DSP BlackRock World Gold Fund


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DSP BlackRock World Gold Fund

  1. 1. JUNE 2011Why “Gold” continues to be among the best performing asset class?lInvestment demand for gold is among the key factors influencing prices at present, and has been driven largely by global economic concerns and by the potential longer-term inflationary consequences of central bank’s monetary policies.l prime driver of gold price in the recent months has been its appeal as a safe haven asset. ThelEven at high prices consumption demand remains strong.lGlobal production has been falling.Gold MarketlInvestor sentiment was driven lower by the European Sovereign Debt concerns, weaker US economic data and the potential impact of high oil prices on the rate of global growth. The resulting risk aversion supported the gold price above $1,500 per ounce for most of the month.lGold demand trends in Q1 2011 were published by The World Gold Council, a key industry body for the gold market. The results of this survey showed that both China and India were the key sources of demand in the first quarter, accounting for 57% of jewellery and investment demand globally. Excluding official sector demand, jewellery accounted for 56% of total demand in Q1, with an increase quarter-on-quarter. This questions the price-elastic nature of jewellery buying, as demand for gold jewellery in both India and China has continued to grow quarterly despite the gold price rising 29% over the past year to end March 2011.l silver price began to give back some of the strong gains of the past 9 months, declining -20.6% in May, as COMEX raised their The margin requirements four times in one week.Portfolio UpdatelHong Kong listed G-Resources stock price rose as they confirmed to the market that they had successfully secured a debt facility enabling them to bring their asset into production towards the end of 2011 with minimal equity dilution.l BGF World Gold Fund’s exposure to companies operating in Peru also began to make a small recovery as some resolution to the The political instability appeared in sight.l falling silver price put pressure on the share prices of silver companies in the portfolio, such as Hochschilds and Fresnillo, The causing these holdings to under perform. We remain positive on these holdings in spite of a fall in the silver price due to their relative low cost of productionl BGF World Gold Fund also took profits from some non-gold holdings that have performed well year to date. TheOutlooklInvestment demand has been the most important driver of the bull market to date and the key factors that have been driving that demand – concerns about financial markets, Eurozone debt and inflation – are likely to persist for the foreseeable future. The potential for further net purchases by central banks could also be supportive of prices.lGold equity valuations are still in historically low ranges but earnings expansion on the back of elevated gold prices and growth in dividends could well catalyse a rerating.lthe moment, we believe the interest rate and exchange rate environments remain bullish for gold. AtWhy invest in DSP BlackRock World Gold Fund?lDSP BlackRock World Gold Fund invests predominantly in units of BlackRock Global Funds - World Gold Fund (BGF - WGF), which has performance track record of more than 15 years, and is one of the largest funds in its category* with net AUM of US$ 8.30bn^ (Rs.37,393 crore) **lBlackRock has one of the strongest Natural Resources team in its industry and has won numerous industry awards for investment performance.lInvestors have access to the stock selection skills of a highly regarded and experienced Natural Resources team at BlackRock.l - WGF enjoys the maximum - AAA rating, from both Standard & Poor’s and OBSR. BGF Past performance is no guarantee of future results.*Funds investing in gold mining companies **As per conversion rate (RBI) on May 31, 2011: USD/INR = 45.03 Source: Internal^Source: BlackRock BGF - World Gold Fund Sectoral Allocation
  2. 2. DSP BlackRock World Gold Fund - Portfolio DSP BlackRock World Gold Fund - Performance Name of Instrument % of Net Assets Compounded Annualised Return BlackRock Global Funds - World Gold Fund 99.29% Period DSP BlackRock FTSE Gold Mines World Gold Fund (cap) Index^ (Class 12 USD Shares) ^^ CBLO / Reverse Repo Investments 1.02% Last 1 Year 20.82% 12.12% Net Receivable/ (Payable) (0.31%) Last 3 Years 7.70% 10.87% Total 100.0% Since Inception 18.06% 13.95% NAV / Index Value ` 18.5198 169,238.22 Total AUM as on May 31, 2011 Rs. 1,087.79 crores (May 31, 2011) ^ Benchmark. The ‘since inception’ returns are calculated on ^^Fund domiciled in Luxembourg Rs. 10/- invested at inception. For this purpose the inception date is deemed to be the date of allotment (September 14, BGF - World Gold Fund Sectoral