All that you need to know about Mutual Funds this week
India’s first woman FM presented her maiden budget yesterday. The highlight was a commitment to grow our economy from $3 Trillion this year to $5 Trillion in 5 years i.e a growth of 10.75% in nominal USD terms every year. Historically the fastest that any economy has grown from $3 Trillion to $5 Trillion is China in 4 years from 2005 to 2008. Let us know if the growth is achievable in our online poll.
Here are our top picks for investors on what is proposed in this budget:
- Infrastructure spending of Rs 100 lakh crore over the next 5 years
- Rs 70,000 Crore allocated for public sector bank recapitalization
- Increase the minimum public shareholding limit in listed companies to 35% (from 25%)
- Customs duty on gold increased from 10% to 12.5%
- Tax on buybacks by listed companies at 20% to bring parity with dividend distribution tax
The US economy has grown for 121 consecutive months, since June 2009, following the Great Recession, marking the longest economic expansion in American history. The US stock market has followed the economy with the S&P 500 and Nasdaq 100 both making new all-time highs this week.
We have had an international allocation since the start in our recommended portfolio through the ICICI Prudential US Bluechip Fund, and we reiterate the importance of international diversification.
The AUM of the mutual fund industry increased 11.4% YoY to Rs 23.79 lakh crore in March 2019, shows the Economic Survey of India 2019. However, Mutual Funds witnessed net inflows of Rs 1.1 lakh crore in FY 2018-19, down 60% YoY from the net inflows of Rs 2.7 lakh crore in the previous financial year.
Sundaram Mutual Fund will amend the minimum investment/redemption limit for all equity funds (excluding ELSS) to Rs 100. The proposed changes will come into effect from 8th July.
Index Returns
| Index | Weekly open | Weekly close | Change |
| BSE Sensex | 39,394.64 | 39,513.39 | 0.30% |
| Nifty | 11,788.85 | 11,811.15 | 0.19% |
| S&P BSE SmallCap | 14,239.33 | 14,141.83 | -0.68% |
| S&P BSE MidCap | 14,808.34 | 14,725.65 | -0.56% |
Source- BSE/NSE
Top 5 best performing funds
| Name | Week | 3Y | Category |
| HSBC Brazil | 2.3% | 16.4% | Fund of Funds |
| Reliance Nivesh Lakshya | 2.2% | NA | Long Duration |
| DSP World Agriculture | 2.0% | 6.3% | Fund of Funds |
| Edelweiss Greater China | 1.9% | 16.1% | Fund of Funds |
| Principal Global Opp | 1.9% | 12.4% | Fund of Funds |
Source – Kuvera.in
Top 5 worst performing funds
| Name | Week | 3Y | Category |
| Tata Digital India | -2.4% | 16.6% | Sectoral |
| JM Core 11 | -2.2% | 17.0% | Focused Fund |
| IPRU Dividend Yield | -1.8% | 11.0% | Dividend Yield |
| Baroda Mid Cap | -1.8% | 10.5% | Mid Cap |
| Tata Infrastructure | -1.8% | 11.6% | Sectoral |
Source – Kuvera.in
What investors bought
We saw the most inflows in these 5 Funds –
| Name | 1Y | 3Y | Category |
| Mirae Large Cap | 14.8% | 17.1% | Large Cap |
| Kotak Standard Multicap | 13.4% | 16.1% | Multi-Cap |
| Parag Parikh LTE | 7.3% | 14.8% | Multi-Cap |
| HDFC Small Cap | 0.6% | 17.3% | Small Cap |
| Mirae Emerging Bluechip | 16.3% | 18.8% | Large & Mid Cap |
Source – Kuvera.in
What investors sold
We saw the most outflows in these 5 Funds –
| Name | 1Y | 3Y | Category |
| Invesco India Contra | 7.8% | 17.2% | Contra Fund |
| DSP Equity Opp | 9.5% | 13.8% | Large & Mid Cap |
| ABSL Frontline Equity | 8.4% | 12.2% | Large Cap |
| SBI Blue Chip | 9.9% | 12.0% | Large Cap |
| UTI Nifty Next 50 Index | -2.3% | NA | Index Fund |
Source – Kuvera.in
Movers & Shakers
1/ Axis Mutual Fund has announced that Vijayalakshmi Rajaram Iyer has been appointed as an Independent Director on the board of Axis Mutual Fund Trustee Limited.
2/ Union Mutual Fund has appointed Vinay Paharia as a Co-Fund Manager of Union Large-cap Fund and Union Tax Saver Schemes.
3/ Principal Mutual Fund has announced that V S Mathur and H M Singh have ceased to be independent directors of the board of the Trustee Company. Raman Uberoi and Ameet Parikh have been appointed in their stead.
Quote of the week:
Budgeting has only one rule: Do not go over budget.
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