To generate long term capital appreciation by investing predominantly in equity and equity related securities with a focus on riding business cycles through dynamic allocation between various sectors and stocks at different stages of business cycles in the economy. There is no assurance that the investment objective of the Scheme will be achieved.
The Scheme will aim to provide long-term capital appreciation by investing predominantly in equity and equity related securities with focus on riding business cycles through dynamic allocation between various sectors and stocks at different stages of business cycles. The Scheme will follow an active investment strategy with an aim to be well diversified across industries, sectors and market capitalization. A business cycle is basically defined in terms of periods of expansion and contraction. Each business cycle comprising of up cycle and down cycle typically has 4 phases (1) expansion - rising growth (2) peak - growth stabilizes at a high level (3) contraction - declining /slowing growth 4) trough - phase of weak/no growth. The fund manager will consider various economic parameters (like corporate profit growth trend, GDP growth, Current Account Deficit, fiscal deficit, interest rates, inflation etc.), investment indicators (like investment in capex, capacity utilization, credit growth, etc.), business and consumer sentiment which are leading economic indicators (purchasing manager index, business confidence index, sales of various consumer discretionary products, etc.) in addition to other parameters to decide the phase of business cycle. The relative performance of equity market sectors typically tends to rotate as the overall economy shifts from one stage of the business cycle to the next, with different sectors assuming performance leadership in different economic phases. The Scheme aims to identify economic trends and investing in the sectors & stocks that are likely to outperform at any given stage of business cycle in the economy. While constructing the portfolio, the Scheme would follow top-down approach for identifying the stage of business cycle and sector opportunities. Subsequently, through bottom-up approach Scheme endeavors to identify strong companies within the sectors identified.
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