This is a safe fund in this category, to stay put for the long-term
The former UTI Mastergain-92 was launched in May 1992 as a closed-end scheme and was welcomed by investors raising a huge Rs4,472 crore with its initial public offer. The fund turned open-end in January 1997 and was renamed in July 2005. This is an open-ended equity scheme with an objective of investing at least 80 per cent in equity and equity related instrument with medium to high risk profile, with the remaining 20 per cent in debt and money market instruments with low to medium risk profile.
Over the years the fund has had both good and bad years. But its performance over the past three years has brought it back into the limelight. It has delivered the second highest annualised return of 6.90 per cent over the 3-year period ended December 31, 2010. After an exceptional run between 2002 and 2004, the fund faltered in the next three year cycle, holding 20 per cent cash exposure in 2006 leading to its underperformance. A lot changed in the fund's performance after Anoop Bhaskar started managing this fund in April 2007.
He started by broad basing the portfolio. "The positioning and strategy of the fund was tightened by September 2007 and it was positioned as a flexi cap product with not less than 70 per cent of the portfolio in large caps and the balance spread across mid and small caps," says Anoop Bhaskar. Though it missed out on the initial part of the rally that started in March 2009, it made up with allocations in Auto and increased exposure to technology stocks. "We avoided bets on high beta names across Infrastructure and Oil & Gas. And, also focused on domestic consumption adding Hero Honda, Bajaj Auto, Tata Motors, Infosys and TCS," explains Bhaskar on what helped the fund perform.
Our View
This is a safe fund within the category. The fund remains invested in large-cap stocks for the long periods and sticks to safe bets in the mid-cap space. This makes the fund steady, which hardly ever throws any surprises. For those looking for safety in this category, this is the fund to stay put for long-term.