HDFC Taxsaver continues to shine with a five-star rating acquired since November 2004. The fund's performance can be gauged from the fact that its rating never went below four stars in its rating history of 89 months.

The fund has always shown resilience while protecting the downside. From January this year, the fund has limited its equity investment to a universe of 31-35 stocks. This year, the fund is up 30 per cent (till December 19) against the category return of 25.53 per cent. But like most of its peers, the fund underperformed the Sensex's year-to-date return of 42.39 per cent.

For the September quarter, the fund generated returns of 14.31 per cent, 0 64 per cent less than the category average.

Among sectors, the fund has raised its exposure to automobiles. In September this sector was 15.47 per cent of the fund's portfolio and it increased to 18.73 per cent in November.

From May till August, the fund had maintained its exposure to the technology pack at 11 per cent. In September it increased its tech exposure to 14.32 per cent and 14.40 per cent in November.

The fund is looking at the services sector positively. Textiles is another sector which the fund finds promising and has doubled its exposure here. The fund has completely exited from financial services while reducing exposure to the metals sector.