SBI Contra Fund UNFOLLOW THE HERD

 Invest in SBI Contra Fund

KNOW YOUR FUND

Some companies have sound fundamentals and the potential to grow in the long term. But guess what? They might be part of a sector or themselves going through a difficult phase or in a turnaround phase. Hence, they are priced lower than their intrinsic value. SBI Contra Fund aims to identify and invest in such opportunities. 

INVESTMENT OBJECTIVE:- To provide the investor with the opportunity of long-term capital appreciation by investing in a diversified portfolio of equity and equity related securities following a contrarian investment strategy.

TYPE OF SCHEME:- An open-ended Equity Scheme following contrarian investment strategy.

KEY HIGHLIGHTS:- • The idea is to focus on companies and sectors that are currently out of favour. Within this, the attempt is to find companies that have the potential to revert back and grow in the long-term • The fund follows a value investing philosophy with portfolio valuations lower than prevailing market averages backed by thorough research and investment process • Investing in neglected stocks which have strong asset value and fundamental attributes as well as focusing on under-owned sectors which have high potential • Invests across market cap and sectors, wherever there might be opportunities • Suitable for patient investors who believe in the philosophy and are willing to invest in the long-term.

SBI Contra Fund has given 80.96% (CAGR) returns over the last year

 

FACTORS FOR THE RECENT FUND PERFORMANCE

INHERENT POSITIONS WHICH BENEFITED THE FUND: Overweight on pharma stocks at a time when pharma sector was out of favour (which was our contrarian call) and with the onset of COVID, the sector came into prominence and our overweight positioning here benefited the fund performance. 

BARGAIN VALUATIONS DUE TO EXTREME RISK AVERSION: From end of February till mid-May, investors were overly concerned around COVID-19 and this led to many stocks available at extreme bargain valuations. The fund was able to buy few of these beaten down stocks at that time and has subsequently benefited as Govt and Central bank policies have led to a significant rebound in market valuations. 

HIGHER ALLOCATION TO SMALL CAP STOCKS: The fund substantially increased its allocation in select small cap stocks in 2019. This hurt the fund initially, however, over the last 1 year these stocks have meaningfully outperformed the broader indices thus contributing to the performance of the fund. 

FUND DETAILS

Fund Manager: Mr. Dinesh Balachandran Managing Since: May-2018 Total Experience: Over 17 Years Benchmark: S&P BSE 500 Index (TRI)

 

Quantitative Data: Standard Deviation# : 24.52% Beta# : 1.04 Sharpe Ratio# : 0.34 Portfolio Turnover* Equity Turnover : 0.91 Total Turnover : 1.70 Total Turnover = Equity + Debt + Derivatives # S o u r c e : C R I S I L F u n d A n a l y s e r *Portfolio Turnover = lower of total sale or total purchase for the last 12 months (including equity derivatives) upon Avg. AUM of trailing twelve months. Risk Free rate: FBIL Overnight Mibor rate (3.43% as on 30th April 2021) Basis for Ratio Calculation: 3 Years Monthly Data Points Note: Fund Manager for Foreign Securities Mr.Mohit Jain w.e.f. Nov 28, 2017. Exp. Over 5years Ratios are computed using Total Return Index (TRI) as per SEBI Circular dated Jan 4, 2018

 

Exit Load: For exit within 1 year from the date of allotment - 1 %; For exit after 1 year from the date of allotment - Nil. Entry Load: N.A.

 

SIP: Rs.Any Day SIPRs. Facility is available for Monthly, Quarterly, Semi-Annual and Annual frequencies through electronic mode like OTM / Debit Mandate. Default SIP date will be 10th. In case the SIP due date is a Non Business Day, then the immediate following Business Day will be considered for SIP processing. Daily: Minimum Rs500 & in multiples of Rs1 thereafter for a minimum of 12 instalments. (Kindly refer notice cum addendum dated June 02, 2020 for further details) Weekly: Minimum Rs1000 & in multiples of Rs1 thereafter for a minimum of 6 instalments. (or) Minimum Rs500 & in multiples of Rs1 thereafter for a minimum of 12 instalments. Monthly: Minimum Rs1000 & in multiples of Rs1 thereafter for minimum six months (or) minimum Rs500 & in multiples of Rs1 thereafter for minimum one year. Quarterly: Minimum Rs1500 & in multiples of Rs1 thereafter for minimum one year. Semi Annual: Minimum Rs3000 & in multiples of Rs1 thereafter for a minimum of 4 installments. Annual: Minimum Rs5000 & in multiples of Rs1 thereafter for a minimum of 4 installments. Minimum Investment: Rs5000 & in multiples of Rs1 Additional Investment: Rs1000 & in multiples of Rs1

