LIC Index Fund Beats the Index | Value Research By a significant margin. Those sitting on cash and who decided to play safe were left out. But, we still can't figure out the LIC's magic wand. Read more to know the mysteries of Tuesday's panic buying
Fundwire

LIC Index Fund Beats the Index

By a significant margin. Those sitting on cash and who decided to play safe were left out. But, we still can't figure out the LIC's magic wand. Read more to know the mysteries of Tuesday's panic buying

The sudden spurt and exuberance on Tuesday in the Indian equity market helped rebuilt some lost confidence and money, and also left had some interesting observation worth noticing. The fourth biggest gain (in terms of percentage) and the second biggest (in points) certainly gave a sigh of relief for mutual fund investors, too.

A total of 47 open-ended funds went up by 6 per cent and more, moving in tandem of the benchmark indices. While, clearly it was the index fund category that stole the show, there were a few categories like the Pharma, Healthcare and FMCG that fizzled, despite the rally.

Being an index fund, LIC MF Index Sensex gained the most; the fund witnessed an astronomical growth of 9.68 per cent, as the NAV increased from Rs.31.01 as on March 24 to Rs.34.01, as against the Sensex which gained 6% per cent. Other gainers in the same category included Nifty Junior BeES, Banking BeES and Kotak PSU Bank ETF, up by 8.36 per cent, 7.72 per cent and 6.81 per cent, respectively. On the contrary, Franklin Pharma, Magnum Pharma, ICICI Prudential FMCG, JM Healthcare Sector, UTI Pharma & Healthcare, Magnum FMCG etc., were among those which returned between 1-2 percentage points.

In the Equity Diversified category, JM Contra gained the most, followed by Tauras Starshare. NAVs of both the funds were up by 8.15 per cent (Rs. 8.73 as on March 24 to Rs. 9.44) 8.04 per cent (Rs.47.50 as on March 24 to Rs.51.32), respectively. Principal Junior Cap (7.87 per cent), DBS Chola Opportunities (7.34 per cent) and Taurus Discovery Stock (7.19 per cent) were also among the top gainers. Besides, several Technology oriented funds made their presence justified after a long time, as the top gainers on Tuesday's trade included Infosys and several other of its ilk. Consequently, Franklin Infotech, UTI Software, DSPML Technology.com and Birla Sun Life New Millennium were up by more than 5 per cent.

It is said that one who doesn't throw the dice won't get a six, but there exist equal chances of getting a one, so it's all about taking chances. Something similar came to the surface, while analyzing the NAV movements. Take for example Banking sector funds, while Reliance Banking gained 6.21 per cent, UTI Banking gained 7.82 per cent, why so? Well, that's purely a factor of how much one is invested in the markets at such turbulent times or how much is the cash component as percentage of net assets. While, Reliance banking had a cash component cash and cash equivalent to the tune of 32 per cent, UTI Banking had a meager 2 per cent holding in cash.



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