DSP Value Fund is a mutual fund scheme launched on December 10, 2020. It is designed on fundamental value-investing principles and comprises its portfolio by investing in ‘good’ Indian and international companies at ‘good’, reasonable prices.
DSP Value Fund aims to have up to 35 percent allocation to global ‘value’ stocks via internationally renowned value managers such as Berkshire Hathaway, Lindsell Train, Harding Loevner, Veritas.
It may maintain cash positions to try to reduce downside risk & to reinvest when prices turn reasonable again.
The current allocation of the mutual fund scheme is 94.87 per cent in equity and 3.8 percent in debt and cash. The fund has a total AUM (assets under management) of ₹601.99 crore.
This fund has given a return of 16.49 percent CAGR (compound annual growth rate) since inception. This means an investment of ₹10,000 made at the time of allotment would have given a return of ₹13,004 by now, according to the details shared by the AMC.
Investment allocation
Its high return is not a result of fluke but it can be partly attributed to over one-fifth allocation to global funds, particularly Warren Buffett’s investment firm Berkshire Hathaway.
The top stock holdings in the mutual fund scheme are Berkshire Hathaway (6.84%), Veritas Global Focus Fund (5.84%), Harding Loevner Global Equity fund (5.12%), WCM Global Equity Fund (4.74%) and ITC Ltd (4.65%).
By market capitalisation, the fund scheme has 41.20 percent allocation in large caps, 22.40 percent in global funds, 16.20 percent in small caps, 12.50 percent in mid-cap and 7.60 percent in uncategorised.
The top sectors in which the mutual fund scheme has invested are mutual funds (20.19%), IT (8.76%), pharma (8.53%), finance (6.84%), aerospace & defence (4.83%) and diversified FMCG (4.65%).
Other key details
The expense ratio of the fund scheme is 1.71 percent as of Sept 7, 2022, and the exit load is up to one percent up to 12 months. The fund managers for the scheme are Aparna Karnik, Prateek Nigudkar and Jay Kothari. The minimum investment in the scheme is ₹500.
The level of risk in the investment is very high. Its benchmark is NIFTY 500 TRI.
The mutual fund house says that the value fund carries very high risk. This investing style may take you through long phases of under-performance, so only those investors are advised to invest who think of their investment horizon in terms of decades, not years.
"If you are impulsive and make investment choices based on short term returns, don’t consider this fund," says the fund houses while sharing details about DSP Value Fund.
