praveen
18-11-2007, 11:13 AM
A fund to participate in smaller companies with high growth potential……………………. !
Investment objective
It is an open-ended equity scheme with an objective to achieve long term capital appreciation from a portfolio that is substantially constituted of equity and equity related securities focussed on smaller companies.
Investment Strategy
The corpus of the fund (65-100%) will primarily be invested into equity and equity related securities of small and midcap companies. These companies will be chosen from the lower quartile, by market capitalization, of stocks listed on National Stock Exchange and Bombay Stock Exchange. The fund manager will adopt bottom-up approach for stock picking, where investments will be selected primarily on the basis of specific criteria relevant to the company rather than general macro environment considerations. The fund may also take some exposure (0-35%) to large cap stocks. The scheme aims to provide the benefits associated with companies having strong earnings and growth potential. However, a specific portion of the fund, subject to a max. of 35%, will also be invested into debt and money market instruments in order to meet its liquidity requirements.
Conclusion
The scheme offers participation in the growth of smaller companies which can outperform broader market in long term. But investment in smaller companies comes with high risk compared to large cap stocks. So this fund comes with high return potential coupled with high risk. Hence, investors who have taken enough exoposure in large cap funds can consider investing in this fund with long term investment horizon.
Investment objective
It is an open-ended equity scheme with an objective to achieve long term capital appreciation from a portfolio that is substantially constituted of equity and equity related securities focussed on smaller companies.
Investment Strategy
The corpus of the fund (65-100%) will primarily be invested into equity and equity related securities of small and midcap companies. These companies will be chosen from the lower quartile, by market capitalization, of stocks listed on National Stock Exchange and Bombay Stock Exchange. The fund manager will adopt bottom-up approach for stock picking, where investments will be selected primarily on the basis of specific criteria relevant to the company rather than general macro environment considerations. The fund may also take some exposure (0-35%) to large cap stocks. The scheme aims to provide the benefits associated with companies having strong earnings and growth potential. However, a specific portion of the fund, subject to a max. of 35%, will also be invested into debt and money market instruments in order to meet its liquidity requirements.
Conclusion
The scheme offers participation in the growth of smaller companies which can outperform broader market in long term. But investment in smaller companies comes with high risk compared to large cap stocks. So this fund comes with high return potential coupled with high risk. Hence, investors who have taken enough exoposure in large cap funds can consider investing in this fund with long term investment horizon.