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January 24, 2005 16:41 IST
It was a dull week at the stock markets. The BSE Sensex was up marginally by 9 points (0.14%) to close at 6,183 points. However, the Nifty took a small hit as it slipped to 1,925 points (down 6 points), a fall of 0.31%. But the stock market, like it has done innumerable times over the years, again took the investors for a seesaw ride during the week. Leading Diversified Equity Funds| Diversified Equity Funds | NAV (Rs) | 1-Wk | 1-Mth | 1-Yr | 3-Yr | Incep. | SD | SR | | GIC D'MAT | 15.65 | 0.19% | -2.43% | 9.75% | 26.34% | 5.85% | 6.52% | 0.40% | | KOTAK GLOBAL INDIA | 12.83 | -0.30% | -6.37% | NA | NA | 30.36% | 7.91% | 0.26% | | DSP ML EQUITY | 26.61 | -0.30% | -1.08% | 27.82% | 43.07% | 22.86% | 8.27% | 0.53% | | FRANKLIN INDIA PRIMA | 104.34 | -0.45% | -1.48% | 32.16% | 69.33% | 23.42% | 9.33% | 0.58% | | SUNDARAM INDIA LEADERSHIP | 12.77 | -0.57% | -2.36% | NA | NA | 27.49% | 3.96% | 0.94% |
(Source: Credence Analytics. NAV data as on Jan 20, 2005. Growth over 1-Yr is compounded annualised) (The Sharpe Ratio is a measure of the returns offered by the fund vis-�-vis those offered by a risk-free instrument) (Standard deviation highlights the element of risk associated with the fund.) Mutual funds from the diversified equity funds segment languished in the negative terrain during the week; GIC D'MAT (0.19%) was the only scheme to post positive returns. It was a mixed week as funds from both the large cap and mid cap segment featured among the weekly top performers. Category leaders HSBC Equity (-2.73%), HDFC [Get Quote] Top 200 (-1.82%) and Franklin India Bluechip (-1.26%) had a poor week as well. Mutual fund IPO (initial public offering) activity continues unabated. Franklin India Flexi Cap Fund (FIFCF) is the latest to join the bandwagon. As the name suggests, FIFCF can move its corpus across market capitalisations to take advantage of the 'flavour of the day'. However, investors would do well to take into account their own risk-appetite before investing in such a scheme. Leading Debt Funds| Debt Funds | NAV (Rs) | 1-Wk | 1-Mth | 6-Mth | 1-Yr. | Incep. | SD | SR | | ESCORTS INCOME PLAN | 20.59 | 0.09% | 0.36% | 2.09% | 4.61% | 11.39% | 0.42% | 0.16% | | CANINCOME | 11.43 | 0.08% | 0.39% | 1.58% | 2.24% | 5.83% | 0.67% | -0.30% | | CHOLA FREEDOM INC. | 10.53 | 0.07% | 0.30% | 1.84% | 3.79% | 9.54% | 0.22% | -0.58% | | SUNDARAM SEL. DEBT DYN. | 12.11 | 0.06% | 0.23% | 1.08% | 0.68% | 8.40% | NA | NA | | ING VYSYA SELECT DEBT | 10.17 | 0.06% | 0.60% | NA | NA | 1.43% | 0.37% | -0.60% |
(Source: Credence Analytics. NAV data as on Jan 20, 2005. Growth over 1-Yr is compounded annualised) The 10-Yr benchmark GOI yield closed at 6.71% (January 20, 2005). Inflation easing up to an 8-month low was a positive development. Conventional long-term debt funds came to the fore. Escorts Income Plan (0.09%) emerged as the top performer followed by Canincome (0.08%). Leading Balanced Funds| Balanced Funds | NAV (Rs) | 1-Wk | 1-Mth | 1-Yr | 3-Yr | Incep. | SD | SR | | UTI BALANCED FUND | 34.85 | 0.06% | -1.94% | 16.28% | 25.93% | 19.24% | 5.22% | 0.40% | | UTI VARIABLE INV. ILP | 12.05 | -0.35% | -1.18% | 6.69% | NA | 19.00% | 3.63% | 0.30% | | SUNDARAM BAL | 19.48 | -0.50% | -2.71% | 15.79% | 26.79% | 15.30% | 5.28% | 0.43% | | DSP ML BAL | 21.18 | -0.56% | -2.80% | 17.73% | 30.96% | 14.34% | 5.25% | 0.51% | | HDFC BALANCE | 19.14 | -0.79% | -1.88% | 15.09% | 24.10% | 16.31% | 5.21% | 0.41% |
(Source: Credence Analytics. NAV data as on Jan 20, 2005. Growth over 1-Yr is compounded annualised) UTI Balanced (0.06%) was the sole fund from the balanced funds segment to clock positive returns. Category leader HDFC Prudence (-1.80%) had a modest week. Investors afford disproportionate importance to returns while evaluating their investments. While the importance of returns cannot be denied, they also need to factor in the cost of investing in the mutual fund. Higher costs take a toll on the returns generated for investors and it would be foolhardy to ignore them. To conclude, as we have consistently advocated, investors' investments should be a reflection of their risk appetites. They shouldn't sway to the tune of the markets; instead they should use common sense and select investments that suit their risk profile. As markets correct, we believe long-term investors should take this opportunity to increase allocations to equities. Click here to get a free copy the latest issue of Money Simplified - The Definitive Guide to Tax Panning.
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