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- DSP Black Rock TIGER fund – Fund Overview
- Start planning Retirement from early stage
- Mutual Funds can help reach goal faster
| DSP Black Rock TIGER fund – Fund Overview Posted: 11 Jun 2014 05:11 AM PDT Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Leave a missed Call on 94 8300 8300
DSP Black Rock TIGER fund – Fund Overview
This fund is suitable for well informed active investors looking for good investment opportunities in the short to medium term. The fund was launched in May 2004. It has an AUM base of about Rs 977 crores. The expense ratio of this fund is 2.14%. The fund manager of this scheme is Rohit Singhania. The scheme is open both for growth and dividend plans. The current NAV (as on June 4 2014) is 59.2 for the growth option and 17.48 for the dividend option.
Portfolio Construction
The fund invests in basket of diversified cyclical stocks, with a large cap and high growth focus.From a sector perspective, the portfolio has an infrastructure bias, but also has substantial exposure to BFSI, Energy and Telecom and Materials. In terms of company concentration, the portfolio is very well diversified with its top 5 holdings, ICICI Bank, L&T, HDFC Bank, SBI and RIL for only 29% of the total portfolio value. Even the top 10 stock holdings account for less than 42% of the total portfolio value.
Risk & Return
We have seen in Figure 1 that, the DSP Black Rock TIGER fund has outperformed it's category across most time periods. The last one year returns have been particularly strong at nearly 41%. The returns over the 3 to 5 year periods have been low, because the cyclical sectors were generally very subdued during this timeframe. From a risk perspective, the volatility of the DSP Black Rock TIGER fund is slightly higher than the infrastructure sector funds category. The annualized standard deviation of monthly returns of the fund is 27%, as compared to 25.4% for the category. However, on a risk adjusted returns basis, as measured by Sharpe Ratio, the fund has outperformed the infrastructure sector funds category. Sharpe ratio is defined as the ratio of excess return (i.e. difference of return of the fund and risk free return from Government securities) and annualized standard deviation of returns. Higher the Sharpe ratio better is the risk adjusted performance of the fund. The Sharpe Ratio of the DSP Black Rock TIGER fund is 0.18 versus 0.09 for the category.
Comparison with Peer Set
A comparison of annualized returns of the DSP Black Rock TIGER fund (growth option) versus its peer set over one, three and five year time periods shows why this fund is considered a top pick in its category. See chart below for comparison of trailing annualized returns over three, five and ten year time periods. NAVs as on June 4 2014.
Dividend Payout Track Record
DSP Black Rock TIGER fund Dividend Option has an excellent dividend payout track record. Since inception in 2004, the fund has paid dividends every year, except in 2011.
Lump Sum and SIP Returns
The chart below shows the growth of Rs 1 lakh lump sum investment in the DSP Black Rock TIGER fund (growth option) since inception. A lump sum investment of Rs 1 lakh in the NFO (growth option) would have grown to over Rs 6 lakhs by the end of 2007. There fund NAVs saw sharp correction in the stock market crash in 2008, and has been quite volatile over the last 5 years. However, the fund NAV has reclaimed its historical high.
The chart below shows the returns since inception of Rs 3000 monthly SIP in the DSP Black Rock TIGER fund (growth option). The SIP date has been assumed to be the first working day of the month.
The chart above shows that a monthly SIP of Rs 3000 started 5 years back in the DSP Black Rock TIGER fund (growth option) would have grown to nearly Rs 7.5 lakhs, while the investor would have invested in total only Rs 3.6 lakhs. The SIP returns (XIRR) is nearly 14%. The SIP returns are low, because the cyclical sectors have been grossly underperforming over the last 5 years. However, once the economic growth revives, the SIP returns will undoubtedly improve.
Future Outlook
The future outlook for cyclical sectors looks very positive, for reasons described at the beginning of the article. Cyclical sectors do very well in bull markets. Let us take a look at history to get an indication. The DSP Black Rock TIGER fund was launched just after the Lok Sabha elections of 2004. The period from 2004 to 2007 was one of the strongest bull markets in the history of Indian equities. The chart below shows the growth in NAV of the DSP Black Rock TIGER fund from June 2004 to June 2007.
