S&P Dow Jones Indices has been the de facto scorekeeper of the ongoing active versus passive debate since the first publication of the S&P Indices Versus Active Funds (SPIVA) U.S. Scorecard in 2002. Over the years, we have built on our experience publishing the report by expanding scorecard coverage into Australia, Canada, Europe, India, Japan, Latin America, and South Africa.
The SPIVA India Scorecard compares the performance of actively managed Indian mutual funds with their respective benchmark indices over 1-, 3-, 5-, and 10-year investment horizons. In this scorecard, we studied the performance of three categories of actively managed equity funds and two categories of actively managed bond funds over the 1-, 3-, 5-, and 10-year periods ending in June 2020.
A volatile H1 2020 saw the S&P BSE 100, the benchmark for large-cap funds in India, ending in the red (down 14.39%). Conversely, investors that tactically shifted asset allocations to Indian fixed income categories at the start of 2020 may have endured lower drawdowns, with the S&P BSE India Government Bond Index ending in the black (up 7.78%) in the same period. The sharp correction in Q1 of calendar year 2020 was followed by a strong rebound in Q2 of calendar year 2020 with the S&P BSE 100 up 20.3%, supported by the economic relief package coupled with easing monetary policy.
For Indian equity categories in H1 2020, the equal-weighted fund returns were higher than their respective asset-weighted and index returns, suggesting that smaller-sized funds were able to better navigate this volatile period than their larger peers.
