Diversified mutual funds as the name suggest enables an investor to diversify his or her financial portfolio and can be invested by all retail investor class with a slight risk appetite as the basket of assets makes the fund a less riskier category. This we are making a comparison strictly to other equity funds which are thematic or sectorial in nature and cannot be opted in by every investor category being high on risk.
What is a diversified mutual fund?
These mutual fund invests across sector, market capitalization, geographies and even across asset classes and thus developments in one area help prevent a major impact on the entire fund.
Few of the basis to choose the diversified mutual fund:
Typically diversified mutual funds can be small cap, mid-cap or large cap oriented schemes and their best selection is possible by following the few listed ways:
1. Say if you wish to invest in small cap diversified mutual funds then you would need to make a return comparison among funds falling in the same category say a SBI and another say UTI small cap scheme.
2. Compare the fund return to its benchmark. This is the rule with all the mutual funds, which making a best choice.
3. You need to be sure of the various charges such as the fund management, expense ratio etc. and then take the decision accordingly. Exit load be another penalty if you redeem the units before the pre-decided period.
4. Also, best betting on the fund best evaluate the volatility the fund is exposed to considering the Sharpe Ratio and Standard Deviation.
1. Parag Parikh Flexi Cap Fund-Growth:
This flexi cap fund from PPFAS Mutual fund category has an asset size of Rs.10,276 crore. NAV is 43.31 as of July 2, 2021. The benchmark of the fund is Nifty 500 TRI and the fund over the 1-year period has given a return of 57.94 percent. SIP as well as the lump sum investment can be started at minimum Rs. 1000.
Value Research online has accorded a 5-star rating to the fund. Top holdings of the fund are Bajaj Holdings, ITC, Microsoft Corporation, Facebook, Persistent Systems.
2. Mahindra Manulife Multicap Badhat Yojana-Regular Plan-Growth:
This is a 4-star Crisil rated multi cap fund. Asset under management of the fund is Rs. 532 crore. NAV of the fund as on July 2 is 18.069. Top holdings of the fund comprise ICICI Bank, SBI, Infosys, RIL, Sun Pharma, Atul, Dalmia Bharat and Birla Soft among others.
Benchmark for the fund is S&P BSE 500 TRI. Expense ratio of the fund is 0.77 percent. SIP in the fund can be started for Rs. 500. With a monthly SIP of Rs. 10,000, the investment is now valued at Rs. 5.91 lakh, providing an annualized yield of 35.07%.
Top holdings of the fund include ICICI Bank, Infosys, SBI, RIL, Sun Pharma, Larsen and Toubro, Atul Ltd.
3. SBI Large and Midcap fund:
Erstwhile, SBI Magnum Multiplier fund is a large and mid cap fund from the house of SBI Mutual fund. The AUM of the fund is equivalent to Rs. 4083 crore. Risk-o-meter defines the fund to be moderately high on risk.
NAV of the fund as on July 2 is 333.89. SIP in the scheme can be started for as low as Rs. 500.
Value Research Rating has given the fund a 3-star rating.
Top holdings of the fund include HDFC Bank, Page Industries, ICICI Bank, SBI, Relaxo Footwear etc.
In 3 years time, the SIP of Rs. 10000 per month is now valued at Rs. 5.41 lakh, providing gains of Rs.1.81 lakh, i.e.an annualized yield of 28.43%.
4. HDFC Top 100 Fund:
This is a large cap equity fund with some portion in the mid cap stocks too. The fund was previously referred as HDFC Top 200 G. Over the last one year, the fund has outperformed its benchmark Nifty 100 TRI and commands an expense ratio of 1.82 percent. Furthermore, asset size of the fund is a whopping Rs. 20,040.9 crore.
Absolute returns from the fund has been to the tune of 83 percent over the five year period.
Top holdings of the fund include HDFC Bank, ICICI Bank, SBI, Infosys, RIL, L&T and ITC among others.
Mutual funds investment are subject to risk. Investors need to do their own research to select the suitable investment considering their risk profile, investment goal and investment horiozon. The story is here only for informational purpose. Greynium Information and its employees shall not be liable for any loss incurred for any investment decision taken considering the above listicle.