Mid-Cap Heavy Funds Plunge

The equity markets went into a tailspin yesterday. Fortunately, normalcy returned towards the end of the day. Large-cap index Sensex closed with marginal loss. Fund investors, who missed yesterday's wild swings, would be wondering why their funds' NAVs are down substantially today.

Before we give the reasons, let's first take a look at how diversified equity funds behaved yesterday. Of 119 funds, only three registered gains. More than one fourth of the funds lost over 2 per cent, while three slipped over 3 per cent.

Huge exposure to mid- and smaller companies let the funds down--as against a minor 0.15 per cent loss of the Sensex, the BSE Midcap Index and BSE Small-Cap Index skidded 2.68 and 3.72 per cent, respectively. Investors lost money to the tune of Rs 26,227 crore, as small- and mid-cap stocks were hammered.

Funds that suffered the most include Taurus Discovery Stock (-3.35 per cent), Escorts Growth (-3.32 per cent) and Tata Growth (-3.01 per cent). All three have huge exposure to small and mid-sized companies. The three funds, UTI Index Select Equity, GIC D'Mat and GIC Growth Plus II, survived yesterday on back of large-cap tilted portfolios.

Top Losers Fund    1-Day Change    Large Cap    Mid-Cap    Small-Cap Taurus Discovery Stock   -3.35   25.98   55.31   17.23 Escorts Growth   -3.32   50.51   28.28   21.22 Tata Growth   -3.01   21.46   55.51   22.95 Canexpo   -2.90   19.63   52.50   27.87 Canequity Diversified   -2.71   21.21   61.87   16.92 Canemerging Equities   -2.70   14.48   52.65   29.59 Chola Opportunities   -2.60   36.16   46.50   12.47 JM Equity   -2.60   46.91   32.54   20.44 LICMF Growth   -2.50   32.13   37.38   26.65 Taurus Starshare   -2.46   43.16   37.75   18.43 ING Vysya Midcap   -2.38   16.29   52.48   31.23 Prudential ICICI Emerging STAR   -2.31   6.77   40.53   52.66 Principal Junior Cap   -2.28   46.69   39.73   7.77 HSBC Midcap Equity   -2.27     69.07   30.87 Magnum Midcap   -2.26   4.87   89.17   5.95 Standard Chartered Classic Equity   -2.25   32.70   50.69   12.51 ING Vysya Select Stocks   -2.24   36.14   40.52   23.34 LICMF Equity   -2.23   59.27   16.41   22.21 Magnum Contra   -2.23   49.85   41.03   9.12 Reliance Growth   -2.18   25.92   57.46   14.28 UTI India Advantage Equity   -2.14   25.27   54.01   20.72 Sahara Mid-Cap Fund   -2.13     66.28   30.74 ING Vysya Domestic Opportunities   -2.12   33.72   49.51   16.77 Tata Midcap   -2.11   5.46   60.94   33.47 Franklin India Opportunities   -2.10   31.60   36.92   23.73 Bonanza Exclusive Growth   -2.09   53.76   38.10   8.15 Sundaram S.M.I.L.E   -2.08   23.46   35.39   40.68 LICMF Opportunities   -2.07   67.34   18.61   14.04 Tata Equity PE   -2.07   42.81   45.24   11.46 JM Emerging Leaders   -2.06   35.52   46.88   17.45 Magnum Emerging Businesses   -2.03   4.91   65.61   27.44 Tata Service Industries   -2.02   29.45   49.57   20.89 All figures in %