BSE Sensex may have beaten NSE Nifty by a huge margin in 2018, first time in nearly half a decade, but its growth number does not bring any cheer. As a whole, stock and mutual fund investors are counting losses despite a 5.9% growth of Sensex as against Nifty’s 3.2%. Mutual funds have done a tad better as compared to the equity markets, but most of them left retail investors disappointed. After pumping in thousands of crores of rupees into equity funds, a majority of investors have to wait patiently to see stock market improve in 2019, probably after the general elections.
On their part, debt funds have shown a much better performance. When one-fourth of equity funds gave a positive return in 2018, 98% of debt funds reported positive growth. Gold has returned 8% growth, but taxes will take away the sheen.
With an annual post-tax return of 7.7%, the Public Provident Fund (PPF) has turned out to be the darling of investors in 2018. As the inflation-wary central bank kept policy rates high, the rates on 10-year government securities (G-Sec) were directly impacted, and in turn, influenced returns on several products that are bench-marked to the G-Sec rate, including PPF.
Experts predict that 2019 may be very different from the year that’s gone past. It only means that putting all eggs in one basket may be risky.