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The objective of SBI Bluechip Fund is to invest in a diversified basket of stocks whose market capitalisation is at least equal to or more than the benchmark BSE 100.
Despite the trend of large-cap stocks outpacing the mid and small cap segments in the past year, this fund under-performed the benchmark by a significant margin.
For a one-year period, the fund has generated a return of 41 per cent and trailed the benchmark by 21 per cent.
The recent performance merits a review of investments in the fund.
Investors can consider a switch from the fund into Magnum Contra from the SBI table.
This fund has good track record over a five-year period with a compounded annual return of 72 per cent.
Magnum Contra predominantly invests in large-cap stocks, with only 20 per cent of assets invested in stocks with a market capitalisation of less than Rs 7,500 crore, as per the latest factsheet.
Magnum Contra also ranks better on consistency of performance.
SBI Bluechip Fund is benchmarked against the BSE-100 and it has trailed its monthly returns in 15 out of the past twenty-one months. Magnum Contra, on the other hand, despite being benchmarked against the same index, has trailed in just seven of the 21 months.
However, one positive aspect of SBI Bluechip Fund is that during the market corrections in May 2006 and March 2007, it contained losses better than the benchmark.
Portfolio Overview: SBI Bluechip Fund had a record collection during its new fund offer (NFO). It has collected over Rs 3,000 crore. Since inception, however, the fund has witnessed outflows and a significant drawdown in asset size; as per the December fact sheet, it stood at Rs 1,572 crore.
The fund had 42 stocks in its portfolio and the top three sectors — energy, financial services and industrial manufacturing — accounted for 40 per cent of the assets. It predominantly invests in large-cap stocks, with a market cap of over Rs 7,500 crore.
Over the past quarter, the fund has pruned exposure to the IT sector and stepped up exposure to construction. It had a sizable exposure to the pharma sector.
IVRCL Infrastructure, Hindustan Construction and Patni Computers were the stocks from the mid-cap space.
Fund facts: The fund was launched in February 2006. It is managed by Mr Pankaj Gupta. The NAV per unit is Rs 16.5
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