00:00 Mutual funds, which invest investors' money in the stock market, are known as equity funds.
00:07 But not all equity funds are the same.
00:10 The type of shares these funds invest in and the strategy of their investment can be divided into different categories.
00:19 The cycle of fast and slow is going on in the economy.
00:22 There are different stages in the economy and there is a different business cycle at each stage.
00:28 There are different sectors in the industry, such as banking, pharmaceuticals, FMCG, IT, etc.
00:36 And there are many companies in each sector.
00:38 There is a unique opportunity for investment in each business cycle.
00:42 If the portfolio of the shares associated with the sector is made in accordance with the business cycle,
00:49 then a better profit can be expected.
00:52 Business cycle fund is a kind of thematic fund.
00:56 Thematic fund means a portfolio of the selected sector, which is somehow connected to each other.
01:03 For example, if we talk about an infrastructure theme, then sectors such as power, cement, telecom, etc. will be included.
01:11 This is not the case in the business cycle fund.
01:13 Here, according to the business cycle, changes can be made in the sector.
01:17 That is, business cycle funds are different in many ways from other thematic funds.
01:22 The investment of a business cycle fund can be in all kinds of sectors and all kinds of market cap stocks.
01:31 From the perspective of risk, the thematic fund can be placed between a sectoral fund and a diversified fund.
01:38 Where a sectoral fund invests in the shares of the same sector,
01:42 there is an opportunity to invest in all sectors of the company in a diversified fund.
01:48 In a diversified fund portfolio, all kinds of sectors can be included in every business cycle.
01:54 On the other hand, in a business cycle fund, the rotation of sectors continues.
01:58 According to the business cycle, the sectors from which a good performance is expected,
02:02 those sectors can be included in the portfolio of such funds.
02:07 Based on a special process of common peace, first the sector chosen according to the business cycle is done.
02:13 And then strong companies are chosen economically for those sectors.
02:17 In the portfolio of a business cycle fund, there can be defensive and non-defensive sectors.
02:23 Defensive sectors such as pharmaceuticals, FMCG, IT and telecom are very stable.
02:30 And these sectors perform well even in the era of economic downturn.
02:34 But non-defensive sectors such as financial, infrastructure, automobile, cement etc.
02:42 perform better in the era of economic boom.
02:45 The performance of the stock market depends on the business cycle to a large extent.
02:49 And because a business cycle fund has a sector rotation,
02:53 the funds of this sector have the ability to perform well in all circumstances.
02:58 There are four stages in a business cycle.
03:00 Expansion, peak, contraction, slump, and slump.
03:07 It has often been seen that the performance of some shares also changes due to the change of the business cycle.
03:13 In this case, if the investment portfolio is in the form of a business cycle,
03:17 then better returns can be expected.
03:20 Investors who understand the slump in the share market and have the ability to bear the related risks,
03:27 can invest in such funds for 5 years or more and expect good profits.
03:34 A free and SIP can be invested in the business cycle fund.
03:41 But when the market is at its peak, it is better to invest through SIP.
03:50 In this category, ICICI, Prudential Business Cycle Fund, Tata Business Cycle Fund, etc. are some of the selected funds.
03:59 And now, from 15 November, Aditya Birla Sun Life's new fund offer, i.e. NFO, is open.
04:06 Which will remain open till 29 November.
04:09 This is an open-ended fund, so even after the NFO closes, this fund will remain available for purchase and sale.
04:16 That's all for this video. Like and share the video.
04:19 Also, don't forget to subscribe to the channel.
04:22 (gentle music)
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