HDFC Hybrid Equity Fund - Dividend Option

The important features of the HDFC Hybrid Equity Fund - Dividend Option are mentioned in the following table:

Investment Amount for the HDFC Hybrid Equity Fund - Dividend Option

Asset Allocation for the HDFC Hybrid Equity Fund - Dividend Option

Who can Invest in the HDFC Hybrid Equity Fund - Dividend Option?

The persons who are eligible to apply for the subscription of units under the HDFC Hybrid Equity Fund - Dividend Option are as follows:

1. Resident Individuals either singly or jointly (maximum of 3)
2. A biological parent or legal guardian on behalf of a minor
3. Karta of Hindu Undivided Family (HUF)
4. Companies
5. Proprietorship which is under a sole proprietor
6. Association of Persons (AOPs)
7. Bodies and units created by Navy
8. Bilateral Development Cooperation Agencies
9. Non-Resident Indians (NRIs)
10. Partnership Firms
11. Public Sector Undertakings (PSUs)
12. Bodies Corporate
13. Bodies and units created by Air Force
14. Limited Liability Partnerships
15. Bodies of Individuals (BOIs)
16. Scientific and Industrial Research Organisations
17. Religious and Charitable Trusts
18. Foreign Portfolio Investors (FPIs) who are registered under SEBI
19. Banks and Financial Institutions (banks include both Co-operative Banks and Regional Rural Banks (RRBs)
20. RBI
21. Bodies Corporate incorporated outside India with the permission of the Government of India
22. Overseas Citizen of India (OCI)
23. Bodies and units created by Army
24. Bodies and units created by other paramilitary units
25. Persons of Indian Origin (PIOs)
26. Multilateral Financial Agencies and so on.

NAV Disclosure and Benchmark for the HDFC Hybrid Equity Fund - Dividend Option

The total value of net assets of the scheme is divided by the number of units outstanding under the scheme on the date of valuation. The valuation of the investments will be done on the basis of the valuation norms which are specified in Schedule VIII of the SEBI (MF) Regulations. The calculation is made as follows:

NAV per unit (Rs.) = (Fair Value or Market Value of the investment of the Scheme + Current Assets - Current Liabilities and Provisions) / Number of units outstanding under the plan.

The NAV will be calculated by the asset management company (AMC) and disclosed accordingly at the end of every working day. The NAV should be published in at least 2 daily newspapers. The Net Asset Value (NAV) will also be published on the website of the AMC as well as the website of AMFI (www.amfiindia.com). This has to be published before 9:00 p.m. on every working day. In case of delay, the AMC will be required to explain the reason for the delay to the AMFI and SEBI in writing by the next day.

The NAV of the scheme is calculated and rounded up to 4 decimal places.

The benchmark index of the HDFC Hybrid Equity Fund - Dividend Option is NIFTY 50 Hybrid Composite Debt 65:35 Index.

HDFC Hybrid Equity Fund - Dividend Option Fund Manager

The fund managers for the HDFC Hybrid Equity Fund - Dividend Option scheme are Mr. Chirag Setalvad and Mr. Rakesh Vyas. Mr. Chirag Setalvad is the Senior Fund Manager. He has a B.Sc. degree in Business Administration from the University of North Carolina. He has been in HDFC Asset Management Company Limited since 19 March 2007. Mr. Rakesh Vyas is the Dedicated Fund Manager for Overseas Investments. He has a B.E. (Electrical) degree along with a PGDBM from XLRI, Jamshedpur. He has been in HDFC Asset Management Company Limited since October 2009.

Investment Restrictions of the HDFC Hybrid Equity Fund - Dividend Option

On the basis of the SEBI (MF) Regulations, there are certain restrictions which are applicable at the time of making investments. Some of these restrictions can be summed up as follows:

