Diversified Equity Funds: Not Dead Yet

It has been a prolonged spell of bear-run for investors in diversified equity funds no surprise here since the Indian markets have been on of the worst performers in Asia so far in 2001. The glittering returns for early 2000 are now history and the Value Research category of equity funds is currently down 30 per cent for the one-year period. Yet, despite the disappointing performance and sharp losses in the near-term, there are a handful of "islands of safety" where long-term returns of equity funds continue to be impressive. With returns in excess of 20 per cent annualised against a negative 1.13 per cent return on Sensex, in the last five years. These funds re-affirm the basic doctrine - equities are meant for the long haul and require commitment. It is important to highlight here that even five years is not a sufficiently large period for equity investing but the sample is constrained for want of funds with a longer track-record. Long-Range Gains  The Leaders…..  (Rs)  (%)   Pioneer ITI Bluechip 18.98 27.6  Pioneer ITI Prima Plus 12.04 22.2  Zurich India Equity 9.93 20.7  Birla Advantage 21.91 19.6  …and the Laggards  GIC Fortune '94 4.70 -11.2  Canglobal 4.99 -10.9  Canbonus 7.21 -7.2  JM Equity-G 6.71 -6.3  Taurus Discovery Stock 3.75 -4.9    The Leaders Now, the all-important question - which are t