This article presents an outperformance consistency report of active mutual funds. This analysis was done for a SEBI-sponsored talk given to Tamil Nadu Investors Association Members on March 24th, 2024.
Disclaimer: Fund performance reports present return and risk analysis of a fund with representative benchmarks and not investment recommendations. It must be expressly understood that the data below reflect only past performance and is in no way an indication of future performance.
Rolling return outperformance consistency (aka performance consistency): Active fund returns are compared with category benchmark returns over every possible 5Y and 10Y period from Apr 2006 to March 2024. The higher the outperformance consistency, the better. Suppose 876 fund returns were compared with 876 benchmark returns, and the fund has beaten the benchmark 675 times. The consistency score will be 675/876 ~ 0.77 or 77%. A score of 1 means 100%.
Categories studies with benchmarks used
| Category | Benchmark |
| Aggressive Hybrid Fund | Crisil6535 |
| Contra | Nifty 100 TRI |
| Dividend Yield | Nifty 100 TRI |
| Equity Linked Savings Scheme | Nifty 200TRI |
| Flexi Cap Fund | Nifty 200TRI |
| Focused Fund | Nifty 200TRI |
| Large & Mid Cap | Nifty 200TRI |
| Large Cap Fund | Nifty 100 TRI |
| Mid Cap Fund | NiftyMidcap150TRI |
| Multi Cap Fund | Nifty 200TRI |
| Sectoral/ Thematic | Nifty 100 TRI |
| Sectoral/ Thematic (international) | Nifty 100 TRI |
| Small cap Fund | NiftyMidcap150TRI |
| Value Fund | Nifty 100 TRI |
Clarification:
Overall: 10-year periods; Regular Plan Funds vs Category benchmarks
- 168 funds across all categories with at least 500 10-year data points
- 78 funds (46%) with a performance consistency of 70% or more
- 87 funds (52%) with a performance consistency of 60% or more
Overall: 5-year periods; Direct Plan Funds vs Category benchmarks
- 277 funds across all categories with at least 500 5-year data points
- 96 funds (35%) with a performance consistency of 70% or more
- 123 funds (44%) with a performance consistency of 60% or more
Mid cap funds:
5-year periods; Direct Plan Funds vs Nifty Midcap 150 TRI
- 22 funds across all categories with at least 500 5-year data points
- 4 funds (18%) with a performance consistency of 70% or more
- 7 funds (32%) with a performance consistency of 60% or more
10-year periods; Direct Plan Funds vs Nifty Midcap 150 TRI
- 14 funds across all categories with at least 500 5-year data points
- 5 funds (36%) with a performance consistency of 70% or more
- 7 funds (50%) with a performance consistency of 60% or more
Small cap funds:
5-year periods; Direct Plan Funds vs Nifty Midcap 150 TRI
- 14 funds across all categories with at least 500 5-year data points
- 6 funds (43%) with a performance consistency of 70% or more
- 6 funds (43%) with a performance consistency of 60% or more
10-year periods; Direct Plan Funds vs Nifty Midcap 150 TRI
- 8 funds across all categories with at least 500 5-year data points
- 3 funds (37%) with a performance consistency of 70% or more
- 4 funds (50%) with a performance consistency of 60% or more
Flexicap Funds:
5-year periods; Direct Plan Funds vs Nifty 200 TRI
- 20 funds across all categories with at least 500 5-year data points
- 9 funds (45%) with a performance consistency of 70% or more
- 11 funds (55%) with a performance consistency of 60% or more
10-year periods; Direct Plan Funds vs Nifty 200 TRI
- 13 funds across all categories with at least 500 5-year data points
- 7 funds (54%) with a performance consistency of 70% or more
- 8 funds (61%) with a performance consistency of 60% or more
Focused Funds
5-year periods; Direct Plan Funds vs Nifty 200 TRI
- 15 funds across all categories with at least 500 5-year data points
- 6 funds (40%) with a performance consistency of 70% or more
- 8 funds (53%) with a performance consistency of 60% or more
10-year periods; Direct Plan Funds vs Nifty 200 TRI
- 10 funds across all categories with at least 500 5-year data points
- 5 funds (50%) with a performance consistency of 70% or more
- 5 funds (50%) with a performance consistency of 60% or more
Additional resources:
Summary
- “Beating” the market is not easy!
- Only 45% to 55% of funds consistently beat the index in most categories. Selecting those funds is no guarantee of future outperformance.
- Investors are better off with passive funds: no fund manager risk, less fee, no performance anxiety, and time spent elsewhere. Ideally, a Nifty or Sensex index fund is enough.
- Active funds or passive funds are not a primary issue. We first need a proper financial plan.
Do share this article with your friends using the buttons below.
