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Investors with a long-term horizon seeking to invest in a multi-cap fund can buy the units of Canara Robeco Equity Diversified Fund. In the current volatile market situation, investing in a multi-cap fund could help investors tap into various segments across market-caps.
The performance of the fund has been notable, especially during market downturns.
It capped the downside well during the 2011 and 2018 market corrections. In the on-going corrective phase, too, it has limited the downside better. Year-to-date, the scheme has slumped 14.9 per cent while its benchmark and the multi-cap category have plummeted 22.6 per cent and 20.8 per cent, respectively.
Performance and strategy
Over one-, three- and five-year time-frames, Canara Robeco Equity Diversified has delivered good returns that are higher than its benchmark.
The level of outperformance has been in the wide range of 2-8 percentage points.
In the past one year, the scheme’s NAV has declined 13 per cent, outperforming the benchmark that has tumbled 21.3 per cent. It has outpaced peers such as Kotak Standard Multicap and BNP Paribas Multi Cap over the past one- and three-year time-frames.
Investors can buy units through the systematic investment plan (SIP) route to mitigate market choppiness.
The fund invests predominantly, about 69 per cent, in large-cap companies, with the remaining in high-conviction mid- and small-cap stocks.
It also has 5 per cent in debt and cash. The scheme invests in growth as well as value stocks.
About 55 per cent of the fund’s assets is allocated to the top five sectors; in that, banks is the preferred sector with a higher allocation of 18 per cent.
Majority of the investment goes into consumption-based sectors such as private banks, automobiles, FMCG, insurance and consumer discretionary.
Infrastructure and exports-based sectors are also part of the portfolio.
The fund is overweight on healthcare and FMCG, and underweight on financial, software, energy and construction sectors.
It has a concentrated portfolio with 52 stocks; the top 10 stocks comprise 41 per cent of the asset allocation. Holdings have been gradually built up in pharma and software sectors.
Baring the top six stocks, the allocation towards individual stocks is less than 3 per cent, mitigating portfolio risk.
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