With Over 30% SIP Returns, These Two Dividend Yield Funds Are Good For SIP

Inflation continues to be high as we entered FY 2022. Inflation has been at levels not seen in decades for several months. In April 2022, inflation reached 7.79 per cent, the highest level in 8 years. In these tough times, investment plays a crucial part in returns that beat inflation. Investors with long term investment goal looking for dividend-yielding stocks but also want to avoid the high risks compared to stocks mutual funds become a good option. Dividend yield funds are a category of mutual funds that seek long-term capital appreciation by investing primarily in stocks that have a current or potentially attractive dividend yield.

Templeton India Equity Income Fund - Direct-Growth

This Dividend Yield Fund is an open-ended fund from the house of Franklin Templeton Mutual fund. It is a high-risk medium-sized fund of its category that seeks to generate capital gains by investing in emerging market stocks.

The fund has Rs 4,082.87 Crores worth of Assets Under Management (AUM). The Net Asset Value (NAV) of this fund declared on 16th May 2022 is Rs 85.5635. The fund has an expense ratio of 1.66%, while the category average is 1.12%. 

 It has 76.35% investment in equities of which 58.13% is in large-cap stocks, 13.82% is in mid-cap stocks, and 0.85% is in small-cap stocks. The fund has the majority of its money invested in the Energy, Consumer Staples, Technology, Construction, and Automobile sectors. 

This fund invests in Indian and emerging market companies that have the potential to provide growth through capital appreciation as well as regular income through dividends. The fund has consistently declared a dividend every year for the last 12 years. Since its launch, it has delivered 23.06% average annual returns. 

You can start investing in this fund with Rs 5,000 as lump-sum payments, whereas, to start to SIP the required amount is Rs 500. It charges 1% on redemption within 365 days of the investments.

SIP Returns

Tenure	Absolute Returns	Annualised Returns
1 Year	2.47%	4.63%
2 Year	33.82%	30.86%
3 Year	51.77%	29.08%
5 Year	63.43%	19.74%

ICICI Prudential Dividend Yield Equity Fund - Direct Plan-Growth

This Dividend Yield Fund is an 8-year-old fund launched on May 16, 2014, by the ICICI Prudential Mutual fund. It is an open-ended high risky medium-sized fund of its category and rated highly risky for investments. 

The size of the Assets Under Management (AUM) of the fund is Rs 910.32 crore. Whereas, its Net Asset Value (NAV) as of 16th May 2022 is Rs 26.99. The expense ratio is below its category average standing at 0.94, while the category average is 1.25%. 

The fund has 90.43% investment in equities of which 71.24% is in large-cap stocks, 3.8% is in mid-cap stocks, and 9.97% in small-cap stocks. The fund has the majority of its money invested in the Technology, Financial, Energy, Automobile, and Services sectors. The fund since its inception has delivered 19.42% average annual returns.

The fund is suitable for investment for the investors who aim to invest in a portfolio which invests primarily in dividend-yielding stocks and aims to capital appreciation on a long term basis. This fund is good for long term investments with a 5-year investment horizon.

The investment in this fund starts with the minimum required amount of Rs 5,000, and Rs 100 for SIP. It charges 1% on redemption within 365 days of the investments. 

SIP Returns

Tenure	Absolute Returns	Annualised Returns
1 Year	0.24%	0.44%
2 Year	31.07%	28.47%
3 Year	45.24%	25.82%
5 Year	48.80%	15.90%

Disclaimer

Mutual fund investments are subject to market risk. Read all scheme related documents, and Terms and Conditions carefully before investing. The above-mentioned information is purely informational and doesn't guarantee any return. The Greynium Information Technologies and the Author are not liable for any losses caused as a result of a decision based on the article.