This international mutual fund has been an outlier with double-digit returns

The equity markets in India have been pummelled over the last one month with the benchmark indices now trading 15% below their all-time peak. But the performance of the top indices is still relatively better considering the mid-cap space has seen a major correction with many stocks having lost 30-50% of their value in the last few weeks.

The state of the equity market has also shaken the mutual fund industry and their returns. Many funds that were sitting on high double-digit returns over the last one year have seen their net asset value (NAV) sink to the negative territory.

In fact, if the equity mutual fund categories are considered, 15 out of the 20 equity MF categories have seen their NAV skip below the 0% mark in the last 12 months.

The biggest hit has been taken by the ‘international’ category, or funds that invest primarily outside India.

The international category of MFs, which comprises nearly six dozen schemes, has shrunk by around 17% over the last one year and some have lost nearly half their value.

Indeed, just two international MFs have managed to eke out some gains for their unit holders: Aditya Birla Sun Life Commodity Equities Fund and DSP World Mining.

The Outlier

Aditya Birla Sun Life Commodity Equities Fund has been a true-blue outlier, churning out 11.7% return under the direct plan and 11.2% under the regular plan over the last one year.

So, what did it really bet on?

The fund has only Rs 18 crore in assets under management. Chemicals and consumer staples were the two key ingredients of its portfolio sectoral mix.

CF Industries Holdings Inc (US, chemicals); Bunge (US, Consumer Staples); Nutrien (Chemicals); Archer Daniels Midland (US, Consumer Staples) and Israel Chemicals (Chemicals) were the top five holdings for the fund. These five companies comprised around half of its portfolio.

The fund also bet on Mosaic Company, Sociedad Quimica y Minera de Chile SA, Deere & Company, Ingredion, Tyson Foods, Associated British Foods, BRF Brasil Foods, Kubota, Wilmar International, UPL Chemicals, Yara International, Marine Harvest, Chambal Fertilisers & Chem, Golden Agri Resources and Nippon Meat Packers.