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Bond, G-sec funds score points in market melee - Views on News from Equitymaster
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  • Apr 27, 2000

    Bond, G-sec funds score points in market melee

    The market volatility over the past few days witnessed growth fund net asset values (NAVs) being shaved off by over 20% in just a week. Growth funds have hogged the limelight so far distracting investors from the staid (and better performing) Bond and Government Securities Funds.

    The hammering that most stocks (particularly software) have received over the last two weeks saw a corresponding decline in growth fund NAVs, with software funds being hit the hardest. Other so-called Balanced Funds with heavy exposure to software stocks also suffered. While equities were the villains, the fixed income securities market was relatively unaffected in the last couple of weeks. This translated into moderate, but stable growth for income fund investors.

    Open-ended / Bond Schemes NAV
    Deposit I-NIT 1997 (Plan A) 11.0 5.0% 1.2% 0.0% 25.6%
    Birla Income Plus B 17.9 0.4% 1.8% 13.6% 15.2%
    Birla Income Plus A 10.0 0.3% 1.7% 12.8% 14.9%
    Chola Triple Ace (Gr) 14.8 0.3% 1.0% 13.3% 13.4%
    Escorts Income Plan (Gr) 13.0 0.3% 1.4% 14.5% 14.3%
    Dundee P S B Fund (App) 10.9 0.2% 0.4% 0.0% 8.4%
    Dundee Liquidity Fund (Gr) 11.5 0.2% 0.8% 12.9% 12.5%
    Dundee Corp. Bond Fund (App) 10.7 0.2% 0.5% 0.0% 6.2%
    IL&FS Bond Fund (Gr) 110.7 0.2% 1.6% 0.0% 10.2%
    ING Income Portfolio (Gr.) 11.3 0.2% 1.4% 0.0% 11.7%
    LIC MF Bond Fund (Gr) 11.5 0.2% 1.3% 0.0% 13.7%
    Alliance Cash Manager 1,184.1 0.1% 0.6% 9.5% 9.0%
    Birla Cash Plus (Gr) 13.0 0.1% 0.6% 9.5% 9.6%
    DSP Merrill Lynch Bond (Growth) 14.5 0.1% 1.8% 13.7% 13.0%
    DSP Merrill Lynch Liquidity (Growth) 11.9 0.1% 0.4% 8.7% 8.4%
    JF India Bond Fund (Gr) 13.7 0.1% 1.8% 14.0% 13.7%

    Investors who had invested in growth and IT funds to ride the equity boom, may want to review their portfolios given the irrational behaviour of stock markets. A higher exposure to income/g-sec funds may lend some stability to their portfolios in times of such volatility. However, investors should also be wary of the interest rate risk that is inherent in income/g-sec funds.

    Open-ended / G-Sec Schemes NAV
    Tata Gilt Sec Fund A (Reg) 10.8 1.6% 3.9% 14.3%
    Tata Gilt Sec Fund B (App) 11.5 1.1% 3.8% 14.8%
    LIC MF Govt. Sec. Fund (Gr) 10.7 0.2% 2.2% 6.8%
    Alliance Govt. Sec. (ST) (Gr) 1,067.3 0.2% 2.1% 6.5%
    K Gilt Savings Plan (Gr) 11.5 0.2% 1.2% 11.2%
    Birla Gilt Plus Liquid Plan (Gr) 10.9 0.2% 1.8% 8.5%
    DSP-ML Govt. Sec. Fund B(Div) 10.3 0.2% 1.6% 1.4%
    DSP-ML Govt. Sec. Fund B(Gr) 10.7 0.2% 1.6% 6.7%
    Birla Gilt Plus Liquid Plan (Div) 10.4 0.2% -2.2% 4.3%
    Pru ICICI Gilt(TP) (Gr) 11.1 0.2% 2.6% 10.2%
    Dundee Sovereign Trust (Gr) 11.4 0.2% 1.7% 11.1%
    JM G-Sec Fund (PFP) (Gr) 11.1 0.1% 2.3% 11.0%
    Zurich (I) Sov Gilt (IP) (Gr) 10.2 0.1% 1.7% 1.7%
    JM G-Sec Fund (RP) (Gr) 11.0 0.1% 2.7% 10.1%
    Cangilt PGS (Income Plan) 10.3 0.1% 2.7% 5.5%
    Alliance Govt. Sec. (LT) (Gr) 1,091.6 0.1% 3.9% 9.1%
    K Gilt Investment Plan (Gr) 12.0 0.1% 2.8% 14.6%
    UTI G-Sec Fund (Gr) 110.9 0.1% 3.2% 9.9%
    Cangilt PGS (Gr Plan) 10.6 0.1% 3.0% 5.8%



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