Sunday, March 22, 2009
IDFC India GDP Growth Fund
The IDFC India GDP Growth Fund seeks to invest the assets in the sectors representing the three components of India's GDP viz., Agriculture, Services and Industry. The allocation to these levels of GDP will be in the same proportion as their contribution to the overall India's GDP, and will normally be revised on a semi-annual basis, or whenever the GDPgrowth estimates are revised.
COMMENTS AND RECOMMENDATION :
The Fund is innovative and aims to capture the Growth in India's GDP. The Fund would act as a Good Diversified Fund as it will be investing in Stocks in Sectors and Industries across market captilisation. The Fund Manager, Mr.Ajay Bodke has had a good expertise in managing Funds and has performed reasonably well. The Fund may a Good Pick for Long Term Investors.
The Fact that India's economy is relative insulated from the Global meltdown and that India is better positioned better than most countries makes Indian Markets attractive and India should better GDP numbers going forward. This in turn will help the Fund give good returns.
The Fund, however, may not find it easy to mirror the GDP. Besides, there are not many great performers in the agriculture sector and getting right stocks in optimum proportion would not be very easy. Also, not all the sectors of the economy would perform in a similar manner at any given point and hence the fund has to remain invested in a particular sector in a particular proportion and this is a negative of the new fund.
IN A NUTSHELL, THERE ARE MANY TOP PERFORMING FUNDS WHICH OFFER SIMILAR FEATURES AND HAVE A TRACK RECORD TO BOAST OF. RISK AVERSE INVESTORS WOULD BE BETTER OFF TO WAIT FOR THE FUNDS PERFORMANCE TO COME OUT AND THEN TAKE A CALL. OTHERS CAN TAKE THE SIP ROUTE AND INVEST IN THE FUND.
Best of luck,
Srikanth Shankar Matrubai
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