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Franklin India Balanced

Franklin India Balanced Fund (Dividend Plan) seeks to create a portfolio with a debt equity mix in t

Franklin India Balanced Fund (Dividend Plan) seeks to create a portfolio with a debt equity mix in the range of 60-40% each. Entry into the fund carries a load of 1%-0% depending on the amount invested. Exit within 12 months also carries a load of 0%-1%, with load increasing for higher values of investments.

Franklin India Balanced Fund (D) so far has been managed almost similar to the growth option having a similar debt equity mix, investing in almost the same set of stocks as also in the same proportion. The fund is a relatively new fund, being launched in July 2000. The fund was launched soon after the steep fall in market and was fully invested portfolio for its equity allocation by August. Of its equity allocation, 25 per cent was in technology stocks. The sustained market fall and especially tech stocks since then, has dragged the fund below its face value. The fund exercised higher caution with its debt allocation, staying away from debt till October 2000 given the volatility in debt markets at the back of pressure on interest rates. Since November 2000, the fund has built its debt portfolio, accounting for 33 percent of total. The bond portfolio is mainly invested in bonds of public financial institutions and select corporate debt. The debt portfolio of the fund is not actively managed and the fund is totally kept away from gilts.

The fund carries a well-balanced portfolio with an equity debt mix of 54: 46. The equity portfolio is largely invested in growth stocks – technology, FMCG and healthcare accounting and select cyclicals. The fund’s debt portfolio is being managed conservatively seeking coupon income. It is too early to evaluate the fund now. The fund has been an average performer in its brief history. The fund is down 13.5% since its launch, but initial investors in the fund should not lose patience with their investment in the fund.