The first quarter was ever-so-slightly kind to the average mutual fund, according to the latest Lipper performance report. Equity funds, in fact, improved 0.1% for the period. Mixed-asset funds moved up close to 0.8% on average, while U.S. diversified equity funds weakened 0.4%, the research group says.

But sector funds posted the strongest and weakest performance: funds focused on precious metals skyrocketed 42% in Q1’16, while commodities precious funds jumped 12% on average — followed by utility funds at 11%.

On the down side, health care/biotech funds dropped 14% in the first three months of the year. Commodities energy funds moved down about 8%, according to Lipper data.

Many value-tilted funds improved near 3% over the quarter, while many of their growth counterparts fell by 3%.

Looking at equity funds by region, Latin American funds topped the charts with an average gain of over 15%. Emerging-market funds overall jumped 4%. On the other hand, China funds fell close to 6% in Q1, while Japan funds declined about 5% on average.

Equity funds fell 6% on average in January. Only a small percentage, 4%, of equity and mixed-asset funds posted positive returns for the month — which saw the Dow Jones drop 5.5%, and the S&P 500 decline 5.1%. (The Shanghai Composite plunged nearly 24% in the first month of 2016).

In February, equity funds weakened about 0.5% on average, though about one-third of equity funds and mixed-asset funds posted positive returns. (The Dow gained 0.3% for the month, while the S&P 500 declined close to 0.5%.)

In March, equity funds improved 7%, and close to all equity and mixed-asset funds, or 97%, posted positive performance figures. The Dow improved 7%, and the S&P 500 gained 6.6% for the month.

BofA-Merrill Study

Analysis of mutual fund performance finds that less than one in five large-cap mutual funds outperformed the S&P 500 in the first quarter in 2016. This represents “the lowest quarterly hit rate in our data history spanning 1998 to today,” according to a recent Bank of America Merrill Lynch report.

“The average fund lagged by 1.9 [percentage points], marking a record spread of underperformance,” explained equity and quantitative strategist Savita Subramanian and colleagues at Merrill. “And growth funds, for which our data extends further back, saw a 6% hit rate, the worst since at least 1991, with the average fund lagging by the widest margin we have recorded in our quarterly data: –3.5 [percentage points].”

Value managers had a better hit rate, the report says, with 19.6% topping their respective index for the quarter. Plus, 29% of core funds did so.

The Merrill strategists point to a few factors that appear to be contributing to fund managers’ “recipe for distress.” “Heightened correlations … and low alpha opportunity … continued to hurt, as stock selection thrives when intra-stock correlations are low and alpha is abundant,” they explained.

However, it’s also true that these contributors to underperformance have been around “for a while.” Instead, the report authors believe “the lit match taken to active returns last quarter was likely the massive reversal — by the market, by sectors, by styles and by stocks — occurring within the quarter.”

First, momentum investors found that “almost nothing worked during both halves of the quarter except valuation,” according to the report authors. Second, crowded positions proved to be “particularly damning” in Q1: The 10 most popular stocks underperformed the 10 most neglected stocks by almost seven percentage points, which is “an atypically high spread,” they say.

The quarterly results for small-cap managers topped their mid- and large-cap counterparts, with more than 80% of core small-cap funds topping the Russell 2000 Index and average excess performance of over two percentage points.

In value, 68% of these small-cap funds topped the index, and the average fund outperformed by 92 basis points, despite being underweight in top sectors like utilities and REITs.

Mid-cap funds struggled, with just 13% beating the index and the average fund down 2.1%.