A Guide To Investing In Hdfc Mutual Funds

HDFC Mutual Fund is currently the largest mutual fund and actively managed equity mutual fund in India. It is one of the most profitable asset management companies (AMC) in the country, managing assets worth Rs. 6.1L Cr as of March 31, 2024. The company services more than 75,000 empanelled distribution partners through 210 branches spread across more than 200 cities in India.

HDFC Mutual Fund offers a range of investment options, including equity funds, debt funds, floating rate debt funds, and balanced funds. The specific funds offered include the HDFC Focused 30 Fund, HDFC Balanced Advantage Fund, HDFC Retirement Savings Fund, and HDFC Dynamic PE Ratio FoF Fund, among others.

Investing in HDFC Mutual Funds can be done online or offline. For online investments, one can use platforms such as HDFC's InvestNow and ISA (Investment Services Account). The prerequisites for online investments include being an existing HDFC Bank account holder and being KYC compliant. For offline investments, one can fill out an investment application form.

HDFC Flexi Cap Fund

When considering investing in mutual funds, it is important to evaluate your financial goals and risk appetite. HDFC Flexi Cap Fund carries a very high risk, according to SEBI's Riskometer, and is suitable for investors who can remain invested for at least 3-4 years and are prepared for potential moderate losses. The fund has delivered returns of 18.39% since its inception in January 1995.

To invest in HDFC Flexi Cap Fund, you can purchase it directly from the HDFC Mutual Fund website or through platforms like MF Central and MF Utility. Most banks also act as mutual fund distributors, so you can seek their assistance. Before investing, ensure you have completed your Central Know Your Customer (CKYC) requirements and have a Permanent Account Number (PAN) and a bank account.

It is important to note that HDFC Flexi Cap Fund, like any other flexi-cap fund, requires a minimum investment period of five years. Investing in this fund carries the risk of negative returns, and investors should be prepared for ups and downs in their investment value.

HDFC Mid-Cap Opportunities Fund

Investing in mutual funds can be done in several ways. Here is a step-by-step guide on how to invest money in the HDFC Mid-Cap Opportunities Fund:

Step 1: Understanding the Fund

Firstly, it is essential to understand the HDFC Mid-Cap Opportunities Fund. This fund is an open-ended equity scheme that primarily invests in mid-cap stocks. Mid-cap companies are those ranked between 100 and 250 by size (market capitalization). The fund aims to provide long-term capital appreciation and has a minimum exposure of 65% in mid-cap stocks. It selects companies with reasonable growth prospects, sound financial strength, sustainable business models, and acceptable valuations.

Step 2: Evaluating Risk and Return

When considering investing in any mutual fund, including the HDFC Mid-Cap Opportunities Fund, it is crucial to assess your risk tolerance and return expectations. Mid-cap funds, in general, tend to be more volatile than large-cap funds, and their performance can fluctuate more during stock market downturns. However, they also offer higher potential returns over the long term. Therefore, investors should be prepared for the possibility of moderate losses.

Step 3: Growth vs. Dividend Option

When investing in mutual funds, you have the option to choose between growth and dividend. If you select the dividend option, any dividends announced by the fund will be paid out to you. On the other hand, if you opt for the growth option, the dividends will be reinvested in the fund, allowing your capital to grow. The dividend option is suitable if you rely on mutual funds for income to cover daily expenses. Otherwise, the growth option is generally recommended to maximize your capital growth.

Step 4: Lump Sum vs. SIP Investment

The next step is to decide between investing a lump sum amount or using the Systematic Investment Plan (SIP) route. If you have a substantial amount of cash readily available, you may choose to invest it as a lump sum. Alternatively, the SIP approach allows you to invest smaller amounts at regular intervals, helping you benefit from rupee cost averaging and introducing discipline to your investment strategy.

Step 5: Online or Offline Investment

You can invest in the HDFC Mid-Cap Opportunities Fund either online or offline. For online investments, ensure you have completed your Central Know Your Customer (CKYC) requirements and then proceed to the HDFC Mutual Fund website or other platforms like MF Central or MF Utility. For offline investments, you can visit a branch or office of an intermediary, such as HDFC Bank, and fill out the necessary forms to invest in the fund of your choice.

