De­signed for All-weather Per­for­mance

The Economic Times - - Smart - PORT­FO­LIO CHANGE

It is that time in mar­kets when be­ing in­vested with large-sized com­pa­nies makes sense as they are are show­ing bet­ter earn­ings growth. One mu­tual fund that plays this theme is In­vesco In­dia Growth Fund. The fund is man­aged by Ta­her Bad­shah and Amit Gana­tra. The in­vest­ment style of the fund can be summed up in one ex­pres­sion: all-weather eq­uity fund. Through bot­tom-up ap­proach, the fund man­agers take con­trolled risks in all di­rec­tions. There are two as­pects to this: One, with re­spect to the bench­mark in­dex (S&P BSE 100), the fund man­agers are up to 50% over­weight on a sec­tor or un­der­weight. There is no de­vi­a­tion from this norm. The se­cond as­pect is that they also ac­com­mo­date com­pa­nies based on growth and value themes. This pro­tects in­vestors from se­vere down­side in times of bear phase of mar­kets. The fund man­agers choose stocks whose val­u­a­tions are rea­son­able com­pared with its growth prospects. In a port­fo­lio of 36 stocks, the scheme has 75% ded­i­cated to the growth theme while 25% is ded­i­cated to value theme. With this strat­egy, the scheme has out­per­formed its peers and the bench­mark by a good mar­gin. In the past three­year and five-year pe­ri­ods, the scheme has de­liv­ered 15.2% and 19% re­turns, in con­trast to 10% and 13% re­turns re­spec­tively by the S&P BSE 100 in the same pe­riod.At present, the scheme is over­weight on con­sumer dis­cre­tionary and fi­nan­cials, in­dus­tri­als in­di­cat­ing that the fund man­agers are bank­ing on the big con­sump­tion and econ­omy re­cov­ery themes. L&T Fi­nance Hold­ings (PAST 6 MONTHS)

New En­trants In­crease in Al­lo­ca­tion

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