IF YOU want a smooth ride with no nasty bumps, this one's for you. No mind-boggling returns here, but neither will you have to deal with sleepless nights. This fund has always outperformed or delivered close to the category average in all its years of existence.
The aim of this open ended balanced fund is to strike a balance between growth and stability. Growth is offered on the equity side.
By managing the interest rate movements and credit risk, the fixed income component adds stability. The fund is managed by Anand Radhakrishnan, Sachin Desai and Vivek Ahuja.
Its performance of 53 per cent in 2009 was lower than the category average (57 per cent), but not way behind either. The reason could have been the strong large cap bias that moderates the return of the fund during market upsides.
Most of its peers rode on smaller stocks to deliver higher returns since the BSE Small Cap (127 per cent) and BSE Mid Cap (108 per cent) outperformed Sensex (81 per cent).
But it is this conservative trait that kept investors happy in 2008 when the fund fell less than the category average. The fund's equity allocation has been range bound (60-70 per cent of the portfolio) and doesn't deviate much, barring a few exceptions, especially in 2009. The equity component is reasonably diversified at 32 stocks (12 month average), almost equal to that of the category, while allocation to a single stock rarely exceeds seven per cent.
On the debt side, a significant portion (around 22 per cent since inception) of its portfolio is invested in debentures. The fund manager favours exposure to the financial services sector. Structured obligations and G-Secs also find a place in this portfolio.
