Closed end funds which have completed one year have delivered an average of 100% return over a one year period.
Investors who have invested in closed end funds which were launched just a year back have made a killing. Value Research data shows that eight funds which were launched during April 2013 - January 2014 have delivered an average of 100% absolute return over a one year period, significantly outperforming their respective benchmarks. Some funds like Sundaram Select Micro Cap Series 1 & 2 have delivered a whopping 139 % and 136% respectively.
However, if we analyze the performance of open end funds over a one year period, they too have fared well. The category returns of open end diversified funds stood at 70% over a one year period and large cap category delivered 60% absolute return. So, can the superior performance of closed end funds be attributed merely to luck since most funds have done well due to an overall rally in the market? (The BSE Sensex has rallied 50% since April 2013.) Or have the structure and timing of launch of closed end funds helped these funds?
One year performance of closed end funds
