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Changes in Recommended Funds (as at June 2010) August 20, 2010
The article highlights the changes in our recommended funds across various fund categories as at June 2010.
Author : Dhruva Raj Chatterji


Untitled Document
  Recommended Funds as at December 2009 Recommended Funds as at June 2010
Equity Funds
Equity: Diversified HDFC TOP 200 FUND - GROWTH HDFC TOP 200 FUND - GROWTH
DSP BLACKROCK TOP 100 EQUITY - REGULAR PLAN - GROWTH DSP BLACKROCK TOP 100 EQUITY - REGULAR PLAN - GROWTH
HDFC EQUITY FUND - GROWTH HDFC EQUITY FUND - GROWTH
Equity: Mid cap & Small cap SUNDARAM BNP PARIBAS SELECT MIDCAP APPRECIATION- GROWTH  DSP BLACKROCK MICRO CAP FUND - GROWTH
RELIANCE GROWTH FUND -GROWTH RELIANCE GROWTH FUND -GROWTH
Equity: Infrastructure ICICI PRUDENTIAL INFRASTRUCTURE FUND - GROWTH ICICI PRUDENTIAL INFRASTRUCTURE FUND - GROWTH
DSP BLACKROCK INDIA T.I.G.E.R. FUND - REGULAR PLAN - GROWTH DSP BLACKROCK INDIA T.I.G.E.R. FUND - REGULAR PLAN - GROWTH
Equity: Banking & Financial
Services Sector  
RELIANCE BANKING FUND- GROWTH RELIANCE BANKING FUND- GROWTH
Equity: Pharma NA RELIANCE PHARMA FUND- GROWTH
Equity: Technology NA DSP BLACKROCK TECHNOLOGY.COM FUND- GROWTH
Equity: FMCG NA FRANKLIN FMCG FUND- GROWTH
Equity: Contra & Value ICICI PRUDENTIAL DISCOVERY FUND - GROWTH ICICI PRUDENTIAL DISCOVERY FUND - GROWTH
NA UTI MASTER VALUE FUND – GROWTH
Equity: Dividend Yield UTI DIVIDEND YIELD FUND- GROWTH UTI DIVIDEND YIELD FUND- GROWTH
Equity: ELSS HDFC TAXSAVER - GROWTH HDFC TAXSAVER - GROWTH
SUNDARAM BNP PARIBAS TAXSAVER OPEN ENDED- GROWTH FIDELITY TAX ADVANTAGE FUND- GROWTH 
Equity: Index HDFC INDEX FUND SENSEX PLUS PLAN- GROWTH HDFC INDEX FUND SENSEX PLUS PLAN- GROWTH
Equity: Overseas FIDELITY INTERNATIONAL OPPORTUNITIES FUND- GROWTH FIDELITY INTERNATIONAL OPPORTUNITIES FUND- GROWTH
SUNDARAM BNP PARIBAS GLOBAL ADVANTAGE- GROWTH TATA GROWING ECONOMIES INFRASTRUCTURE FUND PLAN A- GROWTH
PRINCIPAL GLOBAL OPPORTUNITIES FUND- GROWTH NA
Bond Funds
Debt: Floater
BSL FLOATING RATE LONG TERM- GROWTH 
BSL FLOATING RATE LONG TERM- GROWTH 
HDFC FLOATING RATE INCOME FUND LONG TERM PLAN- GROWTH 
HDFC FLOATING RATE INCOME FUND LONG TERM PLAN- GROWTH 
Debt: Short Term
RELIANCE SHORT TERM FUND- GROWTH 
RELIANCE SHORT TERM FUND- GROWTH 
JM SHORT TERM FUND- GROWTH 
HDFC HIGH INTEREST FUND - SHORT TERM PLAN - GROWTH
Debt: Ultra Short Term
TEMPLETON INDIA ULTRA SHORT BOND FUND- GROWTH
LICMF INCOME PLUS FUND- GROWTH
NA
RELIANCE MONEY MANAGER FUND- GROWTH
Debt: Income
ICICI PRUDENTIAL LONG TERM PLAN- CUMULATIVE 
FORTIS FLEXI DEBT FUND- GROWTH
BSL DYNAMIC BOND FUND RETAIL - GROWTH 
BSL DYNAMIC BOND FUND RETAIL - GROWTH 
Debt: Gilt - Short Term
ICICI GILT FUND TREASURY PLAN- DIVIDEND PAYOUT 
BSL GILT PLUS LIQUID PLAN - GROWTH
Debt: Gilt - Long Term
FT INDIA GOVERNMENT SECURITIES FUND LONG TERM PLAN- GROWTH 
BSL GOVERNMENT SECURITIES FUND LONG TERM PLAN – GROWTH 
Hybrid Funds
Balanced Funds
HDFC PRUDENCE FUND - GROWTH 
HDFC PRUDENCE FUND - GROWTH 
DSP BLACKROCK BALANCED FUND-GROWTH 
DSP BLACKROCK BALANCED FUND-GROWTH 
Monthly Income Plan (MIP)
UTI MONTHLY INCOME SCHEME-GROWTH  
RELIANCE MONTHLY INCOME PLAN- GROWTH 
HDFC MF MIP - LONG TERM PLAN - GROWTH 
HDFC MULTIPLE YIELD FUND PLAN 2005- GROWTH

