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FUNDSUPERMART.COM MUTUAL FUND RESEARCH RECOMMENDATIONS

At Fundsupermart.com, we have an in-house research team to provide independent research and detailed analyses of the market movements, and to help you make the smartest next move.

We strive to analyze funds with as long a comparable history as possible and only within their peer group.

For A Look At Our Methodology, Click here..

For A More Detailed Description Of Why We Recommend Any Particular Fund, Please Click On The Recommended Fund's Name Below:

 

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Equity
Debt
Hybrid
Recommended Funds  Fund Class
Performance (Annualised)
1 year 2 years 3 years 5 years
Buy  
IDFC GOVERNMENT SECURITIES FUND- INVESTMENT PLAN- GROWTH  Gilt - Long Term  14.09 8.11 11.08 10.01
SBI MAGNUM GILT FUND LONG TERM PLAN- GROWTH  Gilt - Long Term  18.35 9.39 12.36 9.81
UTI SHORT TERM INCOME FUND- INSTITUTIONAL PLAN- GROWTH  Short Term  9.69 8.69 10.07 9.75
FRANKLIN INDIA SHORT TERM INCOME PLAN- GROWTH  Short Term  11 9.59 10.29 9.24
SUNDARAM SELECT DEBT SHORT TERM ASSET PLAN- GROWTH  Short Term  9.4 8.62 9.89 10.22
RELIANCE REGULAR SAVINGS FUND DEBT OPTION- GROWTH  Short Term  10.17 9.1 9.65 8.55
BSL SHORT TERM OPPORTUNITIES FUND- GROWTH  Short Term  10.39 10.03 10.64 9.92
FRANKLIN INDIA INCOME BUILDER ACCOUNT PLAN A- GROWTH  Income  11.94 8.1 10.56 9.62
SBI CORPORATE BOND FUND- GROWTH  Income  10.97 10.81 10.19 9.57
ICICI PRUDENTIAL LONG TERM PLAN- GROWTH  Income  14.84 13.81 12.46 10.34
CANARA ROBECO INCOME FUND- GROWTH  Income  12.15 7.22 9.33 8.33
UTI BOND FUND- GROWTH  Income  13.16 6.59 9.55 9.17
UTI DYNAMIC BOND FUND- GROWTH  Dynamic Bond  11.94 9.55 10.54 -
TATA DYNAMIC BOND FUND OPTION A PLAN A- GROWTH  Dynamic Bond  12.3 9.04 10.84 9.11
RELIANCE DYNAMIC BOND FUND- GROWTH  Dynamic Bond  12.66 6.92 9.9 9.36
BSL DYNAMIC BOND FUND- GROWTH  Dynamic Bond  13.41 9.51 10.51 9.5
Please note that while we hope that these recommendations would be useful for investors, you are also advised to look at the fund's scheme information document/ statement of additional information and do your own further research before making your investment decisions.

IDFC GOVERNMENT SECURITIES FUND- INVESTMENT PLAN- GROWTH


Our Analysis:
The funds mandate is to invest into government securities which will provide stable returns over a long period of time. A perusal of the portfolio shows that the funds exposure into G-Secs which stood at 96.2% in December 2013 went to as low as 30.80% in March 2014 and finally as on November 2014, was at 98.57%. The average maturity of the fund increased from 10.7 years to 17.09 years during December 2013 to November 2014.

Fund Manager Comments:
The policy review in early February held very little new information for medium term investors. The key to forecast how many more rate cuts still rests with forecasting CPI inflation and the real rate target that RBI wants to set over inflation. There is some additional clarity on the latter; the Governor has further narrowed his real rate target band to 1.5  2% from 1.5  2.5% earlier, as was said matter-of-factly in the post policy media interactions. On the former, the RBI is choosing to be cautious thus far and rightly so given that it is the policy maker and not a trader. Notwithstanding that, and assuming that dynamics of the new CPI series (the base year is slated to be updated with accompanying weight and basket modifications) are not very different from the old one, we believe there is a good chance of average CPI falling towards 5% in the year ahead. If this happens, then the central banks framework will allow for meaningful cuts in the future. In the very near term, market seems to be building in some uncertainty premium as the front loaded rate cut expectations of some quarters seem to have been put to rest for now.

