MF Query Board

Yes. PSU funds do perform exceptionally well in election years. If you recall the last election year, i.e. 2014, at that time PSU funds gave average returns of 48 per cent, whereas in other years, the returns have mostly been in the negative. There are only three funds that are available for investment which dedicated to investing in PSU stocks, out of which, one is ETF. If we look at their portfolios, then around 97 per cent of the total assets are invested in equity and related instruments and the remaining three per cent is in cash. If we dive deeper, then around 80 per cent of the assets are contributed by top 10 companies and 56 per cent of the assets are contributed by top five companies. Indeed, it is a very concentrated portfolio. Such concentrated portfolios carry higher risk than a diversified portfolio. So, if you have achieved all your financial goals, specifically those which are your needs and if your risk profile permits you to take higher risks, then you can consider investing in PSU funds for the time period of one year.







Aditya Birla Sun Life Equity Hybrid '95 Fund, the erstwhile Aditya Birla Sun Life Balanced '95 Fund, is an aggressive hybrid fund. At the end of March 2019, it had invested 75.61 per cent of the assets in equity, 24.1 per cent in debt and 0.29 in cash. It has invested in 82 stocks and the top 10 stocks constitute 31.15 per cent of the assets, while top three sectors constitute 40.74 per cent of the assets. If we look at how it has fared with benchmark (CRISIL Hybrid 35+65 - Aggressive index) then in the 1-year and 3-year periods, it has underperformed the benchmark, while in the 5-year period, it has outperformed the benchmark by 1.39 per cent. Now, if we compare it with its peers, it has underperformed its peers during all the periods. If we look at its portfolio in detail, then it seems that the fund manager is more optimistic on financial services, which are 35.53 per cent of the total funds, followed by 12.45 per cent in technology and 11.23 on consumer cyclical. Looking at the dividend history, it has paid dividends every year from 2009 to March 2019, but the rate of dividend has continuously reduced over the period. However, one thing to note is that it is not mandatory on the part of mutual funds to pay dividend and also it is not the tax-efficient way. So, it would be better to sell this fund, and based on your risk profile, invest in a mix of debt and equity separately and start SWP for regular income.