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Business Standard
09-06-2025
- Business
- Business Standard
FoF expense structure not consistent across schemes, says DSP MF
The expense ratio of fund of funds (FoFs), a mutual fund category witnessing renewed interest following Budget 2024 tax changes, may be masking the real cost in several schemes, DSP Mutual Fund said in a report on Monday. FoF investors pay costs on two fronts — the expenses charged by the fund house for managing the FoF and the total expense ratio (TER) of the underlying schemes. "Investors often focus only on the expense ratio of the FoF wrapper (the fund that they directly invest in), without realising that there is also an additional hidden cost: the expense ratio of the underlying fund(s)," the fund house said. In the note, DSP MF said it has opted to disclose the total expenses of all its FoFs. "At DSP, in the spirit of full transparency, we disclose the Total Expense Ratio (TER) of our Fund of Funds (FoFs), which includes both the cost of the FoF itself and that of the underlying funds. We believe this comprehensive disclosure is essential for investors to make well-informed decisions that accurately reflect the true cost of their investments," it said.
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Business Standard
09-06-2025
- Business
- Business Standard
FoF expense ratios inaccurate in select schemes, says DSP Mutual Fund
The expense ratio of fund of funds (FoFs), a mutual fund category witnessing renewed interest following Budget 2024 tax changes, may be masking the real cost in several schemes, DSP Mutual Fund said in a report on Monday. "Investors often focus only on the expense ratio of the FoF wrapper (the fund that they directly invest in), without realising that there is also an additional hidden cost: the expense ratio of the underlying fund(s)," the fund house said. In the note, DSP MF said it has opted to disclose the total expenses of all its FoFs. "At DSP, in the spirit of full transparency, we disclose the Total Expense Ratio (TER) of our Fund of Funds (FoFs), which includes both the cost of the FoF itself and that of the underlying funds. We believe this comprehensive disclosure is essential for investors to make well-informed decisions that accurately reflect the true cost of their investments," it said.
Time of India
03-06-2025
- Business
- Time of India
NFO Alert: DSP Mutual Fund launches index funds on IT and Healthcare sectors
DSP Mutual Fund has launched two new index funds — the DSP Nifty IT Index Fund and the DSP Nifty Healthcare Index Fund . These offerings provide investors a strategic avenue to gain exposure to the IT and healthcare sectors, both known for their relative resilience in volatile equity markets. The new fund offer, or NFO , for both funds, is open for subscription and will close on June 16. The DSP Nifty IT Index Fund aims to replicate/track the Nifty IT Index and would be investing in the top 10 IT companies by free float market capitalisation. The Indian IT sector has demonstrated smooth earnings growth with relatively low earnings variability, which has helped to reduce earnings surprises. Over the last 12 years, the Nifty IT index has delivered consistent earnings growth, outperforming many other sectors. While the IT sector has underperformed the broader market in recent years, historical cycles suggest potential for a turnaround, making this an opportune moment for investors to consider sector-focused exposure. Best MF to invest Looking for the best mutual funds to invest? Here are our recommendations. View Details » Also Read | NFO Insight: Nippon Income Plus Arbitrage Active FoF opens. Is it time to add this emerging category to your portfolio? The DSP Nifty Healthcare Index Fund aims to replicate or track the Nifty Healthcare Index, investing in the top 20 healthcare companies based on free-float market capitalisation. Notably, India's healthcare sector accounts for a relatively small share of the country's total market capitalisation compared to developed and emerging markets. This indicates significant growth potential, supported by expanding healthcare infrastructure, rising insurance penetration, and ongoing medical innovation. Live Events "The launch of the DSP Nifty IT Index Fund and DSP Nifty Healthcare Index Fund offers investors a balanced approach to participate in sectors that combine growth with resilience. In uncertain market environments, defensive sectors like IT and healthcare have seen lower drawdowns, with the potential to deliver attractive returns,' said Anil Ghelani, CFA, Head of Passive Investments & Products at DSP Mutual Fund. 'By strategically including low-beta sectors such as Information Technology and Healthcare, investors can construct a more resilient and efficient portfolio, which may help them optimise returns and effectively manage market risk. Defensive sectors are currently underrepresented in broader indices, and history shows that when underweight, sectors like IT and Healthcare tend to outperform the market over the following year. Our disciplined passive management approach aims to closely track these sectors, helping investors capture structural growth with lower volatility,' said Gurjeet Kalra, Business Head – Passive Funds, DSP Mutual Fund. Also Read | Gold prices may fall 12-15% in next 2 months, warns Quant Mutual Fund Defensive sectors such as Information Technology (IT) and Healthcare have historically exhibited low beta relative to the broader equity market, meaning they are less affected by market downturns, economic crises, or geopolitical events. For instance, during the Global Financial Crisis (Jan – Oct 2008) and the Covid-19 pandemic (Jan – March 2020), Nifty Healthcare and Nifty IT indices outperformed the broader Nifty 500 Index by experiencing lower drawdowns and quicker recoveries. These sectors benefit from diversified global revenues, which reduce their dependence on domestic economic cycles. To put this in context of numbers, ~ 96% of total revenues for the companies in the Nifty IT Index come from various global markets other than India. Notably, 52% of the total revenues for companies in the Nifty Healthcare Index are derived from global markets, compared to just 25% for companies in the Nifty 50 Index.
