|
February 15, 2000
Books
Columnists
Indian Tax
Insurance
Interview
Mutual Funds
NRI Tax
Personal Finance
Personal Banking
Real Estate
Stocks
|
Fund Pick: Magnum Equity Fund
Background
Magnum Equity Fund (Magnum Multiplier Scheme '90 earlier) was the first close-ended equity fund of SBI Mutual Fund. It was converted into an open-ended fund in December 1997. The fund's equity strategy is focused on stocks of companies with a sustainable competitive advantage. Since its launch, the fund has paid dividend aggregating 93 per cent, besides a 1:5 rights at par. Magnum Equity Fund carries 2 per cent exit load for redemption within one year, 1 per cent load for redemption between one and two years and no load for over two year investments.
Performance
The fund has been a consistent performer in its long history of nine years. The fund was the market darling in its initial years and during the great Indian scam in 1992, it traded at a 200 per cent premium to its net asset value (NAV). The fund guarded its initial gains till 1994 to melt for four years thereafter. In the four-year bear phase of the market, the fund also suffered on account of its dividend payout, taking its toll on the portfolio quality. However, from the last quarter of 1998, the fund initiated a consolidation of its position and has since then moved up the performance charts.
In the recent past, the fund has shown an excellent performance, leapfrogging several notches to the top position. The fund since its launch has given an annualised return of 26.34 per cent, 220 per cent over the past one year and 91.9 per cent over the past quarter ending January 31, 2000. The fund ranks fourth among 36 diversified open-ended equity funds over the one-year period and is the top performing fund during the quarter.
The fund is overweight on software stocks (41 per cent), media (16 per cent) and FMCG (13 per cent). In recent months, the fund has assumed exposure in telecom stocks while paring its exposure to diversified companies, auto ancillaries and pharma stocks. The top 15 holdings account for 75 per cent of its net assets up from 61 per cent in August 1999.
Outlook
From being an evenly diversified fund across stocks and sectors, the fund has turned aggressive with increased concentration in its top holdings and few sectors. The fund could yield high returns with extreme volatility. The earlier 2 per cent exit load irrespective of the term of investment has now been changed to a graded structure working in favour of long-term investors.
| FUND BASICS |
|
|
|
|
|
| Objective |
Size |
NAV:11/02/00 |
Exit Price |
Entry Price |
Total Returns |
|
Growth |
349 Cr |
44.49 |
44.49 |
44.49 |
26.34% pa |
| BENCHMARK COMPARISONS (%) |
|
|
|
|
31/1/00 |
|
|
1M |
3M |
6M |
1Yr |
3Yr |
| Fund |
21.7 |
91.9 |
143.5 |
220.0 |
58.2 |
| Sensex |
4.0 |
17.1 |
14.6 |
57.0 |
15.5 |
| Nat. Index |
9.6 |
38.8 |
44.6 |
98.1 |
24.7 |
| BENCHMARK COMPARISONS (%) |
|
|
|
|
31/1/00 |
|
|
Q1 |
Q2 |
Q3 |
Q4 |
Year |
| 1999 |
44.8 |
-6.6 |
46.6 |
54.5 |
206.2 |
| 1998 |
4.3 |
-8.2 |
12.6 |
0.3 |
8.1 |
| 1997 |
15.8 |
5.8 |
-4.6 |
-9.5 |
5.9 |
| 1996 |
5.1 |
7.8 |
-16.3 |
-6.9 |
-11.8 |
| TOP HOLDINGS EQUITY (30/09/99) |
|
|
Value (Cr) |
|
Assets % |
| SSI |
|
|
49.61 |
|
15.65 |
| Zee Telefilms |
|
|
39.24 |
|
12.38 |
| Himachal Futuristic |
|
|
25.71 |
|
8.11 |
| Satyam Computer |
|
|
17.09 |
|
5.39 |
| Vikas WSP |
|
|
15.25 |
|
4.81 |
| Shyam Telecom |
|
|
12.58 |
|
3.97 |
| Sri Adhikari Brothers |
|
|
10.56 |
|
3.33 |
| HCL Technologies |
|
|
10.08 |
|
3.18 |
| KLG Systel |
|
|
10.05 |
|
3.17 |
| Dabur India |
|
|
9.13 |
|
2.88 |
| Leading Edge Systems |
|
|
8.34 |
|
2.63 |
| McDowell & Co. |
|
|
7.99 |
|
2.52 |
| Grasim Industries |
|
|
7.35 |
|
2.32 |
| IEC Softwares |
|
|
7.16 |
|
2.26 |
| Citicorp. Securities & Inv. |
|
|
7.04 |
|
2.22 |
Mutual Funds
Tell us what you think of this feature
|
