SEVEN MUTUAL FUNDS

Warren Buffett's 'Buy-and-Hold' Mantra

SARASIJ MAJUMDER

Warren Buffett's favourite holding period is forever.  Many of his equity portfolio were hold for decade(s). However, the same cannot be applied for Indian mutual funds , though. Only a few  mutual funds have crossed the BENCH MARK, on long term basis, if above principle is applied. I identified those mutual funds that have, in many ways, managed to hone the art of 'buy-and-hold'. To find such funds, we applied the following filters: The fund should hold stocks for five consecutive years. Long-term holding constituted at least 50 per cent of the portfolio

Long-term holdings account for all the outperformance

Name of the scheme	Number of long-term stocks	Average allocation of long-term holdings (%)	Excess returns by the long-term holdings (%)	Average excess returns the by fund (%)
Kotak Flexicap	45	65.9	2.6	2
Kotak Emerging Equity	51	55	5.1	1.8
Franklin India ELSS Tax Saver	41	55	12.2	0.9
Parag Parikh Flexicap	20	54.5	32.1	3.6
Kotak ELSS Tax Saver	37	54.1	6	0.6
DSP Small Cap	62	52.9	17.3	9.3
Kotak Small Cap	59	51.8	8.6	4.8

Just like only some of Buffett's holdings have contributed to most of his portfolio's stellar performance, a select few stock picks of the above funds have more than made up for any mistake the fund might have made in their investment journey. So, let's delve deeper and find the stock-picks that have helped them outperform their benchmark for some years.

Kotak Flexi- Cap

The fund has been under the steady hands of their Chief Investment Officer - Equity, Harsha Upadhyaya, for over a decade. While its long-term holdings, on average, comprise nearly two-thirds of the portfolio, currently, they constitute over 80% of the PORTFOLIO.

Kotak Emerging Equity

Similar to the flexi-cap fund, Kotak Emerging Equity also has a history of long-term holdings making up over 80 % of its portfolio. Presently, the number stands at 62 %.

Having a mid-cap mandate, the fund has picked out many remarkably performing stocks.

Franklin India ELSS Tax Saver

This two-decade-old fund has changed FUND MANAGER several times. Yet, this has not had a significant impact on its long-term holdings, and performance,  which comprise over 40 % of its portfolio.

Interestingly, the fund's top three performers have been banking stocks, with HDFC Bank being a constant feature for the last 15 years.

Parag Parikh Flexi Cap

Parag Parikh Flexi Cap is perhaps the CHOOSIEST when it comes to stock selection, considering it has dabbled in about 100 companies in its more than 10-year history.

At one point, over 70 per cent of the portfolio were long-term holdings.

Kotak ELSS Tax Saver

Another fund from Kotak's equity franchise makes our list. Like Kotak Flexi-cap, this fund is also managed by Harsha Upadhyaya (since August 2015). With similar traits and management style, this fund, too, has proven fruitful for its investors.

DSP Small Cap

What started as a micro-cap fund in 2007 has remained a 'true-to-style' fund to this day. One of the reasons is that its fund manager, Vinit Sambre, has been overseeing this fund since June 2010.

Kotak Small Cap

In August 2019, over 90 per cent of the fund's portfolio comprised long-term holdings, an impressive feat.

The erstwhile mid-cap fund became a small-cap fund in 2018 following SEBI's mandate on restricting AMCs to one fund per category.

If you want to see the HOLDINGS of each MF, look at “FACTA”.

I will recommend to have a BASKET of MF—4 Large Cap, One ELSS for TAX saving Purpose, One with MID CAP, and One with SHORT CAP flavour

References:- Information collected from below listed Weekly/Daily

1.0 Economic Times.

2.0 Outlook-Money.

3.0 Investopedia.

4.0 Mint.

Further Read:https://sarasij1majumder.blogspot.com/2024/01/what-is-difference-between-wealth.html