The fund's ability to ride out prolonged bear phases is yet to be tested
IDBI Top 100, a large-cap-oriented fund, has a short track record of just over three years.
But during this period, the fund has been nimble on its feet, be it stock choices or sector preferences. Over the three-year period, it has earned a return of about 25 per cent, beating its category average by a margin of 6 percentage points.
It has also outperformed its benchmark, the CNX 100 index, by a comfortable margin over one and three-year timeframes. Investors in the fund can continue to hold their units.
Performance and strategy
A 'Top 100' tag normally means that a fund would predominantly invest in the top 100 stocks by market capitalisation. In other words, it has a mandate to focus on large-cap stocks (stocks with market capitalisation of ₹10,000 crore and above). IDBI Top 100 has remained faithful to large-caps to a 'T'.
Since its launch in May 2012, the fund has always stuck to large-cap stocks, barring investment in the Tata Global Beverages stock for a brief while in 2013-14. Its returns over the one and three-year periods are better than peers, such as UTI Top 100, ICICI Pru Top 100 and DSPBR Top 100, even as these funds tend to take a bit of mid-cap exposure to give a boost to returns.
The superior performance is possibly because the fund has made up for the low-risk strategy by remaining fully invested in equities. The fund has not taken refuge substantially in cash or debt in choppy markets. Equity holdings have predominantly been over 95 per cent.
However, the fund's mettle in riding out prolonged bearish phases is yet to be tested.
The fund's sector and stock choices, again, reflect the balance it tries to achieve between risk and return.
Its top sectors so far have been a blend of cyclicals and defensives — banks, auto, pharma and consumer non-durables. Stakes in pharma, for example, went up during the 2013 volatility and holdings in auto moved up in 2014. Even in the in-favour auto space, it has churned stocks quite well, rightly reducing stakes in Hero MotoCorp and exiting Bajaj Auto which have grim outlooks or cutting down on richly valued stocks such as Bosch. It has also pruned exposure to software in the last six months.
It normally holds a portfolio of about 40 stocks with stakes in any one stock rarely exceeding 5-6 per cent. The fund's modus operandi shows that it suits investors who don't fancy a high-risk, high-return proposition.
Best Tax Saver Mutual Funds or ELSS Mutual Funds for 2015
1.ICICI Prudential Tax Plan
2.Reliance Tax Saver (ELSS) Fund
3.HDFC TaxSaver
4.DSP BlackRock Tax Saver Fund
5.Religare Tax Plan
6.Franklin India TaxShield
7.Canara Robeco Equity Tax Saver
8.IDFC Tax Advantage (ELSS) Fund
9.Axis Tax Saver Fund
10.BNP Paribas Long Term Equity Fund
You can invest Rs 1,50,000 and Save Tax under Section 80C by investing in Mutual Funds
Invest in Tax Saver Mutual Funds Online -
For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call
---------------------------------------------
Leave your comment with mail ID and we will answer them
OR
You can write to us at
PrajnaCapital [at] Gmail [dot] Com
OR
Leave a missed Call on 94 8300 8300
---------------------------------------------
Invest Mutual Funds Online
Download Mutual Fund Application Forms from all AMCs
0 comments:
Post a Comment