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FEFI falls 3.7% in January 2010

February 5, 2010

The Fundsupermart All-Equity Fund Index January Update

Author : iFAST Research Team

Untitled Document

FEFI Performance UPDate

The New Year started with a bang with the SENSEX going up all the way to 17,701 but subsequently settling back to 16000 levels, losing almost 6.3% on a month-on-month basis. Some of the reasons that led to the fall were the fears of a rate hike by the RBI on account of higher-than-expected WPI inflation, a rate hike by China, and a correction in the international markets.

As on 31 January 2010, the FEFI closed at 1831.56 points, registering a 3.7% loss. The equity fund managers did a good job in January, considering that the fall in the FEFI is less than the BSE SENSEX, and other broad-based indices like BSE 500 and S&P CNX 500 With SENSEX, BSE 500 and S&P CNX 500 losing 6.34%, 4.86% and 4.0% respectively.

Chart 1

Table 1: FEFI Index levels

	FEFI - IN	Year-to-date (%)
31 December 2009	1831.56	-
31 January 2010	1763.09	-3.7

Table 2: Top 5 Equity funds on our platform in January

	Sector	YTD Returns	MTD Returns
ICICI PRUDENTIAL DISCOVERY FUND - GROWTH	Contra	0.37%	0.37%
IDFC PREMIER EQUITY FUND GROWTH	Contra	0.27%	0.27%
SBI MAGNUM MIDCAP FUND- GROWTH	Midcap	-0.10%	-0.10%
ICICI PRUDENTIAL EMERGING STAR - GROWTH	Diversified	-0.37%	-0.37%
EDELWEISS ABSOLUTE RETURN EQUITY FUND- GROWTH	Specialty	-0.69%	-0.69%

Clearly, the Contra / Value funds performed well in January. Both the top performing funds for the equity segment are contra funds. The remaining funds in the top five funds list delivered negative returns on a month-on-month basis.

Table 3: Bottom 5 Equity funds on our platform in January

	Sector	YTD Returns	MTD Returns
SUNDARAM BNP PARIBAS SELECT FOCUS APPRECIATION	Specialty	-6.9%	-6.9%
BSL INTERNATIONAL EQUITY PLAN A -GROWTH	Global	-7.3%	-7.3%
JM LARGE CAP FUND- GROWTH	Specialty	-7.4%	-7.4%
BSL COMMODITIES EQUITIES FUND GLOBAL MULTI COMMODITY PLAN RETAIL- GROWTH	Global	-7.6%	-7.6%
MIRAE ASSET GLOBAL COMMODITY STOCKS FUND- GROWTH	Global	-8.8%	-8.8%

As for the worst performing funds, the funds with exposure to companies outside India ended up at the bottom. Globally, most of the equity indices fell in January due to the rate hike in China. The MSCI World Index fell by over 4% while the rupee appreciated by 0.8% in January. Both these factors led to a negative performance of global equity funds.

The Research Team is part of iFAST Financial India Pvt Ltd

iFAST and/or its content and research team’s licensed representatives may own or have positions in the mutual funds of any of the Asset Management Company mentioned or referred to in the article, and may from time to time add or dispose of, or be materially interested in any such. This article is not to be construed as an offer or solicitation for the subscription, purchase or sale of any mutual fund. No investment decision should be taken without first viewing a mutual fund's offer document/scheme additional information/scheme information document. Any advice herein is made on a general basis and does not take into account the specific investment objectives of the specific person or group of persons. Investors should seek for professional investment, tax, and legal advice before making an investment or any other decision. Past performance and any forecast is not necessarily indicative of the future or likely performance of the mutual fund. The value of mutual funds and the income from them may fall as well as rise. Opinions expressed herein are subject to change without notice. Please read our disclaimer in the website.