upward march from the March 2024 lows, with the S&P BSE Smallcap index hitting a new high of ₹46,958.21 on Wednesday in intraday trade.
Calcutta HC's SSC order heats up the election classroom
Political analysts believe cancelling of 25,753 appointments will have serious ramifications
Wanted: An executive to repair Boeing
When Boeing named Stephanie Pope to the new position of chief operating officer in December, the move was widely viewed as a sign that she might succeed the company's chief executive, Dave Calhoun, in the next few years.
