|Category:||Hybrid: Debt-oriented Conservative|
|Net Assets:||R 202 crore (As on Dec 31, 2013)|
|Expense:||1.91% (As on Sep 30, 2013)|
The scheme aims to generate positive returns around 15 months holding period in diverse scenarios of equity and bond markets, by investing primarily in fixed income securities and balance in equity and equity related instruments.
Anil Bamboli since Aug 2005
Chirag Setalvad since Apr 2007
This fund invests around 85 per cent of the net assets in fixed income securities of roughly 15 month maturity and adopt a predominantly buy and hold strategy. This will mean that over the medium term, irrespective of the interest rate movements, the fund will earn returns that are nearly equal to the underlying yield on the bonds. The remaining 15 per cent allocation is in equities where the dividend yields are moderate to high with the investment focus on dividend yield stocks. The scheme targets positive returns over medium time frame and aims to reduce the chances and extent of a capital depreciation over medium term holding period for the unit holder.
The equity allocation has not crossed 20 per cent and its average debt allocation is around 82 per cent and the fund manager also takes active cash calls. The equity allocation has a mid- and small-cap tilt, which does pose risk, but also provides the opportunity for higher returns. It maintains a diverse equity portfolio across sectors, which doesn't go beyond 3 per cent.
This fund underperformed in its initial two years but pulled up its performance in the next four years. With the exception of 2012, in the past five years, this fund has consistently out-performed the category average. 2009 was the best year for this fund when it earned 21.80 per cent compared to the category average of 14.70 per cent. It was in the top quartile from 2008 to 2010.
But in 2012 it slightly underperformed its category average. In 2011, it was amongst the top-5 performers in the category on back of increasing its equity portfolio holdings to over 35 stocks from the earlier 15 stocks. The fund manager reduces the chance of loss by combining the fixed income and equity portion of the portfolio into two sources of yield on the entire portfolio. The equity investment focuses on dividend yield stocks with a buy and hold philosophy. The debt component is invested in quality instruments, which is actively reviewed with changing interest rates.
This fund has the ability to turn around when the markets rise, balancing out the fall that it experiences in years when the markets tank.