ICICI Prudential dynamic: Low on risks, moderate on returns
Investors flock to mutual funds for aggressive returns from the equity market, but ignore the fact that pumping money into the same market can also prove detrimental.
ICICI Prudential Dynamic has been designed to deal with this very fear of losing money in the equity market.
The scheme has the flexibility to take cash calls as high as 35% of the portfolio, which relatively safeguards the capital from erosion during downturns.
The strategy, however, can be a dampener if the markets were to make a sudden turnaround and move upwards, as redeployment of cash can take time.
Thus, while the scheme may not generate stupendous returns in rallies, it will also not fall like pack of cards in meltdowns, as is reflected by its performance in 2008 and in 2010.
Source: Economic Times
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