Mint
15-05-2025
- Business
- Mint
After a glittery rally, gold may be about to make way for stocks
'However, gold prices still have room for improvement with eventual (US) rate cuts on the horizon and continuous central bank buying. Till then, gold can find a key support at the $3080 per ounce level," she said. But gold's geopolitical risk premium is beginning to fade as the ongoing US-China trade negotiations have shown significant progress, noted Apurva Sheth, head of market perspectives and research at Samco Securities. Also read: Early birds report of a steady yet muted Q4 Last week, the US agreed to cut duties on Chinese exports to 30% from 145% for 90 days, while China reduced its tariffs on US goods to 10% from 125% for the same period, signalling an intent to de-escalate and move towards a structured trade agreement. 'This has reduced the need for investors to seek shelter in traditional safe-haven assets like gold," Seth added. In fact, during the latest Mint quarterly market survey, Jay Kothari, lead equity strategist at DSP Mutual Fund, noted that the best way to play gold from hereon is through gold-related equities. Uncertainty's gold Uncertainty defined FY25, marked by shifting policies and global tensions. Gold capitalized on this instability, outshining other asset classes. To be sure, gold returned around 27% in 2024, outperforming every other asset class and marking its ninth consecutive annual gain last year. A couple of ongoing wars, relentless central bank buying – for diversifying reserves and reducing reliance on the US dollar – and a weakening global outlook drew investors to gold, as they faced a spate of uncertainties in the near term. US president Donald Trump's tariff tantrums and the recent rout in the US currency and treasury market further increased the appeal for gold as the only reliable safe haven asset, further fuelling its rally in 2025. Indian investors appear to taking a U-turn from safe haven gold to riskier assets like equities, as green shoots of geopolitical stability begin to emerge across the globe. With the precious metal already delivering returns as high as 25% in the first four months of 2025, experts believe there is limited room for significant upside, especially as global uncertainties begin to wane. This likely explains why domestic gold exchange traded fund (ETF) redemptions reached a one-year high last month. Also read: Banks' Q4 earnings hit an 8-quarter high. But that's not driven by loans Moreover, gold has remained under pressure lately, with prices being very volatile in the last three to four weeks. Going forward, Kaynat Chainwala, associate vice-president of commodity research at Kotak Securities, anticipates a 7-8% correction in gold prices in the short term, driven by easing US-China trade tensions. In India, gold prices touched an all-time high of ₹100,000 per 10g in the retail market last month. The surge in demand for the yellow metal reached a 15-year high in 2024, fuelling its meteoric price rise. Gold demand in the country reached 4,974 tonnes in 2024, mainly driven by jewellery and investment demand, which accounted for 40% and 24% of total gold demand respectively, according to the latest NSE Market Pulse report. Also read: What the market crystal ball sees for the next 3 months While total demand rose 0.6% on a year-on-year basis, albeit on a high base, demand for gold investment rose the highest at almost 25% during the same period. Equities turn? But how long will this heightened investment demand for gold endure? A recent Motilal Oswal Financial Services report highlighted that with domestic equities underperforming, the gold price to Nifty-50 index ratio has already breached its historical median and is now nearing its FY16 peak of 4.2x. Historically, such levels have suggested a higher probability of equities outperforming gold in the future. Could a sustained recovery in equities alter this dynamic? In fact, even though gold has outperformed domestic equities in a one to three-year timeframe, from a very long-term perspective, equites have historically delivered superior returns. Hence, experts are advising caution in investing in gold going forward. 'Investors should invest in a staggered manner as and when gold (prices) falls from here on, instead of going all in. While existing uncertainty around US's trade deals will support gold prices for the next few months, we are expecting a consolidation phase in the near term," said Pranav Mer, vice-president of the equity broking group's commodity and currency research team at JM Financial Services. MCX Gold is likely to consolidate in a range of ₹91,542 to ₹93,034, which is at a 50-62% retracement level of the recent rally from ₹86,710 to ₹99,358, noted Seth from Samco Securities. On booking profits, Mer from JM Financial Services suggested that investors should book profits whenever gold rallies from current levels. In fact, investors began redeeming in March, with gold ETFs seeing their first net outflows in over a year that month. In April, however, redemptions reached a one-year peak at ₹ 1,669 crore.