Subject to a friendly budget (our most likely scenario) we would expect RBI to move again either in March or at the April policy. Post that it may reserve further judgment till it assesses buildup of CPI in the April  June quarter. Bond investors with medium term views should do well so long as the structural theme remains intact; as seems the case till now.

Fund Details (As on November 2014)

Inception: 09 March, 2002

AUM : Rs. 532 Crore

Fund Manager: Suyash Choudhary

Exit Load : NIL

 
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SBI MAGNUM GILT FUND LONG TERM PLAN- GROWTH


Our Analysis:
The fund will invest into government securities issued by the Central Government/State Government. To meet the liquidity requirements, the fund manager can also invest into term/notice money market, repos and reverse repos. During the 1 year of analysis (December 2013 to November 2014), the funds average exposure into G-Secs has been to the tune of 84.88%. As for the average maturity of the fund, it has increased from 9.08 years in December 2013 to 19.96 years in November 2014.

Fund Manager Comments:
The RBI on January 15th reduced the repo rate by 25 bps to 7.75%. This was as per the guidance given in the December policy that if the disinflationary process continues there could be scope for rate reduction even outside the monetary policy review. The December inflation printing at 5%, much below expectations and below the RBI target of 6% for January 2016, provided room for RBI to reduce rates. Further scope for reducing rates would depend on the continuation of the disinflationary process and encouraging Fiscal Developments. We believe there would be further scope for reduction in policy rates on account of the following:

Inflation Outlook:
Retail Inflation has been surprising positively below expectation over the last couple of months. Lower trend in global commodity prices, Governments continuous focus on containing price pressures by diverting spending from subsidies to productive uses and lower rural wage growth provides comfort on the future path of Inflation. Also, sustained global disinflation momentum and weaker domestic demand provides room for RBI to ease policy rates further.

Fiscal Situation:
The Central Government Fiscal deficit has been narrowed from 7.5% of GDP in FY09 to 4.5% in FY14. The government seems committed towards the process of fiscal consolidation. Rationalising of diesel prices and the easing of global commodity prices particularly crude, would help the government in this process. We believe that the FY16 fiscal deficit could be in the 3.6% - 3.8% of GDP but also believe that this could be achievable with realistic assumptions on the revenue and expenditure front. In our view the quality of the budget would be keenly watched by the RBI rather than the deficit number alone. The governments focus on rationalising the expenditure towards more productive purpose and increasing capacities would provide scope for further rate easing.

Keeping in mind improving fiscal situation and current narrow spreads for AAA rated corporate bonds the GILT curve looks more attractive at this juncture.

Fund Details (As on November 2014)

Inception:

AUM :

Fund Manager:

Exit Load :

 
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UTI SHORT TERM INCOME FUND- INSTITUTIONAL PLAN- GROWTH


Our Analysis:
The funds mandate is to invest into money market securities and high quality debt which is not just less risky but also highly liquid. The average maturity of the portfolio can be up to 4 years. During the 1 year of analysis, the fund has been increasing its exposure into G-Secs while at the same time reducing the surplus parked into Non Convertable Debentures. The funds allocation into G-Secs was increased from 5.7% to 39.34%, while the exposure into Non Convertable Debentures was reduced from 75.09% to 28.73% during December 2013 to November 2014. The average maturity of the portfolio during the 1 year ranged between 1.08 years to 4.18 years. As on November 2014, the average maturity stood at 2.82 years.

Fund Manager Comments:
The shorter end of the yield curve is expected to shift upwards in the near term due to large issuances lined up for the quarter. However with comfortable liquidity medium term view is supportive for short term rates and funds having a combination of income accrual and lower duration like UTI Short Term Income Fund continue to provide a good investment opportunity over the next 6 to 12 months, as a part of the core holding in your Fixed Income portfolio.

