Are We in a Bear Market? What is Mutual Fund Performance Data telling us?
This article explores the signals from the mutual fund market to see if we are currently in or approaching a bear market in India.
Are We in a Bear Market? What is Mutual Fund Performance Data telling us?
Posted on 13 Jan 2025 • Updated on: 14 Jan 2025
Author: Sayan Sircar
Tags: 
Market Movements
19 mins read
Market Movements
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This article explores the signals from the mutual fund market to see if we are currently in or approaching a bear market in India.
📚 Topics covered:
- What Defines a Bear Market?
- Analysing Equity Mutual Funds for Bear Market Indicators
- How Close Are We to a Bear Market in India?
- Which funds are currently in the near bear market territory?
- Are we in a bear market right now based on what the indices are doing?
- What should investors do with this data?
What Defines a Bear Market?
A bear market is a 20% or more fall in the stock market from a peak followed by a recovery lasting months.
Right now, the SENSEX and the Nifty 50 are trading far from the 20% fall mark from their 52-week highs. The best indicator is the Nifty Total Market Index which does not indicate a bear market.
We believe that a practical approach to understanding whether or not we are in a bear market will be helpful to investors. We use data from equity mutual funds to check if these funds have fallen 20% (bear territory) or close to a 20% fall (near bear territory) from their 52-week highs. We are choosing the 52-week high as the peak for the sole reason that the lifetime highs of most of the indices in India have taken place in the last 12 months. In the cases where 52-week hgih was not the lifetime high, we have gone back two years.
If you want to know more about the performance of your mutual funds, you can get a free Mutual Fund Portfolio review.
Analysing Equity Mutual Funds for Bear Market Indicators
Since indices are not investible we will first look at the indication from individual mutual funds. The complete universe of mutual funds is a valid proxy for the entire stock market.
We are using NAV and Fund Categorisation data from AMFI to create the table below. The average is a simple arithmetic average and is not weighted by AuM. Market data is for the period ending 13-Jan-2025
| Category | Average Fall | Funds # | Bear Funds | Near Bear Funds |
|---|---|---|---|---|
| All Equity Funds | -10.96% | 784 | 32 | 89 |
| Contra | -11.82% | 3 | 0 | 0 |
| Dividend Yield | -12.95% | 10 | 0 | 1 |
| Elss | -11.78% | 43 | 1 | 1 |
| Flexi Cap | -11.64% | 40 | 0 | 2 |
| Focused | -12.58% | 29 | 0 | 4 |
| Large & Mid Cap | -11.83% | 31 | 0 | 1 |
| Large Cap | -11.97% | 33 | 0 | 1 |
| Mid Cap | -12.56% | 30 | 0 | 3 |
| Multi Cap | -11.59% | 29 | 0 | 1 |
| Sectoral Thematic | -12.25% | 204 | 6 | 41 |
| Small Cap | -12.08% | 29 | 0 | 0 |
| Value | -12.07% | 20 | 0 | 1 |
| Index Funds | -8.92% | 283 | 25 | 33 |
Here there is one caveat that the fund category, as defined by AMFI, contains both market-capitalisation weighted funds (like the Nifty 50 and Nifty Next 50 trackers) as well as factor (like low volatility) funds.
Related:
Bottom fishing tracker: which mutual funds have fallen the most?
How Close Are We to a Bear Market in India?
These mutual funds have fallen 20% or more from their 52-week high.
