In the first 10 years of its existence, 1996 to 2006, this fund beat the category average every single year. However, doubts were raised when it performed averagely in 2007 and 2008. It then silenced every sceptic by the best performance in its category in 2009.
The fund manager has been at the helm of this scheme since its inception. He likes to stick to his beliefs, the current trends dont bother him. The funds mandate allows equity allocation to be between 40-75 per cent. The fund has stayed within its equity limit, averaging 70 per cent since mid-2006. The manager had a high equity allocation in 2008, most of it in lower caps. This was why the fund performed averagely in 2008, but also why it topped the category in 2009.
The manager keeps the portfolio well diversified with respect to both stocks and sectors. Over the past year, the average number of stocks have been around 60. Since 2006, the allocation to the top five stocks did not go beyond 20 per cent.
On the debt side, the fund manager takes small exposures in structured debt and G-Secs. However, on the whole, he prefers bonds and debentures of the financial services sector.
This fund is the biggest in its category, and also the best. It reaped benefits for its investors with the fiveyear returns of 24 per cent (as on March 3), against the categorys 16 per cent. These numbers make the fund a very good pick.
