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Friday, Jul 27, 2007
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Business Daily from THE HINDU group of publications Friday, Jul 27, 2007 ePaper |
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Mutual Funds Markets - Investments
Over the six-month period ended July 24, actively managed diversified funds have delivered about 13 per cent
Nilanjan Dey Kolkata, July 26 In a scenario marked by steeper valuations and increased volatility, diversified equity funds that have been launched this year have spread their portfolios over more than 15 prominent sectors, the larger allocations going in favour of areas such as capital goods, financial services and telecommunications. Diversified funds, about a dozen of which have been introduced this year, have also been able to pick up stocks from segments such as real estate/construction, power/power equipment and software. All three figure notably among the leading industries that fund managers have preferred so far. A look at the holding patterns – details of not all the recently launched funds are available – suggests that the funds concerned have attempted to create fairly broadbased portfolios. The attempt of late has been to play down such sectors as automobiles and cement, which are not being greatly favoured by investors at the moment. The diversified funds that have been rolled out since January this year include Taurus INFRA TIPS, Lotus India Contra, DBS Chola Hedged Equity, Fidelity International Opportunities, JM Small & Mid-Cap, JP Morgan India Equity, AIG India Equity and Franklin India High Growth Companies Fund. Besides, there are one or two latter-day entrants like Reliance Equity Advantage Fund. Banks, IT, oil top sectors
Financial services (read banks and housing finance companies) make up a critical share of the new crop of portfolios. Lotus India Contra, for instance, has particularly emphasised on it, allowing it to contribute over 17 per cent of the net assets, according to data supplied by Value Research. Some of the other more important sectors here are construction (15.9 per cent) and chemicals (11.1 per cent). The fund has relatively low exposure to technology and healthcare. JP Morgan India Equity, which has invested in over 40 stocks, has well over 20 per cent in “industrials”, a sweeping reference to industrial capital goods, construction, industrial products etc. Banks, IT and oil are the other top sector for the fund managers, Mr Harshad Patwardhan and Mr Amit Gadgil. Of the 15 that have been disclosed in JP Morgan’s maiden portfolio statement, the top holdings are L&T, Infosys, Bharti and Reliance. JM Small and Mid-Cap, which came in April, has struck a somewhat different chord by investing in textile stocks, which collectively account for 10 per cent-plus of its net assets. Among its other top sectors are construction (16.9 per cent) and metals / metal products (11.7 per cent). Sources point out that the first six months or so of 2007 has been considerably active in terms of new launches, a trend that may be seen in the context of the advancing stock market. Fund houses have tried to make good use of the situation, a strategy that may well continue if the market remains as buoyant as it is at the moment. Over the six-month period ended July 24, actively managed diversified funds have delivered about 13 per cent, Value Research has indicated. Banking funds, incidentally, have done better, with over 20 per cent to their credit during this period.
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