Cautious Escapades

							CMYK

FUND FOCUS
Hybrid: Equity-oriented Returns Fund Crisil Bal.
1-year 2-year 3-year 5-year Since launch 29.86 26.90 30.42 27.60 22.15 26.65 25.51 24.95 NA 19.98 Rank 13/28 24/27 16/21 16/20 NA

UTI BALANCED

Cautious Escapades
While overall equity allocation is kept under check, the fund invests heavily in mid- & small-caps
conservative asset allocation has made this fund a laggard in recent times. All through the equity rally of the past three years, the fund’s allocation to stocks has seldom gone beyond 61 per cent. In the recent months, it has turned even more conservative by reducing equity exposure to 55 per cent. This reflects that the fund actively rebalances portfolio to move assets in safer debt instruments with the rise of stock markets. Therefore, this is definitely not the fund for those looking for flamboyant returns. The fund has failed to beat an average peer in each of the last three calendar years. 2005 was harsh when the fund landed in the bottom quartile. And a recent fund manager change makes things more uncertain. But a positive aspect is lower volatility which gets reflected in low stan, dard deviation. In the Performance past as well, the fund Performance Statistics 4500 8 has proved that it can Fund Category 4000 Mean Mthly Ret. 2.18 2.48 6 3500 handle tough situations. Std. Dev. 4.51 4.94 3000 Sharpe Ratio 0.40 0.42 For instance, in 2000, 4 2500 when the markets were 2000 2 1500 bearish, the fund deliv1000 0 ered 26 per cent return 500 -2 against the category’s average negative return -4 Fund Return +/- Category Average Growth of Rs 1,000 of 13 per cent. It man-6 2001 2006 2005 2002 2004 2003 aged the technology downfall of 2000-01 quite well by shifting into debt. Till 2002, things were favourable for the fund as the debt markets were doing well. However, there have been dramatic changes after that, forcing the fund to be more aggressive. Since mid 2003, allocation to mid- and small-caps has always remained more than 50 per cent of the equity allocation. The typical characteristic of this fund is that while the overall equity allocation is kept under check, within equities, the fund has been investing aggressively in mid- and small-caps. But despite sizing up allocation to mid- and small-cap stocks, the fund has not kept pace with peers. On the debt part, some big interest rate calls seem to have played a role in the fund's under performance in recent years. As far as the credit quality is concerned, high-rated corporate bonds form the core of the portfolio. To sum it up, the fund has found the going tough in the last few years. Investors will have to keep a close watch and gauge how the new manager takes things forward.
Quarterly Fund Return (%) +/- Category Average

Returns (%) as on September 22, 2006

Asset Allocation Fund Style
Total Assets (Cr) Equity Debt Cash

544.20 61.09 33.63 5.28

Investment Style GrowthBlend Value Capitalisation Large Mid Small

A relatively

Top Holdings

Technology Construction Automobile Diversified Health Care Energy Basic/Engineering Financial Services Chemicals Consumer Non-Durable

GOI Securities AAA/P1+ AA Cash Equivalent

Credit Rating

% of assets 21.46 55.41 9.56 13.57

Portfolio Manager Information
Amandeep Singh Chopra is manager since Feb 2006. Mr. Chopra holds a B.Sc. Degree from St. Stephen's College and an MBA from FMS, Delhi. www.utimf.com NAV: Rs 52.40 (22/09) Entry Load: 2.25% for investment less than Rs 2 crores. Exit Load: Nil Expense Ratio: 2.21% Plans: Growth, Dividend Launch: Mar ‘95 Min Investment: Rs 1,000 Benchmark: Crisil Balanced Fund Index

Portfolio Data as on August 31, 2006

October 2006 Wealth Insight 40

CMYK

Growth of Rs 1,000

Top Sector Weights

Inst % of assets Grasim Industries Equity 4.96 Madras Cements Equity 4.68 Reliance Industries Equity 4.62 GOI 30/03/2009 6.96% GOI 3.60 Citifin.Cons.Fin.‘08 7.05% NCD 3.60 Infosys Technologies Equity 3.40 LIC Housing Fin.’12 7.28%NCD 2.75 HDFC Bank CD 2.71 GOI 05/04/2012 6.85% GOI 2.66 Satyam Computer Equity 2.47 % of assets 16.08 15.36 10.44 9.75 8.10 8.00 7.74 5.53 4.79 4.49