Step 6: Direct or Regular Investment

Finally, you need to decide whether to invest directly with the mutual fund company or through an intermediary like HDFC Bank. Direct investments do not incur commission charges, but investing through an intermediary provides access to a more extensive range of funds, and you can manage all your funds through a single account. If you opt for direct investment, you will need to approach each fund house individually and manage your investments separately.

HDFC Small Cap Fund

The inception date of the HDFC Small Cap Fund is April 3, 2008, and the Net Asset Value (NAV) as of March 1, 2023, was 88.8570. The fund size is approximately ₹33962.8 Cr, which is 10.32% of the investment in the small-cap fund category. The expense ratio is 1.57%, which is slightly higher than the category average of 1.82%. The latest NAV (as of October 17, 2024) is ₹141.305.

The HDFC Small Cap Fund is suitable for investors who are looking to invest money for at least 3-4 years and are seeking very high returns. These investors should also be prepared for the possibility of higher losses in their investments. The fund has a very high-risk rating according to SEBI's Riskometer.

To invest in the HDFC Small Cap Fund, you can purchase it directly from the website of the fund house, HDFC Mutual Fund. Alternatively, you can use platforms like MF Central, MF Utility, or seek the help of a mutual fund distributor or your bank. Before investing, it is important to consider factors such as risk versus return, growth vs dividend options, lump sum versus SIP, and deciding between online or offline investment methods.

HDFC Focused 30 Fund

The current fund manager is Vinay Kulkarni, and the fund has an Asset Under Management (AUM) of ₹7,57,067 Cr as of 18 October 2024 (or ₹6,723 Cr as of 30 September 2023, according to another source). The latest NAV available is ₹145.1080 as of 1 March 2023 (or ₹151.1400 as of 2 November 2023, according to another source).

The HDFC Focused 30 Fund is considered a Very High-risk investment. The expense ratio is 1.80 (or 0.53% according to another source), and there is an exit load of 1% if redeemed within one year.

The fund has delivered returns of 15.28% since its inception and is suitable for wealth creation. It is important to note that mutual funds are subject to market risks, and investors must consider their financial goals and risk appetite before investing.

To invest in the HDFC Focused 30 Fund, you can purchase it directly from the HDFC Mutual Fund website or through platforms like MF Central, MF Utility, or similar. Most banks also act as mutual fund distributors, so you can seek their assistance.

Before investing in mutual funds, it is essential to consider factors such as risk versus return, growth vs dividend, lump sum versus SIP, online or offline investment, and direct or regular investment routes. It is also crucial to complete the Central Know Your Customer (CKYC) process and have a Permanent Account Number (PAN) and a bank account.

HDFC Retirement Savings Fund

The HDFC Retirement Savings Fund is an open-ended retirement solution-oriented scheme with a lock-in period of 5 years or until retirement age, whichever is earlier. The fund's investment objective is to provide long-term capital appreciation/income by investing in a mix of equity and debt instruments to help investors meet their retirement goals. There is no assurance that the investment objective will be realised.

The fund is managed by Srinivasan Ramamurthy, Shobhit Mehrotra, and Priya Ranjan, who collectively have over 15 years of experience in equity research and fund management. The fund has a suggested investment period of 5 years and above.

The HDFC Retirement Savings Fund is suitable for investors seeking a corpus to provide for their pension in the form of income after the age of 60 years and those who wish to invest predominantly in equity and equity-related instruments. Investors should consult their financial advisors if they are unsure whether the product is suitable for them.

When investing in the HDFC Retirement Savings Fund, there are a few things to keep in mind. Firstly, it is a flexi-cap fund, which means the fund management team has complete freedom to invest in companies of different sizes, depending on where they expect maximum gains. This versatility makes flexi-cap funds most suitable for equity fund investors. Secondly, as with all equity funds, investments must be made through the SIP route. Finally, it is important to note that there is a lock-in period of 5 years or until the investor attains retirement age, whichever is earlier.

To invest in the HDFC Retirement Savings Fund, you can purchase it directly from the HDFC Mutual Fund website or through platforms like MF Central and MF Utility. Alternatively, you can seek the help of a mutual fund distributor, including most banks.

Frequently asked questions