Why Is Reliance Pharma Fund One of the Best in its Category?
Pharma sector has been under watch by the sectoral investors after it sparkled in the post-recession momentum of 2008. Reliance Pharma Fund was the scheme which was benefited the most with a marvellous 175% return within a year in 2009-2010. The experts at MySIPonline have analysed various parameters in detail to help the investors make an informed investment in Reliance Pharma Fund.
Attributes of Reliance Pharma Fund (G)
Reliance Pharma Fund growth can be considered as the best pharmaceutical sectoral fund as it has a lesser standard deviation as compared to the benchmark and peers with a positive alpha of 5.77 while the alpha of the category is 1.55. It means that Reliance Pharma Fund has generally provided 5.77 more percentage returns than the benchmark. It has smartly handled the positive trends in the pharma sector of the economy and has always beaten its benchmark in the positive trends with exceptional returns. The negative markets of 2008, 2011 and 2013 have been a barrier to the continuous growth of the fund since inception.
The Sharpe and Sortino ratios are currently negative as the market has been harsh on pharma in the recent years, but the figures are in a much better position as compared to the benchmark and peers as it possesses a beta of 0.71. The trailing returns of the last 10 years are 19.85% and 5 years are 16.01 while the benchmark returns for 5 and 10 years are 11.67% and 6.85%, respectively. (data as of 9th Aug 2018)
Investment Style and Portfolio
Reliance Pharma Fund follows a well-researched strategy of growth investing by selecting the quality stocks with an average PE ratio of 36.04%. The number of stocks is generally kept at 20 with a high concentration on the healthcare firms with growth potential. The low number of good quality stocks is the reason why it has beaten its benchmark and peers with such a considerable margin. Large-cap stocks possess the majority of the corpus, 30-40% of the corpus is allocated in equity instruments of mid-cap companies. Generally, 10% of the corpus is invested in small-cap companies. The top 5 holders possess more than 45% of the stocks, namely Sun Pharmaceuticals, Cipla, Divi's Laboratories, Dr Reddy's Lab, and Aurobindo Pharma. (data as of 9th Aug 2018)
Who Manages the Fund?
Reliance Pharma Fund is managed by Mr Shailesh Raj Bhan who is an expert in managing the sectoral and thematic equity funds. He has handled the scheme through the ups and downs of last 13 years. He is an MBA in Finance and CFA and has more than 19 years of experience in equity research and fund management.
Who Should Buy?
The pharma sector has been volatile in recent years; as a result, the NAV of Reliance Pharma Fund is low at the moment which can be well utilised by a lumpsum investment according to experts at MySIPonline. To be on the safer side, SIP can also provide handful returns at lower risk. The pharma sector is expected to bounce back in the upcoming years. Hence, the Reliance Pharma Fund can be a good bet for long-term investment according to the current market scenario. The investors can invest through MySIPonline and take the assistance of the financial experts available 24*7.