The Hindu Business Line : DJ Global Titans 50 posts 15% return in 3 years

Those who were thrilled when UTI proposed a fund based on the Dow Jones Global Titans index, a proposal that never took off because of gaps in regulations, may now be truly upset, given the index's recent performance.

Dow Jones Global Titans, a benchmark made up of 50 stocks, has delivered over 15 per cent over the past three years - gains that investors could have shared, at least partly, if the proposed UTI-SSgA Global Titans Index Fund had indeed materialised.

`UTI-SSgA' represented the combination of the Indian fund house and State Street Global Advisors, with which it had tied up.

The product, which then was a first for India, could have become a diversifier for domestic investors who wanted to taste internationally-known equities through a passively-managed vehicle. While the fund was to follow Indian regulations, SSgA Asia was mandated as the investment advisor.

"This was a pioneering concept and could have turned out well for retail investors in India," said someone who now says was determined to put in an allocation when the fund was mooted. SSgA, he added, was among the world's top institutional asset manager and its association with UTI could have been vital.

The index, as defined by Dow Jones, is composed of large-cap trans-national companies, with operations in multiple countries and revenues that are generated internationally. Data pertaining to March 31 worked out by DJ show it has provided 15.3 per cent annualised returns on a three-year basis.

Its constituents represent diverse sectors, including consumer goods, financial services, energy, telecom and technology.

The country allocation list is led by the US, with 29 companies, followed by the UK and Switzerland. Japan and South Korea, each with one company, are the only two Asian representatives.

While 15 per cent-plus could indeed be labelled as attractive, investment circles here point out that index funds in India have done decidedly better, thanks to a booming equity market. The reference is to the fact that these funds have provided an average 50 per cent or so in the past three years.

Some of the regulatory issues that came in the way of the fund's launch have since been addressed, and investors hope positive news will come their way insofar as the proposal is concerned.

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