This is a hybrid mutual fund that is aimed at current income and long term capital appreciation through investments in a judicious mix of equity and equity related instruments as well as debt and money market instruments.
Type of fund
This is an open ended balanced mutual fund scheme.
The objective here is to offer capital appreciation and periodic returns over the long term with the aim to minimize capital erosion.
|CRISIL rank||Rank 4 out of 5|
|Exit load||1% if redeemed within 1 year|
|Product label – Risk and target investors||Moderately high risk. Meant for investors looking for periodic returns in a balanced fund with long term capital growth.|
|Benchmark||CRISIL Balanced Fund Index. This benchmark is primarily used to track performance of equity-oriented balanced mutual funds. The index has a blend of CNX Nifty Index (65%) and CRISIL Bond Fund Index (35%).|
|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.|
|Taxation (on investment and on redemption)||As per applicable sections under the Income Tax Act.|
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 Prashant Jain also manages the fund and comes with over 20 years of experience in the mutual fund industry. He manages several other funds from HDFC Mutual Funds including HDFC Infrastructure Fund, HDFC Monthly Income Long Term Plan and HDFC top 200 Fund etc. He is a celebrated fund manager overseeing some of the best products from HDFC AMC. His educational qualifications are CFA – AIMR, USA; PGDM – IIM Bangalore; B. Tech – IIT Kanpur. He has previously worked with Zurich AMC and SBI Mutual Fund.
This fund invests in both equity and debt instruments with a scattering of money market instrument investments. The percentage of portfolio for each class of funds depends on various variables such as interest rates, market volatility etc. The investments are designed to provide long term capital appreciation and periodic returns.
Portfolio – Sector / Top 10 holdings*
|State Bank of India||Financial||Equity||5.32|
|ICICI Bank Ltd||Financial||Equity||5.26|
|Larsen & Toubro Ltd||Diversified||Equity||4.95|
|8.3% GOI 2042||Sovereign||Central Govt. Loan||4.22|
|Maruti Suzuki India Ltd||Auto||Equity||3.11|
|Aarti Industries Ltd||Chemicals||Equity||3.09|
|Aurobindo Pharma Ltd||Healthcare||Equity||2.42|
|8.97% GOI 2030||Sovereign||Central Govt. Loan||2.26|
*As on 2nd Sept 2015
|AUM||Rs.8,711 crores (Growth)|
*As on 2nd Sept 2015
|Compounded Annualised Returns||Scheme Returns (%)||Benchmark Returns (%)|
|Returns for last 1 year||17.50||9.37|
|Returns for last 3 years||18.75||8.13|
|Returns for last 5 years||17.53||10.59|
|Returns since inception||21.33||NA|
*As on 31st March 2011
Expert view of the fund
The HDFC Prudence Fund is one of the oldest and best performing balanced or hybrid funds in the country. It is being managed by the able minds of Mr Prashant Jain accompanied by Mr Rakesh Vyas. The fund is ideally suited for investors looking at medium to long term balanced investments in mutual funds, such as retirement planners. The fund offers long term benefits and customers can also opt for systematic investment option or lump sum payments with the long horizon in mind. It is advisable to consult your personal financial advisor before investing in any mutual fund.
How to apply
Investors and use both online and offline routes to invest in HDFC Prudence Fund.
To invest online, you must register with HDFCMFOnline and generate your personal HPIN. You will get all the forms and documents online to fill and submit. You can use multiple payment avenues to start investing in this fund. You may also approach independent agents however you should be careful when choosing a dealer.
You can approach any HDFC branch servicing mutual fund customers with your details and KYC form to start investing. The branch will provide you with forms and list out the details required from your end, which can then be submitted in the same location. Third party vendors can also be approached for completing the registration process, though you should do a background check first.
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