Over the past eight years, this fund has consistently managed to stay ahead of the curve. An amazing feat when you take into account its investment objective.
In its initial years, its contrarian sector moves and concentrated stock allocations made it an awfully bold choice. Its brash allocation to metals and auto in the year 2000, is a case in point. In 2001, when other diversified equity funds were bullish on FMCG, this fund avoided these sectoral stocks. It stayed underweight on healthcare but remained bullish on auto.
However, somewhere down the road, it has transformed into a diversified equity offering. It tends to stick more with consensus sectors.
Recently in 2009, in line with other equity diversified funds, it moved up the exposure to financial services sector and was benefited as the BSE Bankex index turned into one of the best-performing indices in the recent rally (09/03/2009 to 30/06/2009).
Apart from this, the fund manager reduced the cash and debt exposure from 27.12 per cent in February 2009 to 10.68 per cent in June 2009. All these moves paid off as the fund delivered 72.23 per cent over this period, close to the category's 71 per cent.
The fund has evolved into a much more conservative offering. Once the fund manager takes a stance, he holds the stocks and avoids aggressive churning. The number of stocks has risen from 34 (start of 2006) to around 70 and the concentration of the top 10 holdings has also been brought down over the same period.
Its excellent performance over the past years coupled with the ability not to crumble during a market downturn, and a blended portfolio of growth and value stocks make this fund a topnotch pick.