NA = Not Applicable, New recommended funds highlighted in red

While assessing funds to derive the list of Recommended Funds, we have looked at past performance, expense ratios and resilience of the funds. (Click here for more details on the methodology)

The past performance of the mutual funds schemes takes up a large part of our consideration. Although the past performance is not indicative of future performance, we believe that past performance can still give us an indication of the quality of the fund management team. We look specifically at cumulative performance over various time horizons (from one-year to five-year periods) and the returns as per calendar year, to rank these funds.

Changes in Recommended Funds for Equity Funds

In the equity segment, most of the changes in recommended funds were on account of funds being recommended for some new categories / classifications, or on account of new funds being added on to our platform (from the last review period).

The new sector categories that we added in the recommended funds include Pharmaceuticals, Technology and FMCG (Fast Moving Consumer Goods) as these sectors have performed well in the first half of 2010.

In categories like Mid and Small-caps and ELSS (Equity Linked Savings Schemes), the changes in recommended funds were primarily due to addition of new funds on to our platform (from the last review period).

Changes in Recommended Funds for Bond and Hybrid Funds

The changes in recommended funds from the bond and hybrid segment were a mixed bag. Some changes were due to addition of new funds on to the platform (from the last review period). And some were due to a slight downgrade of earlier recommended funds.

In some categories like Ultra Short-Term and Monthly Income Plan, the changes were primarily due to addition of new funds on to our platform. In the Ultra Short-Term category, both the recommended funds viz. LICMF INCOME PLUS FUND- GROWTH and RELIANCE MONEY MANAGER FUND- GROWTH, were added on to our platform after the last review. From the Monthly Income category, HDFC MULTIPLE YIELD FUND PLAN 2005- GROWTH was added on to our platform after the last review.

However, for certain categories, the changes in recommended funds were due to a downgrade of earlier funds in this review. In the Debt-Income category, ICICI PRUDENTIAL LONG TERM PLAN- CUMULATIVE was excluded from our recommended funds list as the overall rank of the fund (within its peer category) fell sharply from the first place (as at December 2009) to the eighteenth spot (as at June 2010). The huge fall in overall ranking of the fund could primarily be attributed to the sharp rise in the expense ratio of the fund.

In the Debt-Short Term category, JM SHORT TERM FUND- GROWTH, was excluded from our recommended funds list, as the overall rank of the fund fell slightly from the second place (as at December 2009) to the fourth spot (as at June 2010).

In the Monthly Income Plan (MIP) category, UTI MONTHLY INCOME SCHEME-GROWTH  was excluded from our recommended funds list, as the overall rank of the fund fell from the first place (as at December 2009) to the sixth spot (as at June 2010). Meanwhile, the overall rank of our new recommended fund in the MIP category viz. RELIANCE MONTHLY INCOME PLAN- GROWTHclimbed up from the seventh rank (as at December 2009) to the second rank (as at June 2010).
 
Previous Recommended Funds Have Not Gone Bad

We usually recommend funds that have the highest overall rank within their respective fund category / classification, unless they don’t have the requisite track record. So it may happen that a previously recommended fund no longer appears amongst the top ranked funds (within that category) for the relevant review period. Our observation has been that most of the previously recommended funds that have been replaced, have not performed poorly, but have dropped by a mere one or two ranks (overall rank), as a result of which they have been replaced.
The high turnover in the recommended funds list is primarily on account of funds being recommended for some new categories / classifications, or on account of new funds being added on to our platform (from the last review period).


iFAST and/or its content and research team’s licensed representatives may own or have positions in the mutual funds of any of the Asset Management Company mentioned or referred to in the article, and may from time to time add or dispose of, or be materially interested in any such. This article is not to be construed as an offer or solicitation for the subscription, purchase or sale of any mutual fund. No investment decision should be taken without first viewing a mutual fund's offer document/scheme additional information/scheme information document. Any advice herein is made on a general basis and does not take into account the specific investment objectives of the specific person or group of persons. Investors should seek for professional investment, tax, and legal advice before making an investment or any other decision. Past performance and any forecast is not necessarily indicative of the future or likely performance of the mutual fund. The value of mutual funds and the income from them may fall as well as rise. Opinions expressed herein are subject to change without notice. Please read our disclaimer in the website.

 


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