Top 5 Large cap Mutual Funds with consistent returns

The idea of this  post is to select and rank large cap funds based on consistent return over long period of time. Selecting funds pose a real challenge as the number of funds in each category keeps on increasing. Also over different period of time there is huge variation in  returns for Mutual Funds.

For example a fund with great 1 year or 3 year returns may not perform good over a 5 year or 10 year period . Therefore I laid down some criteria  to pick the fund taking into consideration returns for all possible periods from 1 year to 10 year, with higher weight for long term returns. This way we can filter signal from the noise and also overcome our inherent biases.

The criteria and methodology is listed below.

  1. The fund should have at least 10 years of history.
  2. The data from value research is used which lists returns over 1-year, 3-year, 5-year and 10-year periods.
  3. The  returns are as on date 24-Feb-2017.
  4. The weighed average return is calculated by assigning following weights based on duration of returns. Annual compounded returns are taken into consideration.
  • For 10 year returns weight is  40 out of 100
  • For 5 year returns weight    is  30 out of  100
  • For 3 year returns weight    is  20 out of 100
  • For 1 year returns weight    is  10 out of 100

Hence formula for weighed average returns

Weighed Average returns =  (40*(10 year return) + 30*(5 year return) + 20*(3 year return) + 10*(1 year return) )/ 100

    The results are interesting and we can see value research rating also agrees with us to some extent.



I have selected top 5 funds on the basis of weighed average returns and the following graph tells us the whole story. For comparison sake I have included the S&P BSE 200 index .

  1. Quantum Long Term Equity Fund
  2. Birla Sun Life Frontline Equity Fund
  3. HDFC Top 200 Fund
  4. Birla Sun Life Top 100 Fund
  5. SBI Bluechip Fund



    Stay tuned for Top 5  Multi cap funds in next post.

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