After a long decline, the stock market seems to be moving towards an uptrend once again. However, there may be some profit recovery as well. Mutual Fund is an instrument that gives you average returns in a volatile market environment. In such a situation, the report of Ajit Singh tells which mutual funds can give you good returns.
Sankaran Naren, a well-known fund manager in the mutual fund industry, says that any investor should invest in such a fund that can at least give better returns than the benchmark. If the benchmark gives an annual return of 6 per cent, the return should be at least 8 percent where you are investing. The role of a fund manager is to do this.
Investors should search for a suitable manager if a fund manager does not offer its investors returns that are higher than the benchmark. There are numerous fund schemes on the market offering returns that are higher than the benchmark. As a strategy, the value theme is proving to be the best at the moment. Investors must remember that value investing for a patient investor will do well in the long run. The program makes investments in industries with long-term growth prospects. Value investing abroad is an established and well-explored concept and in India too, everyone looks for value in anything.
Value Theme outperformed in 18 years
Data from Value Research shows that if one invested Rs 10 lakh in ICICI Prudential’s Value Discovery Fund in 2004, that amount has grown to Rs 2.5 crore. That is, a return of 19.7 percent annually. In contrast, the same sum is today worth Rs 1.3 crore in its benchmark Nifty 50. In other words, it has generated a 15.6 percent return. The plan adheres to value investment principles. It makes investments in a variety of inexpensive equities with alluring prices.
Return of Value Discovery Fund on 10 thousand monthly SIP
| 5 years | 3 year | |
| amount invested | Rs 6 lakh | Rs 3.6 lakh |
| price at the end of July | Rs 9.61 lakh | Rs 5.34 lakh |
| return in percentage | 18.97 | 27.59 |
| Nifty 50 TRI (%) | 14.62% | 19.51 percent |
Increase in attractiveness in value investing
Nimesha Shah, MD, iPro Mutual Fund said, “Over the years we have seen an increase in the attractiveness of Indian investors in value investing. Investors are now aware. Now it is important that the investor is fully aware of this. Follow diligently. We advise making investments for at least five years. Long-term investments give compound returns.”
Midcap returns higher than Nifty
If you look at the schemes of midcap funds, they have given higher returns than their benchmark. For instance, in 14 years, Edelweiss Midcap Fund has generated a return of 4.4x. If someone had made a 10-thousand-rupee monthly SIP into this fund in 2007, the sum would today be worth 78.16 lakh rupees. His initial investment was 17.60 lakh rupees. This translates to an annual return of 18.43%. The Nifty Midcap 150 Index TRI’s return over the same time period was 16.87%. In this, the value of SIP investment has gone up to Rs 68.44 lakh.
Return of only 12.78 percent in
Nifty 50 TRI If someone has done a SIP of 10 thousand rupees every month in Nifty 50 TRI since 2007, then that amount has become 48.44 lakh rupees. In other words, only a 12.78 percent return has been received. While Nifty 50 TRI has given a gain of 15.38 percent in five years, Edelweiss Midcap has given a gain of more than 20 percent. In five years, the Birla Sunlife Midcap Fund generated a return of 25.1%.
Based on investment
Capitalization of the Market In medium-sized businesses, midcap equity funds invest depending on market capitalization. In terms of market capitalization, midcaps include companies between 101 and 250. Compared to large caps, midcap companies provide investors the chance to invest in sectors with stronger growth prospects. Compared to small-cap stocks, these are less risky and more volatile.
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