There is an absolute craze for equity mutual funds in India and this rush has pushed benchmark indices higher. To be honest it is very difficult to pin-point, which would be the best performing equity fund in 2018. Let us cite an example. HDFC Equity until recently underperformed some other equity mutual funds, due to large holding in select bank stocks, which barely moved.
With the sudden bank capitalization move these stocks rallied and pushed the NAV and performance higher. Similarly, if one fund has large holding in IT and these stocks stop moving, the performance of that fund is going to be lacklustre.
In any case here are a few funds that have performed well, have a strong portfolio and could continue to do well.
This fund has one of the lowest expense ratio among large cap equity funds. In fact, the expense ratio at 1.98 per cent is excellent. It has a very high rating from Crisil as well.
The fund has generated a return of close to 30 per cent in the last one year. The growth plan of the fund presently has an NAV of Rs 38.65. The dividend plan of the fund is Rs 21.99.
You can also invest in this equity fund through SIPs. The minimum investment required is Rs 500. This fund is for those looking at large cap equity funds. It is important to remember that large cap equity funds can offer you steady returns and any kind of superlative returns at least from these high levels on the Sensex is ruled out.
DSP BlackRock Micro Cap Fund
This is one of the most sought after microcap funds. In the last one year, the fund has generated a superlative returns of 40 per cent. However, we wish to emphasize that micro cap funds are for those willing to take a risk, since they can fall more sharply when the markets fall.
At the moment this fund has given solid returns and to expect similar returns in 2018 would be far-fetched.
DSP Blackrock has holdings in midcap stocks like Finolex Cables, Eveready Industries, APL Apollo Tubes etc. If you are looking to invest in the growth option you would need to invest at Rs 70.17. Under the dividend plan the NAV is Rs 42.06. Investors can buy into the fund if you see slightly lower NAV. There is also an SIP option with a minimum sum of Rs 500.
ICICI Prudential Balanced Fund
This is a balanced fund with exposure to both equity and debt. This fund has given a return of 25 per cent in the last one year. We are recommending a balanced fund for those who are willing to take moderate risk. ICICI Prudential Balanced Fund has exposure to equity shares of ICICI Bank, ITC, NTPC, HDFC and ONGC.
It also has exposure to government debt and bonds of HDFC Bank and ICICI Bank. The fund has declared a monthly dividend of Rs 0.24. Dividends are tax free in the hands of the investors. It is a good idea to invest in the fund through the SIP route.
Aditya Birla Sun Life Top 100 Fund
This is a large cap fund that has done reasonably well in the last few years. The asset under management of the fund is Rs 3703 crores. It is not the largest fund, but, has done well over a period of time.
One can invest in the fund through small SIP of Rs 1,000 each month. Aditya Birla Sun Life Top 100 Fund has given a return of almost 32 per cent in the last one year. The three year returns is more modest at 13 per cent.
This is a high risk investment like most other equity mutual funds mentioned above. Opt for the dividend plan, since dividends are tax free in the hands of the investors.
Reliance Top 200 Retail Plan
This is another large cap equity fund which is worthy of investment in 2018. The fund has investment in State Bank of India, Infosys, Larsen and Toubro and HDFC Bank.
The fund has generated a return of 38 per cent. One can invest in the fund with a small SIP of Rs 100. The initial amount of investment needed is Rs 5,000.
If one is looking to invest in the fund, they can invest at a price of Rs 33.13, under the growth plan. A good scheme for those looking to invest for the long term.
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