DWS Inv Opportunity fund: Not recommended in current market
This Equity Diversified fund has been delivering slightly weak performance under current market condition. Financial advisor Arnav Pandya advices conservative investors to look at other alternatives till the time the fund's performance improves.
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DWS Inv Opportunity fund: Not recommended in current market
This Equity Diversified fund has been delivering slightly weak performance under current market condition. Financial advisor Arnav Pandya advices conservative investors to look at other alternatives till the time the fund's performance improves.
Like this story, share it with millions of investors on M3
DWS Inv Opportunity fund: Not recommended in current market
This Equity Diversified fund has been delivering slightly weak performance under current market condition. Financial advisor Arnav Pandya advices conservative investors to look at other alternatives till the time the fund's performance improves.
DWS Investment Opportunity Fund is an equity diversified fund with an investment objective to generate capital by actively investing in different asset classes as per market conditions. However, lately, this fund has not been up to the mark and has been experiencing downfall in performance. Conservative investors should stay away from this fund till time that its performance improves, advices financial advisor Arnav Pandya.
The fund is a dynamic scheme that can invest its money across different assets as per the market conditions. The fund had around 8 per cent of its assets in cash & current assets at the end of May 2010. The fund had the highest exposure to transportation at over 8 per cent of the portfolio which was followed by banks and consumer non durables. Infosys was the top individual holding with an exposure of over 7 per cent followed by ITC and Cairn India. There were a lot of companies with a 3 per cent plus holding which included Reliance Industries, TRF, BHEL, Bajaj Auto,IRB Infra, HDFC Bank, and Spicejet. The fund was outperforming its benchmark the BSE 200 over the one, three, and five year time periods.
Six months later the fund had a major change of portfolio as banks shot up to the top position in terms of the sector exposure with a figure of nearly 15 per cent. This was followed by transportation and industrial capital goods. While Infosys managed to retain the top spot in the individual holdings this was closely followed by ICICI bank. Some of the other holdings with a high exposure included Spicejet, Mannapuram General Finance, BHEL, and ITC. The fund was outperforming the benchmark over the one and five year time period. The portfolio turnover ratio of the fund remained over 1 times.
Banks retained the top sector position at the end of May 2011 with an exposure of around 16 per cent. This was followed by software at 9 per cent and then by finance. ICICI Bank was the top holding in the fund with nearly 7 per cent of the corpus in this company. ITC was next and there were two IT companies Infosys and TCS and two more banks HDFC Bank and SBI in the top 10 holdings list. The fund was underperforming the benchmark marginally on the one and three year time period but outperforming on the five year period. The portfolio turnover ratio had now dipped below 1.
Six months later the fund had nearly 10 per cent of its portfolio in fixed deposits along with cash and current assets and this is a large figure. In terms of the sectors banks was in the top spot with a figure of around 16 per cent followed by consumer non durables and software. ITC was the top holding in the fund but this was just marginally ahead of HDFC bank and Infosys. The funds portfolio turnover ratio had gone below 0.7 times. ICICI bank, Mannapuram General Finance and Bharti Airtel were some of the other top stocks in the portfolio. The fund was now underperforming the benchmark over the one and three year time periods.
The fund saw a marginal drop in the percentage of assets that were in liquid form at the end of May 2012. At the same time the exposure to banks went up to nearly one fourth of the total corpus of the fund. Even consumer non durables now had an exposure of around 15 per cent. The fund took an aggressive stand with the top holding being HDFC Bank where the exposure was nearly 9 per cent. This was followed by ITC and there were a total of four banks in the top 10 list along with 3 consumer non durable companies. The fund was underperforming the benchmark over the one and three year time periods and the turnover ratio had also climbed over 1 times.
Investors who are conservative in nature can look for other alternatives till the time that its performance improves and remains consistent. The current portfolio makes this a slightly risky investment which might not be suitable under the current circumstances for many long term investors.
