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A Balanced Approach to Investing in India

Taking a balanced approach to investing in India is a recipe for success for investors seeking diversified exposure to the country’s top-performing equity and high-yielding bond markets.

Currently, the Indian equity market is among the best performing emerging markets while its corporate and sovereign bond markets offer yields that are among the highest in the world; and approximately 4 times the yield of Government of Canada 10-year bonds.

To put the performance of India’s bond and equity markets in perspective, the S&P BSE Sensex Index is up 23.7% for year-to-date period ending May 30, 2017[i], while the S&P BSE Bond Index is up 7.7% over the same period.[ii]

Incidentally, the performance of both the equity and bond markets are forecasted to climb higher. The equity markets are expected to benefit from higher earnings growth. In an interview with The Economic Times, Jonathan Garner of Morgan Staley notes that this is the best back-to-back earnings growth environment we have had since 2006-07. “We are bullish on India, see Sensex at 34,000 in June ‘18.” [iii]

In another interview with The Economic Times, Chetan Ahya, also of Morgan Stanley, notes that “From 2018, India will be firing on all cylinders.”[iv]

In the meantime, the performance of the Indian bond markets is expected to improve on the back of record low inflation. At 2.18% in May, inflation is at its lowest level since India started publishing an economy-wide consumer price index in 2012, due in part to a decline in food prices.[v]

Inflation is now well below the Reserve Bank of India's medium-term target of 4 percent, and at the lower end of its CPI projection of 2 percent-3.5 percent in the first half of the fiscal year, triggering speculation that the Reserve Bank of India may cut interest rates at its next meeting in August[vi] – sending bond prices higher.

With both the equity and bond markets forecasted to deliver strong returns, investing in a balanced fund that leverages the performance of both asset classes is therefore a good, lower-risk solution for investors seeking to capitalize on the combined strengths of the Indian equities and bonds.

The Excel India Balanced Fund – the only fund of its type in Canada– allows investors to capture the potential upside of both asset classes in a single fund. Its unique, actively managed, diversified portfolio comprises primarily of 60% Indian publicly-listed equities and 40% Indian investment grade corporate bonds, with the aim of generating income as well as capital appreciation.

The Fund is managed by Birla Sun Life Asset Management Ltd., one of the largest and most respected asset managers in India, which currently also manages Excel’s top-performing Excel India Fund. 


[i] Excel Funds Management Inc.

[ii] http://economictimes.indiatimes.com

[iii] http://economictimes.indiatimes.com



[vi] ibid

Excel Funds are offered by Excel Fund Management Inc. and distributed in Canada through authorized dealers.

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus or Fund Facts document before investing. The indicated rates of return are the historical annual compounded total returns including changes in share or unit value and reinvestment of all dividends or distributions and do not take into account sales, redemption, distribution or optional charges or income taxes payable by any securityholder that would have reduced returns. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.  Rate of return is used only to illustrate the effects of compound growth and is not intended to reflect future values of the Fund or returns on investment in the Fund.

Speculation or stated beliefs about future events, such as market and economic conditions, company or security performance, upcoming product offerings or other projections are “forward-looking statements.” These forward-looking statements represent the beliefs of the speaker or author and do not necessarily represent the views of Excel. General business, market, economic and political conditions could cause actual results to differ materially from what the speaker or author presently anticipates or projects.

The information presented above is not intended to provide specific financial, investment, tax, legal or accounting advice and should not be relied upon in that regard. You should not act or rely on the information without seeking the advice of a professional.  Please consult your advisor before investing.

This article does not constitute an offer or solicitation to buy or sell any investment fund, security or other product, service or information to any resident of the U.S. or the U.K. or to anyone in any jurisdiction in which an offer or solicitation is not authorized or cannot legally be made or to any person to whom it is unlawful to make an offer or solicitation. 



Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.