Fund Details (As on November 2014)

Inception: 23 June, 2003

AUM : Rs. 4021 Crore

Fund Manager: Sudhir Agarwal

Exit Load : 0.25% on or before 30 days, NIL after 30 days

 
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FRANKLIN INDIA SHORT TERM INCOME PLAN- GROWTH


Our Analysis:
The funds focus will be on the shorter end of the curve. Over a period of 1 year, the fund has increased the allocation into corporate debentures from 61.05% in December 2013 to 95.28% in November 2014. On the other hand, the fund has been gradually reducing exposure into Pass-Through Certificates (PTCs) from 19.57% to 0.03% during December 2013 to November 2014.The average maturity of the fund was 2.59 years in November 2014 as against 1.92 years in December 2013.

Fund Manager Comments:
The fund invests in fixed income securities at the shorter-end of the curveprimarily in corporate bonds, with a focus on high accrual income. It is one of the oldest short term funds in the industry, which has delivered consistent performance across time horizons and interest rate cycles. The fund has successfully tackled rising and easing interest rate scenarios. The fund uses a bottom-up security selection process involving in-depth fundamental credit research combined with top-down macro analysis to construct a portfolio that has the potential to generate attractive risk-adjusted returns.

Outlook: The three key risks for fixed income funds (interest rate risk, credit risk and liquidity risk) now appear to be more benign in India. From an investment perspective, with yields still remaining elevated at the shorter end and with the credit environment improving, we continue to remain positive on corporate bonds and accrual strategies.

Fund Details (As on November 2014)

Inception: 31 January, 2002

AUM : Rs. 10079 Crore

Fund Manager: Santosh Kamath & Kunal Agrawal

Exit Load : 0.50% on or before 1 year ,NIL after 1 year

 
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SUNDARAM SELECT DEBT SHORT TERM ASSET PLAN- GROWTH


Our Analysis:
The fund aims to generate regular returns on the portfolio by investing into government securities and liquid top rated corporate/PSU debt and extremely liquid money market investments. The fund is biased towards the corporate debt space as can be seen from the fact that during December 2013 to November 2014, the average allocation into corporate debentures stood at 65.82%. On the other hand, the allocation into G-Secs has been increased from 0.38% in December 2013 to 12.73% in November 2014. The average maturity of the fund has seen a steady increase from 1.34 years to 3.17 years during December 2013-November 2014.

Fund Manager Comments:
Outlook
Macro-economic parameters have been stabilizing from last 2-3 quarters Inflation has moderated with further trajectory being downwards, stable government at center is showing strong intent for reforms and controlling subsidies & fiscal deficit, current account deficit and currency volatility is under control.
Global economy is also slowing and most of the bigger developed economies excluding United States of America, are struggling with slower growth and risk of deflation resulting into quantitative easing. Global commodity prices have dropped significantly which will put further downward pressure on inflation. RBI has acknowledged this situation and started the rate cutting cycle by cutting rate by 25bps 2-3weeks ahead of monetary policy. We believe that RBI will continue the stance and we will see further rate cuts by RBI.

Sundaram Select Debt Short Term Fund:
Actively managed short term bond fund through a combination of Buy & Hold (Strategic) & view based calls (Tactical) would make the fund an ideal vehicle for investors who aim to benefit from the intermittent volatility & the broad downward trajectory of interest rates.

Fund Details (As on November 2014)

Inception: 04 September, 2002

AUM : Rs. 800 Crore

Fund Manager: Dwijendra Srivatsava & Sandeep Agarwal

Exit Load : NIL

 
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RELIANCE REGULAR SAVINGS FUND DEBT OPTION- GROWTH


Our Analysis:
The fund will invest into fixed income securities like Central Government Securities, Treasury Bills, Corporate Bonds, CBLO, etc. It may also take an exposure into Derivatives like Interest rate swaps. The funds mandate has fixed the exposure into government securities at 50% of the corpus. During the 1 year under study, the funds exposure into non convertible debentures stood at 80.12% in November 2014 as against 70.68% in December 2013. As far as the average maturity of the portfolio is concerned, it was 2.03 years in December 2013 vis-à-vis 2.09 years in November 2014.

