Investors can wait and watch Mirae Asset Opportunities Fund?s performance for some more time before parking their money

Mirae Asset Opportunities Fund, a diversified equity scheme, has recorded robust performance in a short span of three years and has given better returns than some of its larger and more established peers.

PERFORMANCE

Mirae Asset Opportunities Funds recorded about 8% decline in net asset value so far in 2011 compared with more than 10% fall in net asset value

(NAV) for its peers. During the same

period, benchmark share indices the Sensex and the Nifty declined about 12%.

Launched in the financial meltdown year of 2008, the fund initially failed to attract investors. However, it cashed in on the opportunity to buy at reasonable rates, which came in handy in the following year. In 2009, the year when the markets were recovering, the fund experienced a record jump of about 109% in NAV. This compares with 89% rise for the BSE 200. In 2010, the fund returned 23%, higher than 16% gain in the BSE 200. The fund has recorded about 61% absolute gains for investors since its launch against 18% return by the BSE 200 during the same period.

PORTFOLIO

Mirae Asset Opportunities is a multicap equity fund with about 50 stocks in its portfolio. It mostly focuses on financial and energy sector stocks and shows a bias for large-caps. It has assets under management of 150 crore. The fund is quite active in churning portfolio and has moved across more than 150 stocks since its launch.

Wide diversification, with average exposure per stock of about 2%, lowers stock-specific risk of its portfolio. But the large number of stocks and frequent portfolio churning increases cost of managing. The fund has an expense ratio of about 2.4%.

Currently 69% of the fund?s equity portfolio earns notional profit of which about one-third is from stocks bought in 2008.

Except a few large-cap stocks such as Bharti Airtel, Tata Steel and Reliance Industries that are currently trading below April-May 2008 levels, the scheme has made robust gains on stocks bought cheap in 2008 and held on till date. Some such stocks include State Bank of India, ITC, HDFC, Gas Authority of India, Infosys, Dr Reddy?s and Lupin.

OUR VIEW

Existing investors can continue to hold their investments in the fund that has returned more than the markets in a span of just three years. New investors, however, might want to wait and watch the fund?s performance for some more time before putting in their money.