Mirae Asset Emerging Bluechip Fund

Mirae Asset Emerging Bluechip Fund aims To generate income and capital appreciation from a diversified portfolio predominantly investing in Indian equities and equity related securities of companies which are not part of the top 100 stocks by market capitalization and have market capitalization of atleast Rs.100 Crores at the time of investment.

Mirae Asset Emerging Bluechip Fund is unusual for a mid-cap fund to use the ‘bluechip’ moniker in its label. But this fund lives up to its name by scouting for quality names alone in the mid-cap space.

Mirae Asset Emerging Bluechip Fund has outpaced both its benchmark and peers in every year since launch, though it has a limited track record, from 2011. Strong returns have helped this fund hold onto a five-star rating since it entered the rating chart in 2013. The fund has never fallen below the first quartile in the five years since launch.

Mirae Asset Emerging Bluechip Fund prefers larger mid-cap companies. It consciously avoids tiny-sized companies, those with operating profits below Rs 100 crore.

Though the Mirae Asset Emerging Bluechip Fund is quality-oriented, it is value conscious. It hunts for businesses with decent growth prospects and a good ROCE. Buying good companies at reasonable prices is the key philosophy. The portfolio allocation shows a consistent 40-60 per cent allocation to mid caps (higher than that of the category) and a 20-40 per cent to large caps.

With a 35.3 per cent CAGR over three years and 29.7 per cent over five years, the fund is ahead of its benchmark by comfortable 9-13 percentage points. It has beaten peers by 7-9 percentage points in the same period. Bull or bear phases have gone equally well for the fund during its short tenure. The one shortcoming is that due to its recent vintage it hasn’t faced a severe bear market of the 2008 magnitude. While quality stocks have faced a rough time in the last one year, the fund has managed to handle this shift well with a convincing outperformance of both its benchmark and category.

Invest Rs 1,50,000 and Save Tax up to Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds. Save Tax Get Rich

Top 10 Tax Saver Mutual Funds for 2017 – 2018

Best 10 ELSS Mutual Funds to Invest in India for 2017

1. DSP BlackRock Tax Saver Fund

2. Tata India Tax Savings Fund

3. Birla Sun Life Tax Relief 96

4. ICICI Prudential Long Term Equity Fund

5. Invesco India Tax Plan

6. Franklin India TaxShield

7. Reliance Tax Saver (ELSS) Fund

8. BNP Paribas Long Term Equity Fund

9. Axis Tax Saver Fund

10. Sundaram Diversified Equity Fund

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Invest SBI CONTRA FUND Online

SBI CONTRA FUND

This fund has changed its focus from taking contra bets–investing in stocks that are out of favour–to running a diversified, multi-cap strategy with a mild contra bias. The approach has been refined to focus more on the growth potential of underlying businesses, with reasonable valuation just being a supportive parameter rather than the key criterion. The fund leans heavily towards large-caps compared to many of its peers in the multi-cap space which are mid-cap oriented. It has the freedom to take outsized sector bets, even though the portfolio focuses on companies and not sectors.

The fund is helmed by a highly skilled fund manager, but it needs to show a sustained improvement in performance to merit a place in your portfolio.

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Invest Birla SunLife Short Term Opportunities Fund

BSL Short Term Opportunities Fund Online

The scheme had been running a reasonable exposure to sovereign bonds

(~35%) in the last couple of months. Going forward, we intend to bring down

the exposure to sovereign bonds and increase exposure to corporate bonds.

After remaining at ultra low levels for several months, Corporate bond spreads

have moved up to median levels (50- 55 bps for AAA- Gsec). The fund is

currently positioned in such a way that ~50% – 65% of the portfolio is

invested in AAA/sovereign bonds and ~35% -50% of the portfolio is invested

in AA centric corporate bonds. For the last few months we were constructive

on duration and were underweight on corporate bonds. With expansion in

corporate bond spreads & softening interest rate environment, we intend to

build higher exposure to corporate bonds in our portfolio going forward. The YTM of the portfolio is currently at 8.41%. The fund continues to focus on an
accrual strategy with a high credit quality bias.

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Birla Sun Life Manufacturing Fund

Invest Birla Sun Life Manufacturing Fund Online

It has been over 20 months since we have launched the Birla SL Manufacturing Fund. I think it is an opportune time to provide an update. Also, I have learnt that there are unfounded concerns over the performance of the fund even after the NAV being at > INR 11.5 currently. This is not an effort to counter the concern but to present facts and figures to all.

