DSP Flexi Cap fund is a mutual fund that invests across various market capitalizations and sectors including large-cap, mid-cap, and small-cap stocks. These funds are provided by DSP Investment Managers which is a well-known asset management company in India.
Understanding DSP Flexi Cap Fund
DSP Flexi Cap Fund has flexibility in terms of asset allocation. The fund manager invests and adapts to changing market conditions across the entire financial market.
DSP Flexi fund aims to generate long-term capital appreciation by investing in a diversified portfolio of stocks. The fund manager analyzes many factors including company fundamentals, industry trends, and market conditions to make investment decisions. The portfolio composition changes over time, based on the fund manager's assessment of market opportunities. Here are some key features of DSP Fund:
Diversification
DSP fund has a diversified portfolio which means they invest in a wide range of stocks from various sectors and market capitalizations.
Risk-Return Profile
The risk-return profile of the DSP Flexi Fund varies depending on the fund's investment choices. The risk can be moderate to high as it invests in mid-cap and small-cap stocks which are generally more volatile than large-cap stocks.
Active Management
The fund manager plays a crucial role in actively managing the portfolio by making investment decisions based on research and market analysis. A fund manager’s objective is to optimize returns for investors.
Investor Suitability
This fund is suitable for investors with high-risk tolerance. These funds are appropriate for investors who want exposure to a diversified equity portfolio and are willing to stay invested for an extended period.
Regulation
SEBI's categorization and classification of mutual funds make sure that the fund follows a predefined investment strategy and maintains transparency in the fund's portfolio composition.
A Practical Example of DSP Flexi Cap Fund
For example, the DSP Flexi-Cap Fund has identified a potential investment opportunity in the Indian IT sector. The fund manager believes that the IT sector has potential for growth due to increasing digitization and demand for technology services.
In this scenario, the fund manager allocates a portion of the fund's assets to large-cap IT companies such as Infosys and Tata Consultancy Services (TCS). These companies have a strong track record, established client relationships, and a wide range of IT services.
Additionally, the fund manager also allocates a portion of the fund's assets to mid-cap IT companies such as Mindtree or L&T Infotech. These companies have higher growth potential but also carry higher risks than their larger counterparts.
The DSP Flexi Cap Fund aims to benefit from the Indian IT sector while managing risk through diversification by investing in a mix of large-cap and mid-cap IT companies.
Latest Asset & Portfolio Allocation
As of September 2023, the DSP Flexi Cap fund maintains a balanced portfolio. The following is a breakdown of the portfolio's asset allocation:
Equity:
The majority of the portfolio constituting 97.66%, is allocated to equity assets. This shows the fund's primary focus on equity investments.
Debt:
As of the same date, there is no allocation to debt instruments. This indicates a strong equity-oriented approach by the fund.
Other:
A minor allocation of 2.34% is directed towards other asset classes which could include instruments such as cash or cash equivalents.
The portfolio’s allocation according to sector:
Financial
The largest sector allocation which is 32.99% is in the financial industry. It shows a significant bet on the financial industry's growth and stability.
Capital Goods
11.34% allocation is directed toward capital goods companies. These goods diversify the portfolio across industries.
Automobile
The fund has a notable stake of 10.27% in the automobile sector.
Technology
8.15% portion of the portfolio is invested in the technology sector. This portion shows the fund's interest in tech-driven growth opportunities.
Top Stock Holdings
The top stock holdings of the DSP Flexi Cap fund are:
Bajaj Finance Ltd.
Bajaj Finance is a financial company that represents an 8.33% portion of the fund's equity holdings.
HDFC Bank Ltd.
HDFC Bank is a prominent financial institution. It highlights the fund's 5.69% exposure to the banking sector.
Apar Industries Ltd.
4.65% allocation to Apar Industries points to a diversified approach with investments in sectors beyond financials.
Samvardhana Motherson International Ltd
The fund has a notable 4.18% stake in Samvardhana Motherson International, an automotive and manufacturing company.
Ways to Invest in DSP Flexi Cap Fund in India
Investing in DSP Flexi funds in India is a straightforward process. Following are the ways to invest in these funds:
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Direct Investment through the Asset Management Company (AMC):
- Visit the official website of DSP Investment Managers or the AMC.
- Create an account if not registered.
- Fill the KYC process by submitting the necessary documents.
- Choose the DSP Flexi Cap Fund to invest.
- Provide the required details including the investment amount, folio number, and payment method.
- Make the investment through net banking, NEFT, RTGS, or a Systematic Investment Plan (SIP).
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Online Investment Platforms:
- Utilize online investment platforms or mobile apps provided by mutual fund distributors and aggregators. Popular platforms like Groww, Paytm Money, and Kuvera give access to DSP Flexi-Cap Funds.
- Register and finish the KYC process.
- Search for DSP Flexi Cap Fund and select the one(s) to invest in.
- Provide investment details and complete the transaction.
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Authorized Banks and AMCs' Branches:
- Visit the nearest branch of the Asset Management Company (DSP Investment Managers) or authorized banks that provide mutual fund services.
- Speak with the mutual fund desk representative who can help with the investment process.
- Complete the required documentation and invest through cheque, demand draft, or electronic transfer.
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Stock Brokers with Mutual Fund Services:
- Many full-service stockbrokers give mutual fund investment services. Individuals who have an account with such a broker can invest in this fund through their platform.
- Log in to the brokerage account and locate the mutual fund section.
- Search for DSP Funds and follow the instructions to invest.
Investors also have the choice of investing in DSP Flexi Cap fund direct growth or DSP Flexi Cap fund regular growth plans for higher returns. Read about Flexi Cap Funds.
Final words
DSP Flexi Cap Fund provides a flexible and diversified long-term investment option for investors. These funds can provide many advantages like higher returns and professional management because of their ability to adapt to financial market conditions. However, it's important to be aware of the market risks and the impact of the fund manager's decisions on performance.