The Hindu Business Line : DSPML Top 100 Fund: Invest

For investors looking to invest in blue chip, large-cap stocks at attractive levels, a fund such as DSPML Top 100 may be a good option. As the name suggests, the fund invests in stocks that figure in the top 100 companies when ranked by market capitalisation. Large-cap funds are safer investment options during turbulent market phases as institutional investors flock to frontline companies in stable, mature businesses.

DSPML Top 100 Equity has had a strong track record of outperforming its benchmark, the BSE 100, since its launch in 2003. Over the past year, it has delivered a return of about 35 per cent as against 25 per cent by the BSE 100. Its performance over one-year and three-year periods outpaces that of other strictly large-cap funds with a track record, such as Franklin Bluechip and HSBC Equity.

Although the fund beat the BSE 100 by a wide margin since its launch, it has not been any more risky than the index itself. Over the last 48 months, DSP Top 100 has outperformed the BSE 100 nearly 70 per cent of the time. What is more impressive is the fact that it has been more successful in containing downside.

For instance, the BSE 100 had a negative monthly return in 10 occasions over the last four years. The fund was able to contain declines to a level lower than the index nine out of ten times. DSP Top 100 is, therefore, suitable for conservative investors.

Portfolio overview: The fund invests in about 40-50 stocks picked largely from the BSE 100 Index. Idea Cellular, DLF and HDIL are some of the stocks that the fund has picked from outside the BSE 100. The smallest stock by market capita lisation in its portfolio is that of Union Bank of India at about Rs 6,500 crore.

The fund has a well-diversified portfolio, with the top ten stocks accounting for only 35 per cent of the assets. Its top sector holdings include banking, capital goods and energy, which have led the rally over a one-year period. About 35 per cent of the portfolio is invested in these sectors.

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