A rough patch last year does not dent Standard Chartered Premier Equity's appeal. This mid-cap fund started off reasonably well but lost massively in the quarter ended June 2006. While an average peer lost 13.60 per cent, this one was down 24 per cent. Subsequently, things have improved tremendously for the fund.
The second quarter of 2007 has been exceptionally good as it beat the average peer by an unbelievable margin of 17 per cent. This made it the only non-infrastructure fund to be among the top five diversified equity funds over a one-year horizon.
That success owes much to fund manager Kenneth Andrade, who took over in February this year. He has not completely overhauled the portfolio but gradually reduced exposure to metals. He does not shirk from taking concentrated bets in specific sectors. While the fund has been betting upon the services sector over the past year, in May it clocked in a not-so-shy 43 per cent. Even now, it consumes over a quarter of the fund's assets. His stock picks like Srei Infrastructure Finance have also proved to be very rewarding.
This portfolio is true to its convictions. Unlike its peers in the mid-cap space, this fund does not have a bloated portfolio. Its holdings are fairly evenly distributed amongst 35 stocks. By taking a meaningful exposure to a small number of promising stocks, the fund manager is able to leverage its small size to its advantage. Taking bigger bets in small- and mid-caps is bound to increase the risk, but then that's what this fund is all about. This relatively smaller mid-cap fund is a compelling option to add zing to your portfolio.