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- Use Mutual Fund SIPs with SWPs to Get Regular Income
- UTI Opportunities Fund Invest Online
- What Should you Look Out For In a Health Policy?
| Use Mutual Fund SIPs with SWPs to Get Regular Income Posted: 10 Mar 2014 07:13 AM PDT Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Leave a missed Call on 94 8300 8300
Systematic withdrawal plans help you redeem a fixed sum at given intervals from your portfolio
For further information contact Prajna Capital on 94 8300 8300 by leaving a missed call
Leave a missed Call on 94 8300 8300
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| UTI Opportunities Fund Invest Online Posted: 10 Mar 2014 06:14 AM PDT Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Leave a missed Call on 94 8300 8300
UTI Opportunities Fund has an impressive 3 yr and 5 yr performance track record relative to market and category averages, but a somewhat disappointing 6 mth and 1 yrperformance record. In this article, Anoop takes us through the fund strategy, the reasons that have helped him deliver a superior long term performance as well as a detailed review of what contributed to the near term underperformance. He also takes us through how he is positioning the fund going forward, and what are some of the strategy changes that he has adopted, at the margin, to ensure that the fund continues delivering long term outperformance.
Fund strategy
The fund aims to deliver alpha through an opportunistic, top-down driven sector selection strategy. In a market which is increasingly influenced by FII flows - which tend to be more top down than bottom up oriented, a top-down sector selection strategy is increasingly relevant in Indian markets. Unlike some other "Opportunities" funds that employ an across-market cap strategy, this fund focusses largely on the large cap universe. We further define "opportunities" as situations arising out of sectoral favourability rather than opportunities arising out of capitalization rerating.
Performance analysis
Drivers of long term outperformance (3 yr& 5 yr) :
The long term performance track record (3 yr and 5 yr numbers) are well ahead of market benchmarks and category averages, which demonstrate the long term wealth creation record of this fund. The fund has maintained a defensive posture since December 2010, which can be seen from the fact that the fund's beta has been around 0.6 since then. This has helped significantly reduce volatility in the fund's performance and helped deliver better than market performance, in a market that has been characterised over the last 3 years by high volatility and frequent sell-offs in some high beta stocks.
Reasons behind muted near term performance ( 6mths and 1 yr) :
Essentially, the fund's performance has been trailing its peer only in the last quarter, which has impacted the short term and the one year performance figures of the fund. Hence on should not confuse the one year performance metric as an indicator of the year long performance of the fund. The reasons that can be attributed to the blip in the performance are as follows :
Sector allocations:
· The overweight position to the Cement and Cement Products sector has had a negative attribution to the overall fund performance over the last two months. The sector has been an underperformer in the last quarter of the calendar year primarily because of pricing pressures arising due to demand constraints.
· Financial Services: The sector primarily witnessed movement in the mid cap banking sector stocks and PSU Banking stocks. The fund orientation/bias towards large caps coupled with the strategy to avoid government companies contributed to the negative attribution to the performance through this sector.
· Oil & Gas: A similar trend was witnessed in the sector where government announcements and the euphoria over the "visible" pragmatism of the government led to a run up in the PSU run stocks in this sector. The portfolio's lack of exposure to PSU Oil & Gas stocks had a negative contribution again to the performance.
· Consumer Goods: The portfolio continues to have a significant exposure to this sector and the underperformance of the sector led by the large cap constituents again worked against the portfolio strategy in the short term.
Portfolio strategy going forward
Sectoral & Market Cap Allocation
· The portfolio would continue its current strategy of active sector selection with a top down bias.
· The one change that would and is being witnessed in to increase exposure to quality midcaps in the sectors to bring up the allocation to ~15% of the portfolio. Recent changes have been MRF Ltd. in the automobile sector and Shree Cements Ltd. in the cement sector.
· We would continue our significant exposure to the Financial Services where the portfolio has increased its exposure to Axis Bank Ltd. and would continue to avoid PSU Bank stocks, except SBI Bank (we believe that PSU Banks are closer to their peak valuation at 1/1.05x Price to Book as compared to their current valuations at 0.90/0.95x Price to Book. We believe there is a higher probability of the private sector banks undergoing re-rating due to significant spread in the current valuations as compared to their respective peaks).