| Category | Fund | Return |
|---|---|---|
| Sectoral Thematic | Tata Infrastructure | -21.25% |
| Sectoral Thematic | Invesco India PSU Equity | -22.23% |
| Index Funds | ICICI Prudential Nifty Next 50 Index | -21.08% |
| Elss | quant ELSS Tax Saver | -20.34% |
| Index Funds | UTI Nifty Next 50 Index | -20.86% |
| Index Funds | DSP Nifty Next 50 Index | -21.03% |
| Index Funds | Motilal Oswal Nifty Next 50 Index | -20.80% |
| Sectoral Thematic | Aditya Birla Sun Life PSU Equity | -22.29% |
| Index Funds | UTI Nifty 200 Momentum 30 Index | -20.72% |
| Index Funds | Kotak Nifty Next 50 Index | -20.72% |
| Index Funds | SBI Nifty Next 50 Index | -20.91% |
| Index Funds | HDFC NIFTY Next 50 Index | -21.08% |
| Index Funds | Navi Nifty Next 50 Index | -20.68% |
| Index Funds | Axis Nifty Next 50 Index | -20.75% |
| Index Funds | Motilal Oswal Nifty 200 Momentum 30 Index | -20.89% |
| Index Funds | Aditya Birla Sun Life Nifty Next 50 Index | -21.07% |
| Index Funds | ICICI Prudential Nifty 200 Momentum 30 Index | -21.02% |
| Index Funds | BANDHAN NIFTY200 MOMENTUM 30 INDEX FUND - GROWTH - DIRECT PLAN | -20.95% |
| Index Funds | Edelweiss Nifty Next 50 Index | -20.81% |
| Index Funds | HSBC NIFTY NEXT 50 INDEX FUND - Direct Growth | -20.98% |
| Sectoral Thematic | HDFC Defence | -22.31% |
| Index Funds | Kotak Nifty 200 Momentum 30 Index | -20.98% |
| Index Funds | LIC MF Nifty Next 50 Index | -20.81% |
| Sectoral Thematic | quant PSU | -24.26% |
| Sectoral Thematic | SBI Energy Opportunities | -20.38% |
| Index Funds | HDFC NIFTY200 Momentum 30 Index | -21.10% |
| Index Funds | HDFC NIFTY Realty Index | -21.69% |
| Index Funds | Tata Nifty Realty Index | -21.62% |
| Index Funds | Motilal Oswal Nifty India Defence Index | -29.15% |
| Index Funds | Kotak BSE PSU Index | -21.26% |
| Index Funds | Motilal Oswal Nifty 500 Momentum 50 Index | -20.28% |
| Index Funds | Nippon India Nifty 500 Momentum 50 Index | -20.38% |
Which funds are currently in the near bear market territory?
Sectoral Thematic category
| Fund | Return |
|---|---|
| Aditya Birla Sun Life Transportation and Logistics | -19.69% |
| SBI Automotive Opportunities | -19.60% |
| SBI PSU | -19.23% |
| quant Infrastructure | -18.80% |
| UTI-Transpotation and Logistics | -18.61% |
| quant Manufacturing | -18.59% |
| quant Business Cycle | -18.50% |
| ICICI Prudential PSU Equity | -18.40% |
| Samco Special Opportunities | -18.31% |
| quant Quantamental | -17.92% |
| BANDHAN Infrastructure | -17.54% |
| quant BFSI | -17.53% |
| SBI Magnum COMMA | -17.47% |
| DSP Natural Resources and New Energy | -17.38% |
| quant Momentum | -17.38% |
| BANDHAN TRANSPORTATION AND LOGISTICS FUND - GROWTH - DIRECT PLAN | -17.16% |
| HDFC Transportation and Logistics | -17.15% |
| Taurus Infrastructure | -17.14% |
| Kotak Quant | -17.09% |
| Tata Housing Opportunities | -17.02% |
| Tata Resources & Energy | -16.95% |
| Edelweiss Business Cycle | -16.93% |
| Nippon India Power & Infra | -16.91% |
| ICICI Prudential Commodities | -16.76% |
| Tata Quant | -16.62% |
| Aditya Birla Sun Life Quant | -16.56% |
| 360 ONE QUANT FUND DIRECT GROWTH | -16.48% |
| HDFC Housing Opportunities | -16.39% |
| quant ESG Equity | -16.38% |
| UTI India Consumer | -16.16% |
| UTI Infrastructure | -16.13% |
| HDFC MNC | -15.98% |
