Equity markets were relatively unchanged in January, with frontline indices not moving much. The unravelling of the corporate earnings season and anticipation around the interim budget meant that the Nifty 50 TRI barely recorded 0.02% returns in the month, while the broader market BSE 500 TRI gave 1.92%. Small caps were back in favour during January after a dull December.
Despite moderate indices, category 3 long-only Alternative Investment Funds (AIFs) had a solid month, with funds delivering well enough to go past standard benchmarks. Long-only funds invest in companies that are traded regularly in the Indian exchanges. They are unrestricted by any rigid mandate and can tweak their strategies to suit market conditions to derive the best returns.
During the month, 55 of the 63 category III long-only funds managed to outperform the Nifty 50 TRI, while 43 strategies (nearly 8 in 10) delivered better returns than the BSE 500 TRI.
The long-short category’s performance was also healthy in January. As many as 15 of the 23 funds delivered more than the Nifty 50 TRI. Against the BSE 500 TRI, the overall performance was lukewarm.
Long-only funds gave 3.56% on average in January. The long-short funds ended the month with 0.65% returns on average.
Open-ended funds did very well in the long-only category with seven of the top 10 being such schemes. Again, open-ended strategies continued to dominate the toppers’ chart in the long-short category.
Top 10 long-only performers
In January, the top long-only funds in terms of returns delivered way above the standard benchmarks – Nifty 50 TRI and BSE 500 TRI. Also, the top five strategies gave double-digit returns, while the others managed to deliver 4-7 percentage points more than the indices.
As mentioned earlier, seven of the top 10 long-only funds were open-ended, while the remaining four were closed-ended. This is the opposite of what was prevalent in the previous few months when closed-ended funds dominated the toppers’ list.
Here is the list of the top 10 funds in the category 3 long-only funds segment.


Top 5 long-short funds


Summary & Outlook
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