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 mail ID and we will answer them OR You can write back to us at PrajnaCapital [at] Gmail [dot] Com
--------------------------------------------- Invest Mutual Funds Online
Download Mutual Fund Application Forms from all AMCs Download Mutual Any Fund Application Forms ---------------------------------------------
Best Performing Mutual Funds
B. Large and Midcap Funds Invest Online
C. Mid and SmallCap Funds Invest Online
D. Small and MicroCap Funds Invest Online
2. Franklin India Smaller Companies E. Sector Funds Invest Online
F. Tax Saver Mutual Funds Invest Online 1. ICICI Prudential Tax Plan 2. HDFC Taxsaver
G. Gold Mutual Funds Invest Online
H. International funds Invest Online 1. Birla Sun Life International Equity Plan A 2. DSP BlackRock US Flexible Equity 3. FT India Feeder Franklin US Opportunities 4. ICICI Prudential US Bluechip Equity 5. Motilal Oswal MOSt Shares NASDAQ-100 ETF |
| What Should you Look Out For In a Health Policy? Posted: 10 Mar 2014 04:42 AM PDT Invest In Tax Saving Mutual Funds Online Call 0 94 8300 8300 (India) Never Compare Apples and Oranges Most of us look at the premium amounts of a health policy and pick up that policy which has the lowest premium. The result of this is a lot of heartburn. This is like comparing apples to oranges rather than apples to apples. The result of this is a disaster. This is similar to the principle of purchasing penny stocks with the hope that it will make one rich. But Does It Do So. It is very rare that this takes place. Most of the time one loses everything .If one has to compare a health policy it is best that one thoroughly studies the policies and picks up the best policy not just by looking at the price but taking all factors into consideration. One must start by reading the fine print carefully. One cannot study an elephant just by looking at its trunk. In a similar manner one has to thoroughly study the health policy and not just the premium. Check That Maximum Renewable Age What Is The Use Of A Health Policy If it Does Not Serve You When You Need It The Most?.Always check out the maximum renewal age of that health policy. Always check and see if these policies have a lifetime clause. If not one will have to bear medical bills in his old age which would be sky high. When one purchases a health policy look out to see that ones family is covered for a reasonable length of time. Choose wisely only those policies which have a lifetime renewability clause. Else one might “Buy in Haste and Repent at Leisure”. It Wasn’t Raining When Noah Built The Ark This saying basically means “Always Plan Ahead”. One must never wait for the problem to take root before finding a solution. This holds good when one has to decide on the sum assured. This calls for a forward thinking approach. Always choose a sum assured in that family floater policy which is sufficient. If one takes a coverage of INR 2-3 Lakhs on a family floater policy it tends to be insufficient. One has to choose a coverage amount which is sufficient to protect ones family keeping in mind the effects inflation has on those medical bills. A family floater policy takes the age of the senior most beneficiary of the policy when calculating the premium. After ones age crosses 45 years one notices a huge jump in the premium amounts to as high as 40%.Always lock on to the higher levels of coverage at a younger age. Do not try to upgrade these policies at a later age as the premiums tend to be very high at older ages. Medical tests may be required and if ones family members contract a disease in the interim period this disease is excluded for the upgraded amount .Upgrade is as good as purchasing a new policy at an older age paying higher premiums and is certainly not recommended. Always factor in deductions and exclusions while purchasing that health policy. Study The Rating System Of These Health Policies Each mediclaim policy has certain in built features which add muscle to it. Certain health policies might exclude preexisting diseases for a period of 4 Years while certain policies might exclude preexisting diseases for a couple of years. The policies which exclude preexisting diseases for a couple of years have a better rating than the four year policy. The health policy might have a sublimit clause which caps or limits the hospital room rent to a particular amount. In the hospital not just the room but also the Doctor’s charges and service charges differ. Different rooms have different charges for doctors and services and this point needs to be noted .One also should study the copayment clause where one has to bear a measure of the cost. This might vary from 10% to 20%.Always choose policies which do not have sub limit clauses on expenditure and on diseases. Even though these health policy premiums might be marginally higher they cover a higher financial risk. The claims settlement record and lifetime renewability clauses are very important in these policies and play a very important role in their ratings. The health policies which provide comprehensive coverage have a higher rating.
Happy Investing!! We can help. Call 0 94 8300 8300 (India) Leave your comment with mail ID and we will answer them OR You can write back to us at PrajnaCapital [at] Gmail [dot] Com
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