Mutual Comparison Between SBI Focused Equity Fund & Axis Focused 25

What are you buying when you invest 1 Lac in the SBI Focused Equity Fund? What are you buying when you invest 1 Lac…

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What are you buying when you invest 1 Lac in the SBI Focused Equity Fund?

What are you buying when you invest 1 Lac in Axis Focused 25?

Every mutual fund manager has just few stocks to choose from. Therefore, most Mutual Fund houses will have similar stocks. The below ones are the common stocks.

  • There are 26 stocks in the SBI focused equity fund while,
  • There are 25 stocks in Axis focused 25 mutual fund
  • And, in Total 5 stocks are similar in both mutual funds.

SBI Focused Equity fund has Equity Holding: 90.27% |  F&O Holdings: 0.00%

Axis Focused 25 fund has Equity Holding: 84.29% |  F&O Holdings: 6.90%

Notice the F&O hedge component in the Axis-focused fund while the SBI Focused Equity fund is truly focused on just Large cap equity!

Data tells us that SBI fund also has more exposure to debt part than Axis focused 25 fund.

Debt Holdings SBI Focused Equity : 9.73% (Out of 1 lakh, 9,730 rs in Debt) Axis focused 25 : 8.27%. (Out of 1 lakh, 8,270 rs in Debt) Debt part helps the portfolio to lower the volatility during erratic market movements and brings in fixed income component.

Also Axis focused 25 uses 6.9% money in FnO holdings to hedge. This Hedge works both ways. It can generate extra income if market falls. But, it limits the potential to earn good return, when there is a sudden rally in underlying stocks, which are hedged.

Axis focused 25 comes with 1.85% expense ratio while as sbi focused with 1.65%. This simply means Rs.1850 per lac invested in axis focused 25 vanished and similarly Rs.1650 for sbi focused .

SBI focused has 90.27% equity which brings volatility. During a good bull run, this MF will beat the Axis Focused 25 equity fund hands down! Vice versa, SBI Mutual Fund will give bigger draw downs w.r.t Axis MF due to higher allocation to stocks.

From its data of fund size , Axis focused 25 with 16,700 Cr size 310 Cr per annum. No obligation on performance. SBI focused with 23,800 Cr size 390 Cr per annum. Again, No obligation on performance.

Given this data, I will invest in SBI Focused Equity, because they put 90,000 of my 1 lac in Equity. Also, Higher proportion in large cap companies. And they charge me 1650 rs per annum for the service which is less than Axis focused 25 fund.

See below images, Both the funds cannot beat individual top holdings of their constituents.

Both are never going to beat direct equity. Especially their own top 3 holdings.


When we compare in last 1 year performance between both seems similar. However in long term SBI Focused Equity will definitely beat Axis Multi cap.


Sujith⚡ Investment Advisor SEBI
Whatsapp: http://wa.link/p3d57p
Twitter: @REALmoneydhan

Sujith Salunkhe

Btech in Information Technology followed by an PG in Financial engineering & Risk Management from National Institute of Securities Markets. Certified Investment Advisor XB, FRM (USGARP) .

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