Visibility of green shoots of economic recovery has enthused investors about the growth prospects of the mid cap segment. The government’s Make in India push, boost to MSME loans, among other measures could play a crucial role in driving corporate earnings of companies in this segment. Recently, rating agency Moody’s upgraded India’s GDP estimate for…
Amidst volatility in the equity market investors have resorted to profit booking. Hence, inflows in equity-oriented mutual funds, including inflows in Equity-linked Savings Schemes (ELSS), have remained muted over the past few months. Poor performance of schemes across categories as compared to the benchmark can also be attributed for lack of investors’ interest. Despite this,…
Do not put all your eggs in one basket! No other expression can emphasize more on the importance of diversification in investing. As you might be aware, investing in different asset classes helps optimize the risk-return trade-off. But for more effective results, diversifying within an asset class is equally crucial. Under the present market conditions, wherein the…
The S&P BSE Sensex continued its northward journey gaining +4.1% in October 2020, after retracing -1.5% in the previous month. The reduction in numbers of new COVID-19 cases and active cases was a positive signal for the Indian equity markets. Overall, sentiments seemed hopeful that with phase-wise unlocking and easing COVID-19 restrictions, the Indian economy…
SEBI has introduced Flexi Cap Fund as a new category under equity schemes. Flexi Cap Fund will be characterised as schemes investing minimum 65% of its assets in equity and equity related instruments with dynamic allocation across large cap, mid cap, and small cap stocks. The introduction of this category has come as a relief to multi…
Ever since the coronavirus pandemic outbreak, the banking and financial sector has grossly underperformed the broader markets. ‘Financial’ is an index-heavy sector which accounts for 35.5% of the Nifty 50. The overhang of the moratorium and the Reserve Bank of India’s (RBI’s) cautious commentary on Non-Performing Assets (NPAs) had dampened the investor sentiments. Nevertheless, things appear to…
The Franklin Templeton Debt Fund Debacle seems to have changed investors’ perception about debt mutual funds. But has it really changed for the debt fund managers? Many distributors and mutual fund advisors actively promoted debt funds as an investment avenue to conservative investors looking for stability and regular income. Even retirees were convinced to park…
Most equity-oriented funds invest in a sizeable portfolio of 45-60 stocks to achieve optimal diversification. However, the performance of a fund over a period is usually driven by a few selected stocks having higher weightage in the portfolio. Though diversification is an important aspect of fund management, beyond a point diversification does not add much…
Prevailing market sentiments predominantly drive stocks, which may cause the inappropriate pricing of some fundamentally sound stocks in the short run, discouraging potential investors. However in the long run, some of these stocks may grow to reflect their true value and reward investors for their patience. Such stocks could be major beneficiaries of economic recovery.…
Soon after the COVID-19 lockdown started in the last week of March 2020, the trouble began for mutual funds on multiple grounds–dwindling physical transactions, cancellation of Systematic Investment Plans (SIPs) by investors (due to job losses, pay cuts, and/or deferred payments), redemption pressure, and risk aversion set in as uncertainty loomed. The Assets Under Management (AUM) of…
