DSP Mutual Fund launches DSP Business Cycle Fund; offers investors chance to enter and exit themes at the right time
Offers Flexibility for active allocation of significant weights to industries in an upcycle
Chennai, November 29, 2024: DSP Mutual Fund has announced the launch of the DSP Business Cycle Fund, an open-ended equity following business cycles-based investing theme. This fund provides investors with the opportunity to invest across various market capitalizations, including large, mid and small cap companies. The investment strategy focuses on dynamically allocating assets to industries and sectors that exhibit strong growth potential, improving fundamentals, and attractive valuations.
The DSP Business Cycle Fund employs a framework-driven approach to select industries and companies with high growth or turnaround potential. It allows for active allocation to sectors during upcycles while also implementing cash calls and other risk management strategies. By focusing on identifying strong industry cycles, the fund offers an unconstrained investment approach across market capitalizations, enabling investors to participate in growth opportunities regardless of company size.
The fund categorizes its investment universe into broader sectors and evaluates them at the industry level. It aims to identify industries that are at the bottom of their cycle with potential for significant growth, trading at low valuations compared to benchmarks. Additionally, the fund utilizes dedicated forensic analysts to exclude companies with poor corporate governance, even if they show strong growth prospects.
In terms of risk management, the fund incorporates various strategies including portfolio hedging through put options and arbitrage opportunities. Furthermore, it maintains the flexibility to invest up to 10% of its portfolio in Real Estate Investment Trusts (REITs) or Infrastructure Investment Trusts (InvITs) when equity market opportunities are limited.
"Timing entry and exit of themes can be tricky for investors on their own and may sometimes lead to errors. Redeploying capital after exiting a sector also calls for a thorough evaluation. DSP Business Cycle Fund is strategically designed to navigate through different phases of business cycles while managing risks effectively. We believe this fund will provide investors with a unique opportunity to capitalize on changing market dynamics," said Charanjit Singh, Fund Manager, DSP Mutual Fund.
The New Fund Offer (NFO) for the DSP Business Cycle Fund will open for subscription on November 27, 2024, and will close on December 11, 2024.
About DSP Mutual Fund
DSP Mutual Fund has an over 25-year track record of investment excellence. Today, we have the honour of managing money for over 35 lakh investors from all walks of life: hard-working salaried individuals, high-net-worth individuals, NRIs, small and mid-sized business owners, large private & public corporations, trusts and foreign institutions. We take great pride in knowing that we play a key role in the creation of wealth for all our investors and will always continue to be an organization with a purpose - it is our responsibility to make a real difference to the lives of our investors.
DSP Mutual Fund is backed by the 160+ year old DSP Group. Over the past one and a half centuries, the family behind the Group has been very influential in the growth and professionalization of capital markets and money management business in India. DSP Group is currently headed by Mr. Hemendra Kothari.
Our investors' interests will always remain at the core of our business, and we will continue to maintain a relentless focus on doing what's best for them, as they #InvestForGood.
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