Category: Your Money

Mutual Fund League Tables

shyam July 30, 2014September 9, 2014

AMFI puts out AUM statistics of mutual funds once a quarter. Here are some key take aways.

The Top 5 Dominate

Between 2009 and 2014, the top 5 players have remained the same: HDFC, ICICI, Birla Sun Life and Reliance. And their share has remained more-or-less the same: 56.96% in 2009 and 54.6% now.

32 out of a total of 46 funds have less than 2% share, 29 have less than 1%

There are way too many schemes

There are 1066 equity schemes (all permutations and combinations.) The top 2 schemes (both from HDFC) have more than 10% of AUM and the top 10 have about 30%. The rest of them fight for scraps.

Direct plans even the playing field

… a bit.

PPFAS has a 5% share of all direct plans.

However, Direct plans are yet to make a dent

Equity AUM under direct plans have doubled since last year. This ought to be giving distributors sleepless nights…

Categories Investing Insight, Your Money Tags mutual funds

Bonds, Rates and USDINR Update

shyam July 28, 2014September 9, 2014

The Yield Curve

Lets put the current zero-coupon yield curve in context.

Jan 2011 vs. Now

Jan 2012 vs. Now

Jan 2013 vs. Now

Indian 10 yrs vs. US

After the initial Modi euphoria, the spread between Indian 10 yrs and US 10 yrs started to revert back to its mean:

Total Return Indices

Investors in the long bond are yet to recover from the July 2013 draw-down but this year is looking good. Long-bond might just be the place to be as the RBI is widely expected to get into easing mode later this year/early next year.

Cumulative Returns Since 2000

Short

Intermediate

Long

Cumulative Returns Since 2010

Short

Intermediate

Long

Bond ≠ Boring

Returns have been volatile for bond investors.

Can’t really sell “stability” here.

USDINR

A new normal past the euphoria and the hangover?

In closing

With inflation somewhat stabilizing and the NDA-II government wanting to kick start growth, bonds are getting interesting again. And when rates start moving, currencies cannot be far behind.

Stay updated on the latest news related to Indian interest rates here. Its curated.

Categories Investing Insight, Your Money Tags bonds, rates, returns, USDINR

A Real Live Innovator’s Dilemma

shyam July 27, 2014September 9, 2014

The last time I wrote about innovation, I pointed out some of the most common problems that innovators face (The Disruptor’s Dilemma) and how incumbents can use regulation to stymie the disruptor. Peter Yared has an interesting post up on Techcrunch on how BMW is responding to Tesla’s onslaught and winning. Here’s the tl;dr:

Legacy companies can mislabel their products to leverage their brand, especially if an upstart compares itself directly to a particular model.
Legacy companies are often willing to hodgepodge new technology with their older technology to stave off new competitors
Innovators should not underestimate the power of a legacy company’s large, lumbering sales channel.
Legacy companies are often in numerous segments of a market and leverage their scale to beat an upstart’s roadmap.

Read the whole thing here: BMW Vs. Tesla

Categories Investing Insight, Your Money Tags innovation

Weekly Recap: 8 Truths

shyam July 26, 2014

The Nifty posted a decent +1.65% this week (+1.96% in USD) in spite of Friday’s sell off.

Equities

Major
DAX(DEU)	-0.78%
CAC(FRA)	-0.11%
UKX(GBR)	+0.62%
NKY(JPN)	+1.59%
SPX(USA)	+0.16%

MINTs
JCI(IDN)	+0.04%
INMEX(MEX)	+0.70%
NGSEINDX(NGA)	-1.41%
XU030(TUR)	+2.49%

BRICS
IBOV(BRA)	+1.15%
SHCOMP(CHN)	+3.28%
NIFTY(IND)	+1.65%
INDEXCF(RUS)	-2.43%
TOP40(ZAF)	-0.37%

Commodities

Energy
Brent Crude Oil	+1.03%
Ethanol	+1.91%
Heating Oil	+2.17%
Natural Gas	-4.23%
RBOB Gasoline	+0.10%
WTI Crude Oil	-1.26%

Metals
Copper	+1.89%
Gold 100oz	-1.08%
Palladium	-0.19%
Platinum	-0.50%
Silver 5000oz	+0.00%

Currencies

USDEUR:+0.73% USDJPY:+0.47%

MINTs
USDIDR(IDN)	-0.32%
USDMXN(MEX)	-0.10%
USDNGN(NGA)	-0.09%
USDTRY(TUR)	-1.39%

BRICS
USDBRL(BRA)	+0.10%
USDCNY(CHN)	-0.26%
USDINR(IND)	-0.30%
USDRUB(RUS)	+0.03%
USDZAR(ZAF)	-1.23%

Agricultural
Cattle	+4.70%
Cocoa	+2.80%
Coffee (Arabica)	+9.03%
Coffee (Robusta)	+1.09%
Corn	-2.42%
Cotton	-5.41%
Feeder Cattle	+2.91%
Lean Hogs	-2.67%
Lumber	+0.06%
Orange Juice	-3.14%
Soybean Meal	+4.63%
Soybeans	+2.82%
Sugar #11	+1.00%
Wheat	+1.22%
White Sugar	-0.47%

Nifty Heatmap

Index Returns

Sector Performance

Market Cap Decile Performance

Decile	Mkt. Cap.	Advance/Decline
1 (micro-cap)	-6.16%	68/66
2	-0.32%	62/72
3	-3.25%	60/74
4	-0.68%	62/72
5	+0.39%	70/64
6	-2.19%	60/74
7	+0.03%	65/69
8	-1.79%	60/74
9	-0.05%	66/68
10 (mega-cap)	+1.07%	70/64

Most of the market performance was centered around large-caps.

Top Winners and Losers

HDFC	+8.62%
ASIANPAINT	+9.81%
GLENMARK	+11.84%
CAIRN	-10.61%
CROMPGREAV	-8.26%
DLF	-7.35%

A dick move by Cairn sent its stock reeling. After insisting that it need the cash for expansion (and not paying it out in dividends and being less than honest about its buyback), it loans $1.25 billion to Vedanta. Independent directors sleeping at the wheel as usual.

ETFs

NIFTYBEES	+1.47%
BANKBEES	+0.09%
INFRABEES	-0.79%
JUNIORBEES	-1.64%
GOLDBEES	-1.70%
PSUBNKBEES	-4.69%

Banks vs. PSU banks – its a walk off!

Investment Theme Performance

Financial Strength Value	+2.40%
Long Term Equity*	+1.70%
Efficient Growth	+1.62%
Consistent10*	+1.47%
Market Elephants	+1.46%
Enterprise Yield	-0.12%
IT 3rd Benchers	-0.22%
Growth with Moat	-0.24%
Quality to Price	-0.55%
Balance-sheet Strength	-1.27%
Refract: PPFAS Long Term Value Fund⁺	-1.42%
Magic Formula Investing	-1.44%
Industrial Value	-2.47%
ADAG Mania	-2.55%
Momentum 200	-4.88%
Market Fliers	-5.88%

We have this thing called “Refract” going on where we plan to take the NSE equity only portion of a mutual fund’s portfolio and setup an equally weighted theme. Its a live experiment, so follow along…