Until a few years ago, SBI Magnum Multiplier Fund was an average performer but, its performance underwent a spectacular transformation the moment it shifted focus towards large-caps. The large-cap allocation is as high as 65 per cent in stocks of companies with sound management. It also invests in companies where it sees opportunities for growth, which is in-line with its own growth style.
The fund follows the Benchmark S&P BSE 200 by limiting its deviation to sectors and stocks within levels. Cash position is also rarely above 7 per cent, giving it ample leeway to handle redemptions and opportunities. All these factors have played a huge role in its blockbuster performance since 2014. Its three-year return is about 23 per cent, which is way ahead of its peers. It has repeatedly outperformed its benchmark, consistency making it a top performer.
The portfolio is made of quality stocks such as HDFC Bank, UPL, Britannia Industries and Axis Bank, among others. The performance has been consistent over both bear and bull phases of the market, which is a good test for investors to consider investing in this fund. The fund manager’s deftness in changing asset allocation and moving across sectors to benefit from market movements has augured well in its performance.
For instance, the fund’s positions in Ahluwalia Contracts and Aurobindo Pharma have proved valuable. It does take calls to be in sync with cyclical sectors, but is also cautious to increase exposure to defensive sectors such as pharma and consumer non-durables when the markets are volatile. The over two-decade history, consistency, and pedigree of the fund house are all factors that make this a suitable fund to consider investing in. Make SIP investments in this fund with a 3-5 year timeframe to benefit the most.