Fund Manager Comments:
The investment philosophy of this fund is to generate alpha by investment into credit assets at absolute high yields and attractive spreads in the 2-3 years horizon without carrying high duration (not above 2 years) in the fund.
- Currently, we are maintaining duration of around 1.72 with focus on higher accruals which is around 10.15%-10.20%.
- With the credit environment improving, we have started shifting allocations from shorter maturities corporate bonds to 2-3 years private assets yielding higher rates in the current market. This would enhance both the gross yield as well as duration of the fund.
- The endeavor of the fund is to maintain attractive carry of the portfolio along with moderate duration so as to benefit in the current interest rate scenario.

Fund Details (As on November 2014)

Inception: 09 June, 2005

AUM : Rs. 4917 Crore

Fund Manager: Prashant Pimple

Exit Load : 1.00% on or before 1 year, NIL after 1 year

 
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BSL SHORT TERM OPPORTUNITIES FUND- GROWTH


Our Analysis:
The fund aims at identifying mispriced credit opportunities in the market and invests in them. This strategy helps them in enhancing the portfolio returns. The fund will invest into short and medium term securities to manage credit risk. The funds corpus is skewed towards the corporate debentures space with allocation into the same having increased from 58.36% in December 2013 to 77.86% in November 2014. The funds modified duration stood at 2.53 years in November 2014 vis-à-vis 1.09 years in December 2013.

Fund Manager Comments:
The scheme is positioned as a short term income fund wherein we intend to invest pre-dominantly in well researched corporate bonds and credit structures. The portfolio endeavours to have a well balanced exposure across the credit profile to maintain a healthy risk return ratio. As on 31st Dec 2014, the scheme has 52% of its portfolio invested in AAA & equivalent papers including cash, cash equivalent and the remaining 46% in AA & below rated papers. The scheme predominantly invests in corporate bonds and debentures of varying tenures, currently upto 90% of the portfolio. We believe the rates in short end of the curve are likely to remain stable with downward bias, owing to RBIs proactive approach on liquidity front, cautious approach on rate action to secure medium term inflation target of 6%, improving corporate balance sheets and economic fundamentals. The fund will continue to take active duration calls (within the fund level duration cap of 3 years) through exposure to AAA papers. The YTM& Modified Duration of the scheme is 9.40 and 2.50 years respectively.

Fund Details (As on November 2014)

Inception:

AUM :

Fund Manager:

Exit Load :

 
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FRANKLIN INDIA INCOME BUILDER ACCOUNT PLAN A- GROWTH


Our Analysis:
The fund intends to actively manage the portfolio by investing into high quality fixed income instruments. A perusal of the portfolio shows that the fund is heavily skewed towards corporate debentures as the average allocation into this instrument stands at 59.13% during the 1 year analysis period (December 2013 to November 2014). As on November 2014, the fund had 73.41% of the corpus allocated into corporate debentures. On the other hand, the funds exposure into G-Secs increased from 3.23% in December 2013 to 61.21% in August 2014 and as on November 2014 stands at 14.50%. As far as average maturity is concerned; the fund had increased the same from 2.63 years in December 2013 to 10.93 years in August 2014 but finally reduced it to 4.63 years by November 2014.

Fund Manager Comments:
It is a long bond fund  focused on Corporate / PSU bonds. The fund is actively managed in terms of duration and securities. It is one of the oldest long bond funds in the country with a track record of 17 years.

Outlook: 2015 has started on a good note with the central bank shifting its monetary policy stance, and cutting rates. The RBI has said that further easing would depend on data that confirms continuing disinflationary pressures and high-quality fiscal consolidation. We expect the RBI to further ease policy rates over the next year or so, provided inflation remains under control, and any other major exigency does not occur. Therefore duration strategies continue to be favourably placed for 2015, with interest rates poised to come down further.

