L&T Business cycles Fund NFO 30 Jul 2014 to 13 Aug 2014
L&T Business cycles Fund NFO is open for subscription from 30 Jul to 13 Aug. The strategy of the fund is to use business cycles in the economy along with stock selection using L&T G.E.M. methodology for stock selection. It is well known that all economies go through business cycles. In other words every economy go through the periods of expansion and contraction. The fund aims to timing the business cycles to generate alpha returns in long run compared to other equity diversified funds.
Download L&T Business cycles fund NFOCommon Application form For Individuals. Problem in downloading the application? Contact for L&T business cycles fund NFO application by Post.
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L&T Business cycles Fund NFO is an open ended equity fund with concentrated portfolio across fewer sectors without any market cap bias. Stock selection is based on L&T proprietary G.E.M investment approach. The scheme is benchmarked against BSE S&P 200.
L&T Business cycles Fund NFO aims to invest predominately in equities and related products including equity derivatives. Its portfolio positioning is based on the stage of the economic or business cycle. Only medium term business or economic cycles are used in taking decision about investments and not swayed by short term movements. Investors should note that short term performance of L&T Business cycles Fund can be significantly different from other diversified equity funds due to nature of investment style. It has potential to provide higher alpha in Medium term to Long term, potentially outperforming in both raising and falling markets.
Minimum application amount is 5000 rupees and there after in multiples of 1 rupee. Exit load is applicable at 1% of NAV with in 18 months of purchase / allotment. Growth, Dividend Pay-out and Dividend Re-investment options are available. Both Direct and Non-Direct plans are available for investments. Investors can also have the option of SIP during NFO of L&T Business cycles Fund.
Download L&T Business cycles fund NFOCommon Application form For Individuals Cheques should be drawn in favour of “L&T BUSINESS CYCLE FUND”. Date should be On or after 30 Jul 2014. All cheques should be CTS2010 compliant. Should sign on 4th page and 5th page (If opting for SIP). If not KYC compliant, Download kyc form and submit along with A4 size pan card xerox and address proof. Photograph should be affixed and photocopies to be self attested. Problem in downloading the application? Contact for L&T business cycles fund NFO application by Post.
Key economic indicators to determine Business Cycle Stages
Historically business cycles tend to repeat in certain patterns which can be identified with relative reliability using some key indicators.
a) Macro-economic factors like Growth expectations in GDP and IIP, PMI, Investment cycle, Credit growth, Inflation, Interest rates and Money supply.
b) Anecdotal evidence through ground level research like Inventory levels, Corporate capex, Profit growth, Volume / Demand growth and Capacity utilization levels for core sectors.
c) Valuations like Overall stock valuations (deviation from historical mean), Upgrades / Downgrades, Valuation gap between cyclicals and defensives.
Performance of cyclicals and definsives during contraction and expansion stages of business cycles
Examples of Cyclical and Defensive Sectors
Examples of Cyclical are Industrials, Auto, Banking , Real estate, Infrastructure, Materials and Consumer durables. Similarly examples of Defensive sectors are Healthcare , Consumer staples, IT , Utilities and Telecom.
Reasons to invest in L&T Business cycles Fund NFO
Expected economic recovery due to improving global economy and stable government.
Improving macro environment like comfortable CAD (Current Account Deficit), Inflation off from peak levels, Stabilizing Indian Rupee against other currencies and bottom out of growth rates.
Some of the key indicators showing signs of recovery are Port Volumes, healthy expansion of PMI, Bottomed out M&HCV Sales and Power generation, corporate profit growth at low cyclical lows.
Suitability of L&T Business cycles Fund NFO to investors based on risk of investments
Mutual Fund investments are subject to market risks. Please read the offer document and KIM carefully before investing. Please consult your financial advisor before investing.