Fund of Fortnight

Every fortnight, we recommend one open-ended equity diversified fund that has the best potential of returns for the next one year considering its constituents remain the same.[EasyDNNnews:PaidContentStart]

Reason for recommendation
Multicap funds are a compelling choice now due to their diversified exposure, ability to navigate geopolitical volatility, and alignment with India’s strong macroeconomic growth. Hence, our choice of MF Select this time is Nippon India Multi Cap Fund. The fund has consistently outperformed its category average across most timeframes. Its 1-year rolling return stands at 18.60 per cent, outpacing the category’s 13.30 per cent. The 3-year return is slightly lower than the category at 15.30 per cent vs 15.80 per cent, but the fund bounces back with 5-year and 7-year rolling returns of 17.00 per cent and 16.50 per cent, compared to the category averages of 15.60 per cent and 15.20 per cent, respectively.

A closer look at the sectoral exposure reveals a well-diversified portfolio. Financials dominate the fund with 27.47 per cent, showcasing the fund manager's confidence in India’s banking and financial services sector. This is followed by Services at 16.37 per cent, and Capital Goods at 12.85 per cent, indicating a focus on infrastructure and domestic manufacturing revival.

In terms of risk-adjusted performance, Nippon India Multi Cap Fund stands out. With a Sharpe ratio of 1.37 and Sortino ratio of 1.99, it delivers superior risk adjusted returns. The fund’s top holdings underline its focus on quality Large-Cap names with consistent performance. HDFC Bank Ltd. leads the pack with 5.81 per cent, followed by Axis Bank Ltd. (4.14 per cent) and ICICI Bank Ltd. (3.82 per cent). Industrial and energy representation comes through GE Vernova T&D India Ltd. (3.36 per cent) and Reliance Industries Ltd. (3.29 per cent), while Max Financial Services Ltd. (2.63 per cent) provides exposure to the growing insurance sector.

Backed by robust long-term returns, strong risk-adjusted metrics, and a diversified sectoral and stock exposure, the fund is a compelling case for investors seeking consistent wealth creation across market cycles.

[EasyDNNnews:PaidContentEnd] [EasyDNNnews:UnPaidContentStart]

[EasyDNNnews:UnPaidContentEnd]