Many people have been asking me one question:

Should we stop investing in Hdfc Top 200? it has given poor performance over the past 3 years – and many people are asking me to get out of this portfolio…

My take:

Prashant Jain is a good fund manager – and my view on him does no change over a short period. He may not be the best judge on sectors, or hey he might just be.

When you run such a big fund, you will get a few calls wrong – as long as you get a majority of the calls right, you are doing fine.

In the past 12 months I have been tempted to sell my FMCG stocks, IT stocks and banking stocks. Luckily my broker made me hold on to those shares far longer – and i have no regrets. I sold Monsanto and got a chance to buy it back – but decided to let go of Monsanto. Sold MRF, Coromandel international, Cummins, Siemens, Tata Steel, ………….the list is endless and still have a chance to buy back most of them. In fact replaced Coro by buying Liberty Phosphate – and the arbitrage margins were fantastic -no doubt about that.

PJ is normally ahead of the curve. He may have exited FMCG a little earlier – but it makes logical sense, does it not?

Imagine if you get a chance to sell a share at 270 and buy it back at 103 – it happened in case of Coro: Liberty, but that was a chance which I DID NOT KNOW WHEN I sold Coro!

Now PJ may have his logic – but I realise that he may have moved ahead of the curve.

I also like Franklin India Blue Chip, Hdfc’s Mid cap fund, I Pru’s Discovery fund, Prima of Templeton….

What is my view on Hdfc Top 200? I really do not have a view. I see it slipping for sure – but it could make a comeback. If you are fund manager agnostic try an Index fund. I have seen many people remove completely from Top 200, Prudence, ..Equity….and have no regrets. Keep your options open, no harm !

And to remind u guys I am a direct equity guy, by and large….

 

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  1. Trouble is, investors want to eat their cake and have it too!

    They want their fund to beat the benchmark each year.

    They don’t have the time to monitor investments. Many won’t learn how to do it.

    Almost everyone won’t pay a fee for professional advice.

    Tell them to invest in the benchmark itself so that the fund need not be monitored for performance or changed, they say, they want alpha!

  2. Hi PV – Nice one. This is why the MF industry is having challenges. Unless they can keep ahead of the curve in spotting sectors and riding growth they will not do any better than the index. Direct equity is still better imo too.

    – Ravi

  3. hey, you never talk of elss. even for a direct equity guy elss is a must. also asset allocatopn wise makes sense. cocentrated direct equity and an elss gives diversification.

  4. Subra Thank You for Your Input on PJ Managed fund . My retirement is in HDFC TOP 200 and Asset Replacement Fund or a corpous which may be required over Next 7 to 10 Years are parked in Prudance(.If the Goals are 7 to 20 Years away ,why should we change from PJ for a Blip for some Time In His Funds .Goals are decade away .PJ is Undoubtedly one of the Best IN Our Country along with Sankar Naren,Keneth Andrade ,Radhakrishnan…and as is Said in cricket ( Special Example- Sachin TENDULKAR )…Form is Temporary , CLASS IS PERMANENT ! So PJ will come Back and So if we already have an exposure to Sankar ,Keneth ,Radhakrishnan ,I feel we should continue with PJ (Sachin is Retiring ,Not PJ..I am sure he will come back..ROARINGLY)One question comes in mind which PJ defends …Large Fund Size dosent affect performance …What we are currently seeing is diffrent . Besides his calls on FMCG and SBI ,real villan may be Corpous size…. As More and more people are Selling or Not adding SIP to his funds , eventually Fund corpous may will reduce and that may create WONDER ! Prashant is also well known for his sticking to convictions to the core and this BLIP may be an opprtunity for him to Ponder this aspect as well . Market is the greatest teacher to all of us ,whatever Our Business card Says ……In all I am going to stick with PJ. Happy Vijayadasmi and Dussera to Fellow Readers !

  5. Last 5 years is a big disappointment for Top-200 and wonder whether it could attain its past glory. If it has to break-even with inflation adjustment returns, NIFTY needs to double in a year time. While nothing can be ruled out, certainly it is a mountain to climb. With markets moving no where and pressure of redemptions, wrong calls made matters worse and would haunt Top-200 for long time. To me this fund is like Sachin Tendulkar and best time has definitely gone and not sure would ever return.

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