As all of you would recollect, the fund was launched in Jan’15 when the markets were in good mood and the concept of “Make in India” was making headlines every day. Sensex and Nifty indices peaked in early months of 2015. In fact, as you read this note, those peaks have not been breached yet. In this backdrop, we think that an absolute return of 15% is credit worthy.

It was during this phase of the market peak that Birla SunLife Manufacturing Fund received the money through the NFO with a compulsion to deploy almost immediately.

Birla SunLife Manufacturing Fund started to build the portfolio slowly maintaining high cash levels and higher large cap stocks and limited mid cap stocks. It took four months for the cash level to fall below 10% still maintaining high large cap exposure. However, as the markets corrected the midcap exposure has increased in the portfolio, as seen below.

Maneuvering through the above mentioned market scenario and looking through the rhetoric on “Make in India”, the fund has been able to create alpha the broad based index – BSE500 (which is tougher to beat) across time periods. Just to clarify that if the NAV of BSE500 is taken for the same period as the fund, it would have read 9.81 today compared to fund’s NAV of 11.53 (as of 29th Sep’16)

Timeframe 3 M 6 M 1 Y 1.5 Y SI
Fund 13.6% 21.2% 18.0% 13.9% 15.3%
BSE500 Index 5.2% 13.9% 10.5% 5.0% 2.7%
Alpha 8.4% 7.3% 7.5% 8.9% 12.6%
Nifty50 Index 3.7% 11.0% 8.1% 1.2% -1.9%
Alpha 9.9% 10.2% 9.9% 12.8% 17.2%
As of 29th Sep’16; Cumulative returns
SI – Since Inception (3rd Feb’15)

Sectors:

We were very clear from the beginning that returns can be made in Auto, Pharma and select themes in Consumer. Also, we had apprehension on the valuation of Consumer Staples and a strong view that the investment cycle would be slow and delayed for capital goods stocks to perform.

With this view, we have built and maintained sizeable positions of 18-22% in Auto & Auto related stocks for the entire period. Maruti Suzuki, Hero MotoCorp & MRF have sizeable weights. Pharma also had high representation with a weight of 15-19%. It has been a mixed bag as FDA issues led to correction in some stocks while some bottom up picks did very well. Participation in paints, spirits and white goods has been good with positive attribution to the performance of the fund. A sector like Chemicals has done well for us as we held 5-8% weight purely based on bottom up stock picking (Tata Chemicals).

Though we had cautious view on Capital Goods due to slow and delayed investment cycle, we took some exposure to the sector and even this exposure has hurt the performance.

Overall, the sectoral view has panned out leading to the alpha created in the portfolio over the last 20 months.

Stocks:

Bottoms up stock picking is similar to the one followed for BSL Equity fund. The three hypothesis on which the stock picking is done is explained below :-

First hypothesis being to consistently focus on looking for companies that are at an inflection point like that of Strides Shasun, Dishman Pharma & Piramal Healthcare.

Second hypothesis is to look for companies whose managements were committed to pare debt with better free cash flows from core operations and willingness to sell non-core assets that would release a lot of capital and improve return ratios for shareholders. Tata Chemicals and Century Textiles are examples of this. The idea was always that core business was supporting the valuations while the upside would come from non-core sale.

The third hypothesis is always look out for mispricing i.e. when the market believes that current prevailing scenario will last for ever !!! In these times, one gets to buy asset backed companies at really cheap valuations. Tata Steel and Hindustan Zinc are such investments we have made.

Additionally, there are some well identified and unique stocks that have done exceedingly well like Birla Corp, Heidelberg Cement, Kansai Nerolac, SH Kelkar etc.

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Birla Sun Life Balanced Advantage Fund

Birla Sun Life Balanced Advantage Fund
(An Open-ended Asset Allocation scheme)
This fund dynamically allocates between Equity and Debt instruments in a ratio that gives your investment the edge. This is primarily achieved by arriving at a combination of quality stock selection and active portfolio rebalancing that effectively decreases risk and combats volatility better than others.
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search_img.jpg Emotion-free investment approach
search_img.jpg Potential downside protection
search_img.jpg Equity
taxation
search_img.jpg Smart
withdrawal
feature

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Franklin India Prima Fund

Franklin India Prima Fund – An open-end growth scheme with an objective to provide medium to long term capital appreciation as a primary objective and income as a secondary objective.

Franklin India Prima Fund has left its benchmark in the dust and has never dipped below a four-star rating in the last four years. This also shows its adaptability to both cycle and style shifts in the market.