 

 

RETURNS (NAV as on 17th June, 2021)

Period Invested for	₹10000 Invested on	Latest Value	Absolute Returns	Annualised Returns	Category Avg	Rank within Category
1 Week	10-Jun-21	9895.40	-1.05%	-	-0.48%	3/3
1 Month	17-May-21	10677.50	6.78%	-	6.27%	1/3
3 Month	17-Mar-21	11149.90	11.50%	-	9.39%	1/3
6 Month	17-Dec-20	12782.70	27.83%	-	21.81%	1/3
YTD	01-Jan-21	12616.00	26.16%	-	20.38%	1/3
1 Year	17-Jun-20	19717.70	97.18%	97.18%	73.56%	1/3
2 Year	17-Jun-19	16043.60	60.44%	26.62%	22.27%	1/3
3 Year	15-Jun-18	15192.20	51.92%	14.91%	14.09%	1/3
5 Year	17-Jun-16	19440.70	94.41%	14.21%	15.99%	3/3
10 Year	17-Jun-11	31873.70	218.74%	12.28%	14.15%	3/3
Since Inception	06-May-05	104830.90	948.31%	15.69%	14.59%	1/3

Returns Calculator 

SIP RETURNS (NAV as on 17th June, 2021)

Period Invested for	₹1000 SIP Started on	Investments	Latest Value	Absolute Returns	Annualised Returns
1 Year	17-Jun-20	12000	17050.17	42.08 %	86.12 %
2 Year	17-Jun-19	24000	38545.83	60.61 %	53.14 %
3 Year	15-Jun-18	36000	57841.11	60.67 %	33.32 %

RISK RATIOS

Ratios calculated on daily returns for last 3 years (Updated as on 01st January, 1970)

No data available. Ratios are only available for the funds which are 3 years old.

Standard Deviation value gives an idea about how volatile fund returns has been in the past 3 years. Lower value indicates more predictable performance. So if you are comparing 2 funds (lets say Fund A and Fund B) in the same category. If Fund A and Fund B has given 9% returns in last 3 years, but Fund A standard deviation value is lower than Fund B. So you can say that there is a higher chance that Fund A will continue giving similar returns in future also whereas Fund B returns may vary.

Beta value gives idea about how volatile fund performance has been compared to similar funds in the market. Lower beta implies the fund gives more predictable performance compared to similar funds in the market. So if you are comparing 2 funds (lets say Fund A and Fund B) in the same category. If Fund A and Fund B has given 9% returns in last 3 years, but Fund A beta value is lower than Fund B. So you can say that there is a higher chance that Fund A will continue giving similar returns in future also whereas Fund B returns may vary.

Sharpe ratio indicates how much risk was taken to generate the returns. Higher the value means, fund has been able to give better returns for the amount of risk taken. . It is calculated by subtracting the risk-free return, defined as an Indian Government Bond, from the fund’s returns, and then dividing by the standard deviation of returns. For example, if fund A and fund B both have 3-year returns of 15%, and fund A has a Sharpe ratio of 1.40 and fund B has a Sharpe ratio of 1.25, you can chooses fund A, as it has given higher risk-adjusted return.

Treynor’s ratio indicates how much excess return was generated for each unit of risk taken. Higher the value means, fund has been able to give better returns for the amount of risk taken. It is calculated by subtracting the risk-free return, defined as an Indian Government Bond, from the fund’s returns, and then dividing by the beta of returns. For example, if fund A and fund B both have 3-year returns of 15%, and fund A has a Treynor’s ratio of 1.40 and fund B has a Treynor’s ratio of 1.25, then you can chooses fund A, as it has given higher risk-adjusted return.

Alpha indicates how fund generated additional returns compared to a benchmark. . Let’s say if a fund A benchmarks its returns with Nifty50 returns then alpha equal to 1.0 indicates the fund has beaten the nifty returns by 1%, so the higher the alpha, the better.