Investors putting in money in overseas funds via the systematic investment plan (SIP) route have seen a relatively tough time, compared to those in other categories for whom returns remain in the positive territory.

According to data by Value Research, of 128 schemes investing in international funds, 23 have returned losses on a three-year basis.

Interestingly, only 24 schemes across categories have generated losses over a three-year period. The only other one falls in the sectoral (pharma) category.

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Further, of the 23 schemes investing overseas, six have shown negative returns over both the one-year and three-year periods.

“Returns from schemes investing in international funds have been below par because of the poor performance of overseas markets. Indian indices have, in comparison, performed much better,” said DP Singh, deputy MD of SBI Mutual Fund. He pointed out that over the last one year, the constant depreciation in the rupee shored up returns in international currency terms, which explains better returns over a one-year basis. With global markets in the recovery mode, one could expect a better showing by this category going ahead.

A peek into returns by major global indices makes the picture clear. On a one-year basis, the Dow Jones index has returned 4.36% and the Nasdaq 3.76%, compared to 13.95% by the Sensex and 12.8% by the Nifty. France’s CAC-40, Germany’s DAX and the Euro Stoxx 50 have returned between 17% and 21%.

However, on a three-year basis, the Indian benchmarks have outperformed global peers, giving 95.77% (Sensex) and 98.01% (Nifty) in returns. During the same time span, the Dow and Nasdaq have returned between 33% and 38%, while the European indices have showed returns in the range of 30-48%.

Agrees Alok Singh, chief investment officer at Bank of India MF. International indices have paled in comparison to the Indian benchmarks, which is why this category has not shown returns at the desired levels, he said. Sectoral and flexi-cap funds present investors the choice to diversify and churn, and offer the freedom to target higher returns.

In comparison, the worst-performing ELSS scheme has returned 4.13% over three years, with the best-performing one returning 25%.

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The worst and best performers in other categories are: flexi-cap (2.93% and 25.95%), large and midcap (7.82% and 21.59%), largecap (3.91% and 34.22%), midcap (7.78% and 27.3%), multicap (9.16% and 26.51%), smallcap (12.05% and 36.43%), and value-oriented (10.71% and 28.32%).

For international funds, the worst performer returned (-)18.69% over three years, while the best performer generated 16.62%.

A fund manager said over the last one year, the sectoral category has picked up as investors are keen to explore themes like banking that have been doing well. The best performer among sectoral (banking) returned 44.37%, while the figures for infra, technology and pharma were 34.72%, 13.76% and 8.6%, respectively.

The worst performers among these returned 12.67% (banking), 14.54% (infra), 5.12% (tech), and (-) 0.55% (pharma).