Fund Details (As on November 2014)

Inception: 23 June, 1997

AUM : Rs. 1578 Crore

Fund Manager: Santosh Kamath & Sumit Gupta

Exit Load : 0.50% on or before 1 year ,NIL after 1 year

 
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SBI CORPORATE BOND FUND- GROWTH


Our Analysis:
The funds mandate is to invest into corporate debt securities which are either liquid or of varying maturities. A small portion of the corpus will also be invested into money market instruments to meet the normal redemption requirements. An analysis of the portfolio shows that the fund had consistently increased the allocation into certificate of deposits from 8.64% in February 2014 to 99.43% in July 2014, after which it was gradually reduced to nil by October 2014. The fund underwent a complete change in August 2014 when it was decided to allocate the maximum corpus into corporate debentures. The fund started taking an exposure into this instrument in August 2014 to the tune of 39.31% and as on November 2014 stands at 87.84%. Accordingly, the average maturity of the portfolio has also increased from 0.09 years in December 2013 to 3.59 years in November 2014.

Fund Manager Comments:
Philosophy
Investment in various NCDs is based on fundamental tenants of capacity, covenant, collateral and character. Emphasis being on optimal risk adjusted return. Fund Manager adopts a passive duration strategy relying upon credit spread to generate superior returns.

Architecture
The steady state portfolio shall contain 40-60% in a core illiquid portfolio mostly centered around AA & A rated NCDs. The balance of the portfolio shall be in higher rated securities to keep a constant maturity and provide liquidity to the portfolio.

The fund is ideal for investors over a 2-3 year investment horizon.

Fund Details (As on November 2014)

Inception: 19 July, 2004

AUM : Rs. 144 Crore

Fund Manager: Dinesh Ahuja

Exit Load : 3.00% on or before 1 year ,1.50% after 1 year but on or before 2 years ,0.75% after 2 years but on or before 3 years ,NIL after 3 years

 
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ICICI PRUDENTIAL LONG TERM PLAN- GROWTH


Our Analysis:
The funds mandate is to invest into debt and money market instruments of varying maturities with a view to maximize income while maintaining a balance between yield, safety and liquidity. During the 1 year analysis period (December 2013 to November 2014), the fund started taking an exposure into G-Secs in April 2014 to the tune of 87.68% and as on November 2014, the allocation stood at 92.97%. The average maturity of the fund saw a significant increase from 0.18 years to 12.05 years during December 2013 to November 2014.

Fund Manager Comments:
The Fund intends to generate potential capital appreciation by following model based dynamic duration management that will enable the fund manager to systematically manage interest rate risk.
-The Fund based on the Current Account (CA) model will aim to maintain high duration when interest rates are high, and maintain low duration when interest rates are low. This will help in capturing interest rate cycles from both sides over a longer period of time.
-Investors who wish to benefit from changing interest rate cycles with controlled interest rate risk may consider investing in this fund.

Why Now?

The CA index is moving towards positive territory that indicates an opportunity in duration space. Other macro-economic variables are also showing signs of improvement and pronounce a strong case for investing in higher duration funds.
-The fund is currently running a duration of 7.26 years with an aim to capture this opportunity and generate potential capital appreciation from falling interest rates.

Fund Details (As on November 2014)

Inception: 28 March, 2002

AUM : Rs. 144 Crore

Fund Manager: Manish Banthia

Exit Load : 1.00% on or before 3 years ,NIL after 3 years

 
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CANARA ROBECO INCOME FUND- GROWTH


Our Analysis:
The fund will invest into debt and money market instruments of different maturities and risk profiles and a portion of the funds will also be allocated into rated and un-rated corporate bonds and debentures. An analysis of the portfolio shows that the fund has been increasing allocation into G-Secs from 59.95% in December 2013 to 69.32% in November 2014. During the same time period, the funds exposure into corporate debentures increased from 28.77% in December 2013 to 61.35% in May 2014 and finally as on November 2014 stood at 20.21%. The average maturity of the fund has increased from 5.89 years to 12.14 years during the 1 year period (December 2013 to November 2014).

