FUND PICK: UTI MNC Fund

High returns, low risk

UTI MNC Fund has been ranked in the top 30 percentile (CRISIL Fund Rank 1 or 2) since June 2011, except for the June 2014 quarter. Launched on May 29, 1998, its primary objective is to create value through long-term capital growth by investing predominantly in equities of large-cap and mid-cap multinational corporations (MNCs) across sectors. Managed by Swati Kulkarni, the fund's quarterly average assets under management for the June 2015 quarter was Rs 1,084 crore.

The fund has outperformed its benchmark (CNX MNC Index) and the category (average performance of schemes defined under the CRISIL Mutual Fund Ranking - Diversified Equity Category as of June 2015) across various time frames.

An investment of Rs 1,000 in the fund at inception would have grown to Rs 6,299 by August 31, 2015 - an annualised return of 20 per cent vis-à-vis the peer group's 16.54 per cent (Rs 4,687) and the benchmark's 16.45 per cent (Rs 4,652).

And someone investing through the systematic investment plan route since inception would have generated 22.01 per cent compounded annual growth rate returns vis-à-vis the benchmark's 15.84 per cent.

The fund has performed well even on a risk-adjusted basis, as reflected in a higher Sharpe ratio of 2.24, compared with the category's 1.23 and the benchmark's 1.06 over the past three years ended August 31, 2015.

The fund has lower exposure (58.25 per cent) to CRISIL-defined large-cap stocks, compared with peers (67.08 per cent). It has consistently held 27 stocks for the past three years, with Maruti Suzuki, Bosch, Eicher Motors and Hindustan Unilever among the top returns generators.

The fund has higher exposure to pharmaceuticals, auto and auto ancillaries, which have delivered superior returns of 31.65 per cent (as represented by CNX Pharma) and 30.67 per cent (as represented by CNX Auto), respectively, compared with the benchmark's 24.98 per cent.