I want to know about the equity funds of Standard Chartered AMC. Also tell me the reasons for the underperformance of Standard Chartered Premier Equity Fund
03-Nov-2006 •Research Desk
I want to know about the equity funds of Standard Chartered AMC. They are Standard Chartered Classic Equity, Standard Chartered Imperial Equity, Standard Chartered Premier Equity and Standard Chartered Enterprise Equity. Also tell me the reasons for the underperformance of Standard Chartered Premier Equity Fund. Please tell about them in detail
Standard Chartered Classic Equity was the first equity fund to be launched by the fund house in July 2005. The fund is a vanilla diversified equity fund with the flexibility to invest across market capitalisations. The fund currently has a strong large-cap bias with over 77 per cent of its assets parked in the large-cap stocks. In quick succession to this fund, the fund house launched Standard Chartered Premier Equity in September 2005. This is a mid-cap oriented fund. Then in February, Standard Chartered Imperial Equity Fund was launched, which is a large-cap dominated offering. The fund has a mandate to invest in large-caps and relatively bigger mid-cap stocks. On the risk-return spectrum, the fund houses places Imperial Equity at the lowest rung, meaning that it is a relatively low-risk-low return proposition. Then come Classic Equity and Premier Equity in that order.
As far as the performance, the funds have not been exceptional. The oldest of these- Classic Equity- misses the category average by close to 5 per cent over the one-year period ending November 2. The fund has returned 44 per cent, in comparison to category's 49 per cent. Same is the case with Standard Chartered Premier Equity Fund, which is down 11 per cent over the last six months to be ranked 157th out of 165 funds. Mid-cap stocks were beaten down badly in the stock market collapse of May, due to which many mid-cap oriented funds lost significantly. And this fund was no exception.
Recently, the fund house launched the close-ended Standard Chartered Enterprise Equity Fund, with the objective of investing into stock IPOs. But after its launch, the markets turned bearish and there have been few IPOs. As a result, about 38 per cent of the fund's assets are still invested in cash and equivalents, while the equity allocation is primarily invested in Sensex constituents.