New Delhi, Aug. 3 -- Value funds invest in stocks that are undervalued compared with their intrinsic worth. These schemes typically look for companies trading at relatively lower valuations with the expectation that the market will eventually recognise their true value.

Under the Securities and Exchange Board of India (SEBI) categorisation rules, value funds are required to invest at least 65% of their assets in stocks, with a focus on a value investing strategy.

However, not all value funds have delivered the same level of performance. While some schemes have generated strong positive alpha by outperforming their benchmark indices, only two value funds have negative alpha.

Among all value funds, only Sundaram Value Fund and Baroda BNP...