Best Pick For 2016!

best mutual funds

By Rahul Pithadia:  The small cap and the mid cap stocks are those which turns out to be the most exciting stocks of a portfolio as it invests in smaller companies which has huge potential to grow . The risk associated with this fund is too high because the total investment is focused on the stocks from small caps and mid caps sector. During the corrective phase or bad times this scripts do not have any lower limits to fall which can turn into capital loss. However every coin has 2 sides as these small size companies have potential to turn large which once happens can add bumper returns to your corpus. The reason why this is one best fund for 2016 is because our outlook on the Indian markets is positive and if this scenario is valid then this fund will provide multiple returns. It is suitable to investors having high risk bearing ability within the age of 20-40 years.

Canara Robeco Emerging Equities is the best amongst the small cap & mid cap category and it is ranked 1 by CRISIL. It aims to generate long term capital appreciation through investing in diversifies mid-cap stocks which have higher probability to turn into bigger corporates in the coming future.

Canara Robeco Emerging Equities Fund: Daily Chart

canara-robeco-201601131

Portfolio Analysis: As per the sectoral holdings Engineering & Capital Goods have been most favored sector for this fund as it is contributing 17.84% to the entire portfolio followed by Banking and Chemicals Sector. Top Holdings and Sector Allocation for this fund are shown below

sector-allocation-canara-robeco-20160113

Investment perspective: This fund has maximum exposure to equity and as per our outlook on Indian Equity markets we feel that the corrective action of past months is on the verge of completion and post that the Bull Run should resume which will provide alpha returns. Hence this is the correct time to park your money in this fund through the SIP route.

In a nutshell, this fund looks to be the best amongst the midcap and small cap sectors as it has less exposure to Banking and no exposure to Pharma stocks which can turn out to the laggards in the upcoming bull trend. The break of 65 levels will provide excellent opportunities to investors to enter in staggered fashion and ride closer to their goals!

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