These funds identify the funds that have consistently performed well in the last six and 12 months.
Let’s check the performance of the Nifty 200 Momentum 30 TRI index. It is the oldest momentum index. It outperformed the small-cap index last year!
Momentum index has almost matched the small-cap index by investing in the 200 largest companies. It’s surprising because larger companies grow slower than their small-cap peers.
Though momentum funds only have a three-year history, their recent record shows they should be taken seriously.
Momentum funds can be a supplementary allocation in your portfolio (5-10%). We suggest staying invested in them for the long term (at least seven years).