Sundaram Financial Services Opportunities Fund-Direct Plan

Reason for recommendation 

This is an open-ended equity scheme, which invests predominantly in equity of companies engaged in the banking and financial services. 

The fund has a good mixture of the stocks among large-cap, mid-cap and small-cap sectors. The scheme has invested ~73% of the corpus in blue-chip stocks which cushions the returns from the current market volatility. 

The major holdings of the fund are in HDFC Bank, ICICI Bank and Kotak Mahindra Bank. Post Q4FY18, the private banker HDFC Bank is seeking opportunities in the SME segment which are expected to boost the earnings going ahead. However, with the improving asset quality Axis Bank is expected to reap more returns in the coming years. 

Moreover with the presence of stocks like YES Bank, IIFL Holdings, the next one-year outlook for the fund seems to bepromising. So, we see this fund as a potential buy to generate better returns compared to other funds in the longer run. The fund is suitable for high-risk investors