Reliance Banking tops fund returns in 2007

Reliance Banking Fund, an open-ended scheme from Reliance Mutual, topped the returns chart in 2007 in the banking funds' category, posting nearly 77 per cent returns.

Launched in 2003, the scheme has shown consistency in short- and long-term investment horizons. The scheme generated superior returns over one-year timeframe beating peer UTI Banking Sector Fund by a wide margin.

Good stock selection strategy, with a fair mix of large- and mid-cap stocks, and the sustained rally in the banking sector has helped the scheme.

Banking stocks have been rallying, as the sector has good growth prospects amid robust economic growth.

A slew of stock-specific news, along with view of easing interest rates, has led to rally in banking shares, in turn benefiting the sector fund from India's largest fund house.

Assets under management of the scheme in November rose to 2.54 bln rupees from 2.17 bln rupees in October.

The scheme is yet to disclose assets and portfolio at the end of December. As on Nov 30, the scheme had deployed 85.48% of its corpus in shares with a good mix of large- and mid-cap shares. Rest was held in cash,

Large-cap banking stocks represented nearly 55% of the portfolio, while mid- and small-cap shares, respectively, had 39% and 6% weight in the portfolio.

During November, the top pick was State Bank of India, with 14.78% weight, followed by ICICI Bank and Punjab National Bank with 11.21% and 8.87% weight, respectively, in the portfolio.

The scheme made fresh investments in Indiabulls Financial Services, during November.

The top five stocks""State Bank of India, ICICI Bank, Punjab National Bank, HDFC Bank and Bank of Baroda""account for 50.13% of the corpus.

Shares of State Bank of India, ICICI Bank, Punjab National Bank, HDFC, Bank of Baroda, JM Financial, Andhra Bank and Dena Bank collectively had 70.52% weight in the scheme's portfolio.