The NAV of the fund grow more than 3.5 times in 3 years. It gave a compounded annualized return of 53%. We are at a similar juncture now. In many ways, from the equity market perspective the political situation is much better now than in 2004. In 2004, the UPA – 1 Government had to rely on the support of the Left Front, which was opposed to economic reforms. The NDA Government, on the other hand, has a comfortable majority in Lok Sabha. In fact, BJP by itself, has an absolute majority, and therefore will be free from the compulsions of coalition politics. This will enable the government to pursue economic reforms more aggressively. On the monetary policy side, the RBI governor in the latest policy review has indicated that the interest rate tightening regime is now probably over. As the RBI moves to a more benign monetary policy, it will provide a stimulus to the cyclical sectors. The DSP Black Rock TIGER fund with its focus on domestic cyclical sectors is thus well positioned to gain from the revival of economic growth. The fund has already given a trailing return of 51% in the last 3 months, and is poised to go from strength to strength. However, investors should also note that, cyclical and high beta stocks also tend to be volatile. Since DSP Black Rock TIGER fund is focused on cyclical sectors and stocks, investors in the fund should be prepared for high volatilities. Therefore, investors need to have a sufficiently long time horizon if they want to invest in this fund. Investors with high risk appetite and moderate to long term time horizon can consider buying the scheme through the systematic investment plan (SIP) or lump sum route. Investors should consult with their financial advisers if the DSP Black Rock Tiger fund is suitable for their individual risk profiles and time horizons.
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 ---------------------------------------------
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| Start planning Retirement from early stage Posted: 11 Jun 2014 03:41 AM PDT Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Leave a missed Call on 94 8300 8300
Start planning Retirement from early stage
Retirement is often thought to be a state when one stops work ing. But in reality , retirement is a state of mind of being financially free -when one works because he/she loves to and not because he/she has to. This is the reason why retirement years are also called the golden years of life.
Currently , many lead a life as if there is no tomorrow and concentrate on spending on wants rather than needs.
But what we forget is each one of us will grow old and would need money to retire as one can be young without money but can never be old without it.
That's why for every individual retirement planning becomes an inherent need.
In the end, remember that it's not the years in your life that count, but it's the life in those years that matters. So plan ahead of time to make the most of your golden 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 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 | ||||||||
| Mutual Funds can help reach goal faster Posted: 11 Jun 2014 01:46 AM PDT Download Tax Saving Mutual Fund Application Forms Invest In Tax Saving Mutual Funds Online Leave a missed Call on 94 8300 8300
Mutual Funds can help reach goal faster
Everybody expects an intendant and secured retired life. But look at the rising medical costs, increasing life expectancy and the high rate of inflation. The question is will traditional investment plans build a retirement corpus which, when invested on maturity , be able to generate a regular stream of monthly income to cover our expenses so that we are able to maintain at least the same standard of living as today , if not better?
During these years, he/she has to build a corpus which has to sustain him/her for the post retirement life of 25-30 years.
Now, can we better this?
Investments in equity funds should predominantly be into those funds that benchmark against the nifty index. This way, an investor can be sure that if nifty/ sensex goes up, then his/her investment will also appreciate.
An investor can follow a static allocation model, where by his investment into equity and fixed income does not hange, or follow the dynamic model. In dynamic allocation, an investor reviews the investments every six months and hangs the allocation.
A simple strategy could be or every 15% rally in the equity markets, you reduce your exposure to equities by 5%. Similarly, if there is a fall in equity markets, then for every 15% fall in equities one can increase equity exposure by 5%. This way , you will be able to take advantage of equity volatility . Following this strategy can help you move out when there is over-optimism in the markets, and enter into equities when there is general pessimism.
Once you have a corpus of Rs 25 lakh, which should get created in the first eight years, you can start adding some midcap and sectoral funds.
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 |
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