Fund Manager Comments:
Canara Robeco Incomes portfolio constitutes of corporate bonds and government securities. The scheme aims to earn accrual interest income through investment in corporate bonds while generating alpha through g-sec exposure. The fund maintains a judicious mix of various credits to maintain a balance between return, liquidity and safety. Typically the fund has exposure to high quality credit papers.

The outlook for long duration continues to be positive in short to medium term. With inflation falling below RBIs target, rate easing cycle has already commenced with 25bps rate cut in January 2015. RBI is expected to continue with its softer monetary policy stance in wake of subdued inflation expectations, weak global commodity prices especially crude oil and weak global growth. All these factors are positive for bond markets and Income funds, in particular. The fund actively manages allocation between corporate bond and g-sec based on spread movement within these two asset classes.

Fund Details (As on November 2014)

Inception: 19 September, 2002

AUM : Rs. 156 Crore

Fund Manager: Avnish Jain

Exit Load : 1.00% on or before 1 year

 
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UTI BOND FUND- GROWTH


Our Analysis:
The fund actively manages duration by investing into medium to long term corporate bonds and G-Secs. In addition to this, the fund manager is also given the flexibility to invest at the shorter end of the curve if conditions are not conducive for long or medium duration papers. The fund manager seems to be taking active calls in G-Secs as the allocation into this instrument has increased from 65.51% in December 2013 to 80.26% in November 2014. On the other hand, during December 2013 to November 2014, the non convertible debentures allocation decreased from 27.01% to 17.08%. The average maturity of the fund stood at 11.58 years in November 2014 vis-à-vis 10.11 years in December 2013.

Fund Manager Comments:
Investors should also look at increasing their exposure in long term duration funds like UTI Bond Fund as reversal in interest rate cycle provides an opportunity over the medium term. Investors should look at this fund with an investment horizon to 12 to 24 month to capture the entire reversal in interest rates.

Fund Details (As on November 2014)

Inception: 04 May, 1998

AUM : Rs. 2442 Crore

Fund Manager: Amandeep Chopra

Exit Load : NIL

 
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UTI DYNAMIC BOND FUND- GROWTH


Our Analysis:
The fund will be actively managed in accordance with the fund managers call on the interest rate movements. While interest rates are rising this fund will be managed like a cash fund. whereas it can take the form of an income fund when interest rates are on a downward trajectory. As far as the instruments in the portfolio are concerned, the funds allocation into G-Secs had increased from 4.14% in December 2013 to 68.87% in May 2014 and finally reduced to 35.19% in November 2014.The funds exposure into Non Convertible Debentures which stood at 88.85% in December 2013 was gradually reduced to 22.91% in November 2014. The average maturity of the portfolio increased from 3.73 years to 5.21 years during December 2013 to November 2014.

Fund Manager Comments:
UTI Dynamic Bond Fund continues to be an all weather fund and remains a good bet for the investors at this point in time as it actively manages the duration to take advantage of movement across the yield curve. Investors should look at increasing exposure towards this fund over the next 6 to 12 months.

Fund Details (As on November 2014)

Inception: 16 June, 2010

AUM : Rs. 440 Crore

Fund Manager: Amandeep Chopra

Exit Load : 0.75% on or before 89 days ,NIL after 89 days

 
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TATA DYNAMIC BOND FUND OPTION A PLAN A- GROWTH


Our Analysis:
The funds mandate is to invest into bonds, debentures, G-Secs and money market instruments. The investment strategy of the fund allows it to dynamically switch the maturity profile from long to short and vice versa in a short period of time. In the 1 year of analysis, the fund manager has been favoring G-Secs as can be seen from the fact the exposure into the same has increased from 40.77% in December 2013 to 66.16% in November 2014. During the same time period the fund had reduced the allocation into Non Convertible Debentures from 33.85% to 28.04%. As far as average maturity goes, it has increased from 4.16 years in December 2013 to 10.75 years in November 2014.