After faltering in 2006-2008, it made a strong comeback and has beaten both the benchmark and the category by big margins. What we like about this fund is its ability to deliver impressive returns over long periods without playing every big market move. It follows a growth-at-a reasonable-price strategy. It filters stocks on the basis of the company’s return on capital, appetite for capital and treatment of minority shareholders. The fund has been a big wealth creator over four market cycles, with a 21 per cent CAGR since launch.

Franklin India Prima Fund five-year CAGR of 26.06 per cent and three-year CAGR of 29.76 per cent are 12-15 percentage points higher than the returns from the benchmark and 3-4 percentage points higher than those of the peers.

Franklin India Prima Fund had lagged behind others in the bull markets of 2006-07 and fell sharply in the bear phase of 2008. But save for that one bad patch, its performance has been uniformly impressive. Purely growth-oriented funds have had trouble keeping up with the market in the last one year, but this fund has managed a good margin of outperformance.

Franklin India Prima Fund doesn’t take shelter in large caps, with allocations at 25-30 per cent. Mid-cap allocations have always made up 65-70 per cent of assets, which is higher than those of the category.

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Top 10 Tax Saver Mutual Funds for 2017 – 2018

Best 10 ELSS Mutual Funds to Invest in India for 2017

1. DSP BlackRock Tax Saver Fund

2. Tata India Tax Savings Fund

3. Birla Sun Life Tax Relief 96

4. ICICI Prudential Long Term Equity Fund

5. Invesco India Tax Plan

6. Franklin India TaxShield

7. Reliance Tax Saver (ELSS) Fund

8. BNP Paribas Long Term Equity Fund

9. Axis Tax Saver Fund

10. Sundaram Diversified Equity Fund

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HDFC Mid-Cap Opportunities Fund

HDFC Mid-Cap Opportunities Fund – he aim of the fund is to generate long-term capital appreciation from a portfolio that is substantially constituted of equity and equity related securities of mid- and small-cap companies.

The twists and turns in mid-cap stocks haven’t managed to faze this fund, which has been lodged at a four-star rating without a pause for the last seven years. The fund has earned a four- or five-star rating for the entire period since 2010. Usually parking about 75 per cent in mid-cap companies, the fund has the flexibility to invest up to 25 per cent in large caps. The fund uses this flexibility in a very selective manner. The style is growth at a reasonable price. The fund filters companies that are growing at about 15-20 per cent, with good cash-flow generation and acceptable return on equity.

HDFC Mid-Cap Opportunities Fund three-year CAGR, at 30.3 per cent, and five-year CAGR, at 25 per cent, are about 4-8 percentage points ahead of the benchmark CAGR and 3-4 percentage points more than the returns from the peers. What stands out in its yearly returns is its ability to weather any kind of bear market. In 2008, 2011 and 2013, this was a rare mid-cap fund to contain losses to levels far lower than those of its benchmark. The fund has trailed its benchmark on two occasions since inception and both were big bull years. This may be indicative of its cautious positioning on valuations, despite its growth style.

HDFC Mid-Cap Opportunities Fund showed a slight slippage relative to the benchmark in 2015 but has pulled up its socks thereafter. The AUM has crossed Rs 14,000 crore in recent times. However, its size has so far not proved much of an impediment to performance.

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Top 10 Tax Saver Mutual Funds for 2017 – 2018

Best 10 ELSS Mutual Funds to Invest in India for 2017

1. DSP BlackRock Tax Saver Fund

2. Tata India Tax Savings Fund

3. Birla Sun Life Tax Relief 96

4. ICICI Prudential Long Term Equity Fund

5. Invesco India Tax Plan

6. Franklin India TaxShield

7. Reliance Tax Saver (ELSS) Fund

8. BNP Paribas Long Term Equity Fund

9. Axis Tax Saver Fund

10. Sundaram Diversified Equity Fund

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RISKS of DEBT SCHEMES

Lets us first understand what makes the NAV of debt schemes move to better understand the actual impact of this move.

WHAT ARE THE RISKS THAT DEBT SCHEMES ENTAIL?

CREDIT RISK:

Mutual Funds invest in debt securities such as Government Securities and Bonds issued by companies. While the Government Securities (or Gilts) are considered risk free on account of credit, they remain highly rate sensitive. Similarly, corporate bonds also react to the rate movements. They however, can also decline in cases of rating downgrades since companies can default on their debt. We saw similar price impacts in past in case of JSPL & Amtek Auto.

Mitigation: Strong fundamental research regarding the underlying papers helps in making the right choices. Along with this the portfolios are managed dynamically to ensure the rebalancing in case of any risk of default.

LIQUIDITY RISK

The fund manager may not be able to liquidate a security due to lack of demand (low volumes) or even inappropriate valuation being offered.

