New Delhi, Sept. 18 -- They were late to the party-but they're catching up fast. Momentum funds, barely four years old in India, have already overtaken older, more established factor strategies.

Since the launch of the first momentum fund in 2021, the number of momentum-based funds has climbed to 40, surpassing value investing (38 funds) and quality investing (32 funds), which have existed since 1994, according to Value Research.

As of September, value funds stood at 38, while quality funds were at 32, according to data from Value Research.

The reason: a strong run of outperformance by momentum in recent years, which has prompted asset management companies to roll out new momentum funds to capture surging investor interest.

The benchm...