Strategic agility and resilience drive the performance of offerings amidst market volatility

November 2024 continued to see market volatility as key indices displayed mixed performance. While the Nifty 50 TRI dropped slightly by 0.26%, the BSE 500 TRI showed a modest increase of 0.06%.

Amidst these fluctuating market conditions, Alternative Investment Funds (AIFs) continued to demonstrate resilience. Long-short AIFs emerged as the standout performers, with an average return of 0.57%, significantly outperforming both the Nifty 50 TRI and BSE 500 TRI. Of the 34 Long-Short funds, 28 outperformed the Nifty 50, and 22 outpaced the BSE 500 TRI, showcasing the potential of these strategies in navigating market uncertainty.

In comparison, Long-Only AIFs delivered average returns of 0.50%, with 45 of the 75 schemes beating the Nifty 50 TRI, and 42 surpassing the BSE 500 TRI. Despite the mixed market performance, both Long-Short and Long-Only AIFs proved to be valuable wealth-protection tools during a period of market flux.

Top-10 Long-Only Performers

Category-III Long-Only AIFs continue to provide a dynamic investment approach by focussing on long positions in selected stocks, aiming to achieve capital appreciation. These funds, which operate within a structured AIF framework, employ a strategy similar to traditional equity investing but with more concentrated exposure. In November 2024, the average return for the Long-Only AIF category stood at 0.50%, with 42 of the 75 funds outperforming the BSE 500 TRI and 45 exceeding the Nifty 50 TRI.

Here is a look at the top 5 performing strategies for this month:

Carnelian Asset Management and Advisors - Structural Shift Fundund - November 2024 Return: 7.89% - Alpha over Nifty 50 TRI: 8.15%

This fund targets shifts in market dynamics, investing in sectors with the potential for substantial growth, capitalising on key trends and economic shifts.

Generational Capital Breakout Trust - Breakout Fund 1 - November 2024 Return: 6.02% - Alpha over Nifty 50 TRI: 6.28%

The Breakout Fund focuses on high-growth companies that are expected to experience significant price movements, driven by both technical and fundamental trends.

Monarch Networth Capital - MNCL Capital Compounder Fund - 2 - November 2024 Return: 3.80% - Alpha over Nifty 50 TRI: 4.06%

This fund focuses on compounding capital over time by investing in high-conviction stocks that show long-term growth potential.

Valuequest Investment Advisors - VQ FasterCAP Fund - November 2024 Return: 3.70% - Alpha over Nifty 50 TRI: 3.96%

This fund uses a combination of mid and small-cap stocks with strong growth prospects, aiming for rapid capital appreciation.

Sundaram Alternate Assets - Opportunities Series - Atlas - November 2024 Return: 3.64% - Alpha over Nifty 50 TRI: 3.90%

A diversified fund, Opportunities Series - Atlas focusses on large-cap and mid-cap stocks, providing consistent returns while navigating through market fluctuations.

Top 10 Long-Only AIF Performers (November 2024)

The Long-Only AIF category’s performance compared to benchmark indices is shown below.

The above data highlights the outperformance of several Long-Only AIFs in the current market environment, underscoring their potential to generate positive returns even amid market volatility.

Top-10 Long-Short Performers

Category-III Long-Short AIFs combine long and short positions to generate returns, even in declining markets. These funds aim to capitalise on both rising and falling assets, offering a hedged approach to market volatility. In November 2024, Long-Short funds averaged a return of 0.57%, with 28 out of 34 funds surpassing both the BSE 500 TRI and Nifty 50 TRI benchmarks.

The above data highlights the resilience of Long-Short AIFs, which not only performed well in the face of market volatility but also outpaced traditional equity benchmarks. These funds remain valuable for investors looking for hedged strategies in uncertain market environments.

Here is a look at the top 3 performing strategies for this month:

Swyom Advisors - India Alpha Fund - November 2024 Return: 4.33% - Alpha over Nifty 50 TRI: 4.59%

This fund focuses on undervalued opportunities while shorting overvalued stocks, effectively capturing alpha and generating returns even in challenging market conditions.

Pluswealth Capital Management - Pluswealth Assets LLP - November 2024 Return: 2.68% - Alpha over Nifty 50 TRI: 2.94%

A strategic blend of long and short equity positions that capitalises on market inefficiencies, offering stable returns in volatile conditions.

Helios Capital Asset Management (India) - India Long Short Fund - November 2024 Return: 2.03% - Alpha over Nifty 50 TRI: 2.29%

This fund combines a tactical approach to equity investments with short positions, ensuring strong performance even in downward markets.

Top 5 Long-Short AIF Performers (November 2024)

Conclusion

November 2024 proved to be yet another mixed month for both Long-Only and Long-Short Category-III AIFs, as the market remained volatile, with benchmarks showing moderate fluctuations. While Long-Short funds continued to demonstrate their hedging strength and outperformed Long-Only strategies, both categories still faced challenges, with overall returns remaining in negative territory. Despite this, several AIFs stood out for their strategic flexibility and strong execution, successfully navigating the turbulent market conditions.

For investors, November highlights the importance of diversification and adaptability in AIF strategies. Allocating capital to AIFs with a long-term outlook provides an opportunity to tap into specialised assets and active management strategies that can potentially outperform traditional investments over time. By aligning investments with personal financial goals and risk tolerance, investors can better withstand market volatility while working toward consistent wealth growth. A disciplined, long-term investment approach is crucial for managing risks effectively and optimising returns for future financial security.

Note:

***Post Exp & Tax ; **Post Exp, Pre-Tax; ##Gross returns; ###Post Exp & Pre Perf.Fees & Tax; ^^ Post Exp & Tax and Pre Perf.Fees 

Disclaimer: This Blog is made for informational purposes only and does not constitute an offer, solicitation, or an invitation to the public in general to invest in any of the Funds mentioned. All the Returns mentioned in this blog are provided by the respective asset management companies and may vary based on their reporting structure (Pre-tax, Post-tax, Post-expenses, etc.). PMS Bazaar has taken due care and caution in the compilation of data and information. However, PMS Bazaar doesn’t guarantee the accuracy, adequacy, or completeness of any information. Investors must read the detailed Private Placement Memorandum (PPM), including the risk factors, and consult your Financial Advisor before making any investment decision/contribution to AIF. This Blog has been prepared for general guidance, and no person should act upon any information contained in the document. PMS Bazaar, its affiliates, and their office, directors, and employees shall not be responsible or liable for any investment action initiated. This Blog is intended only for the personal use to which it is addressed and not for distribution.