DSPML Balanced-G

The DSPML Balanced fund has a few weak points, but it is one fund that gives out consistent returns. It might not be an obvious option, but the fund is certainly worth a look in

Though it has delivered above average performances, and even managed top quartile returns in a few years, DSPML Balanced does not turn heads.

Its tactical asset allocation has done little to deliver impressively. Over the past 21 months, the equity exposure has fluctuated in a wide range of 9 percentage points. According to the September 2007 portfolio, the fund has parked 72 per cent of its assets in equity.

The tilt towards mid- and small-cap stocks from December 2006 is here to stay. This automatically gives the fund a riskier tilt. To balance the effect, the shift was accompanied by an increase in the number of scrips from 60 to as many as 75.

Clearly, the fund shies away from taking big sector or even stock specific bets. So don't expect trailblazing returns from such a portfolio. But then one does not look for such returns in a balanced fund.

Our grouse is that even in bearish phases, the fund's track record is not consistent. The instances of the fund losing much less than the category average have been offset by times when it fell much harder than the average. In the recent lean quarters of June 2006 and March 2007, the fund lost as much as the average player. So investors cannot even count on the fund to limit downside risk.

Having listed the weak points, what you can expect from this fund is stability and consistency of returns. The fund will not knock the lights out, but its performance will be in line with the category average.

All in all, the fund may not be the first choice but it is definitely worth a second look.

(by value research)