This fund's adaptability is appealing. Though there have been times when it did not shine and delivered average returns, its approach has translated into a competitive long-term record. Even more favourable is that it has often displayed the ability to protect the downside.
Typical of this fund's style is flexibility in every aspect. Its mandate allows it take on any style it chooses, be it in the form of a multi-cap approach or a thematic one. So one should not be too surprised to sometimes see the fund resemble a hard core mid-cap offering only to later transform itself into a large-cap one. Neither was it surprising to see its 48 per cent large-cap allocation (March 2007) shoot up to almost 70 per cent by June 2007 before sliding and down to 54.75 per cent by the end of that year.
It's also nimble in its asset allocation. More so in 2008 where the cash and debt allocation totally went up to 36 per cent.
If the fund manager sees an opportunity, he is quick to capitalise on it, be it in stocks or sectors. In 2007, for instance, the metals allocation jumped from 8.86 per cent (August) to 20.87 per cent in just two months. A move that paid off handsomely since the BSE Metals delivered a phenomenal 73 per cent during this period. Five months down the road, sensing a downturn it was down to 4 per cent. Similarly, after increasing the allocation to financial services to nearly 21 per cent (December 2007), the fund manager reduced it to 4.93 per cent in June 2008 and four months later it stood at 21.91 per cent. The same treatment is meted out to stocks, with a number of them making short opportunistic appearances in the portfolio. Out of the universe of 327 stocks it has invested in so far, as many as 126 (nearly 40%) have appeared for less than six months.
But rarely does the fund manager take an exposure of more than 5 per cent to a single stock. In fact, this actively managed fund has the highest Sharpe Ratio amongst the tax planning funds, meaning it generates higher returns for every unit of risk taken.
With a multi-cap strategy, diversified portfolio and long-term record, this fund is suitable for all kinds of investors.