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Diversified equity funds holding Nifty’s ‘strongest five’ shine

Many large-cap diversified equity mutual fund schemes have found it difficult to outperform the Nifty over the last one year. This is because almost 66 per cent of the Nifty returns came from just five stocks. Though the Nifty returned 12.3 per cent over the last one year, TCS, Infosys, HDFC Bank, Kotak Mahindra Bank and Reliance Industries gave returns of 62 per cent, 36 per cent, 28 per cent, 44 per cent and 37 per cent respectively and accounted for 66 per cent of the Nifty returns. Fund managers who were able to identify these stocks or increase weightage during the year, managed to outperform the index.One of the exceptions was Parag Parikh Long Term Value Fund, which outperformed the Nifty despite owning just HDFC Bank, with a 8 per cent holding. With a mandate to invest in overseas companies as part of its portfolio, its 15 per cent holding in Alphabet and Facebook, which gained 24 per cent and 30 per cent helped it outperform the index. 64969767 64958642 64960386

Source: ET

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