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by Srikanth Matrubai | Mutual Fund | 0 Downloaded

Sundaram Mutual Fund has come out with a very interesting NFO Sundaram World Brand Fund. Read on.


The Fund has 2 options, option 1 with a 3 years Close ended and Option 2 with a 5 year Closed Ended.

Sundaram World Brand Fund aims to invest 65% to 100% of Assets under Management in Equities listed overseas. The Fund will invest in Top Global Brands across Countries.

The NFO is now open and closes on December 2. It will invest in equities of world's strong brands. They will be advised by Sundaram AMC, Singapore in picking up the portfolio.

The Fund will be benchmarked against MSCI ACWI Index.

The Fund proposes to Declare Dividends as and when the Funds NAV crosses between Rs.12 to Rs.16.


Since almost Top Global Brands are retail oriented, the Fund will be a kind of Global Retail Proxy Investment.

Sundaram claims there have been studies indicating that companies having a strong brand value or brand pull have consistently delivered better returns. In fact, their Back Testing has shown that if you held a portfolio of global brands for a period of 5 years, in 95% of all occasions, you made a positive return irrespective of whether you got in during a bull or a bear market. And also the Fund would have beaten Nifty by a handsome margin of 7%.

Sundaram AMC claims that inspite of high valuations previous research has proved that Companies with High Brand Recognition tend to do well in long periods.


Currently exposure to Top Global brands like Apple, Nestle, Citi, Sony is currently unavailable to Indian Investors and this Fund gives an opportunity to own these aspirational brands.

Indian Markets are at slightly stretched valuations.

Sundaram World Brand Fund is comparatively less risky than other International funds as this fund does not have a Region Specific or Currency specific risk.

Since the fund invests in stocks across a wide spectrum of sectors, geography, currency, the fund should do well in all kinds of markets - be it bull or bear market.


This fund will be treated as Debt fund and will be taxed accordingly. Since the fund is Close Ended, there is a risk of Market timing and also you will not be able to average your investment

Though the Fund will invest in companies that are spread across geographies and Currency risk is largely mitigated. Still the Rupee is expected to appreciate strongly going forward which may limit the gains made by the Fund.


Investors are always advised to have a portion of their money in International funds. If your portfolio is short of international equity exposure, then yes, you can go ahead with this fund. But, if you are new to Investments, then you are better off sticking to the Boring Diversified Indian Equity Funds.

If you still feel that you need an international equity exposure, I would recommend you seriously look at DSP BLACKROCK GLOBAL ALLOCATION FUND and L&T GLOBAL REAL ASSETS FUND.

Since, Sundaram is intending another 3-4 series in the same pattern of portfolio in the coming quarters, you can stagger your investments too by investing a portion of funds in this fund and the balance in the coming series.

Author Details

Srikanth Matrubai Author

Srikanth Matrubai

Srikanth Matrubai has been an active investor and advisor in the stock markets since 1991 and hence is richly experienced having witnessed the bull, bear and flat cycles. Srikanth firmly believes that investments in mutual funds are the best mode to generate healthy returns in the stock markets. Srikanth is an AMFI certified Mutual Fund advisor and a certified IRDA corporate broker.

His blog www.goodfundsadvisor.blogspot.in, was ranked as India's best investment advice blog by the US research ETF database. He contributes with his insightful writings to various websites like Siliconindia, stockmusings, etc regularly on topics ranging from Mutual Funds, Insurance, Personal Finance, IPOs, etc.

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