Looking at Mutual Fund House ranks based on AUM does not solve any purpose for investors and advisers. AMCs should move away from AUM race and start publishing how much % of their AUM is beating benchmark – the primary role for which investors pay management fees to the Mutual Fund.
Following are the ranks as on Dec 31, 2018 based on the percentage of Equity AUM beating its respective benchmark over last 1, 3 and 5 year. Final AUM Beating Benchmark Score is calculated by assigning 20%, 30% and 50% weights for 1, 3 and 5 year period respectively based on percentage of AUM beating benchmark.
The analysis shows that higher AUM does not necessarily mean better performance, which is the general belief among many advisers and investors.
Kotak, Mirae Asset, Principal, Parag Parikh and Axis are the top 5 fund houses based on performance as on Dec 2018.
|Rank||AMC||AUM Beating Benchmark Score|
|2||Mirae Asset MF||73%|
|4||Parag Parikh MF||70%|
|11||Aditya Birla SL MF||53%|
|13||Franklin Templeton MF||51%|
|16||ICICI Pru MF||47%|
|17||Canara Robecco MF||46%|
|22||BNP Paribas MF||31%|
|24||Motilal Oswal MF||28%|
|28||DHFL Pramerica MF||18%|
|30||BOI Axa MF||9%|
|31||JM Finance MF||4%|
The analysis considers all open-ended diversified equity and hybrid funds (Sector/Thematic and Arbitrage Funds are removed for this analysis)