Compared to its benchmark the fund looks impressive, but it is extremely disappointing in comparison with other funds in the category
20-Dec-2013 •Research Desk
You've rated the Birla Sun Life Mid Cap fund as 2 stars, and given the way that you've told us that the best way to watch a mid cap fund is to see how it performs in a volatile market. Now, we have had nothing but volatile markets for the last 1 year, how would you rate the performance of this particular fund over the last 1 year?
-Malini
Compared to its benchmark the fund looks impressive, but Birla Sun Life Mid Cap fund is extremely disappointing in comparison with other funds in the category.
The universe of stocks in which the mid cap funds can invest is large, and therefore a fund manager can bring significant difference to a scheme's performance, with his choice of stocks. On the other hand, you will not notice a significant difference in returns of the best and worst performing fund in the large cap category. This is because of the limited choice of available stocks.
This fund has done a reasonable job in giving consistent returns from a mid-cap portfolio and beating its benchmark. It had a very good year in 2009 when it delivered a return of 120 per cent. But it struggled to match even the category average for 3 calendar years that followed until 2012.
There are funds that have delivered significant returns even over the last 3-4 years, and that is where investors should pick a fund.
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