Parig Parikh Flexi Cap funds, which have the largest ownership of international equity among diverse equity schemes (see: table), reopened for new investments from March 15.

The funds invested 25-30 percent of the corpus in foreign equity and the rest in the domestic equity market, provided international diversified investors, which is one of the reasons for its popularity.

However, with the boundaries of foreign investment for mutual funds, it has not been increased, funds will only invest in the domestic market for now. This can narrow the proportion of international equity in the scheme.
So, should you continue to invest in funds or wait for the foreign limit to be upgraded before doing additional current to this fund?

Scheme
Fund Flexi Cap Parig Parikh (Previous Parig Parikh Long Equity Fund) was launched in 2013. Until recently, it was the only scheme in a stable asset management company.

At that time, the funds managed investor assets worth RS 152 Crore. At present, he manages RS 20,000 Crore, signs of popularity and growth in funds.

This fund has performed well, providing a compound annual return of 14 percent over a seven years, 17.3 percent for a period of five years, and 24.4 percent more than three years. The performance is in the top quartile in this period.

The ownership of US stock funds is an important contributor to its strong appearance.

Parig Parikh mutual funds follow the principles of investment value, where the appearance of good quality companies is available on reasonable assessment, which may not be liked. When the house of funds was invested in pharmaceuticals and technology companies a few years ago, he faced investor supervision. However, this investment paid because the two sectors did well by 2020 because Covid-19.

What does it work?
The funds stick to the long-term investment philosophy in letters and spirits. Data from ACE MF shows that the average turnover ratio of the diverse equity scheme is 69 percent. That is, the funds replaced more than 69 percent of the companies they held on average, in the past year. The turnover ratio of Fund FLEXI Parag Parikh is 18 percent on February 28.

Financial planners say Parig Parikh mutual funds always position themselves as mutual funds for investors with long-term investment horizons.

“Even the site clearly states that the funds are intended for investors with a long-term horizon of at least five years,” Amol Joshi said, founder of the Rupee investment service plan. “For these investors, it must be a business as usual. Given the value of investment in value, funds will now seek investment opportunities in the domestic market. Sooner or later, when the foreign investment limit is increased, funds can rebalance their international exposure.”

Industry executives said the delay in increasing the foreign investment limit of $ 7 billion was caused by the Russian-Ukrainian war and its fall in the global and domestic economy. Crude oil, which contributed most Indian imports, had seen a sharp price increase. Rupees have begun to depreciate and the equity market has fallen sharply. The government and regulators can now wait for things to stabilize before increasing the limit to invest internationally.