Top performersThe month of August 2019 was not that harsh for markets, with the Sensex inching lower by 0.39%. But gold fund investors never had better. With international gold stock funds, gold ETFs and gold savings fund clocking 8-14% return in August, this was yet another month when gold bugs were basking in glory. As risk aversion grips investors, gold as an asset class continues to perform. On the other hand, equity funds with large exposure to PSUs faced a tough month, with funds focussed on PSU banks losing up to 10% in August. In the debt side, short duration, ultra short and credit risk funds did well. Read on to know more.

Equity funds

International equity funds that invest in gold companies came on top. Kotak World Gold Fund generated over 14% return in August, followed by DSP World Gold Fund with 10% gain. In the 3rd position was a small cap fund i.e. Axis Small Cap Fund which gave 5% return in August 2019. Some consumption funds like Reliance ETF Consumption and Tata India Consumer Fund clocked between 3-4% in this month. ETFs that focus on ‘quality’ stocks including SBI ETF Quality and Edelweiss ETF – Nifty 100 Quality 300 were also among the top 15-20 funds.

Most of the biggest equity funds, which have a huge share of assets, had a forgettable month in August. The SBI ETF Nifty 50 mirrored a flattish Nifty. Kotak Standard Multicap Fund’s NAV movement was in line in broader benchmarks. HDFC Equity Fund fell over 3.7% in August and so did HDFC Top 100 Fund that fell over 3.2%. Among the giant funds, SBI Bluechip Fund, ICICI Prudential Bluechip Fund, Aditya Birla Sun Life Frontline Equity Fund fell in the 1-2% range. Interestingly, Axis Long Term Equity Fund gained nearly 1% in this month, quite a different trajectory than most of its peers.

PSU focussed funds were the worst hit in equity fund mart this month. The CPSE ETF was down a whopping 7.6% The Kotak PSU Bank ETF and the Reliance ETF PSU Bank BeEs both slipped over 10%. The SBI PSU Fund dropped over 7% too. Bharat 22 ETF declined by 6.3%.

Here is a chart on the August 2019 performance of the 10 biggest funds in terms of winners and losers.

Giant funds performance

Fund name Category August 2019 return % AUM Rs Cr
SBI ETF Nifty 50 Largecap -0.63 55,199
Kotak Standard Multicap Fund Multicap -0.57 24,959
HDFC Equity Fund Multicap -3.76 22,215
SBI Bluechip Fund Largecap -1.22 21,585
ICICI Prudential Bluechip Fund Largecap -1.08 21,125
HDFC Mid-Cap Opportunities Fund Midcap -0.63 20,893
Aditya Birla Sun Life Frontline Equity Fund Largecap -1.59 20,584
Axis Long Term Equity Fund ELSS 0.8 18,953
SBI ETF Sensex Largecap -0.25 17,816
HDFC Top 100 Fund Largecap -3.32 17,095

Debt funds

Debt funds In the debt market side, August was a quiet month. The best debt fund of the month was PGIM India Short Maturity Fund with over 4% rise in NAV return, followed by PGIM India Ultra Short Term Fund with over 2% return. Some credit risk funds and corporate bond funds also came atop charts. These include Union Corporate Bond Fund with 1.92% return, PGIM Credit Risk Fund with 1.28% gain, Invesco India Corporate Bond Fund with 1.22% rise, DSP Corporate Bond Fund with 1.21% return and Sundaram Corporate Bond Fund with 1.15% rise.

Top debt funds

Fund name Category August 2019 return % AUM Rs Cr
PGIM India Short Maturity Fund Short duration 4.07 116
PGIM India Ultra Short Term Fund Ultra short duratiion 2.03 51
Union Corporate Bond Fund Corporate bond 1.92 331
PGIM India Credit Risk Fund Credit risk 1.28 528
Invesco India Corporate Bond Fund Corporate bond 1.22 535
DSP Corporate Bond Fund Corporate bond 1.21 573
IDFC Banking & PSU Debt Fund Banking & PSU 1.2 7,543
Sundaram Corporate Bond Fund Corporate bond 1.15 662
BNP Paribas Short Term Fund Short duration 1.14 120
Axis Banking & PSU Debt Fund Banking & PSU 1.13 7,134

Some of the banking and PSU debt funds did well in August 2019, with IDFC Banking & PSU Debt Fund generating 1.2% gain, followed by Axis Banking & PSU Debt Fund with 1.13%, and Reliance Banking & PSU Debt Fund with 1.12% return.

With downgrades happening in certain corporates, some debt funds were caught in the down draft. BOI AXA Short Term Income Fund lost a whopping 7.87% in August, followed by Sundaram Credit Risk Fund with 5.1% loss, Sundaram Short Term Debt Fund with 4.45% drop and Sundaram Low Duration Fund with 3.52% decline. Reliance Nivesh Lakshya Fund fell 1.4%, but is still up over 22% in one-year period.

The biggest debt funds are liquid funds. These funds gave about 0.4% to 0.5% positive return in August. Notable examples are HDFC Liquid Fund, ICICI Prudential Liquid Fund, Aditya Birla Sun Life Liquid Fund, SBI Liquid Fund, UTI Liquid Cash Fund and Axis Liquid Fund.

Commodity funds

Gold funds were undoubtedly the star of August. Gold ETFs topped the charts with 10-11% returns across most schemes. The best performers included Axis Gold ETF, Invesco India Gold Fund, Kotak Gold Fund, Invesco India Gold ETF and UTI Gold ETF.

Top gold funds

Fund name August 2019 return % AUM Rs Cr
Axis Gold ETF Fund 11.49 119
Invesco India Gold Fund 11.43 13
Kotak Gold Fund 11.3 147
Invesco India Gold Exchange Traded Fund 11.17 34
UTI Gold Exchange Traded Fund 11.15 460
SBI Exchange Traded Fund Gold 11.15 686
Kotak Gold ETF 11.14 394
Reliance ETF Gold BeES 11.14 2,513
Axis Gold Fund 11.14 50
Quantum Gold Fund 11.1 58

Gold savings funds, basically a mutual fund that invests in their gold ETFs, gained between 8-10% range.

Gold funds had done well in July as well, gaining up to 3.5%. In June, gold funds had gained between 5-7%.

Disclaimer: Views expressed here in this article are for general information and reading purpose only. They do not constitute any guidelines or recommendations on any course of action to be followed by the reader. The views are not meant to serve as a professional guide/investment advice / intended to be an offer or solicitation for the purchase or sale of any financial product or instrument.

Author
Kumar Shankar Roy

Kumar Shankar Roy is contributing editor with RupeeIQ. He can be contacted on kumarsroy@rupeeiq.com