IDFC launced Strategic Sector (50-50) Equity Fund

IDFC Mutual Fund has launched an open-ended scheme - IDFC Strategic Sector (50-50) Equity Fund.

The fund will invest up to 50 per cent of its assets in a chosen sector that is positioned for high returns, while the balance amount may be invested in companies across market capitalisations and across sectors, a news release from the company said. This scheme may also invest in debt and money market instruments. This fund will be benchmarked against the Nifty.

If you analyse the market data over the years, you will note that there has been one sector that has predominantly outperformed the market. The Strategic Sector (50-50) Equity Fund is an innovative product that aims to generate long-term capital appreciation by investing in spotting the leading sectors for each year.

IDFC mutual fund which recently took over Standard Chartered Mutual Fund has decided to launch a scheme based on this called IDFC Strategic Sector (50-50) Equity Fund.

The said equity fund, would invest 50% in one sector while the remaining funds will be pumped-in a diversified portfolio.

IDFC Mutual Fund Investment Head Rajiv Anand said, every year the sector that performs is different and the fund managers of the scheme will try to identify which sector is likely to dominate in that year and will invest in them.

Meanwhile, a study done by Citigroup found that gains made by individual sectors were far greater than the capital market.

“In 2001, it was the auto sector that scored highest gains and outsmarted the Nifty index for that year. In 2002, it was energy sector, in 2003, it was metal and in 2004, it was real estate.
Incidentally, the outperformance has almost always been by a wide margin,” Citigroup added.

Anand said as per the Citigroup study, the gains made by even the second and third best performing sectors also were way ahead of gains made by the Nifty.

The wide-based Nifty index went up by 55% during 2007 while metal sector shares went up by a whopping 193% in the same year. In 2005, Nifty was up by 36% while real estate shares were up by 289%.

Fund category :Equity - Diversified

Scheme plan :Growth, Dividend

Scheme type :Open Ended

Launch date :August 28, 2008

Fund closes : Sept 18, 2008

Fund manager :Mr. Kenneth Andrade

Initial Price :Rs 10/-

Min investment :Rs 5,000/-

Entry load :2.25 %

The scheme will charge an entry load of 2.25 per cent in case of investments of less than Rs 5 crore, while there is no entry load for investments of Rs 5 crore and more.

So, take the opportunity & start your investments in IDFC Strategic Sector (50-50) Equity Fund.

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