Thematic Fund – Betting on India consumption story!

By Rahul Pithadia : Although all mutual funds schemes diversify some schemes don’t, they are basically dependent on a particular theme or sector. Theme is a broad term that is widely used within equity investment which helps the fund manager to identify strong companies within particular macroeconomic sectors. However there are 2 sides of a coin looking at the cyclical nature of business there are times when certain sectors do extremely well and others face troubled times. These funds are launched with a belief that a particular sector will outperform the broader index and will generate higher returns than the broader benchmark.

 

Birla Sun Life Buy India Fund is a THEMATIC open ended growth plan providing 94.58% exposure to Equity. It is dynamic fund which focuses on the stocks and sectors which are driven by the large population of country and the natural consumption pattern.

 

Birla SunLife Buy India Fund – Growth Weekly chart

Birla Sun Life Buy India Fund 201511211

The major focus of the scheme is into banking and automotive sector which is shown in the given table below.

Sector allocation 20151211

Returns as on 14th July 2015

Returns 20151211

Risk Profile:- This fund is concentrated in a few sectors and holdings which are from Midcap to Smallcap space. This increases the risk in case of systematic selloff. However, the fund looks promising from the sectors that look to drive the next phase of up move in India and so some portion of investments can be considered.

In a nutshell, this is one of the preferred funds that we would recommend to invest into in the form of SIP for now and if there is opportunity to buy at lower levels than the investment amount can be proportionately increased.

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