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
Tracking returns of different caps and adjusting the portfolio accordingly is a big task for retail investors; hence, investing in a Flexi Cap Fund is ideal for investors who prefer a simplified investment strategy, allowing fund managers the flexibility to invest across large, mid, and Small-Cap stocks. Hence, our choice for MF Select this time is from this category. Bank of India Flexi Cap Fund has shown impressive performance when compared to its category average over different time periods. Over the past three months, the fund generated a return of 7.07 per cent, significantly outperforming the category average of 3.97 per cent. Over six months, the fund returned 11.1 per cent, while the category average stood at 6.25 per cent. In the longer-term performance, the fund outperformed the category average. Over the past two years, it delivered a return of 23.18 per cent, compared to the category's 18.65 per cent. The fund continued to shine in the three-year period, with returns of 23.22 per cent compared to the category’s 17.8 per cent. The fund has a diversified sectorwise allocation, with a strong emphasis on financials, which make up 25.32 per cent of the portfolio. The fund also has significant exposure to capital goods (12.92 per cent) and metals & mining (9.86 per cent). This sector diversification provides the fund with balanced exposure to both growth and defensive sectors, allowing it to weather different market cycles The fund's alpha of 5.74 indicates higher outperformance against its benchmark when compared to other funds, which have an average alpha of 4.63.

The fund's top five holdings reflect a balanced mix of sectors and industries. The largest holding is State Bank of India (5.28 per cent), followed by Vedanta Ltd. (4.61 per cent) and Hindustan Aeronautics Ltd. (3.73 per cent). These stocks represent a blend of financial, industrial, and energy sectors, showcasing the fund's diversified approach to achieving growth. This fund stands out as a solid investment for moderate risk-taking investors looking to benefit from a well-rounded equity portfolio.

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