Mirae Asset S&P 500 Top 50 ETF FoF offered the highest return of around 20.86% in the last one week. Mirae Asset NYSE FANG+ETF FoF offered 15.74% return in the same period. Edelweiss US Technology Equity FOF and Motilal Oswal Nasdaq 100 FOF offered 7.95% and 6.90% return in the said period.
Franklin India Feeder – Franklin U.S. Opportunities Fund went up by 6.18%. Navi NASDAQ 100 FoF and ICICI Pru NASDAQ 100 Index Fund offered 6.07% and 6.06% respectively in the last one week. Mirae Asset Hang Seng TECH ETF FoF offered 4.20% return in the one week period.
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The wall street based funds delivered stellar performance in the last one week. The expert recommends that one should not invest based on any political party’s win rather focus on goals and then invest. “Investors’ allocation should be done based on their goals and not because of the win of any political party. As an example, if one of the goals is to fund a child’s education in the U.S., then investment can be increased in US funds as that would hedge against the rupee depreciation risk when the money is needed,” said Rajesh Minocha, a Certified Financial Planner (CFP) and founder of Financial Radiance.
“To answer specifically, Trump has historically supported businesses and sectors that could boost some sectors like finance and technology. But in the short-term, we can also witness volatility and therefore it is not suggested to make aggressive changes in the asset allocation,” he added.
In the last three months, Mirae Asset Hang Seng TECH ETF FoF offered the highest return of around 52.04%. Mirae Asset S&P 500 Top 50 ETF FoF offered 26.76% return. Nippon India Taiwan Equity Fund in the last three months gave 21.02% return.
In the last six months, China based funds offered the highest return. Mirae Asset Hang Seng TECH ETF FoF, the topper in the category, gave 43.60% return. Mirae Asset S&P 500 Top 50 ETF FoF and Motilal Oswal Nasdaq 100 FOF gave 28.69% and 8.57% returns respectively in the last six months.
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Based on yearly returns, since 2021 China based funds have offered negative returns. In 2021, the five funds following this economy together lost 9.80%. In 2022 and 2023, they lost 15.26% and 8.86%, respectively.
In the recent past China based funds offered stellar performance after the Chinese government initiatives like fiscal stimulus packages, interest rate cuts, and targeted sector support lifted the market sentiment, driving robust fund performance.
The China based funds have started underperforming in the last one week. Should investors having investments in these funds worry?
According to the expert, investors need not to worry if these are long-term investors though short -term investors can get impacted.
“China had an under performance for a few years and therefore the recent performance is on a smaller base and also because Foreign institutional investors (FIIs) recently increased their exposure. Investors need not worry if these are long-term investors though short-term investors can get impacted. We did see rapid growth and recovery in China after the pandemic, but there are serious concerns about their growing debt levels, especially in the real estate sector. We should not rely heavily on any single market or economy, particularly one with complex regulatory risks. This can increase volatility in a portfolio,” said Minocha.
Mutual fund advisors often advise investors that they should invest around 5-10% of their total portfolio in sectoral or thematic funds. After looking at the performance, if you are interested in making an investment, what allocation to make?
“Different markets often perform differently, which can cushion against domestic volatility and provide smoother returns. The overall portfolio should be diversified and therefore 5 to 10% allocation is ideal for International funds. However, investors should align this allocation with their risk tolerance, financial goals, and time horizon for investing. Additionally, they should focus on high-quality international funds with a history of solid performance and effective management. Investment into International funds can be done directly, or indirectly through other funds that have international exposure. However, the government’s restriction on investing abroad through international funds has still not been lifted, and only a few funds that have not reached their individual limits allow it on a temporary basis,” said Minocha.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