| DSP India T.I.G.E.R. | -15.80% |
| ICICI PRUDENTIAL TRANSPORTATION AND LOGISTICS FUND - Direct Plan - Growth | -15.80% |
| SBI INFRASTRUCTURE FUND - DIRECT PLAN - GROWTH | -15.69% |
| Mahindra Manulife Business Cycle | -15.40% |
| ICICI Prudential Manufacturing | -15.38% |
| Mirae Asset Great Consumer | -15.34% |
| Mahindra Manulife Consumption | -15.26% |
| HSBC Infrastructure | -15.26% |
| CANARA ROBECO INFRASTRUCTURE FUND - DIRECT PLAN - GROWTH OPTION | -15.10% |
Mid Cap category
| Fund | Return |
|---|---|
| quant Mid Cap | -17.39% |
| Taurus Mid Cap | -16.58% |
| Aditya Birla Sun Life Midcap | -15.14% |
Multi Cap category
| Fund | Return |
|---|---|
| quant Active | -17.43% |
Large & Mid Cap category
| Fund | Return |
|---|---|
| quant Large & Mid Cap | -15.32% |
Focused category
| Fund | Return |
|---|---|
| Motilal Oswal Focused 25 | -19.51% |
| quant Focused | -16.64% |
| LIC MF Focused | -15.80% |
| BARODA BNP PARIBAS Focused | -15.35% |
Flexi Cap category
| Fund | Return |
|---|---|
| quant Flexi Cap | -18.95% |
| NJ Flexi Cap | -17.60% |
Large Cap category
| Fund | Return |
|---|---|
| PGIM India Large Cap | -12.54% |
Index Funds category
| Fund | Return |
|---|---|
| Bandhan Nifty Alpha 50 Index | -19.88% |
| UTI Nifty 500 Value 50 Index | -19.61% |
| Motilal Oswal BSE Enhanced Value Index | -19.60% |
| Tata Nifty200 Alpha 30 Index | -19.41% |
| Nippon India Nifty Realty Index | -19.41% |
| Baroda BNP Paribas Nifty200 Momentum 30 Index | -19.38% |
| ICICI Prudential Nifty Auto Index | -18.99% |
| Tata Nifty Auto Index | -18.95% |
| Nippon India Nifty Alpha Low Volatility 30 Index | -17.54% |
| Bandhan Nifty 500 Momentum 50 Index | -17.48% |
| Edelweiss Nifty Alpha Low Volatility 30 Index | -17.46% |
| HDFC Nifty 100 Equal Weight Index | -17.30% |
| Aditya Birla Sun Life Nifty India Defence Index | -17.16% |
| Navi Nifty India Manufacturing Index | -17.15% |
| Sundaram Nifty 100 Equal Weight | -16.93% |
| Aditya Birla Sun Life BSE India Infrastructure Index | -16.48% |
| DSP Nifty Smallcap250 Quality 50 Index | -16.10% |
| ICICI Prudential Nifty200 Value 30 Index | -16.02% |
| Groww Nifty Non-Cyclical Consumer Index | -15.99% |
| Tata Nifty500 Multicap Infrastructure 50:30:20 Index | -15.97% |
| Motilal Oswal BSE Quality Index | -15.94% |
| Motilal Oswal BSE Financials ex Bank 30 Index | -15.59% |
| Kotak BSE Housing Index | -15.53% |
| UTI BSE Housing Index | -15.51% |
| Tata Nifty Midcap 150 Momentum 50 Index | -15.50% |
| Edelweiss Nifty Midcap150 Momentum 50 Index | -15.35% |
| UTI Nifty50 Equal Weight Index | -15.09% |
| ICICI Prudential Nifty50 Equal Weight Index | -15.07% |
| SBI Nifty50 Equal Weight Index | -15.07% |
| Bandhan Nifty 500 Value 50 Index | -15.04% |
| DSP Nifty 50 Equal Weight Index | -15.03% |
| Aditya Birla Sun Life Nifty 50 Equal Weight Index | -15.02% |
| HDFC NIFTY50 Equal weight Index | -15.02% |
Elss category
| Fund | Return |
|---|---|
| ITI ELSS Tax Saver | -16.68% |
Dividend Yield category
| Fund | Return |
|---|---|
| Tata Dividend Yield | -15.31% |
Value category
| Fund | Return |
|---|---|
| Quant Value | -15.49% |
Any funds not in the lists above have not fallen more than 15% from the 52-week high.
Are we in a bear market right now based on what the indices are doing?
