SUNDARAM EQUITY PLUS FUND - A REVIEW AND ANALYSIS
MORE STABLE, LESS RISKY
Aiming to get the best of Gold and Equity, Sundaram Equity Plus Fund follows successful UTI Wealth Builder Series II Fund.
UTI Wealth Builder Series II has been very successful. It has beaten its Benchmark both in Positive and Negative times.
It has risen more and fallen less.
Can we expect the same from Sundaram Equity Plus Fund.... well that depends on how well the Equity portion is managed as the Gold investment does not need the skill of the Fund Manager expect in the extent of exposure towards Gold.
The Sundaram Equity Plus Fund aims to invest around 65% in Equity and 35% in Gold ETFs.
Gold, as we know, has been a star performer for the past couple of years. Gold is a counter cyclical in nature and hence an ideal asset tool in diversification.
But, going forward, Gold is not expected to repeat its Extraordinary performance and hence this fund could struggle to give Alphe returns.
Now, since the Fund Manager has indicated that he will be tilted towards Large Caps, and with balance in Gold ETFs, the Fund will not be volatile and may at best give you Par returns. If you want Alpha returns, then this fund is NOT for you.
Tax Advantage :
Since more than 65% is intended to be invested in Equities, there will be No Long Term Capital Gains Tax.
RECOMMENDATION :
Sundaram Equity Plus Fund is suitable for conservative investors who are looking to hedge their equity portfolio with Gold.
Sundaram Mutual Fund fans can sure go for this fund, others are better off by separating their investment and themselves investing in a Diversified Equity Fund and taking a SIP in Reliance Gold Savings fund which in turn invests in Gold ETFs.
Aiming to get the best of Gold and Equity, Sundaram Equity Plus Fund follows successful UTI Wealth Builder Series II Fund.
UTI Wealth Builder Series II has been very successful. It has beaten its Benchmark both in Positive and Negative times.
It has risen more and fallen less.
Can we expect the same from Sundaram Equity Plus Fund.... well that depends on how well the Equity portion is managed as the Gold investment does not need the skill of the Fund Manager expect in the extent of exposure towards Gold.
The Sundaram Equity Plus Fund aims to invest around 65% in Equity and 35% in Gold ETFs.
Gold, as we know, has been a star performer for the past couple of years. Gold is a counter cyclical in nature and hence an ideal asset tool in diversification.
But, going forward, Gold is not expected to repeat its Extraordinary performance and hence this fund could struggle to give Alphe returns.
Now, since the Fund Manager has indicated that he will be tilted towards Large Caps, and with balance in Gold ETFs, the Fund will not be volatile and may at best give you Par returns. If you want Alpha returns, then this fund is NOT for you.
Tax Advantage :
Since more than 65% is intended to be invested in Equities, there will be No Long Term Capital Gains Tax.
RECOMMENDATION :
Sundaram Equity Plus Fund is suitable for conservative investors who are looking to hedge their equity portfolio with Gold.
Sundaram Mutual Fund fans can sure go for this fund, others are better off by separating their investment and themselves investing in a Diversified Equity Fund and taking a SIP in Reliance Gold Savings fund which in turn invests in Gold ETFs.
Also read....
http://goodfundsadvisor.blogspot.com/2011/04/invest-in-gold-best-way.html
Alternatively, investors can consider investing in
UTI Wealth Builder Fund Series II
Axis Triple Advantage Fund
Canara Robecco Indigo Fund
Best of luck,
Srikanth Matrubai
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