Now Reading: Active momentum funds beat volatility with 10.8% return
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Active momentum funds beat volatility with 10.8% return
Active momentum funds have trounced broader market benchmarks over the past three and six months, a period of high volatility. Over six months to 23 July 2026, they returned an average of…
The Story in Brief
Active momentum funds have trounced broader market benchmarks over the past three and six months, a period of high volatility. Over six months to 23 July 2026, they returned an average of 10.8%, against 1.8% for the Nifty 500 TRI and minus 4.1% for the Nifty 50 TRI. Three-month returns stood at 6.4% versus 1.2% and minus 0.7% respectively. However, returns across individual schemes ranged from 3.7% to 15.2%, reflecting the diversity of quantitative models and fundamental filters used by managers. These funds buy rising stocks and sell laggards, using proprietary signals like earnings momentum. Advisors caution that the strategies remain vulnerable to sharp drawdowns during sudden market reversals, and recommend waiting for longer track records.
The Indian Opinion
The hype around active momentum funds overlooks two uncomfortable facts: performance across schemes varies wildly, from 3.7% to 15.2%, and these strategies are untested in a prolonged downturn. Boosters call it a smart beta revolution; critics warn of a drawdown trap. The real test will come not in this bull run but during the next sharp reversal. How much of that 10.8% can these funds keep when the tide turns?
Source: livemint.com
This story was synthesised by AI from the source linked above.
