Tata Balanced Fund - Plan A


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The fund has handsomely outperformed the benchmark as well as the category over the last ten years.

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Tata Balanced Fund - Plan A

  1. 1. Financial 19.28 Fund HY: Eq- oriented Technology 22.36 Healthcare 9.17 FMCG 9.03 Automobile 8.59 7.87 9.63 8.09 18.66 15.13 Top-5 sectors (%) 42 Mutual Fund Insight April 2014 FUND ANALYST’S CHOICE Value Research Assets `603 crore (December 2013) Launch October 1995 Fund manager Atul Bhole, S Raghupathi Acharya Walking on a tightrope The tightrope walk between safety and returns that a balanced fund has to perform is not straightforward, but Tata Balanced has done this better than most of its peers. This fund has handsomely outperformed the bench- mark as well as the category over the last ten years. Ten year returns have been 16.7 per cent per annum. This compares very well with the category average of 13.5 per cent and the benchmark’s 10.7 per cent. The fund ranks third among balanced funds that have been around for this period. During this time, it has lagged behind the category for five calendar years, but has more than made up for it in the other five. This should make it obvious to investors that the fund is a tad more adventurous than some of the others in our current selection. The likely reason for this is it’s ten- dency to hunt for gains amongst some- what smaller companies. Mid-cap exposure has varied sharply between 47 and just 7 per cent, but has mostly been between 30 and 40 per cent in the past two years. Having said that, the fund has still been relatively steady in its lead over the benchmark, with there being a lag (a small one) in just one year out of the last ten. Since 2000, Tata Balanced A has outperformed the benchmark by a cumulative 80+ per cent. In terms of absolute returns, the fund has dealt well with the shock of the global crisis of 2008. It is now about 35 per cent higher than its pre-crisis peak, which must be a great comfort to investors. According to the manager, the fund follows the growth-at-reasonable- price (GARP) style and stocks are selected on a bottom-up basis backed by rigorous research. The mid-cap focus is on niche businesses backed by high entry barriers like technology, brand franchise, distribution network and relatively higher growth rate. Over the last year, the fund has been underweight on metals and ener- gy and occasionally overweight on FMCG. All in all, despite its rakish bearing, Tata Balanced A is a good choice for all but the most fearful equity investors. TATA BALANCED PLAN A Fund Hybrid: Equity-oriented Recent Rally - Mar 09, 2009 - Nov 09, 2010 Recent Crash - Jan 08, 2008 - Mar 09, 2009 Risk Return Quartile1 2 3 4 Recent Rally 5-year3-year1-year Recent Crash Trailing returns (%) 13.11 10.67 11.17 7.48 21.21 17.29 64.46 55.79 -44.78 -42.86 SIP value (`) 900000 600000 300000 0 March 1999 February 2014`1,000 invested per month for 15 years amounts to `7,40,715 Amount Invested Large Cap 56.11 Mid Cap 36.18 Small Cap 7.71 Market Capitalisation (%) Data as on Feb 28,‘14, Portfolio related data as on Jan 31,‘14 *YTD as on Feb 28, 2014 Fund History -44.40 75.04 14.87 -12.02 30.55 7.54 0.76 -43.28 61.16 16.24 -15.98 26.71 5.94 0.04 -39.76 49.30 14.54 -18.12 22.54 6.38 -0.06 1.37 2.50 2.34 2.33 2.32 3.00 - Year 2008 2009 2010 2011 2012 2013 YTD* 21 2 Rating Quartile ranking Fund Category VR Balanced Expense Ratio Fund Style 313 2