INVESTMENTS
DIVIDEND-YIELD MUTUAL FUND
What is Dividend-Yield Mutual Fund?
When investing in stock or anything connected to equity, dividends are a crucial consideration. By declaring dividends, many businesses distribute a portion of their profits to their shareholders. While some businesses declare no dividends at all, others pay out large dividends. Although firms are not required to declare dividends, some prefer to do so in order to increase the allure of investing in their stocks.
You may pick from thousands of mutual funds, and the most of them have the qualities of competent management, diversification, and liquidity that have made them a well-liked investment. Only a few mutual funds, nevertheless, offer a significant dividend yield. We examine the processes by which certain mutual funds produce and disperse dividends below.
KEY KNOWLEDGE
Advantages of Dividend-Yield fund
Understanding of Dividend-Yield Mutual Fund
A dividend yield fund typically allocates between 70 and 80 percent of its corpus to firms whose dividend yields exceed those of the benchmark or market. As a result, it serves as a filter to aid the fund manager in stock selection. Good dividend payers often have strong cash flows and are more reliable than the majority of other stocks.
It is crucial to remember that a high dividend yield, rather than just large payouts, is the requirement in this case. This implies that a company with a high market price and a decent dividend yield would have a low dividend yield, and the fund could decide not to purchase it. Before making an investment, the fund managers consider growth possibilities and other aspects in addition to the dividend yield.
Factors Consider
before investing in High Dividen-Yield Fund:
Assume for the moment that you are a cautious investor who wants to bring stability to your portfolio by investing in dividend yield funds. Because investing in a low-risk strategy is your goal, you need to search for funds that have a larger allocation to large-cap equities. Your goal in investing will be thwarted, though, if you participate in a program that has a greater percentage of small- or mid-cap stocks.
Many experts advise investors to stay away from schemes with tiny corpuses when making dividend yield fund investments. This is due to the fact that an effective investing strategy may elevate a fund's performance relative to others, while a few missteps might knock it to the bottom. Seek for funds that have historically seen minimal volatility, a low expense ratio, and a respectable corpus size.
Top Performing Dividend-Yield Mutual Fund
ICICI Prudential Dividend Yield Equity Fund Direct-Growth is a Dividend Yield mutual fund scheme from Icici Prudential Mutual Fund. This fund has been in existence for 9 yrs 7 m, having been launched on 25/04/2014. ICICI Prudential Dividend Yield Equity Fund Direct-Growth has ₹2,665 Crores worth of assets under management (AUM) as on 30/09/2023 and is medium-sized fund of its category. The fund has an expense ratio of 0.7%, which is less than what most other Thematic-dividend Yield funds charge.
HOLDING ANALYSIS
EQUITY SECTOR ALLOCATION
Aditya Birla Sun Life Dividend Yield Fund Direct-Growth is a Dividend Yield mutual fund scheme from Aditya Birla Sun Life Mutual Fund. This fund has been in existence for 10 yrs 10 m, having been launched on 01/01/2013. Aditya Birla Sun Life Dividend Yield Fund Direct-Growth has ₹1,009 Crores worth of assets under management (AUM) as on 30/09/2023 and is medium-sized fund of its category. The fund has an expense ratio of 1.58%, which is higher than what most other Thematic-dividend Yield funds charge.
HOLDING ANALYSIS
EQUITY SECTOR ALLOCATION
Templeton India Equity Income Direct Plan-Growth is a Dividend Yield mutual fund scheme from Franklin Templeton Mutual Fund. This fund has been in existence for 10 yrs 10 m, having been launched on 01/01/2013. Templeton India Equity Income Direct Plan-Growth has ₹1,582 Crores worth of assets under management (AUM) as on 30/09/2023 and is medium-sized fund of its category. The fund has an expense ratio of 1.4%, which is higher than what most other Thematic-dividend Yield funds charge.
HOLDING ANALYSIS
EQUITY SECTOR ALLOCATION
Sundaram Dividend Yield Fund Direct-Growth is a Dividend Yield mutual fund scheme from Sundaram Mutual Fund. This fund has been in existence for 10 yrs 10 m, having been launched on 01/01/2013. Sundaram Dividend Yield Fund Direct-Growth has ₹596 Crores worth of assets under management (AUM) as on 30/09/2023 and is medium-sized fund of its category. The fund has an expense ratio of 1.05%, which is close to what most other Thematic-dividend Yield funds charge.
HOLDING ANALYSIS
EQUITY SECTOR ALLOCATION
UTI Dividend Yield Fund Direct-Growth is a Dividend Yield mutual fund scheme from Uti Mutual Fund. This fund has been in existence for 10 yrs 10 m, having been launched on 01/01/2013. UTI Dividend Yield Fund Direct-Growth has ₹3,059 Crores worth of assets under management (AUM) as on 30/09/2023 and is medium-sized fund of its category. The fund has an expense ratio of 1.44%, which is higher than what most other Thematic-dividend Yield funds charge.
HOLDING ANALYSIS
EQUITY SECTOR ALLOCATION
HDFC Dividend Yield Fund Direct - Growth is a Dividend Yield mutual fund scheme from Hdfc Mutual Fund. This fund has been in existence for 3 yrs, having been launched on 27/11/2020. HDFC Dividend Yield Fund Direct - Growth has ₹3,655 Crores worth of assets under management (AUM) as on 30/09/2023 and is medium-sized fund of its category. The fund has an expense ratio of 0.48%, which is less than what most other Thematic-dividend Yield funds charge.
HOLDING ANALYSIS
EQUITY SECTOR ALLOCATION
SBI Dividend Yield Fund Direct - Growth is a Dividend Yield mutual fund scheme from Sbi Mutual Fund. This fund has been in existence for 9 m, having been launched on 20/02/2023. SBI Dividend Yield Fund Direct - Growth has ₹5,208 Crores worth of assets under management (AUM) as on 30/09/2023 and is medium-sized fund of its category. The fund has an expense ratio of 0.82%, which is less than what most other Thematic-dividend Yield funds charge.
HOLDING ANALYSIS
EQUITY SECTOR ALLOCATION
Tata Dividend Yield Fund Direct - Growth is a Dividend Yield mutual fund scheme from Tata Mutual Fund. This fund has been in existence for 2 yrs 6 m, having been launched on 03/05/2021. Tata Dividend Yield Fund Direct - Growth has ₹599 Crores worth of assets under management (AUM) as on 30/09/2023 and is medium-sized fund of its category. The fund has an expense ratio of 0.58%, which is less than what most other Thematic-dividend Yield funds charge.
HOLDING ANALYSIS
EQUITY SECTOR ALLOCATION
Top Returns in Dividend-Yield Mutual Funds
| Fund Name | 1Y Return | 3Y Return | 5Y Return |
|---|---|---|---|
| ICICI Prudential Dividend Yield Equity Fund | 37.44% | 26.85% | 26.32% |
| Aditya Birla Dividend Yield Fund | 42.05% | 25.0% | 23.69% |
| Templeton India Equity Income Fund | 26.50% | 19.73% | 23.20% |
| Sundaram Dividend Yield Fund | 32.16% | 18.54% | 19.84% |
| UTI Dividend Yield Fund | 30.85% | 17.08% | 18.78% |
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