The Hindu Business Line : HSBC Advantage India Fund: Hold

HSBC Advantage India Fund's unit-holders can retain their investments in the fund. The returns generated for the past year appear better than those from funds such as SBI BlueChip and Reliance Equity, launched during the same period.

As the fund has just completed a year, it may be premature to judge its performance. The fund was launched in the midst of the bull-run, followed by a major correction.

HSBC Advantage India Fund is an open-ended, theme-based equity scheme. Its objective is to invest primarily in themes that play an important role in reforms and economic development.

Theme funds generally carry a higher risk profile than diversified funds and are thus suitable for informed investors. Since the fund is yet to ride an entire market cycle, fresh investments can be made after ascertaining the performance.

Performance: The fund has generated a 24 per cent return over the past year, trailing its benchmark BSE-200 by 5 percentage points. The fund actively manages its portfolio, churning it aggressively. Since its inception, close to 10 stocks have stayed in the portfolio. Over 75 per cent of the assets are invested in large-cap stocks with a market cap above Rs 5,000 crore.

Though the fund's portfolio is comparable to funds such as Franklin Prima Plus and Reliance Vision, it has trailed these funds by a significant margin.

On a monthly return basis, the fund trailed its benchmark in eight of the past 12 months.

Given the limited track record, investors looking for fresh investments can consider Franklin Prima Plus or Reliance Vision ahead of this fund, for investments.

Portfolio Overview: HSBC Advantage India has 36 stocks in its portfolio and assets are concentrated in the top three sectors, which account for 50 per cent of the portfolio. The top 10 stocks account for 42 per cent of the assets. BHEL, Grasim and Infosys represent large-cap exposures, while in the mid-cap space Amtek Auto and B. L Kashyap are among the stocks which have stayed in the portfolio for close to a year.

Fund facts: The fund was launched in February 2006. Mr Mihir Vora manages the fund since July 2006.

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