Is Axis Mutual Fund losing its sheen?
In the last few days, a definite trend is visible in Google. When it comes to mutual fund trend in India, a lot of searches is being done on Axis Mutual Fund online redemption.
So, what is the reason behind this sudden interest in the investors that they are looking to exit from Axis Mutual Fund? Till a few months back, Axis remained the favourite of investors, and equity dedicated mutual funds from this fund house were ruling their respective categories.
Nevertheless, things have changed in the last few months. However, in the last three months, the performance of the equity dedicated funds from Axis Mutual Funds has seen a relatively sharp drop. For example, in the last three-year period, Axis Bluechip Fund-Regular has generated a return of 10.14 per cent annually, which remains the best and the highest in its category.
However, in the last three months, the net asset value (NAV) of the fund has increased by 15.32 per cent. Despite such an excellent performance, it remains at the bottom of the ladder in its category. A similar pattern is visible in other funds of this fund house.
Meanwhile, Axis Mid-cap Fund gave a return of 17.17 per cent in the last three months, which remained the lowest in its category. Managed by Shreyash Devalkar, it is the only fund in its category that has generated returns in double-digit in the last three years.
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Three Months Returns (%)
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Three Year Returns (%)
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Funds
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Axis Funds
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Category Average
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Axis Funds
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Category Average
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Axis Bluechip Fund-Reg(G)
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15.32
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19.26
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10.14
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3.38
|
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Axis Focused 25 Fund-Reg(G)
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19.21
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20.56
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7.64
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3.62
|
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Axis Long Term Equity Fund-Reg(G)
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15.51
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20.78
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7.49
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2.52
|
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Axis Midcap Fund-Reg(G)
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17.17
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23.75
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11.54
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2.08
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Axis Small Cap Fund-Reg(G)
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18.87
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26.52
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7.59
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-1.89
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Let’s know the reason behind such a poor performance of the funds during the last three months. One of the main reasons is the high cash component in the portfolio of Axis funds. For example, Axis Mid-cap Fund holds almost 13 per cent of its AUM in cash. As the market picked up from its low in March, this cash component did not contribute to the growth of the NAV. This might have worked for the fund in the falling market, however, in the rising market, it’s of no help.
Going ahead, if the market continues its winning streak, we may see the funds underperform. Nonetheless, if the market falls again, the fund will be relatively better in terms of performance, considering, they remain in cash.