Principal Mutual Funds managed by Principal Pnb Asset Management Company offers a range of innovative and unique investment options for retail as well institutional investors. Currently, this mutual fund company has 4 lakh investors across 102 investor centres and 20,000 empanelled distributors throughout India. Principal Trustee Company Private Limited is the trustee company of the fund house. The Principal Dividend Yield Fund is an open-ended equity scheme offered by this company.
Under the Half Yearly Dividend Policy of this scheme there are 3 different options – payout, reinvestment, and sweep. While under the ‘Dividend Payout’ facility the investors will get regular payout of their dividend, under the ‘Dividend Reinvestment’ facility the declared dividend will be reinvested in the scheme/option itself, and under the ‘Dividend Sweep’ facility the dividend can be invested in any other open-ended scheme of the fund.
Investment Objective of Principal Dividend Yield Fund
The prime motto of this scheme is to offer regular payment as well as long-term capital appreciation to the investors by making investments predominantly in a diverse portfolio of high-dividend yield companies. It invests in the equity and equity-related securities of such companies to fulfil its investment objective of giving higher dividend income with equity market returns.
Key Features of Principal Dividend Yield Fund
The Principal Dividend Yield Fund comes with a number of unique features which make it stand out from various other funds in the market. Here are the key features of this scheme:
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Type of fund |
An open-ended equity fund which invests in the equity and equity-linked instruments of companies yielding high-dividend |
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Plans available |
|
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Options under each plan |
Both the plans come with the following option:
The Half Yearly Dividend Option under both the plans comes with the following sub-options:
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Risk |
Moderately High |
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Systematic Investment Plan |
Available |
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Systematic Transfer Plan |
Available |
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Systematic Withdrawal Plan |
Available |
Investment Amount for Principal Dividend Yield Fund
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Minimum application amount |
Rs.5,000 and any amount thereafter |
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Minimum additional investment |
Rs.1,000 and any amount thereafter |
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Minimum instalment for Systematic Investment Plan (SIP) |
Minimum of Rs.500 and in multiples of Re.1 thereafter (minimum of 12 instalments) |
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Entry Load |
Not Applicable |
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Exit Load |
1% of the applicable NAV – If the units are redeemed within a holding period of 1 year from the allotment date, this amount will be charged as exit load. |
Asset Allocation for Principal Dividend Yield Fund
|
Instruments |
Allocations (Percentage of total assets) |
Risk Profile |
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Equity and its related securities of High Dividend Yield companies |
65% to 100% |
High |
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Money market and debt securities which include liquid mutual fund schemes/debt mutual fund schemes and units of cash |
0% to 35% |
Low to Medium |
NAV Disclosure and Benchmark for Principal Dividend Yield Fund
NAV: The Net Asset Value or NAV of the fund will be computed and distributed on a regular basis. The time and frequency of dividend distribution among the unitholders will not be fixed as the distribution will be determined as per the availability of distributable surplus. The trustee will keep the unitholder’s interests under consideration and declare dividends at a frequency matching their requirements.
The final NAV will be sent for publication in at least 2 daily newspapers which are widely-circulated across the nation. The NAV will also be displayed on the official website of the company at https://www.principalindia.com/ and the website of the Association of Mutual Funds in India (AMFI) https://www.amfiindia.com/ at by 9:00 p.m. in the evening on every working day or any other prescribed time.
Liquidity: The Principal Dividend Yield Fund being an open-ended scheme in nature, the sales and repurchase of its units can be carried out at any working day at the prevailing NAV prices of that particular day subject to relevant loads. Typically, within 10 business days of duly accepting the redemption request, the dividends will be dispatched to the unitholder.
Benchmark Index: The Nifty Dividend Opportunities 50 Index is the benchmark index for the Principal Dividend Yield Fund. This means the assessment of the profits and gains of this fund is done against the performance of this benchmark index.
Principal Dividend Yield Fund Fund Manager
Mr. Dhimant Shah is the fund manager of the Principal Dividend Yield Fund. He has been managing the fund for more than six and a half years now. Mr. Shah has more than 26 years of experience in the stock market, and also manages several other funds under Principal Mutual Fund namely the Principal Focused Multicap Fund, the Principal Emerging Bluechip Fund, and the Principal Dividend Yield Fund.
Why should you invest in the Principal Dividend Yield Fund – Half Yearly Dividend Option?
The Principal Dividend Yield Fund – Half Yearly Dividend Option is a good investment option for investors who want to get regular dividends from their investment. Here are some of the reasons why you should invest in this scheme:
- Professionally managed: Being managed by an experienced fund manager, this scheme is a safe option to invest your hard-earned money. The fund manager knows the best ways to allocate your portfolio assets to bring optimum returns.
- Multiple dividend options: Under the dividend policy of this scheme you will not only get the option of getting regular payouts but also you can choose to reinvest your dividend in the same scheme or in some other open-ended scheme of the fund.
- Optimum returns: Since this fund invests in the equity and equity-linked instruments of companies having relatively high dividend yield track record, the chances of deriving good returns from your investment is quite high.
Minimum investment: The SIPs under this scheme can be started at a monthly instalment as low as Rs.500. This means the investors can invest as per their capacity and capability without any pressure of investing a lump sum amount.
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GST rate of 18% applicable for all financial services effective July 1, 2017.
