HDFC Mutual Fund - Overview
HDFC or the Housing Development Finance Corporation Limited is one of India’s premier financial conglomerates. It was established in 1977 as a mortgage company and has since grown into a financial giant that has major subsidiaries like HDFC Bank, HDFC Standard Life Insurance Company Limited and even HDFC Asset Management Company among others. The services provided by the company range from mortgages to insurance to Mutual Funds.
Mutual Funds are the products offered by the asset management company HDFC Mutual Funds. It was established as a trust under HDFC along with Standard Life Investments Limited as the sponsor. The trustee of the company is HDFC Trustee Company Limited. The company launched its first product in 2000 and has grown considerably since then to offer Mutual Funds spread across 13 different types of funds.
In a recent move, HDFC Mutual Fund, which is India’s largest Mutual Funds manager, acquired Morgan Stanley’s business when they exited the country. The eight schemes of Morgan Stanley that were bought by HDFC had a combined value of Rs. 3,290 crore. This move has put HDFC Mutual Fund even further ahead of its competitors in the Mutual Funds market.
Funds Offered By HDFC Mutual Fund
HDFC Mutual Fund offers a wide variety of Mutual Funds for investors to choose from. They range from the regular equity and debt funds to funds of funds schemes, liquid funds, etc.
Equity funds are designed to invest mostly in the equity markets. The management of these funds can be active or passive (index funds). The various fund options offered under this scheme are meant to meet the long-term investment needs of the customers.
- Debt / Income
The debt funds, or income funds invest in short or long-term bonds, the money market, floating rate investments, etc. The purpose of these investments is to generate an income for the investor and that is exactly what the plans offered by HDFC Mutual Fund do.
Liquid funds are funds that make investments in fixed-income, short-term securities that come with maturity periods of 91 or less days. This makes them a low-risk investment option. These funds come without exit loads.
- Children's Gift Fund
The Children’s Gift Fund offered by HDFCMF is a scheme that has been designed to provide a chance for the investor’s capital to grow over the long term. The fund was launched for investors to meet the goals set for their children.
- Exchange Traded Funds
HDFC Mutual Fund’s Exchange Traded Funds or ETFs are funds that are traded on the stock market. They offer higher liquidity and come with lower fees when compared to other Mutual Funds. HDFC Mutual Fund offers 3 different types of funds in this category.
- Annual Interval Fund - Series 1
The investment objective of the plan under the scheme is to generate income through investments in Debt / Money Market Instruments and Government Securities maturing on or before the opening of the immediately following specified transaction period.
- Rajiv Gandhi Equity Savings Scheme
The Rajiv Gandhi Equity Savings Scheme (RGESS) is an equity investment scheme that offers investors tax benefits. It is meant to encourage small investors to start investing in the capital markets.
- Fixed Maturity Plan
The Fixed Maturity Plans offered by the company are Mutual Funds that invest in government securities and debt markets. They involve low risk and are close-ended schemes.
- Fund of Fund Schemes
This scheme invests in other Mutual Funds. HDFC Mutual Fund offers Gold Fund and Dynamic PE Ratio Fund under this category.
- HDFC Capital Protection Oriented Schemes
This is a scheme that is aimed at generating income for investors by investing in the debt market. The instruments that they invest in come with fixed maturity dates.
Why choose HDFC Mutual Fund?
HDFC Mutual Fund has a lot of offer to potential investors. The company boasts of offering customers a chance to invest profitably. This is made obvious by the following observations about the company.
- Many of the products offered by the company come with CRISIL ratings of 3 and above.
- The company offers investors a huge variety of funds to invest in.
- Investors can get tax advantages by investing with HDFC MF’s ELSS.
- The funds on offer range from short-term to long-term and can be used to meet investor goals. They offer both close and open-ended funds.
- The company offers low, medium and high-risk products.
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