1. The purchase and sale of all kinds of securities can be made by the mutual fund provided the delivery of relevant securities is taken in case of a purchase, and the delivery of relevant securities is made in case of a sale. However, these are subject to certain conditions.
2. The entry into a transaction of securities issued by the government can be made by the mutual funds only if the securities are in the dematerialised form.
3. No loans or advances are to be provided by the mutual fund for any purpose as per the regulations of the SEBI (MF) Regulations.
4. For investments made in debt instruments which are issued by a single issuer, the investment percentage should not exceed 10% of the Net Asset Value (NAV) of the scheme. In this case, debt instruments also consist of money market instruments as well as non-money market instruments.
5. The investments in debt instruments which are issued by a single issuer can be extended to the mark of 12% of the Net Asset Value (NAV) of the plan or scheme with prior approval of the Board of Trustees and the Board of Directors of the asset management company (AMC).
6. Under all the schemes, a mutual fund will not be able to own more than 10% of the paid-up capital of a company which carries voting rights.
7. Investments in debt instruments which are not rated and are issued by a single issuer can be made by a scheme. However, the investment can be made to the extent of only 10% of the Net Asset Value (NAV) of the scheme.
8. The total investment made in debt instruments which are unrated should not exceed the limit of 25% of the Net Asset Value (NAV) of the scheme.
9. The scheme might make investments in other schemes offered by some other asset management company (AMC). However, it is subject to certain conditions including a bar on the investment limit of 5% of the Net Asset Value (NAV) of the scheme.

Dividend Policy of the HDFC Hybrid Equity Fund - Dividend Option

The right of declaring the dividends for the dividend option of the scheme is held by the trustee. The availability will be based on the basis of the availability of the surplus which is eligible for distribution under the scheme. On the declaration of dividends, it will be paid to the unitholders whose names are registered in the Register of Unitholders on the date of record.

The Depositories (NSDL/CDSL) will be providing a list of demat account holders along with the number of units that are held by them in case the units are held in dematerialised mode. This list will be generated in electronic form on the date of record. It will be issued for the Transfer Agent and Registrars of the Mutual Fund who will be eligible to receive the dividends. The interim dividend might also be declared by the trustee at its sole discretion.

However, it is to be kept in mind that the distributable surplus will be calculated as per the SEBI (MF) Regulations and the declaration of distribution of dividend and the frequency for that will be based on the regulations. In this regard, the decision taken by the trustee or the asset management company (AMC) will be the final decision.

The rate of dividend or the frequency of distribution of the same is not assured to the unitholders. In case the dividends are paid out, the Net Asset Value (NAV) of the units will be reduced by the amount of dividend and applicable dividend tax or statutory levy. The rights for altering the date of record is also held by the trustee or the asset management company (AMC).

Other facilities under the HDFC Hybrid Equity Fund - Dividend Option

There are some additional facilities which can be availed by the unitholders of the plan or scheme. The features or facilities offered by the HDFC Asset Management Company Limited are as follows:

1. Systematic Investment Plan (SIP)
2. Systematic Investment Plan (SIP) Top up Facility
3. Micro Systematic Investment Plan (Micro SIP)
4. Group Systematic Investment Plan (GSIP)
5. One Time Mandate or OTM
6. HDFC Swing Systematic Transfer Plan (Swing STP)
7. Dividend Transfer Plan Facility
8. Systematic Withdrawal Advantage Plan (SWAP)
9. HDFC Flexindex Plan
10. National Automated Clearing House (NACH) platform facility for Systematic Investment Plan (SIP)
11. Systematic Transfer Plan (STP)
12. Switching Option
13. Subscription of units through electronic mode
14. Transactions through MF Utility (MFU)
15. Facility to purchase or redeem units of the scheme through the stock exchange(s)
16. Automatic Trigger Facility
17. Flex-Systematic Investment Plan (Flex SIP)
18. HDFC Flex-Systematic Transfer Plan (Flex STP)

Why should you invest in the HDFC Hybrid Equity Fund - Dividend Option?

HDFC Mutual Funds is one of the most established fund houses. It is a large scale fund house which focuses mainly on the delivery of consistent performance of its funds. It has a large range of funds which is suitable for the investment needs of all kinds of investors.

The fund house has been one of the most dominant players in the nation for almost a decade now and is very reliable. If an investor is looking for the appreciation of his/her capital through predominant investments made in equity and other instruments related to equity, the HDFC Hybrid Equity Fund - Dividend Option scheme is one of the best options available.

GST rate of 18% applicable for all financial services effective July 1, 2017.