Diversification of a portfolio is a method of minimising losses and increasing prospect for future growth. Diversified equity Mutual Fund is also of same nature (Less volatility than Mid cap and small cap funds and High Return). It invests across companies, sector of different market capitalisation. Investing in the large cap is considered to be a low-risk and high return investment as it invests in the proven business model and good companies whereas investing in mid and small cap provides the opportunity for more aggressiveness in the portfolio. A well-managed portfolio of large, mid and small-cap companies can help investors to get best returns and help in containing volatility during turbulent market conditions. In this post, we have a look at a best performing diversified mutual funds in the previous year.
You might also like following posts
- Best Large cap Mutual funds to invest in 2017
- Best Balanced Mutual funds to invest in 2017
- Best MIP mutual funds to invest in 2017
- Best Small-Mid cap Mutual funds for 2017
Best Diversified Mutual Funds to invest in 2017
- Birla SL Equity Fund
- Birla SL Advantage Fund
- Reliance Growth Fund
- DSP BR opportunities fund
- ICICI Pru Dynamic Plan
- HDFC Capital Builder
- SBI Magnum Multicap Fund
- Principal Emerging Bluechip
- Quantum Long Term Equity
- ICICI Pru Value Discovery Fund
Details of Top Funds
Birla Sunlife Equity Fund
The fund invests 90% of its asset in diversified equities and 10% in debt or other money market securities as the markets prevail. The fund follows top down approach and bottom up strategy for investing and it also invests in IPO, emerging sectors, and other primary market offerings. The fund’s 10 years average return is 13.64%, has outperformed both its benchmark (8.70) and category (12.14%). The fund is biased towards investing more in large cap securities and has 60% of its asset in it. And, since launch, the fund has generated 24.86% return.
Birla Sun life Advantage Fund
The objective of the fund is to generate long-term growth at relatively moderate levels of risk through a diversified investment approach, the investment emphasis of the scheme would be on identifying companies with sound corporate managements and prospects of good future growth.
The fund is biased towards large cap stocks and its ability to better manage volatility makes it a moderate risk type fund for investors. Around 70% of the fund is invested in large caps due to better valuation in the segment. Over 1 yr, 3 yr and 5yr time period the fund has outperformed the index by 8-12 percentage points.
Reliance Growth Fund
The fund is blend of value and growth investing. The fund seeks long-term growth of capital through research based investment approach in Equity and equity related instruments, and there will be an exposure to debt and money market instruments also. The fund has been a good performer over years. Total AUM is at Rs 5955 crore and 10 years returns are at 14.09% outperforming its benchmark (9.56%).
DSP Blackrock Opportunities Fund
The fund is seeking to generate long term capital appreciation and whose secondary objective is income generation and the distribution of dividend from a portfolio constituted of equity and equity related securities concentrating on the investment focus of the scheme. The fund invests 80-100% in equity & equity-related securities and 0-20% in fixed income securities.
ICICI Pru Dynamic Plan Fund
The fund has been a consistent performer in the segment. The fund invests primarily in equities and for defensive consideration in fixed income securities including money market instruments with the aim of generating capital appreciation. The main feature of the fund is the flexibility to capture upside opportunities across market capitalisation and can switch to cash if the market seems overvalued thus limiting downside. The fund is suited for long term investing. 10 years SIP return for the fund is 15.35% which is considered a good return on investment.
Franklin India High Growth Companies Fund
The funds invest in companies offering the best trade-off between growth, risk, and valuation. The fund managers follows an active investment strategy and will be focusing on rapid growth companies which will be selected based on growth, measures such as Enterprise value, growth rate, price/ earnings/growth, forward price/ sales, and discounted EPS.
With average risk grade, the funds 5 years and 3 years annualized return is 23.89% and 25.49% which is 10 -12 percentage ahead of benchmark. The fund is a good performer in bull phase of the market. 3 years CAGR of Direct plan stands at 30.7%
SBI Magnum Multicap Fund
The fund growth style of investment strategy. The invests across market capitalization and invests 50-90% in large cap, 10-40% in midcap and 0-10% in small cap. The fund has invested major part Financial service (26.04%) and Consumer durables (12.21%) segment. In 5yrs and 3yrs returns is 20.06% and 24.66% respectively and has outperformed its benchmark by 7-10 percentage points.
Principal Emerging Bluechip Fund
The fund focuses on growth and value investing and has been a good performer since inception. Launched in November 2008, the fund has able to grow at a rate of 17%+since inception. The fund invests 65% – 95% in Mid Cap stocks, i.e., stocks with market cap in the range of market cap of benchmark Nifty Midcap 100 Index, and 5% – 15% in Small Cap stocks, i.e., stocks with market cap lower than the market cap of the last stock in the benchmark Nifty Midcap 100 Index.
Quantum Long Term Equity Fund
After underperforming its benchmark in2015, the fund has been a strong performer in the category. In the last three years, the fund has outperformed its peers by 6-7 percentage points.The fund manager invests in the shares of companies that are typically included in BSE 200 Index and attractively priced in the market when compared to the Investment Managers valuation of the company. The fund’s low expense ratio at 1.25% helps return to transfer efficiently to investors.
ICICI Prudential Value Fund
The objective of the fund is to invest in a well-diversified portfolio of value stocks (those having attractive valuations in relation to earnings or book value or current and/or future dividends). The fund is the top rated in the category and AUM is at Rs.16434 crore. The CAGR for 3 yrs is at 33.9%. The ten-year return for the fund is twice the benchmark at 18.4%. From the chart below, we can see the strong performance of the fund in last 5 years.
The List of funds is chosen after comparing of different funds and those which has consistent with its performance in the long-term period.
Charts: Valueresearch
Disclaimers:
This blog post should not be constituted as an advice and investors are requested to do their own due diligence before investing into any of the above-mentioned funds. You can also try out bodhik to get the funds best suited to your profile
** – All the numbers are as of writing of this post i.e 30th March 2017.
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