Allocation 2007). Past performance may or may not be sustained in future and should not be used as a basis for comparison with other investments. Sector Allocation % of Net Assets Gold 78.4% Performance in INR term as on May 31, 2011. The Returns of Silver 13.4% the Scheme shown are for the Growth Option (Regular Plan). Source: Bloomberg Platinum 4.2% Diversified 2.3% Diamonds 0.5% Copper 0.3% Cash 0.8% Features Total 100.0% Source: BlackRock; data as on May 31, 2011 • Minimum investment and minimum additional purchase - Regular Plan: Rs. 5,000/- and Rs. 1,000/- thereafter. - Institutional Plan: Rs. 1 crore and Rs. 1,000/- thereafter. BGF - World Gold Fund - Top 10 Holdings • Options available (for both plans) • Growth • Dividend % of Net Assets - Payout Dividend - Reinvest Dividend Newcrest Mining Ltd. 9.7% Goldcorp Inc. 7.7% • Entry load: Nil Kinross Gold Corp. 7.3% • Exit load (both plans): Fresnillo Plc 6.4% For holding period < 12 months: 1%; Compania De Minas Buenaventura S.a 5.8% For holding period >= 12 months - NIL Industrias Penoles S.a.b. De C.v. 5.3% Impala Platinum Holdings Ltd. 4.1% Note: Investors shall bear the recurring expenses of the underlying Schemes in which the Scheme will invest, in addition to the recurring expenses of the Scheme. Randgold Resources Ltd. 3.9% Agnico-eagle Mines Ltd. 3.5% Eldorado Gold Corp. 3.4% Total 57.2% Source: BlackRock; data as on May 31, 2011DSP BlackRock World Gold fund (DSPBRWGF) is an open ended Fund of Funds scheme seeking to generate capital appreciation by investing predominantly in units of BlackRock GlobalFunds - World Gold Fund (BGF-WGF). The scheme may, at the discretion of the Investment Manager, also invest in the units of other similar overseas mutual fund schemes, which mayconstitute a significant part of its corpus. Asset Allocation: Units of BGF – WGF# or other similar overseas mutual fund scheme(s): 90% to 100%; Money market securities and/or units ofmoney market/liquid schemes of DSP BlackRock Mutual Fund: 0% to 10%. #in the shares of BGF – WEF and BGF – NEF, Undertaking for Collective Investment in Transferable Securities(UCITS) III fund. Features: SIP only in Regular Plan, SWP & STP available in each plan of the scheme. Nomination facility available, subject to applicable conditions as per the Statementof Additional Information (SAI) and Scheme Information Document (SID). Declaration of NAV on all Business Days. Redemption normally within 5 Business Days. Sale and Redemption ofUnits on all Business Days at Purchase Price and Redemption Price respectively. Minimum investment: Rs. 5,000/- (Reg. Plan)/Rs. 1 crore (Inst. Plan). Entry load: NIL. Exit load: HoldingPeriod < 12 months: 1%, Holding Period >= 12 months: NIL. Investors shall bear the recurring expenses of the Scheme in addition to the expenses of the underlying scheme(s) in which theScheme will make investment. Statutory Details: DSP BlackRock Mutual Fund (Fund) was set up as a Trust and the settlors/sponsors are DSP ADIKO Holdings Pvt. Ltd. & DSP HMK HoldingsPvt. Ltd. (collectively) and BlackRock Inc. (Combined liability restricted to Rs. 1 lakh). Trustee: DSP BlackRock Trustee Company Pvt. Ltd. Investment Manager: DSP BlackRockInvestment Managers Pvt. Ltd. Risk Factors: Mutual funds, like securities investments, are subject to market and other risks and there can be no assurance that the Scheme’sobjectives will be achieved. As with any investment in securities, the NAV of Units issued under the Scheme can go up or down depending on the factors and forces affectingcapital markets. Past performance of the sponsor/AMC/mutual fund does not indicate the future performance of the Scheme. Investors in the Scheme are not being offered aguaranteed or assured rate of return. Each Scheme/Plan is required to have (i) minimum 20 investors and (ii) no single investor holding>25% of corpus. If the aforesaid point (i) is notfulfilled within the prescribed time, the Scheme/Plan concerned will be wound up and in case of breach of the aforesaid point (ii) at the end of the prescribed period, the investor’sholding in excess of 25% of the corpus will be redeemed as per SEBI guidelines. DSPBRWGF is the name of the Scheme and does not in any manner indicate the quality of the Scheme,its future prospects or returns. If the SEBI limits for overseas investments allowed to the Fund are expected to be exceeded, subscriptions and switches into the Scheme may betemporarily suspended / SIP/STP into the Scheme may be terminated. For scheme specific risk factors, please refer the Scheme Information Document (SID). For more details, pleaserefer the Key Information Memorandum cum Application Forms, which are available on the website, www.dspblackrock.com, and at the ISCs/Distributors. Please read the SchemeInformation Document and Statement of Additional Information carefully before investing.