DSMPL Opportunities is a speciality fund launched in March 2000. The fund seeks to respond to the dynamically changing economy by moving in and out of sectors in line with the prevailing trends. Entry in to the fund is at a load of 2% while exit is at NAV. In its brief tenure, the fund has not paid any dividends.
The charter gives the fund the leeway to shift across sectors such as life style, pharma, cyclicals and technology, while being concentrated in two or more sectors. This sets DSPML Opportunities, apart from a diversified equity fund and makes it a specialty fund instead. The fund believes that while concentrated investments are subject to considerable risks, they present long term investment opportunity.
Launched at a time when, the ICE rally had started to fizz out, the fund, took positions in technology, cyclicals and lifestyle stocks, while still holding a substantial cash position. By June the fund got fully invested by augmenting its allocation to the technology stocks. As on October 2000, technology stocks account for 51 % of the corpus, while cyclicals and lifestyle stocks account for a 24 and 19% respectively. ITC has consistently been the top holding of the fund. While the fund has exposure to top rung technology counters such as Infosys, Satyam and SSI, its has had exposure to B group stocks such as DSQ Software and BFL Software.
DSPML Opportunities, with its investment spread across 2-3 sectors is likely to be less volatile than a fund committed to sectoral investments. With the fund’s launch coinciding with the broad market crash in April, the fund however, has largely been quoted below par. Since launch the fund has shed 15% of its face value, while the broad market indicator, Nifty Total return has lost 22.3 over the same period.
DSPML Opportunities Fund with its flexible investment charter, is likely to be a nimble footed fund, which would capture the market trend. With the markets on a broad downfall since its launch, investors in such fund should hold a long-term investment view.