The HDFC Long Term Advantage Fund is an equity based savings mutual fund. It is an ELSS with lock-in period of 3 years and has been operational for over 14 years now. It aims to offer long term capital growth as well as tax benefits to investors.
Type of fund
This is an open ended equity linked savings scheme (ELSS) with a lock-in period of 3 years.
The objective here is to offer long term capital appreciation by investing in a portfolio consisting predominantly of equity and equity linked instruments, while offering tax saver benefits.
|CRISIL rank||Rank 5 out of 5 in ELSS category|
|Exit load||No exit load on bonus units and units that are allotted during dividend reinvestment.|
|Minimum investment||Rs.500 for both new and existing investors|
|Product label – Risk and target investors||Moderately high risk. Meant for investors looking for long term capital growth through investments in equity and related instruments.|
|Benchmark||S&P BSE Sensex. This index was compiled in 1986 and has since then become the face of Indian equity market performances. It is among the most visible brands in the equity markets in India.|
|SWP||Yes. Available in Fixed and Variable variants. Frequency of withdrawals are monthly, quarterly half yearly and yearly for Fixed SWP and quarterly, half yearly and yearly for Variable SWP.|
|STP||Yes. Available in two variants namely Fixed Systematic Transfer Plan (FSTP) and Capital Appreciation Systematic Transfer Plan (CASTP). Daily, Weekly, Monthly and quarterly transfer plans are available.|
|Redemption||Proceeds dispatched with 3-4 days|
|Taxation (on investment and on redemption)||As per applicable sections under the Income Tax Act. Tax benefits are also available u/s 80C.|
Mr Rakesh Vyas has over 8 years of experience with 5 years in equity research and 3 years in application engineering. He is the dedicated fund manager for overseas investments. He is a seasoned fund manager and manages several funds for HDFC Mutual Funds including HDFC Capital Builder Fund, HDFC Balanced Fund, HDFC Multiple Yield Fund Plan 2005, HDFC Mid Cap Opportunities Fund and HDFC Short Term Opportunities Fund etc. He has a B.E. Electrical degree and a PGDM from XLRI Jamshedpur. He has previously worked with Lehman Brothers and Nomura.
Mr Chirag Setalvad comes with over 14 years of overall experience of which 11 years were in the fund management and equity research sector and 3 years as an investment banker. Mr Setalvad manages several funds for HDFC Mutual Funds including HDFC Mid Cap Opportunities, HDFC Balanced Fund, and HDFC Capital Builder Fund, among others. He holds a B.Sc. degree and MBA from North Carolina University. He has previously worked with Vernon Advisory Services Ltd and ING Barings N.V.
This fund invests predominantly in equity and equity linked instruments and is a long term savings plan for people looking at retirement planning or capital growth in the long run. The fund has at least 80% of its portfolio made up of equity investments at any given time. The focus is on the long term and a margin of safety is strived for. Short term market volatility doesn’t affect the overall portfolio holdings as investments are targeted at fundamentally strong companies.
Portfolio – Sector / Top 10 holdings*
|ICICI Bank Ltd||Financial||Equity||7.56|
|Larsen & Toubro Ltd||Diversified||Equity||6.04|
|Britannia Industries Ltd||FMCG||Equity||4.12|
|Tata Motors DVR||Auto||Equity||4.00|
|Reliance Industries Ltd||Energy||Equity||3.84|
|Motherson Sumi Systems Ltd||Auto||Equity||3.73|
|AIA Engineering Ltd||Metals||Equity||3.46|
*As on 02-09-15
|AUM||Rs.1200.22 crores (Growth)|
*As on 02-09-15
|Compounded Annualised Returns||Scheme Returns (%)||Benchmark Returns (%)|
|Returns for last 1 year||16.76||10.94|
|Returns for last 3 years||13.09||7.52|
|Returns for last 5 years||10.07||11.50|
|Returns since inception||29.29||16.63|
*As on 31st March 2011
Expert view of the fund
With good performance over the last 13 years, the HDFC Long Term Advantage Plan is an ideal tax saver mutual fund. The fund has given above average returns through the years and beats the benchmark for the most part. The fund is a part of the HDFC Mutual Fund house, which is also the largest AMC in the country. Before investing in this fund, investors should consult with their personal financial advisors so that their risk profile and durations are aligned with that of the fund of their choice.
How to apply
Investors can invest in HDFC Prudence Fund via both offline and online routes.
Online investments can be done primarily through the HDFCMFOnline portal. You can register yourself by fulfilling the KYC norms and generating your personal HPIN number. Payments can be made from debit or credit cards among other options. Alternatively, you can approach independent fund agents to invest in this mutual fund.
For offline investments, you can approach any branch of HDFC dealing with mutual funds and fulfil the formalities over the counter. Once you have registered with the KYC norms, you can proceed to fill the relevant forms and submit documents as required by the authorities. You may also approach third parties for investments though it is advisable to complete the process on your own.
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