Sunday
Top 10 Equity Index Funds – March 2010
Here is the first edition of FRPP rankings in the Equity Index category (See my previous post on FRPP).
Index funds are open-ended funds that track the performance of their respective benchmark indices. Unlike active mutual funds, index funds are passive investments and just attempt to mirror the movements of the benchmark indices. I believe that index funds have a place in the core portfolio.
In the Equity Diversified Funds or Equity Balanced Funds, a boatload of funds managed to beat out the SENSEX and NIFTY. Not the case here. A total of 35 equity index funds were used in the analysis. For reference purposes, SENSEX (1 year return – 105%) held the 4th rank, and NIFTY (1 year return – 95%) held the 10th rank.
| FRPP Rank | Fund Name (Equity Index Funds) | Assets (Rs. Cr.) | NAV (12/3/2010) | 1 year Return (%) |
| 1 | Benchmark Bank BeES | 90.28 | 916.35 | 154.6 |
| 2 | Benchmark Nifty Junior BeES | 65.5 | 104.9 | 169.1 |
| 3 | HDFC Index - Sensex Plus Plan** | 55.08 | 201.61 | 97.8 |
| 4 | ICICI Prudential Index Fund | 97.59 | 47.3 | 87.9 |
| 5 | ICICI Prudential SPIcE Plan | 0.9 | 178.1 | 92.2 |
| 6 | UTI SUNDER | 2.98 | 538.8 | 88 |
| 7 | Franklin (I) Index - BSE | 59.4 | 48.12 | 94.5 |
| 8 | UTI Master Index Fund | 64.21 | 52.86 | 94.9 |
| 9 | Benchmark Nifty BeES | 427.38 | 514.99 | 87.2 |
| 10 | Tata Index Fund Nifty Plan | 9.35 | 30.61 | 86.7 |
Why did many index funds trail SENSEX and NIFTY? This is due to the portfolio manager’s ability (or the lack of it) to track the underlying index. This error is called tracking error. So, when you pick a index fund, look at the ones that have the least tracking error.
Happy Investing!
** Please note that HDFC Sensex Plus Plan invests in SENSEX stocks, but is not a passive index fund.
Labels: FRPP, Index Funds, Mutual Funds, tracking error
by Admin at 19:34 |
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