Investment Objective
DSP Mid Cap Fund seeks to generate long term capital appreciation from equity and equity related instruments of midcap companies. The fund manager will also invest in other equity and equity related securities for optimal portfolio construction.
Investment Strategy
- The fund focuses on companies with consistent earnings and having the potential for significant growth.
- It invests in stocks that can potentially benefit from re-rating.
- It focuses on identifying companies having durable businesses and led by capable management teams, which can generate strong financial performance and have the potential to become future leaders.
- The fund uses bottom-up approach for stock selection and focuses on companies registering high earnings growth and ROE.
- It tends to avoid companies having issues such as corporate misgovernance, capital misallocation and red flags regarding related party transactions. It also avoids companies that are sensitive to regulatory changes, belong to highly cyclical industries or have complex organisational structures.
- Apart from quantitative factors, the fund also uses qualitative factors like governance standards, leadership, proven track record, capital allocation, stakeholder relationships, integrity and passion for the purpose of stock selection.
Who Should Invest
- Investors having an investment horizon of 5 years and above.
- SIP investors who are disciplined enough to continue their SIP for longer tenures.
- Experienced investors having a well-set core portfolio and looking to tactically allocate 10-15% of their overall portfolio to very high-risk opportunities.
- Those who can tolerate high risk, given the higher degree of risk involved in this fund for generating higher returns.
- Investors with patience and mental resilience to stay invested through market cycles for a decade or longer.
- Seasoned investors who view market corrections as opportunities to increase their investments.