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Difference between revisions of "HDFC Housing Opportunities Fund - Series 1"
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| − | '''First''', in general, NFOs are not good because they put the advertising and scheme launch expense burden on the heads of investors. Read and understand what a [[New Fund Offer]] is all about. | + | '''First''', in general, NFOs are not good because they put the advertising and scheme launch expense burden on the heads of investors. NFOs tend to be good and worthy only when they are very unique and address the financial goals of the investor. Most NFOs are generally not worthy taking. Read and understand what a [[New Fund Offer]] is all about. |
'''Secondly''', it is a thematic fund. Investing in thematic fund requires expert knowledge in entry and exit. If timing is not right, we do not get the best possible returns. Generally, themes keep shifting from one to another. Unfortunately, we retail investors do not have that precise abilities to identify and switch. | '''Secondly''', it is a thematic fund. Investing in thematic fund requires expert knowledge in entry and exit. If timing is not right, we do not get the best possible returns. Generally, themes keep shifting from one to another. Unfortunately, we retail investors do not have that precise abilities to identify and switch. | ||
Revision as of 23:49, 18 November 2017
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First, in general, NFOs are not good because they put the advertising and scheme launch expense burden on the heads of investors. NFOs tend to be good and worthy only when they are very unique and address the financial goals of the investor. Most NFOs are generally not worthy taking. Read and understand what a New Fund Offer is all about.
Secondly, it is a thematic fund. Investing in thematic fund requires expert knowledge in entry and exit. If timing is not right, we do not get the best possible returns. Generally, themes keep shifting from one to another. Unfortunately, we retail investors do not have that precise abilities to identify and switch.
Read as to to why to avoid sectoral and thematic funds?
Thirdly, it is a close ended fund. This means that we cannot exit until the completion of tenure. Why get our investment locked with the theme for such long duration? It is better to use an open ended multicap scheme over a close-ended thematic scheme.
More on this is at Open-ended, Close-ended and Interval schemes
Conclusion
- If as projected, if the housing theme perfoms well, we get exceptionally good returns.
- If the theme does not play well, we get very subdued returns.
- Since markets are at peaks, better to go with established schemes in multicap segment than to test new uncharted waters.
- The scheme is suitable only for investors who can take a higher degree of risk taking than the average and medium risk takers.
Related Lessons
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- ICICI Prudential Value Discovery Fund
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