If we look at the broad indices themselves, we are considerably far from a bear market.
| Type | Count | Bear | Near Bear |
|---|---|---|---|
| Sector/Thematic | 15 | 3 | 5 |
| Market Cap | 14 | 1 | 1 |
| Factor | 16 | 1 | 9 |
| Total | 45 | 5 | 15 |
Market Cap indices
| Index | Fall from 52-week high | Bear? |
|---|---|---|
| NIFTY NEXT 50 | -20.89% | Bear |
| NIFTY 50 EQUAL WEIGHT | -15.03% | Near Bear |
| NIFTY SMALLCAP 50 | -14.77% | Neither |
| NIFTY MIDCAP 50 | -13.79% | Neither |
| NIFTY MIDCAP 150 | -13.54% | Neither |
| S&P BSE 500 | -13.40% | Neither |
| NIFTY 100 | -13.39% | Neither |
| NIFTY SMALLCAP 250 | -13.31% | Neither |
| NIFTY 500 | -13.19% | Neither |
| NIFTY MICROCAP 250 | -13.18% | Neither |
| NIFTY TOTAL MARKET | -13.17% | Neither |
| NIFTY LARGE MIDCAP 250 | -13.16% | Neither |
| NIFTY 50 | -11.86% | Neither |
| SENSEX | -10.97% | Neither |
Quite a few sectoral indices are close to the bear category.
Sector/Thematic indices
| Index | Fall from 52-week high | Bear? |
|---|---|---|
| NIFTY DEFENCE | -29.15% | Bear |
| NIFTY REALTY | -21.65% | Bear |
| S&P BSE PSU | -21.26% | Bear |
| NIFTY AUTO | -18.97% | Near Bear |
| NIFTY MANUFACTURING | -17.15% | Near Bear |
| NIFTY NON-CYCLICAL CONSUMER | -15.99% | Near Bear |
| S&P BSE FINANCIALS EX BANK 30 | -15.59% | Near Bear |
| S&P BSE HOUSING | -15.52% | Near Bear |
| NIFTY FINANCIAL SERVICES EX-BANK | -14.75% | Neither |
| NIFTY BANK | -11.69% | Neither |
| NIFTY FINANCIAL SERVICES | -11.07% | Neither |
| NIFTY TOURISM | -10.31% | Neither |
| NIFTY MIDSMALL HEALTHCARE | -8.07% | Neither |
| NIFTY PHARMA | -8.02% | Neither |
| NIFTYIT | -4.38% | Neither |
The same is true with the factor indices as well.
Factor indices
| Index | Fall from 52-week high | Bear? |
|---|---|---|
| NIFTY200 MOMENTUM 30 | -20.94% | Bear |
| NIFTY ALPHA 50 | -19.88% | Near Bear |
| NIFTY 500 VALUE 50 | -19.61% | Near Bear |
| S&P BSE ENHANCED VALUE | -19.60% | Near Bear |
| NIFTY ALPHA LOW VOLATILITY 30 | -17.50% | Near Bear |
| NIFTY 100 EQUAL WEIGHT | -17.11% | Near Bear |
| NIFTY SMALLCAP250 QUALITY 50 | -16.10% | Near Bear |
| S&P BSE QUALITY | -15.94% | Near Bear |
| NIFTY MIDCAP 150 MOMENTUM 50 | -15.42% | Near Bear |
| NIFTY50 EQUAL WEIGHT | -15.06% | Near Bear |
| NIFTY 100 QUALITY 30 | -13.38% | Neither |
| S&P BSE LOW VOLATILITY | -13.28% | Neither |
| NIFTY MIDCAP 150 QUALITY 50 | -12.59% | Neither |
| NIFTY100 LOW VOLATILITY 30 | -12.32% | Neither |
| NIFTY 100 LOW VOLATILITY 30 | -12.32% | Neither |
| NIFTY 50 VALUE 20 | -9.20% | Neither |
Investors should either revisit their plan to invest in sectoral/thematic or factor funds or use this opportunity to enter these funds based on their conviction.
What should investors do with this data?
Related:
Analyse Your Mutual Fund Portfolio for Free with Arthgyaan's Mutual Fund Review Service
There are generally three takeaways from data like this:
- investors should review if their existing funds are on the list and evaluate their next steps including talking to their advisor
- most investors should take this opportunity to rebalance from debt to equity if the asset allocation of their portfolio has drifted by 5%
- for sophisticated investors, such market falls provide the opportunity for bottom fishing in specific themes and factors
Related Articles
- Bottom fishing tracker: which mutual funds have fallen the most?
- Bandhan Nifty Total Market Index Fund: should you invest?
- NSE launches the Nifty Top 10 Equal Weight Index. Should you invest?
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