🔥Enjoy massive discounts on our courses, robo-advisory tool and exclusive investor circle! 🔥& join our community of 5000+ users!
Use our Robo-advisory Tool for a start-to-finish financial plan! ⇐ More than 1,000 investors and advisors use this!
New Tool! => Track your mutual funds and stock investments with this Google Sheet!
Podcast: Let’s Get RICH With PATTU! Every single Indian CAN grow their wealth!
You can watch podcast episodes on the OfSpin Media Friends YouTube Channel.
- Do you have a comment about the above article? Reach out to us on Twitter: @freefincal or @pattufreefincal
- Have a question? Subscribe to our newsletter with the form below.
- Hit ‘reply’ to any email from us! We do not offer personalized investment advice. We can write a detailed article without mentioning your name if you have a generic question.
Join over 32,000 readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email!
Explore the site! Search among our 2000+ articles for information and insight!
About The Author
Dr. M. Pattabiraman(PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. He has over ten years of experience publishing news analysis, research and financial product development. Connect with him via Twitter, Linkedin, or YouTube. Pattabiraman has co-authored three print books: (1) You can be rich too with goal-based investing (CNBC TV18) for DIY investors. (2) Gamechanger for young earners. (3) Chinchu Gets a Superpower! for kids. He has also written seven other free e-books on various money management topics. He is a patron and co-founder of “Fee-only India,” an organisation promoting unbiased, commission-free investment advice.
Our flagship course! Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions! ⇐ More than 3,000 investors and advisors are part of our exclusive community! Get clarity on how to plan for your goals and achieve the necessary corpus no matter what the market condition is!! Watch the first lecture for free! One-time payment! No recurring fees! Life-long access to videos! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
Our new course! Increase your income by getting people to pay for your skills! ⇐ More than 700 salaried employees, entrepreneurs and financial advisors are part of our exclusive community! Learn how to get people to pay for your skills! Whether you are a professional or small business owner who wants more clients via online visibility or a salaried person wanting a side income or passive income, we will show you how to achieve this by showcasing your skills and building a community that trusts you and pays you! (watch 1st lecture for free). One-time payment! No recurring fees! Life-long access to videos!
Our new book for kids: “Chinchu gets a superpower!” is now available!
Most investor problems can be traced to a lack of informed decision-making. We have all made bad decisions and money mistakes when we started earning and spent years undoing these mistakes. Why should our children go through the same pain? What is this book about? As parents, what would it be if we had to groom one ability in our children that is key not only to money management and investing but to any aspect of life? My answer: Sound Decision Making. So in this book, we meet Chinchu, who is about to turn 10. What he wants for his birthday and how his parents plan for it and teach him several key ideas of decision-making and money management is the narrative. What readers say!
Must-read book even for adults! This is something that every parent should teach their kids right from their young age. The importance of money management and decision making based on their wants and needs. Very nicely written in simple terms. – Arun.
Buy the book: Chinchu gets a superpower for your child!
How to profit from content writing: Our new ebook is for those interested in getting side income via content writing. It is available at a 50% discount for Rs. 500 only!
Want to check if the market is overvalued or undervalued? Use our market valuation tool (it will work with any index!), or get the Tactical Buy/Sell timing tool!
We publish monthly mutual fund screeners and momentum, low-volatility stock screeners.
About freefincal & it’s content policy. Freefincal is a News Media Organization dedicated to providing original analysis, reports, reviews and insights on mutual funds, stocks, investing, retirement and personal finance developments. We do so without conflict of interest and bias. Follow us on Google News. Freefincal serves more than three million readers a year (5 million page views) with articles based only on factual information and detailed analysis by its authors. All statements made will be verified with credible and knowledgeable sources before publication. Freefincal does not publish paid articles, promotions, PR, satire or opinions without data. All opinions will be inferences backed by verifiable, reproducible evidence/data. Contact information: letters {at} freefincal {dot} com (sponsored posts or paid collaborations will not be entertained)
Connect with us on social media
Our publications
You Can Be Rich Too with Goal-Based Investing
Published by CNBC TV18, this book is meant to help you ask the right questions and seek the correct answers, and since it comes with nine online calculators, you can also create custom solutions for your lifestyle! Get it now.
Gamechanger: Forget Startups, Join Corporate & Still Live the Rich Life You Want
This book is meant for young earners to get their basics right from day one! It will also help you travel to exotic places at a low cost! Get it or gift it to a young earner.
Your Ultimate Guide to Travel
This is an in-depth dive analysis into vacation planning, finding cheap flights, budget accommodation, what to do when travelling, and how travelling slowly is better financially and psychologically, with links to the web pages and hand-holding at every step. Get the pdf for Rs 300 (instant download)
