Skip to main content

Mutual Fund Review: DSP Black Rock Equity

 

 

DSP Black Rock Equity has proved to be an impressive long term performer with its sound portfolio management strategy

 

LAUNCHED in 1997, DSP Black Rock Equity is one of the oldest schemes in the DSPBR basket. The rise in its asset base and the popularity of this fund is an outcome of the fund's exceptional strategy and impressive performance over the years. Its asset base has grown four-fold to 2,130 crore since 2006.

PERFORMANCE:

Given its presence in the mutual fund industry for over a decade now, DSPBR equity fund has performed well in both bullish and bearish phases. The fund's track record over 13 years appears impressive when compared with the benchmark and other major market indices. The fund featured in the GOLD category for three consecutive quarters


   It did underperform during the dotcom bubble of 2000-01 but managed to stage a quick recovery subsequently. In 2003, it posted a return of 130% compared to gains of 72% in the benchmark- S&P Nifty. Since then there has been no looking back for this fund. It has been consistently outperforming its benchmark as well as major market indices such as the Sensex and BSE 500. This fund has clocked a return of close to 50% over the past three years. If you had invested 1,000 in this scheme about three years ago in October 2007, that would be worth 1,500 today. These returns have been far more superior to those of the Sensex and the Nifty, whose gains were 17% and 20%, respectively during this period.

PORTFOLIO:

DSPBR Equity has traditionally not been a large-cap defined fund, even though it is benchmarked against the S&P Nifty. In 2006, the fund's portfolio was restructured by taking two portfolios and combining them into one. Essentially, the fund is a combination of DSPBR Top 100 Equity and DSPBR Small & Mid Cap. The strategy adopted then has helped the fund build a diversified stock holding. Out of the 87 stocks in its portfolio, its single stock allocation has never crossed 5%, barring a few large caps. While this does put more pressure on the fund manager, the sheer size of the fund probably justifies this kind of a diversification. The fund has an exposure of close to 22% in high beta sectors such as financial services and oil and gas. However, in the financial services segment, the fund is overweight on state-run banks, which are quoting at decent valuations and show growth prospects. A good proportion of its portfolio is invested in steady stocks such as BPCL, SBI, Glaxo Pharma, ONGC, Tata Steel, Bharti Airtel and others.


   The fund manager is positive on the consumption sector, infrastructure, capital goods and agriculture for now. As a result, the fund has increased its exposure in automobiles, healthcare, metals and communications sectors. Even though the fund manager claims to be positive on the infrastructure sector, the fund's exposure is limited to the realty segment. It is also swiftly reducing its exposure to the power and logistics sectors. It is interesting to note that DSPBR Equity fund has rarely sat on cash. Even during the financial meltdown, its cash holding was limited to 10%, while some of the diversified equity funds had more than 35% as cash in hand. DSPBR fund manager Apoorva Shah says that churning of the portfolio has been restricted to large-cap stocks rather than mid-cap stocks. He believes that a large-cap portfolio needs to be consistently changed tactically while mid caps can be held till there is a growth opportunity in the stock. Currently the portfolio turnover ratio of this fund is 2.05 times. This means, on an average, the fund holds a stock for six months.

OUR VIEW:

The fund's sound portfolio management strategy has helped it generate consistent returns in varying market conditions. As a result, it has proved to be an impressive long-term performer. DSPBR Equity, which is perceived as a low-risk and high-return diversified equity scheme, is an attractive option for those looking to invest in mutual funds.

 


Popular posts from this blog

Real Returns in Investing

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300 Real Returns in Investing     A Anil Singh (name changed), 44, works with a private company and believes in investing his entire savings in fixed deposits. His financials from the year 2000 till date is given in the table. Anil's savings in FDs gave him an average return of around 8%. The total amount saved over the 174 months (From January 2000 to June 2014) is Rs 49.80 lakh. The value of his investment today is around Rs 66.71 lakh. Naveen Singh (name changed), 44, works in a similar profile like Anil. However his expenses were on the higher side. His financials are as in the table. Naveen invested only in equities. The total amount saved over the 174 months (From January 2000 to June 2014) is Rs 38.40 lakh. The v...

Budget 2014 Highlights for Saving

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   The new finance minister Arun Jaitley has just presented his first budget. What measures does the budget contain that will specifically impact savers and investors? Here they are: 1. Housing loans exemption for self-occupied properties increased to Rs2 lakh: Earlier this amount was Rs1.5 lakhs. This move barely keeps pace with the inflation in asset values.   2. Investment limit under 80 (C) increased to Rs1.5 lakh: This is a good move again and offers some relief to taxpayers.   3. IT exemption increased to Rs2.5 lakh, Rs3 lakh for senior citizens. This comes as a minor relief for taxpayers.   4. Annual PPF ceiling to be enhanced to Rs1.5 lakh, from Rs1 lakh: This is in tune with the change in 80C.   5. Long term capital gains tax for debt funds has been rai...

ICICI Prudential MIP 25 - Invest Online

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   ICICI Prudential MIP 25     (CRISIL Rank 2)   This scheme was launched March 2004. Please see the chart below for the one, two, three and five years annualized returns from this scheme. The minimum investment in the scheme is Rs 5,000. The asset allocation of the portfolio is 24% equity, 72% debt and 4% cash equivalent and others. Please see the chart below for the monthly dividends declared by the scheme, on a per unit basis, over the last 5 years.   For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call Leave a missed Call on 94 8300 8300 Leave your comment with mai...

Franklin India Smaller Companies Fund - Invest Online

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   Franklin India Smaller Companies Fund   While the universe of small-cap stocks in India is vast, there are very few equity funds which take on the task of sifting through this space for good long-term bets. Franklin India Smaller Companies Fund has managed this with aplomb. What we like about this fund is its significant out-performance of its category and benchmark over the last four years, and its ability to moderate portfolio risk despite investing in the riskiest segment of the equity market. This fund's stock selection strategy, like that of Franklin India Prima Fund is focused on finding companies that generate positive cash flows across business cycles. High return on investment and manageable leverage are also filtering criteria. Says R. Janakiraman, fund ma...

How to open a Capital Gains Account?

Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Buy Gold Mutual Funds Leave a missed Call on 94 8300 8300   How to open a Capital Gains Account? You can open a capital gains account in an authorized bank. The Government has notified 28 banks which can open the Capital Gains Account on behalf of the Government. You have to apply for opening the account by filling out the required application form (Form A) and submit proof of address, PAN card and photograph. You cannot withdraw funds from a capital gains account using a cheque book or ATM, like you do in your normal savings bank account. There are procedures to be followed to withdraw funds from the capital gains account. Investment in Specified Bonds Section 54EC of Income Act provide that if the seller invests whole or part of capital gains arising from the sale of asset in specified Capital Gains, within a period of six months of the ...
Related Posts Plugin for WordPress, Blogger...
Invest in Tax Saving Mutual Funds Download Any Applications
Transact Mutual Funds Online Invest Online
Buy Gold Mutual Funds Invest Now