Funds In­vest­ing in US Stocks Out­per­form the Nifty Eas­ily

In­vest­ments in US re­turned about 2.50% last fis­cal as Nas­daq gained 9.48%, Nifty saw a fall of 8.86% dur­ing the same pe­riod

The Economic Times - - Companies -

Mum­bai: At least six funds fo­cused on in­vest­ing in the US have out­per­formed the broader in­dex Nifty by a wide mar­gin as their ex­po­sure to a few stocks such as Ap­ple and Google helped them race ahead of their do­mes­tic coun­ter­parts.

In the last fi­nan­cial year, such in­vest­ments re­turned about 2.50% on an av­er­age while the bench­mark in­dex 50-share Nifty has ac­tu­ally reg­is­tered an in­vest­ment ero­sion of 8.86%, show data from Morn­ingstar, a mu­tual fund re­search or­gan­i­sa­tion. Dur­ing this pe­riod, Nas­daq re­turned 9.48%.

“By in­vest­ing through our funds in the US, you get a chance to in­vest in some hot ideas like Google, Walt Dis­ney, Ama­zon, Ap­ple, Face­book, sit­ting here in In­dia,” said Anand Rad­hakr­ish­nan, chief in­vest­ment of­fi­cer at Franklin Equity, Franklin Tem­ple­ton In­vest­ments - In­dia. “More­over, in­vestors can also in­crease their in­vest­ment when the ru­pee is fall­ing against the dol­lar.”

“Peo­ple who need dol­lar flows in fu­ture also in­vest in such schemes as it gives them pro­tec­tion against ex­change rate volatil­ity,” he said.

In the past three years, those US in­vest­ing funds have re­turned 19.4% CAGR against 10.8% in the N S E N i f t y, ac­cord­ing to Morn­ingstar data.

Franklin holds the high­est as­sets un­der man­age­ment at ₹ 690 crore as on March 31, 2016, in the cat­e­gory, fol­lowed by ICICI Pru at ₹ 172 crore.

“In­vestors should look at in­vest­ing 10-15% of their equity port­fo­lio in such global schemes, aimed at port­fo­lio di­ver­si­fi­ca­tion,” said


Kaus­tubh Be­la­purkar, di­rec­tor - fund re­search, Morn­ingstar In­dia. “Some high net worth savvy in­vestors pre­fer to in­vest in those funds.”

To­tal as­sets un­der man­age­ment have tre­bled in the past three fi­nan­cial years to ₹ 1,082 crore from ₹ 357 crore as on March 31, 2013, ac­cord­ing to Morn­ingstar data.

Since April last year, those US in- vest­ing funds have out­per­formed the bench­mark Nifty on a year-onyear ba­sis. Be­tween Novem­ber and March this year, they have de­liv­ered stel­lar per­for­mance. For in­stance, those funds re­turned 8.67% yearon-year in Novem­ber, against a 7.60% in­vest­ment ero­sion in Nifty.

The six funds that in­vested in

stocks in the US in­clude Franklin Ind Feeder-Frank US Op­por­tu­nity (growth), ICICI Pru­den­tial US Bluechip Equity (Reg­u­lar growth), JPMor­gan US Value Equity Off­shore (Reg­u­lar growth), Moti­lal Oswal Most Shares NAS­DAQ 100 ETF, Ko­tak In­dia US Equity Fund (growth.), Re­liance US Equity Op­por­tu­ni­ties (Reg­u­lar growth).

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