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ITS RECENT performance entices; top quartile in 2009 with a 1-year return (January 12, 2009) over 100 per cent.
What goes against it is its volatile past. The worst performer in 2006 was the best in 2007 and average in 2008. Fund manager Mohit Mirchandani plans to make it a more consistent offering. Last year he implemented various risk control measures so no longer does one see highly risky bets in a very concentrated portfolio.
He stands apart in his sector preferences. His allocation to Financials and Energy is way below his peers, instead he is betting on Pharma. His allocation to Auto in 2009 was, at times, higher than the category average. All of which paid off.
Typical of this fund's style is
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flexibility. During the downturn, it plunged into cash, which averaged 30 per cent in the last six months of 2008. "Not only do I have to make money for my investors but even protect the gains when the risk-reward is unfavourable," says Mirchandani. Despite the market picking up, he waited before going headlong into equity and it was in May 2009 that the equity exposure was seriously upped.
The size of the fund gives him the leeway to go heavy into smaller stocks, which he does. 2009 started off with a large cap tilt (62%) which dropped by December (25%). "At different stages of the market cycle, different market caps will outperform. We would rather be flexible," he says.
Keep a watch on this fund.
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