While we run a multi-cap fund at Itus, we benchmark the fund to Nifty 50. One of the core reasons for our choice is the long-term compounding nature of Nifty with low volatility.

If we breakdown the returns of Nifty in buckets of 5 years since 2003, and compare the rolling returns vs that of Nifty mid cap and that of small cap, one would see that Nifty has a higher average 5 year rolling returns than any of the other benchmarks in the country. One of the primary reasons for this is the lower volatility of the index (Very few investors appreciate the fact that Nifty continues to be one of the most diversified indices across countries, which also makes it one of the hardest indices to beat consistently. This has driven our choice since Day 1 which governs how we benchmark ourselves.