Fund Manager Comments:
Tata Dynamic Bond Fund is a bond fund with mandate to actively manage duration to capture tactical calls on interest rates, yield curve shifts and spread compression opportunities. Depending upon tactical views on interest rates, the Funds average portfolio maturity may range from short to long duration.

We have increased the duration in the Fund with a view to capture potential capital appreciation opportunities on account of rate cut expectations. More than 95% of the portfolio is allocated to more than 7yrs segment. The Scheme may seek to maintain a higher duration to benefit from potential capital appreciation opportunities in a falling interest rate scenario while utilizing its flexible mandate to manage the interest rate risk as well.

Fund Details (As on November 2014)

Inception: 03 September, 2003

AUM : Rs. 396 Crore

Fund Manager: Raghupathi Acharya & Akhil Mittal

Exit Load : 0.50% on or before 180 days ,NIL after 180 days

 
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RELIANCE DYNAMIC BOND FUND- GROWTH


Our Analysis:
The mandate of the fund has given full flexibility to the fund manager to take an active call on interest rates depending on various parameters of the Indian economy and global markets development. An analysis of the portfolio during December 2013 to November 2014 showed that the average allocation into G-Secs and Non Convertible Debentures stood at 64.70% and 25.29%. The average maturity profile of the fund shows that it has been increased to 14.41 years in November 2014 compared to 9.60 years in December 2013.

Fund Manager Comments:
- The strategy is to run Core positions which are built in line with our medium to long term view and tactical positions to capture opportunities in the short term.
- Currently, Core position is being maintained through 65% allocation in GSecs & 25% allocation in longer maturity corporate bonds, while 5%  20% GSecs is used tactically to capture short term rates movement.
- We intend to run high duration between 6  9 yrs which would be maintained by running higher GSec allocation between 60-80%.We are currently running closer to 70% GSecs & 26% corporate bonds.
- Out of the total GSecs, 3% is positioned in 5-10 yrs maturity GSecs while rest into longer maturity GSecs.
- We have recently switched from shorter maturity GSecs to longer maturity GSecs as and when we got more comfortable with improving macro scenario, interest rate trajectory & attractive spreads between GSecs. We have added to the longer maturity corporate bond exposure at attractive levels.
- Bond allocation is mainly in 5 year and above segment in private AAA category so as to carry high duration at the same time to earn higher yields from the allocation.

Fund Details (As on November 2014)

Inception: 16 November, 2004

AUM : Rs. 4278 Crore

Fund Manager: Prashant Pimple

Exit Load : 1.00% on or before 6 months ,NIL after 6 months

 
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BSL DYNAMIC BOND FUND- GROWTH


Our Analysis:
The fund will dynamically manage the portfolio by actively taking calls on interest rate movements. For this purpose, the fund manager will consider the curve spreads both on the gilt and corporate bond markets. As on November 2014, the fund had 86.82% of the corpus concentrated in G-Secs, which in December 2013 stood at 23.51%. On the other hand, the funds exposure into corporate debentures was reduced from 47.63% to 3.59% during December 2013 to November 2014. The modified duration of the fund was gradually increased from 2.3 years in December 2013 to 6.17 years in November 2014.

Fund Manager Comments:
As on 31st Dec 2014, the modified duration of the scheme stands at 5.12 years and the YTM is 8.30%. The higher portfolio duration has been built chiefly through exposure to Sovereign Bonds which currently accounts for 83% of the portfolio. More than 80% of the portfolio is invested in securities with residual maturity of 5 years and more. Though we continue to stay invested in our portfolio with a bias towards longer duration, given sharp correction in yields over the last 4-5 months, we have tactically pared duration over the last month. Nevertheless, we stay constructive on rates and believe that if Government is able to reinvigorate growth without imparting any inflationary impulses in the economy then rates could decline meaningfully going forward.

Fund Details (As on November 2014)

Inception: 27 September, 2004

AUM : Rs. 10025 Crore

Fund Manager: Maneesh Dangi

Exit Load : 1.00% on or before 1 year ,NIL after 1 year

 
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