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Last modified: January 12, 2014 Mutual Funds

Top Mutual Funds of 2014

Finding the best equity fund to invest in like finding needle in a haystack , remarked my colleague. Which are the top or the best mutual funds as on Jan 2014.  Sadly there is no one answer. Its like finding which bollywood actor is Number 1? if you check latest Time Celebx  (nov 2013)Hritik Roshan beat the Khans and Kapoor to be number 1. But a month earlier he was at number 4. While Salman khan has been at number 2 or 3.   What I mean to say is that it is difficult for someone to be consistently be at the top. There are also flavors or the seasons or fads. For investing in mutual funds, we need a mutual fund which is from a good fund house, has good fund manager,good performance both short term and long terms, have seen the various market cycles and is consistent.

Questions. Questions before the investor

Its not easy choosing a equity mutual fund because of choices, lot of noise,information overload  surrounding the mutual fund industry.

• Time frame of investment. How long is your investment for? 3 years, 5 years, 
• Frequency of investment. How often will you be investing,  lump sum or through Systematic investment plan say monthly ? 
• The category. What category of fund do we want to invest in. Large Cap, Mid cap, Small Cap, Diversified or Balanced, Sector funds
• Performance, ratings. Which fund has performed well, what are the ratings.
• Other factors. What is fund size, who is fund manager etc.

We went through various websites to find good mutual funds to invest in, such as Top mutual funds from Mint Mutual Fund Schemes to invest in. MoneyControls Mutual Fund schemes to invest in   , ET Top 100, Valueresearch Indias finest funds for hit portfolio. Morningstar Best Performing funds  . Most of these top funds (such as Mint 50, ET 100) choose from Valueresearchonlines top rated funds. There was no common fund which we could zero down to.  Given below are Large cap and Large Cap and Mid Cap Funds. Reason for comping up with the list was to start a discussion on which funds can one invest. We have given links to funds on Valueresearchonline for our readers to investigate these funds further.

Large-cap Mutual Funds

Large cap funds invest in some of the biggest companies, which are well represented in the more frequently tracked indices such as the Sensex and the Nifty, are less volatile to market swings compared to other diversified equity funds. These funds mirror the performance of the economy and are geared to handle market cycles better. But they do not deliver exceptional returns in a rising market. The performance of actively managed funds comes out  far superior than passively-managed funds. The 5-year trailing returns indicate that over 50 per cent of the actively-managed funds have delivered superior returns than Nifty. The gap in the two widens when one looks at long-term performance. For instance, over a 10-year period, from the universe of 32 funds, the average of the actively-managed funds posted 22.58 per cent returns compared to the average return of 17.94 per cent delivered by passive funds for the same period. Some of  funds which have made it to Top Mutual funds list of various websites are.

Franklin India Bluechip  . Consistent performer over the past 16 years with a CAGR of 21% against 12% of its benchmark S&P BSE Sensex which makes it a perennial favourite. It is primarily a large-cap fund which focuses on investing in companies with strong financials, quality management and market leadership. Irrespective of market conditions, it has stuck to its mandate of investing in large-cap companies. . Follows time-tested strategy of value and growth stock picking. Managers are Anand Radhakrishnan (6.8 years), Anand Vasudevan (2.9 years)

ICICI Pru Focused Bluechip   : It is a large-cap diversified equity fund with a concentrated portfolio of 20-25 large caps picked from top 100 stocks by market capitalisation on NSE. The fund manager follows a growth style of investing. It has a good mix of concentration and diversification as it uses a combination of bottom-up and top-down investment approach. It is known to take an aggressive position in high conviction stocks, which has helped in outperformance. Quality of companies has ensured steady performance of the fund. Follows its benchmark weightages. In five years, the fund has given 23% against its benchmark CNX Nifty returns of 16%. Manager is Manish Gunwani (2.0 years)

UTI Equity    :  This fund has a chequered past, but has done very well in recently.  The fund has beaten its benchmark S&P BSE 100 every two-year in the past seven years. It has diversified portfolio and the fund has been known for its first-rate stock selection in the last seven years. Manager is Anoop Bhaskar (6.7 years)

BNP Paribas Equity :  The fund struggled in 2008 and 2009. Since then, it has been impressively following a well-articulated strategy to focus on companies with superior earning growth. To this end it chooses companies with pricing power for their competitive advantage or entry barriers. This has translated into a diverse portfolio of quality large caps and few quality mid-caps. This has led to a resilient portfolio during market downturns which also does well in a rising market. Manager is Shreyash Devalker since last 2.3 years.