5-star rated equity fund turns monthly SIP of ₹10,000 to ₹13 lakh in 5 years
3 min read . Updated: 15 Sep 2022, 07:43 PM IST
Premium- Multi-cap funds are the widely preferred category for investors who seek to gain from equity investments in every market circumstance
Multi-cap funds are the widely preferred category for investors who seek to gain from equity investments in every market circumstance, as Multi cap equity funds are perfect for risk-averse investors seeking a diversified portfolio since they invest in firms of all sizes and across industries. As a result, these funds hold large, mid, and small-cap stocks. Multi-cap funds saw a good inflow of ₹392.66 Cr for the month of August 2022, and the funds are great for long-term investments of up to 5 years. Additionally, multi-cap funds have produced an average return of 15.36% over the past five years. While discussing multi-cap funds, we've used the Quant Active Fund Direct-Growth as an illustration, which in five years has grown from a monthly SIP of ₹10,000 to over ₹13 lakh.
Returns of Quant Active Fund Direct-Growth
The fund was launched on January 1, 2013, and Morningstar has given it a 5-star rating, making it more than nine years old. The assets under management (AUM) of Quant Active Fund Direct-Growth were ₹2856.6 Cr Crores as of June 30, 2022, while the fund's NAV was ₹484.11 on September 14, 2022. The expense ratio for the fund is 0.58%, which is lower than that of the majority of other funds in the same category. The fund's annualized SIP return during the previous five years was 31.88%, which is much higher than the category average of 17.25%.
As a result, a monthly SIP of ₹10,000 made at the time would today be worth ₹13.11 Lakh. The fund's annualized SIP return over the past three years has been 43.37%, which is much higher than the category average of 23.38%. As a result, a monthly SIP of ₹10,000 that was begun three years ago has now grown to ₹6.58 Lakh. Since the fund's absolute return over the past year has been 12.65%, which is much better than the category average of 6.87%, a monthly SIP of ₹10,000 that was begun last year has now grown to ₹1.35 Lakh. In the last 5 years, the fund has given a CAGR of 23.62%, 40.63% CAGR In the last 3 years, and 15.79% CAGR in 1 year.
The fund is benchmarked against the Nifty 500 Multicap 50:25:25 TRI. The fund has given a 1-year trailing return of 15.79% higher than the category average of 5.3% and since its launch, it has delivered 21.41% average annual returns higher than the category average of 13.45%. According to the figures above, the fund has doubled investors’ money every 2 years. The fund has a rolling return of 16.8% in 1 year higher than the category average of 11.4%, 15.5% rolling return in 3 years higher than the category average of 12.2% and 5 years of rolling return of 20.7% higher than the category average of 13.8% which indicates the performance consistency of the fund that are likely to witness in the future across the said period.
Key takeaways of Quant Active Fund Direct-Growth
The top five holdings of the fund are ITC Ltd., Ambuja Cements Ltd., State Bank of India, Adani Ports and Special Economic Zone Ltd., and Larsen & Toubro Ltd. The fund has investments in the services, consumer staples, materials, metals & mining, and construction sectors. 99.1% of the fund's holdings are domestic equities, of which 47.05% are large-cap companies, 26.36% are mid-cap stocks, and 25.69% are small-cap stocks.
SIPs can be initiated in this fund starting at Rs. 1000 per month, and there is no exit load. The fund has a Sharpe ratio of 1.32, which is higher than the category average of 0.84, a standard deviation ratio of 22.48, which is higher than the category average of 19.91, a beta ratio of 0.94, which is higher than the category average of 0.84, and a Jension's Alpha ratio of 11, which is higher than the category average of 3.46. All of these ratios indicate that the fund is extremely volatile, but it has also succeeded in producing better risk-adjusted returns to the investors, turning into a high-risk high-reward fund.
