Ashok Kumar, theIPOguru, is a man of few words. So, when he speaks, investors and particularly those chasing the IPO Rainbow with
the proverbial 'pot of gold' at the end of it, listen carefully.
While a whole lot of views are available on schemes which are ‘must haves’ in one’s portfolio, given the uncertain global scenario and volatile market conditions, it’s imperative to know which schemes are an AVOID to prevent investors from losing money or atleast cut losses.
I - JM HI FI Fund (JM Housing, Infrastructure & Financial Services Fund)
NAV: 5.10 Beta: 0.93 Sharpe Ratio: - 0.04 Date of Factsheet : January 29th, 2010
Obejctive: to generate medium to long term capital growth from portfolio of equity and equity related securities by investing in Housing, Infrastructure and Financial Service sectors.
Portfolio Analysis:
The fund hardly has any exposure to the front liners with highest exposure in the Banks, Finance and Ferrous Metals space. A scrutiny of the portfolio holdings over the last one year in terms of stocks and sectors indicates lack of consistency and a discernible strategy. The portfolio in that regard appears to be changing from month to month, which is hardly inspiring.
High exposure to Housing Finance Companies, Banks and Real Estate makes it vulnerable to interest rate movements, given that these sectors are sensitive towards the same and the expectations in rate hikes, they maybe highly volatile . Notable exposure to Auto & Auto Ancilliary stocks does not gel with its overall objective.
A very small corpus coupled with negative Sharpe ratio enhances its risk profile significantly and does not satisfy the risk return principle. Its exposure to the derivatives segment is 16.29%. Clearly, its one of the schemes which can be given a miss.
