Fund Review: SBI Magnum Multi-Cap Fund
Keeping aside the current market corrections, the trend shows that apart from the selected mid-sized companies, a large number of big companies are outperforming the mid-sized ones.
Additionally, the steep valuation of the mid-cap stocks is limiting the scope of alpha generation across sectors. In such a case, the investors should consider multi-cap mutual funds which proffer benefits of both the worlds to create wealth in long-term.
SBI Magnum Multi-Cap Fund is one such option that not only captures the growth of the large-cap stocks but maintains an appropriate balance between the valuation of the large and mid-sized companies. As per the data till the end of 2017, this fund has been one of the consistent performers in the multi-cap category and acquired top quartile ranks 4 times, since 2011.
The Unbiased Rolling Returns
Under the efficient management of Mr. Anup Upadhyay, the fund is picking up the stocks having attractive earnings growth trajectory over at least 3-year horizon. The fund has tried to avoid short-term tactical calls and as a result, the time has proffered it good rolling returns over the past 5 years. Rolling returns are considered to be the most credible performance measure in the mutual fund space that provides an annualized overview of the returns calculated on a daily/weekly/monthly basis. The rolling returns of SBI Magnum Multi-Cap Fund clearly indicate that the fund has consistently beaten its benchmark (S&P BSE 500) in 3-year rolling period over 5 years.
Rolling Returns vs. Benchmark
From the above data, we can figure out that the fund has given more than 20% rolling returns, 60% of times, despite the prevailing volatility in the market over the considered period.
Similarly, the fund has outperformed its peers in the 3-year rolling period from 2013 to 2018.
Rolling Returns vs. Category
The Volatility Measures – Upside and Downside Market Capture Ratio
The Upside and Downside Market Capture Ratios are effective analytical measures to understand the performance of a fund during the rising and falling market conditions. Over the last 3 and 5 years, the upside market capture ratio has been more than 100% which indicates that the fund was able to generate higher returns than its benchmark when the market was rising. Similarly, the Downside Market Capture Ratio was less than 100% which specifies the fund had some risk protection when the market fell during 2015-16.
The Factual SIP Returns
We encourage our customers to start investing in the funds like SBI Magnum Multi cap Fund through SIP mode. Why? If you would have opted for a systematic investment plan (SIP) and invested Rs. 5000 every month in SBI Magnum Multi-Cap Fund for the last five years, it would have created a wonder. The value of your investment would have grown to approx. Rs. 4.8 lac (as on March 29, 2018) from Rs. 3 lac, by now. Also, if we perform further calculations, the fund stands among the top 10 diversified equity schemes with a monthly SIP return rate of 19% over the last five years.
Being from the moderately risky multi-cap category, the fund has a high capture ratio (more than 1 is good) which assures substantial risk-adjusted returns. The fund seeks both value and growth by retaining a balance between the large and mid-cap stocks in its portfolio. It has consistently outperformed its category and benchmark over long time intervals. With approximately 21% of annualized trailing returns in 5 years, this fund can be a suitable option for the investors with moderately high-risk appetite and long term investment goals.
Why Is Economy Falling & Stock Market Rising? The Story Behind the See-Saw Trend!7054 min read Jun 30, 2021
Indian equity indices gained marginally higher ahead of slow economic growth.28363 min read Jun 03, 2019
Market Cheered Modi’s Return. All the Major Equity Indices Traded Higher18583 min read May 27, 2019
Despite Poor Macroeconomic Data, Sensex Managed to Close Higher11874 min read May 19, 2019