Economic Times
14-05-2025
- Business
- Economic Times
‘Sovereign stupidity' and currency debasement make gold a smart hedge in volatile times: Sahil Kapoor
Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel In an exclusive conversation, Sahil Kapoor , Market Strategist and Head of Products at DSP Mutual Fund, shares his sharp take on the ongoing market volatility driven by geopolitical tensions, trade wars, and muted corporate highlights gold's continued strength as both a hedge and a wealth-building asset amid what he terms 'sovereign stupidity' and global currency debasement With valuations stretched across segments and earnings growth under pressure, he advises a cautious and value-focused investment approach while positioning gold and even silver as smart plays in the current macroeconomic landscape. Edited Excerpts –A) The outcome of either event is unknown. What is more certain is that these events are either growth detractors or non-events. In the case of the ongoing trade wars, history shows that there are no winners when trade barriers are the long term, we may see some benefits from tariffs in making certain economies more robust, but their consequences for a world built on global trade are unhealthy. We are not experts on wars or their one thing is clear: for corporate earnings, events such as war can either pose downside risks or be non-events. Investors are better served by remaining cautious, given the valuation backdrop.A) A diversified mix of assets-including domestic and global equities, precious metals, and bonds-is a robust allocation exact proportions should be tailored to individual goals and guided by valuation frameworks for each asset class.A) As of 28th April 2025, 18 Nifty firms have reported their numbers. Sales growth stands at 5%, while profit growth is 4.8%. Nifty firms have now cumulatively reported single-digit profit growth in most of the last four contrast, the Nifty Index's trailing twelve-month price-to-earnings (P/E) ratio is close to 22 times. The return on equity (ROE) for the index is at 15.5%.This valuation mix leaves little on the table in terms of a margin of safety. Corporate earnings remain muted and a cause for concern.A) Gold has been a hedge against global currency debasement and what I have dubbed as 'Sovereign Stupidity'. As per my theoretical model to value Gold, the midpoint of valuations comes close to $ it is very hard to value assets like precious metals and hence it makes sense to remain long in the ongoing Gold bull market and not second guess where it ends. From a risk reward stand point, Silver may offer better odds for investors at this time.A) As of 28th April 2025, Nifty MIDSMALL 400 Index, the SMID focussed index was trading at 33.2 times. Earnings growth for this cohort is in single digits, and it also trades at a 90% premium to world midcap numbers when put in the right context tell you that the margin of safety is missing. Unless valuations become attractive investors should only use a SIP route in this segment and avoid lumpsums and performance chasing.A) Stocks in the BFSI segment, particularly private banks, a few NBFCs, select auto and consumption companies along with the healthcare sectors offers value on a bottoms up basis.Q) How are FIIs viewing Indian markets? We have seen some net buying in the past few sessions, but for the month, FIIs have pulled out more than Rs 13,000 crore from the cash segment of Indian equity markets.A) All investors—whether institutional or retail, domestic or foreign—are broadly return chasers. Our tendency to label investor flows as FII, DII, or SIP can be key impact of FII flows is not on stock market returns per se, but on India's balance of payments. That segment is currently doing fine, but the global trade war has made it more volatile.A) We were valuations focussed and continue to remain so. We may also want to take benefit of cheaper prices if these events and triggers create value in pockets of high quality.(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
