The investment objective of the scheme is to drive long-term capital growth out of an actively managed portfolio consisting of equity and equity-related securities.
Why should you invest in-?
Established Investment Strategy – Parag Parikh Long Term Equity Fund follows the investment value model and selects stocks in the market cap (large, medium-sized, and small-scale enterprises). It follows a buy-and-hold strategy and operates a focused portfolio of some high-trust stocks.
Global Exposure: The Fund’s exposure to global stocks provides a buffer for investors against country-specific risk.
Reduces downside risk – Reducing downside has been effective for the fund. That is, at a time when the market fell, it outperformed its counterpart Nifty 500 TRI. The fund takes cash call when it is challenging to find appropriate investment opportunities because of high valuations.
Consistent performance – The fund produced average rolling returns of around 15 percent over three years and five years. This outperformed the Nifty 500 TRI by 1.3–2 percentage points.
Experienced Fund Manager – Rajiv Thakkar has 18 years of fund management experience. Since 2001 he has worked with Parag Parikh Financial Advisory Services.
The fund scores are high to engage with investors.
Skin in the game – Proposers and fund management departments also join the scheme, ensuring greater accountability.
Fund manager in this scheme
Parag Parikh Long Term Equity Fund is managed by Rajeev Thakkar (CIO and Equity Fund Manager) and Raunak Onkar (Overseas Security Funds Manager).
Rajeev Thakkar has 18 years of fund management experience. Since 2001 he has partnered with Parag Parikh Financial Advisory Services. Since formation, Raunak Onkar has been in charge of foreign securities.
Investment strategy with the global risk that suits long-term investors.
The fund invests in the value stocks of Indian and global companies (which trade below their intrinsic value). It selects market cap stocks where valuations are attractive.
The fund’s exposure to foreign securities helps diversify country-specific risk. This allows investors to invest in businesses that may not have Indian counterparts (such as Facebook, for example). It can invest up to 35 percent of its corpus in foreign currency securities.
The fund adopts a long-term approach through a ‘buy and hold’ policy. In December 2019, about 41 percent of the fund’s portfolio was in stock for at least four years. This strategy is also reflected in the low portfolio turnover ratio of 5.3 percent (excluding equity arbitrage) in December 2019.
The fund maintains a focused portfolio of specific securities that are not regularly churned with strong confidence. In December 2019, the top 10 holdings comprised 65 percent of the corpus.
Parag Parikh is a constant performer
During the 3-year and 5-year terms, Parag Parikh long-term equity fund outperformed the Nifty 500 TRI and its peer funds on a rolling-return basis. For example, the fund has beaten the benchmark by 100 percent over five years, with an average outperformance of 2.1 percentage points.
The fund has also performed well on a purely rolling return basis. For example, investment has returned more than 10% over five years, 100% of the time.
