May 30, 2022 (MLN): In the month of April’22, 6 among 26 equity funds delivered good returns to their investors, while the rest found it difficult to beat the benchmark.
During the same month, the performance of the KSE-100 index which is the benchmark for all equity funds was capped by worsening economic fundamentals, despite the decline in uncertainty on the political front following the formation of the new coalition government as the index increased by just 320 points or 0.7% MoM to settle the month at the 45,249 points level.
As a result of this, most of the equity mutual funds generated negative returns during the month under review, with many of them have fallen far below their benchmarks.
Meanwhile, it is important to note that the total Asset Under Management (AUM) of the mutual fund industry witnessed a decline of 5.0%MoM to Rs1,077bn in the month of April’22 wherein the equity funds witnessed an outflow as AUM reduced by 12% MoM to Rs131bn.
Going by the data compiled by Mettis Global, Golden Arrow Stock Fund (AKDGASF), carrying a high-risk profile, managed by AKD Investment Management Limited, has hogged the limelight as it generated the highest return of 4.15% in the month. However, the fiscal year to month return for the fund clocked in at -14.64% as compared to -4.45% return provided by the benchmark KSE-100 Index.
The fund held most of its investment in Textile Spinning, Power Generation & Distribution, Investment Banks and Technology sectors during the review month. The top five holdings of the fund include Pakistan Stock Exchange Ltd (8.1%), Ellcot Spinning Mills Ltd (6.36%), TRG Pakistan Ltd (6.29%), Cnergyico PK Ltd (6.03%), and Hun Networks Ltd (5.66%).
UBL Financial Sector Fund (UBLFSF), another fund carrying high-risk profile landed as the second-best performing fund with the returns clocking in at 1.82% for the month. The 10MYF22 returns stand at 11.95%, beating the benchmark of -4.45% by an exorbitant margin.
The objective is to provide investors long-term capital appreciation by investing primarily in a mix of an actively managed portfolios of listed equities that offer capital gains and dividends yield potential preferably in the Financial Sector Accordingly, the fund allocated most of its investment in Banks such as UBL (19.13), Bank Alfalah (15.36%), Meezan Bank (15.16%), Habib Bank Limited (12.35%), and Bank Al Habib (10.20%).
First Capital Mutual Fund-B (FCMF) took the third position in the chart as its net asset value grew by 1.81% during the month, thus outperforming the benchmark of 0.7%. However, during 9MFY22, the fund delivered a negative return of 16% compared to the benchmark return of -4.45%.
This high-risk profile fund held most of its investments in OMCs, Oil & Gas Exploration companies, Banks, Investment Banks, and the Fertilizer sector.
Apart from the above funds, HBL Energy Fund (HBLEF), AKD Opportunity Fund (AKDOF), HBL Investment Fund Class-A (HBLIF-A), HBL Growth Fund Class-A (HBLGF-A), NBP Financial Sector Fund (NBPFSECTF), and Al Habib Stock Fund (AHSF) also performed fairly as they managed to provide positive returns of 1.61%, 1.29%, 1.25%, 1.15%, 0.9%, and 0.57% respectively.
On the other hand, HBL Equity Fund (HBLEQF), HBL Investment Fund Class-B (HBLIF-B), and HBL Growth Fund Class-B (HBLGF-B) emerged as the worst-performing funds as they delivered the highest negative returns of 6.16%, 5.63% and 5.07% respectively.
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