Monday, March 16, 2009

Best Funds for A Cautious Investor

Best Funds for A Cautious Investor
ASiingh wrote :
DSPBR T.I.G.E.R. Reg-G - 10%
Kotak 30-G -25%
Magnum Contra-G - 20%
Reliance Growth-G - 20%
Sund. BNP Par. Select Focus Reg-G - 25%

This combination is also Giant/Large cap heavy so is safer. Monthly allocation percentage indicated. What do you feel ?

SRIKANTH SHANKAR MATRUBAI replied :

Dear Asiingh,
Three of the funds chosen by you would not be a good idea for Cautious Investors., namely DSPBR Tiger Fund, Reliance Growth and SBI Magnum Contra fund.
DSPBR Tiger Fund is a Infrastructure Sector Oriented Fund and is very volatile and for a cautious investor will not be a very wise investment.
Reliance Growth Fund has had a terrific past and the future too should be good, but the fund is heavily titled towards Mid-caps and I would avoid this fund too. Its BIG BIG AUM is also a matter of concern.
SBI Magnum Contra Fund has had a good past, but the frequent change in the Fund Manager is starting to tell on the performance of the Fund and also the Fund`s strategy could change anytime from being a Diversified Fund to a Contrarian Fund, for which it was initially conceptualised.

Instead my 3 funds to compliment your other 2 funds would be
HDFC Prudence Fund - A Balanced Fund which has a unmatched past through bull and bear runs.
DSPBR Top 100 Fund - Again a Fund with a Clean Record.
Fidelity Equity Fund - A Go Anywhere Fund with a good record in Bear Markets (for more on this, visit goodfundadvisor dot blogspot dot com)
So, the final selection would be
DSPBR Top 100 Fund
Fidelity Equity Fund
HDFC Prudence Fund
Kotak K30 Fund
Sundaram Select Focus Fund

By the way, I would have a equal propotion of 20% each in these 5 funds.

Also visit http://goodfundsadvisor.blogspot.com/2009/01/fds-or-mutual-funds.html

Best of luck,
Srikanth Shankar Matrubai


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

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