Monday, June 8, 2009

Reliance Equity Advantage Fund Under Performs The Time Period - June 08, 2009

Background: Reliance Capital Limited is the sponsor of Reliance Capital Assets Management Ltd set up in June 1995. Reliance Capital Ltd. is a member of the Reliance Group and has been promoted by Reliance Industries Limited (RIL), one of India's largest private sector enterprises. The fund house manages assets worth Rs 1,02,730.16 crore at end of May 2009.

Reliance Equity Advantage Fund (G) an open-ended equity diversified scheme launched in June 2007. The primary investment objective of the scheme is to seek to generate capital appreciation & provide long-term growth opportunities by investing in portfolio predominately of equity & equity related instruments with investments generally in S & P CNX Nifty stocks and the secondary objective is to generate consistent returns by investing in debt and money market securities.

The minimum investment amount is Rs.5000 and in multiples of Re.1 thereafter. The unit NAV of the scheme was Rs 10.13 as on 5 June 2009.

Portfolio: The total net assets of the scheme increased by Rs 381.37 crore to Rs 1944.47 crore in May 2009.

Reliance Equity Advantage Fund (G) took fresh exposure to one stock in April 2009. It has purchased 33.88 lakh units (1.38%) of Suzlon Energy.

The scheme exited completely from Steel Authority of India by selling 15.06 lakh units (1.05%) in April 2009.

Sector-wise, the scheme took no fresh exposure to any sector in April 2009.

Sector-wise, the scheme did not exit completely from any sector in April 2009.

The scheme had highest exposure to Reliance Industries with 7.02 lakh units (8.10% of portfolio size) followed by State Bank of India with 7.00 lakh units (5.73%), Oil & Natural Gas Corporation with 7.69 lakh units (4.26%) and ITC with 34.13 lakh units (4.13%) among others in April 2009.

It reduced its exposure to Tata Consultancy Services by selling 2.29 lakh units to 4.01 lakh units (by 0.86%), Hindustan Unilever by selling 2.46 lakh units to 7.53 lakh units (by 0.59%), Tata Steel by selling 4.02 lakh units to 13.98 lakh units (by 0.55%) and ITC by selling 9191 units to 34.13 lakh units (by 0.44%) among others in April 2009.

Sector-wise, the scheme had highest exposure to Refineries at 12.10% (from 12.11% in March 2009), followed by Computers - Software – Large at 8.85% (8.22%), Telecommunications - Service Provider at 7.03% (7.22%) and at Power Generation And Supply 5.84% (4.13%) among others in April 2009.

Performance: The performance of scheme is benchmarked against S&P CNX Nifty. The scheme has underperformed the benchmark index over most of the time periods.

The scheme has posted returns of 23.60% underperforming the S&P CNX Nifty that gained 24.51% over 1 month period ended 5 June 2009. Over 3 months period, the scheme advanced by 66.57% underperforming the benchmark index that gained 75.06%. It fell 0.46% less than the benchmark index that declined by 0.88% over 1 year period.

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