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  Ideal allocation: 70% multicaps, 30% midcap funds
Neelesh believes an ideal equity allocation now will be 70% in multicap funds and 30% in midcap funds. The midcap universe is 5 times bigger than large caps – which offers greater stock picking opportunities even when segment valuations appear stretched

48x fund growth vs 7x for market: that’s some alpha!
19.19% vs 9.23% over last 22 years sounds impressive enough in terms of alpha generation. Put it in absolute numbers, and it becomes a staggering 48x vs 7x. That’s the kind of wealth creation that HDFC Equity Fund has delivered over the last 22 years of its phenomenal history. And, as this open letter from Kiran and the appended presentation show, it has already taken fresh guard and is fully prepared for the next big cycle that the fund house sees playing out over the next 5-7 years.

  Theme that stands out now: Organizing India
Taher has moved from steering the equity ship of one process oriented fund house (Motilal Oswal) to another (Invesco). He believes the theme that stands out now in the market is “Organizing India” – aided by the upcoming GST implementation and wittingly or unwittingly by demonetization

2 reasons why fixed income looks attractive now
In the last 3 years, whenever real rates have gone up, it has been an opportunity to invest in fixed income. We have one such opportunity now. Never before has the target inflation differential between US (2%) and India (4%) been as low – there is a strong case for spread compression and therefore for yields to come off in India over time.

  Truly putting the investors’ interests first
Aditi takes us through the thinking that went into the tough decision to stop inflows into DSP BlackRock’s best-selling MicroCap Fund – an example of truly putting investors’ interests first

Duration strategies may not generate alpha in coming year
Markets are disappointed near term due to RBI’s change in stance – however the Union Government and RBI’s clear signals on not trading off macro stability for short term goals augurs well for long term prospects in duration funds. Over next 12 months, duration strategies may not generate significant alpha as we need to be prepared for a longish pause in the rate reduction cycle.

  Fund wohi – soch nayi
Mirae Asset’s new Dynamic Bond Fund’s initial portfolio is likely to be conservative, with a duration of 3-4 years, and is likely to be primarily constructed with CD/CPs, 3-5 years PSU bonds and some portion in govt bonds.

Closer look at the probable lead sector of this bull market
Shrey provides clear perspectives on a number of issues we raise on the BFSI space, including low recapitalization of PSU banks, road ahead for NBFCs post demonetization, questions on embedded value of bank branch networks in a digitized world and valuations in the sector.

  80C tax saving funds for risk averse investors
Suraj Kaeley takes us through UTI Smart Plan – a bouquet of 3 fund offerings with varying risk profiles, all of which qualify for 80C benefit – including UTI ULIP and UTI Retirement Benefit Pension Fund

From 1000 cr to 2000 cr in just 5 months
ICICI Prudential Long Term Plan doubles its AuM from 1000 cr in Aug 16 to 2000 cr by Jan 17. Wider acceptance of unique Current Account model based dynamic bond strategy, backed by robust consistent performance seen as main drivers of increased flows

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