The Economic Times
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| 08 August, 2020, 03:06 AM IST | E-Paper
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    Category Review

    MNC Funds or mutual fund schemes that invest mostly in multinational companies are gaining currency these days. MNCs are always bankable, especially in the current bleak economic scenario due to the pandemic.

    In very simple terms, the fund should provide a fine balance between risk and return. Lower risk than an equity fund and higher return than a debt fund. That makes balanced funds a great product for slightly conservative investors.

    Banking sector funds have surprised investors in the last one month. The category has offered 21.38% returns in one month. It is indeed surprising because the banking sector has suffered a lot in the last one year.

    The pharma sector is benefiting a lot from the Covid-19 global pandemic. After being out in the cold for the last three years, phama funds are back with a a bang.

    Macroeconomic backdrop increasingly favourable for gold, says Chirag Mehta of Quantum MF

    Gold surprised market participants in March by moving in tandem with equities, when it was expected to do the opposite. When there is a sharp fall in asset markets, you can only sell what is liquid, profitable and has low impact cost.

    Analysts said the outlook for equities remain uncertain at least in the next one year. A mix of equity and debt could help reduce sharp swings in returns.

    ​Equity saving schemes are sold as `one of the safest’ investment products. A typical sales pitch goes like this: “look at the portfolio. It is debt, arbitrage, and a little bit of equity.

    The international fund category is offering around 15% returns in the last one year. Suddenly, many mutual fund investors are thinking of diversifying and include at least one international fund in their mutual fund portfolio.

    The investment demand for gold rose, with inflows reported by gold ETFs and folios. The AUM of gold ETFs surged to Rs 5,678 crore in December 2019 from Rs 4,571 crore in December 2018.

    Are ELSS mutual funds losing their charm?

    According to AMFI data, the ELSS mutual fund category has seen net inflows worth Rs 931 crore in January 2020.

    If you are convinced about the efficacy of these `diversifiers,' you may consider allocating a small part of your portfolio to them, only if you have a sizeable portfolio.

    Several funds have given healthy returns over the past year and are worth considering by investors.

    Equity savings funds and dynamic equity schemes are less volatile than regular diversified equity funds.

    Defying predictions of their imminent irrelevance, some actively-managed large cap schemes have bounced back to the top of the return chart.

    Credit-risk funds likely to give up to 9% returns: Analysts

    High differential in spreads between rated bonds & repo makes funds suitable for investors with moderate risk appetite.

    All the 21 funds in the category were positive, and the lowest return offered by the category was 23 per cent in 2014.

    The toppers in the category have offered around 23 per cent returns in both three months and one-year horizon.

    Long duration funds and gilt funds have made a comeback in the last six months.

    Debt mutual fund managers are recommending dynamic bond funds these days.

    Only 15 equity schemes outperformed their benchmark with positive returns last year

    Many toppers in various mutual fund categories were offering negative returns in the last year.

    The Economic Times