Growth funds: Hold steady

'Growth' funds continue to oscillate between optimism and despair. In the last 12 months alone, seven weeks saw the broader market index (BSE 500 TRI) delivering returns of over 2 per cent and three weeks of comparable declines. This prompted us to review our 'growth' funds since they form the cornerstone of your portfolio. We also review the trends prevailing in this category. But before that, you should know that our 'growth' selection includes value-oriented, large- and mid-cap and flexi-cap funds. Value style triumphs again The 'value' investing style continued to maintain its hegemony over funds geared towards growth. Though the growth style showed a flicker of resurgence in the first half of 2023, this was shortlived. So, the 'value' investing style kept its winning streak for the third straight year. When examining the performance of the Nifty 500 Value 50 index (comprising the 50 most value-tilt stocks from the Nifty 500 universe) against the Nifty 500, we can see that the value factor gained notable strength in the latter part of 2023. It continues to win the arm-wrestle this year, too. Active funds wobble Until August 2023, over 90 per cent of active funds beat the BSE 500 index across the three 'growth' categories in terms of year-to-date (YTD) performance. However, the landscape has changed. The broad rally in the home stretch of 2023 allowed the BSE 500 ind

This article was originally published on April 15, 2024.