Thursday, January 22, 2009

Shall I redeem DSP even at Loss?

A senior Citizen Mr.Sen wrote:
i understand that because of amalgamation of dsp ml with a singapore company called hardrock, investors have been asked to redeem if they wish at current nav

i have an investment of rs 15000 in dsp top 100, 30,000 in tiger and 20,000 in opportunity eq. these are doing so badly even my principal has been heavily eroded.

i shall be very grateful if please advise.should i redeem even at a loss of 23,000 rs.or should i let it be for a few months. here let me mention i am a senior citizen

thanks a lot
sen


SRIKANTH SHANKAR MATRUBAI replied

Dear Sen,
Being a Senior Citizen, you should have to invest in Good Large Cap Funds and not Sector/Theme Funds and not even Opportunity Funds, as these funds take lot of time in giving you returns.
But, first of all, let me assure you that DSP ML is now DSP Black Rock, as Meriyll Lynch People had already their Asset Managemnt Company Worldwide long back. DSP had not yet changed the name of the company, which they have now done. Also, in India, all Mutual Funds are run by Trust where even a change in Company which forms the Trust to run the Mutual funds has NO say in the Day to Day Affairs of the AMC.
Coming to your investment, your investments seem to have been done in the Peak of the bull market and hence, seeing such a HUGE erosion. The Best option for you is to 'JUST STAY INVESTED' and hold on for now.
The funds are good except for DSP Tiger which is a Infrastructure Fund and does not look promising even on a three year horizon. You can switch the same to DSPML Equity fund and stay invested for some time till the markets stabilise and then take a call accordingly.
Best of luck,
Srikanth Shankar Matrubai.

Also visit http://equityadvise.blogspot.com for an indepth Equity Analysis

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