In such cases, the Fund Manager may be forced to hold the security for a longer period than he / she desires. In case of very high redemption pressure, the fund manager may sometimes be forced to sell the security at a low price or may be forced to restrict redemptions. Hence, you may not be able to take out money even if you wanted to.

Mitigation: All the funds, any point in time, maintain sufficient liquid/cash equivalent assets in order to meet the anticipated redemptions.

INTEREST RATE RISK:

A debt scheme is merely a portfolio of underlying bonds. The maturity (or better assessed through ‘Duration’) is a measure of how sensitive the bond is to movement of market interest rates. The duration of the scheme is the weighted average of duration of underlying securities.

Higher the duration (interest rate sensitivity) of underlying bonds, higher the resultant duration of the scheme. And higher the duration of a mutual fund, the greater the sensitivity of NAV to interest rate movement. In simple terms, if the duration of a debt scheme is 8, the NAV of the scheme will go down by 8% if the interest rate goes up by 1%. On the other hand, if the interest rate goes down by 1%, the NAV of the MF scheme will rise by 8%.

It is however, notable that any adverse impact of duration is more marked to market basis and still reversible unlike credit, where the impact of adverse credit movement can prove to be irreversible.

Mitigation: Backing on strong economic research and macro indicators, the fund house has benefitted from various rate cycles by switching strategies from “accrual to duration” and “duration to accrual” as and when required. Over the past many market cycles

NAV of debt funds can be influenced from external events also apart from domestic factors like inflation, growth etc as they can manifest in any of the above mentioned risks.

For instance, in mid 2013, a number of foreign investors started selling Indian debt heavily on account of Taper Tantrum and resultant risk aversion to all emerging markets including India. Excessive selling put pressure on bond prices as when the supply is high (people are selling) as compared to demand, prices typically go down. NAV of debt mutual funds across categories took a severe beating during the time.

Fund Categories largely differ based on their interest rate sensitivity (measured through Duration) or the average credit quality of the underlying securities that they invest in. Generally, the funds with higher duration or more aggressive credit positioning are the most volatile. As such, during July 2013, many debt funds faced similar NAV impact as in Feb 2017.

Now, what should a normal investor do in such moments of stress? Typically, in the fear of losing more an investor tends to redeem the investments and thus books these marked to market losses. It is important here to note that, the chances of one’s capital getting wiped off in a debt scheme are low as long as it is duration driven. The loss, however severe will be notional unless redeemed. Especially, when the economy is stable and bond prices fall due to negative sentiment, one should ideally wait for the fund to recover losses.

Is the recovery possible?

Yes, it is possible for a debt scheme to recover by continuing to accumulate the coupons from various underlying holdings. At the same time as sentiment reverses (for better) and markets recover, the positive movement from bond prices also adds to recovery.

But, how long one must wait before the losses are recovered?

The answer to this question is quite subjective as the time require by different funds will be different. The activity level of fund management also plays an important role in such NAV recovery.

Let’s assume Fund A has a YTM of 6% and Fund B has a YTM of 8% & NAV of both the funds suffers due to a market event by 3%.

Now Fund A will recover in 6 month while Fund will make the same recovery in 2-3 months.

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Birla Sun Life Tax Relief ’96

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It’s that time of the year when you need to make plans on how to effectively save your taxes. Worry not, Birla Sun Life Tax Relief ’96 – An Open Ended Equity Linked Savings Scheme (ELSS) with a lock-in of 3 years is the answer to all your tax woes.

With just a click, you can save your taxes with none of the hassles of paper work.

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Invest Rs 1,50,000 and Save Tax upto Rs 46,350 under Section 80C. Get Great Returns by Investing in Best Performing ELSS Funds

Top 10 Tax Saver Mutual Funds for 2017 – 2018

Best 10 ELSS Mutual Funds to invest in India for 2017

1. DSP BlackRock Tax Saver Fund

2. Invesco India Tax Plan

3. Tata India Tax Savings Fund

4. ICICI Prudential Long Term Equity Fund

5. Birla Sun Life Tax Relief 96

6. Franklin India TaxShield

7. Reliance Tax Saver (ELSS) Fund

8. BNP Paribas Long Term Equity Fund

9. Axis Tax Saver Fund

10. Birla Sun Life Tax Plan

Invest in Best Performing 2017 Tax Saver Mutual Funds Online

Invest Best Tax Saver Mutual Funds Online

Download Top Tax Saver Mutual Funds Application Forms

For further information contact SaveTaxGetRich on 94 8300 8300