The month of May saw benchmark indices drop by 2.8% after nearly 15% spurt in April; the best performing PMS strategy in May delivered 3.6% positive return. Read on to know how different categories did against each other and the benchmarks.
After a memorable advance in April, the month of May saw some consolidation in markets. The largecap index Nifty slipped 2.8%, the highest among midcap, smallcap and multicap peers. Portfolio managers who rightly anticipated the market movement came on top. Overall, 61% of PMSes beat the Nifty 50, underlining the alpha creation capabilities of the product. Despite largecap strategies faring poorly compared to others in May, it is in fact a largecap PMS strategy that was the best performer among all. Read on to know how different categories did against each other and the benchmarks.
We at PMSBazaar have data on as many as 157 PMS strategies across 76 managers. All performance mentioned below is as on May 31, 2020. The PMS strategies can be subdivided into 11 categories, namely ETF, Large & Mid Cap, Large Cap, Large Cap + Gold, Mid Cap, Multi Asset, Multi Cap, Sector, Small & Mid Cap, Small Cap and Thematic. Let us look at their performance in detail. Before we begin, it may be noted that PMS strategies disclose returns in different formats, and we have looked at all of them for the sake of comparison. We will not discuss long-term returns of categories which have less than 4 offerings.
There are only two PMS strategies in the ETF group. In May, NJ Advisory's Dynamic ETF Allocation Portfolio fell by 0.46% and Freedom ETF fell by 0.62%, out-performing Nifty. The two ETFs maintain their out-performance over the 1 year as well.
Large & Mid Cap
There are a total of 4 PMS offerings in the Large & Mid Cap group. The category average return in May was -2.57%, slightly better than Nifty 50 (-2.8%). The best performer was Bonanza Growth (-0.98%).
Out of the 3 offerings with at least 1 year track-record, Emkay Investment Managers Emkay Lead PMS is the best performer with -6.8%, which is better than the category average and the Nifty's -19.6% performance.
There are altogether 18 PMS offerings we track in the Large Cap segment. The category average in May is -2.32%, with the best performer being the battle-hardened ICICI PRU Largecap Portfolio (+3.62%), over 640 basis point out-performance over Nifty. All the rest 17 offerings logged negative returns. Overall, 9 out of 18 Large Cap PMS strategies beat the Nifty.
In the 1-year period, the category average is -11.59% compared to -19.60% drop in Nifty. The best performer in the 1-year period is Ambit Inv. Advisors Coffee Can strategy with 10.9% gain, a whopping 3050 basis points out-performance over Nifty. Pelican PE Fund (+4.01%) is another offering that has delivered positive returns in this period. Overall, 15 of 16 Large Cap PMS strategies beat Nifty.
In the 5-year period, Large Cap PMS category delivered 3.51% CAGR and as many as 6 out 8 offerings beat the Nifty's 2.6% CAGR. Tata PMS Consumption Large Cap strategy is the best performer with 8.56% CAGR, followed by AccuraCap Alpha10 (6.48% CAGR).
Large Cap + Gold
This segment has only 1 offering viz. Tata PMS Bluechip Plus, which delivered -4.65% in May 2020.
There are 13 Mid Cap PMS offerings. The category average in May 2020 is -1.76%, better than Large Cap category and in-line with Nifty Midcap 100 (-1.7%). Centrum PMS Deep Value IV offering emerged as the best with +0.30% gain, an outperformance of 200 basis points over the benchmark. Overall, about half the number of total strategies in this segment bettered the benchmark.
In the 1-year period, the category average is -15.20%, much better than the Nifty Midcap 100's -26.1% return. The best performer was Phillip Capital Emerging India Portfolio (down 0.95%). All the 12 Mid Cap strategies beat the benchmark in 1-year period, a testimony to PMS fund management stewardship.
In the 5-year period, Mid Cap PMS category delivered 3.08% CAGR, which again beats the benchmark (+0.10% CAGR). One but all the Mid Cap offerings beat the benchmark, with the best performer being Tata PMS Emerging Opportunities (up 7.54% CAGR), followed by Ambit Inv. Advisors (up 7% CAGR).
This segment has only 1 offering viz. First Global Indian Multi Asset, which delivered -1.06% and comprehensively beat all equity benchmarks.
This is the biggest category of PMS offerings, with as many as 89 tracked by PMSBazaar. The category average of May 2020 was -2.19%, which is better than the multicap BSE 500 index (-2.4%). More than half of the Multi Cap strategies beat the benchmark in May, with the best performers being ICICI PRU Contra Portfolio (up 3.24%) and Credent Asset Management Growth Portfolio (up 1.8%).
In the 1-year period, the category average (of 81 offerings) is -14.83%, again better than the BSE 500 benchmark (down 20%). As many as 3 of 4 strategies also beat the benchmark in the 1-year period ended May 2020. The best performer was Marcellus Consistent Compounders (up 13.8%), a massive out-performance compared to BSE 500.
In the 5-year period ended May 2020, the category average (29 offerings) is 3.76% CAGR, again better than the BSE 500's 2.4% CAGR. As many as 6 out of 10 PMSes beat the BSE 500. The best performers in this period are IIFL Multicap PMS (up 11.77% CAGR), Satco Capital Markets Growth & Momentum (up 11.60% CAGR) and Girik Capital Multicap Growth Equity (11.39%).
There are 5 offerings in this niche space, two each targeting pharma and financials. The best performer in May was Kotak Pharma (up 3.4%), followed by Valcreate Inv. Managers Life Sciences & Specialty Opportunities (up 0.57%).
In the 1-year period, it was Valcreate Inv. Managers Life Sciences & Specialty Opportunities leading the charge with 33.36% gain, followed by Kotak Pharma (up 28.9%).
None of the sector offerings have a 5-year track-record.
Small & Mid Cap
A total of 10 strategies fit in the Small & Mid Cap segment. The category average in May was -1.78%, with half funds bettering it. As a reference point, the BSE Small Cap fell 1.9% in May. The best performer was Equirus Securities Long Horizon Fund (up 1.53%).
In the 1-year period, the category average is -23.06%. Valcreate Inv. Managers Growing India offering was the least affected in this space with -3.92% return. As a reference, BSE Small Cap fell 26.7% in the 1 year period ended May 2020.
In the 5-year period, there are just 3 offerings with Aditya Birla Capital SSP offering leading with +0.43% CAGR.
There are also 10 offerings in the Small Cap PMS universe tracked by us. Nine Rivers Capital Aurum Small Cap Opp. is the best performer with 1.6% gain in a month when the category average is down 1.78%. Many of the offerings lagged the BSE Small Cap (down 1.9%).
In the 1-year period, the category average (of 9 offerings) is -23.85% and Ambit Inv. Advisors Emerging Giants portfolio is the best with just 0.90% decline, braving the cold weather for small cap investments. Many of the offerings lagged the BSE Small Cap (down 26.7%).
There are just 3 offerings with a 5-year track-record. They are led by AccuracAp PicoPower with +1.42% CAGR, out-performing BSE Small Cap index's -0.70% CAGR.
There are 4 offerings and the May category average is -1.85%. The best performer is Green Portfolio MNC Advantage (-0.02%). In the 1-year period, the best performer is Anand Rathi Advisors MNC PMS (up 10%). None of the thematic offerings have a 5-year track-record.
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