The Business Bytes
Mumbai, November 29, 2024 (TBB Bureau): DSP Mutual Fund has introduced its latest offering, the DSP Business Cycle Fund, an open-ended equity scheme designed to capitalize on business cycles. This innovative fund empowers investors to dynamically invest across large-cap, mid-cap, and small-cap companies, aligning with industries poised for growth, strong fundamentals, and attractive valuations.
The DSP Business Cycle Fund leverages a framework-driven approach to identify sectors and industries with high growth or turnaround potential. The fund allows for active allocation during upcycles, while deploying cash calls and other risk management strategies during downturns. Its unconstrained approach ensures exposure to promising opportunities, irrespective of market capitalization, offering investors a well-rounded investment vehicle.
The fund evaluates broader sectors at an industry level to identify opportunities at the bottom of their cycle, targeting significant growth potential. A dedicated forensic team screens out companies with questionable corporate governance, ensuring a high-quality portfolio. The fund employs strategies such as portfolio hedging through put options and arbitrage opportunities to safeguard against market volatility. Up to 10% of the portfolio may be invested in Real Estate Investment Trusts (REITs) or Infrastructure Investment Trusts (InvITs), especially when equity market opportunities are limited.
Charanjit Singh, Fund Manager at DSP Mutual Fund, emphasized the fund’s value in navigating market complexities. “Timing the entry and exit of themes can be challenging for individual investors and may lead to missteps. DSP Business Cycle Fund is structured to manage these transitions efficiently, offering a unique opportunity to capitalize on market dynamics while mitigating risks.”
The New Fund Offer (NFO) for the DSP Business Cycle Fund is open from November 27, 2024, to December 11, 2024, providing investors a limited window to participate in this innovative investment opportunity.
This fund positions itself as a versatile tool for investors, enabling strategic exposure to industries during growth phases and dynamic asset allocation for optimized returns across market cycles.
